MOUNTLAKE TERRACE – Premera Blue Cross will lay off 82 employees within two months as a result of the health insurer’s shift away from processing Medicare claims.
The layoff takes effect Oct. 1, according to a notice filed with the state’s Employment Security Department. It stems from Premera’s announcement in March that it no longer would process claims and offer related services for Medicare Part A as of that date.
“These people are part of the Medicare Part A unit,” said Scott Forslund, a Premera spokesman. “The company’s working hard to assist in opportunities here, as well as elsewhere.”
Fourteen of the employees due to be laid off already have been hired by the company taking over the Medicare processing from Premera, Noridian Administrative Services LLC of North Dakota. The former Premera employees will work in Noridian’s regional office in southern King County.
Under Medicare Part A, the federal government pays Medicare beneficiaries’ claims for hospitals and other facilities but uses private companies to process the claims and perform other services. The program is separate from “Medigap” coverage, which Premera still provides to seniors.
When changes in Medicare subjected those private contractors to more competitive bidding, Premera looked twice at its relatively small presence in the program.
The insurer actually intended to withdraw from the Medicare business two years ago, but Premera delayed action while a federal inquiry scrutinized how the company handled Part A claims. There has been no publicly announced decision from that inquiry.
In addition to ending its Medicare contract, Premera decided earlier this year to transfer services it provided for Medicaid and Basic Health patients to another insurance provider.
One of the state’s largest private companies, Premera has about 3,000 employees. Approximately 2,000 of those people work in the Mountlake Terrace headquarters, Forslund said. The company remains a nonprofit firm after the state’s insurance commissioner rejected Premera’s application to become a for-profit operation.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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