Palmetto to lay off one-third of workforce

Sunday, February 18, 2007

COLUMBIA, S.C. - A month after losing its final appeal for the Region C Medicare contract, Palmetto plans to lay off 700 employees, a company spokesman has told a local TV station.

In January, the Government Accountability Office (GAO) ruled in favor of Cigna Government Services for the contract--valued at about $144 million over five years. The decision capped a months-long battle between Palmetto and Cigna. In January 2006, CMS originally awarded the MAC contract to Palmetto, which has served as Region C DMERC since 1993. Soon after, Cigna, which also bid on the contract, filed a protest, sending it to the GAO for a ruling. The agency ruled in Cigna's favor Sept. 28 and Palmetto filed a protest in October.

The affected employees were told last week that they will lose their jobs between April and June. They include customer service reps, Medicare claims and appeals processors, some management positions, as well as employees on the Medicare Help line, another contract that Palmetto lost.

Billy Quarles, a media relations specialist for parent company BlueCross BlueShield of South Carolina, told a local TV station that the company was working with employees, including giving them "priority in selection for other jobs" within the organization.