Former CMS admin resigns from Centene board over governance, leadership disputes

Former CMS admin resigns from Centene board over governance, leadership disputes

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Leslie Norwalk this week from Centene’s The board is divided over governance processes and committee leadership.

Centene made public her resignation letter Friday in a filing with the Securities and Exchange Commission.

Norwalk, a former administrator of the Centers for Medicaid and Medicare Services, was named to the insurance company’s board in January. She is a strategic advisor to the law firm Epstein Becker Green.

Norwalk did not immediately respond to an interview request.

“The governance process surrounding a recent important decision is seriously behind as I and some other board members see fit,” Norwalk wrote in his April 11 resignation letter.

She wrote that the full board did not receive enough information and had no opportunity to discuss it before voting on “critical matters,” contradicting the board’s standard process. Centene “is best served with board and committee chairs who are aware of the importance of good governance practices,” she wrote.

She concluded the letter by saying that after discussions with current leadership, she “does not believe that meaningful changes, if any, will be made in time.”

The letter was sent to the entire Board of Directors, particularly Acting Chair H. James Dallas and Chair of the Board’s Nominating and Governance Committee Jessica Blume.

Centene did not immediately respond to an interview request.

During Norwalk’s brief time on Centene’s board, she served on the board’s compliance, environmental and social responsibility, and government and regulatory affairs committees. She previously served on the board of Magellan Health, a behavioral health provider that Centene acquired last year for $2.2 billion.

On the earnings call, Centene executives said they were looking to divest non-core pharmacy assets, and there was speculation that Magellan could be one of those assets. Centene is reserved $1.25 billion to resolve allegations that its now-defunct pharmacy benefits management platform overbilled state Medicaid departments for drugs.

in January, Magellan Takes over the administration of the California Medicaid Prescription Drug Program.

The worker shortage has frustrated thousands of patients awaiting approval for prior authorization, some of whom were put on hold for eight hours at a time at the company’s call center. State employees intervened in company call centers, although state employees no longer provided customer support on behalf of the company. California’s health care agency said it withheld $3.8 million, or 64 percent, of Magellan’s January contract as a penalty.

Norwalk’s departure comes as Centene is making changes to its board, in part due to the arrival of activist hedge fund Politan Capital Management.

November, Politan invests $900 million At Centene, the goal is to increase the insurer’s value by selling certain subsidiaries and overhauling Centene’s leadership and board of directors.

Since then, five Politan-approved independent board members have joined the board, and six long-term board members have retired or announced plans to step down.

Politam did not immediately respond to an interview request.

In a filing with the Securities and Exchange Commission on Friday, Centene said it has also replaced the heads of its nominating and governance, audit and compensation committees since November. The company has also separated the roles of chairman and chief executive, appointed a new lead independent director, and implemented a mandatory board retirement age.

In March, the insurer promoted Sarah London to CEO from its technology and healthcare services division. London replaces longtime CEO Michael Neidorff, people who died last week.

In an SEC filing, Centene said “the entire board” is in favor of London.

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