CLAYTON 鈥 Clayton-based health insurer Centene Corp. has canceled its plans for an East Coast headquarters and campus in Charlotte, North Carolina, the company said Thursday.
The company attributed the decision to a massive shift toward remote work. Almost 90% of Centene鈥檚 workforce is either fully or partly remote, a spokesperson said.
The $1 billion Charlotte expansion, first announced in July 2020, was a source of apprehension for 最新杏吧原创 civic leaders who worried it signaled Centene would pull out or at the very least change the company鈥檚 center of gravity away from the region.
Following the announcement, former Centene CEO Michael Neidorff complained that officials in 最新杏吧原创 needed to do more to address crime, and suggested that the Charlotte jobs could have been created instead in 最新杏吧原创. Last year, as state legislators attempted to block Medicaid expansion, Neidorff once again publicly questioned his commitment to the region. At that point, Centene employed about 5,300 here.
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Neidorff, who had served as CEO since 1996, saw the company through massive expansion, growing it from a small, Wisconsin-based Medicaid business into a Fortune 25 giant in the managed care industry. The company achieved much of its growth through acquisitions. But more recently it has moved to streamline its portfolio and improve profit margins, after investors complained that Centene was underperforming its peers.
Then, in February, Neidorff took a medical leave of absence, and Sarah London was appointed CEO the following month. In April, Neidorff died at the age of 79.
The company has since shed subsidiaries and real estate, and last year announced plans to exit the pharmacy benefits management industry. In April, a Centene spokesperson said the company was evaluating its real estate portfolio, including the Clayton headquarters. During an earnings report in July, the company disclosed a 70% decrease in its domestic leased space.
When the company first announced its plans to build the $1 billion East Coast headquarters, it said the first phase of construction would be completed in late 2022, and the second phase was to begin in 2024.
The Charlotte Business Journal, which the news of the scrapped East Coast headquarters on Thursday, said that Centene鈥檚 800,000-square-foot building there is expected to be completed in the coming weeks 鈥 but will not be occupied by Centene.
Centene has 1,700 employees in North Carolina 鈥 many of whom will work remotely or in a hybrid model. It has 642,000 members there in its local health plans, WellCare of North Carolina and Carolina Complete Health.
鈥淭hese decisions will not impact the quality, comprehensive healthcare we provide to our members or the long-standing partnerships we have with the state, our providers, and our community partners,鈥 the spokesperson wrote in an email Thursday. 鈥淲e appreciate the support and partnership provided by our city and state government partners as our operations continue to evolve and grow.鈥
