Wednesday, May 22, 2024

State offering $388M for Centene’s $1B investment, senator says

Centene Corp. will invest $1 billion in a new Charlotte operation and potentially receive a Job Development Investment Grant of $387.8 million, N.C. State Senator Mujtaba Mohammed said today.

His comments in an emailed statement followed Charlotte media reports that the Clayton, Mo.-based insurer, the fourth-largest U.S. health insurer, will add 3,000 jobs at a 1 million-square-foot campus near UNC Charlotte. Mohammed’s district includes the area where the new operation is slated.

“When I am notified of corporate expansions, I get excited for our local fabric,” Mohammed said in the email. “Everyone wins when strong jobs are offered. This is an exciting time for small businesses, our service economy, home ownership, higher education opportunities at [Central Piedmont Community College], Johnson C. Smith University, UNC Charlotte, and so much more.”

Centene representatives did not immediately return requests for comment. N.C. Commerce Department doesn’t comment on individual company recruitment efforts, spokesman David Rhoades says.

The company has nearly 70,000 employees and projects $110 billion in revenue in 2020. It held $22 billion in cash and investments as of March 31.

The $388 billion JDIG incentive hinges on Centene meeting investment and job targets over a specified period. It would be among the largest such grants in state history.

For companies that invest at least $1 billion and promise 3,000 jobs, North Carolina permits reimbursements of up to 90% of the new personal income withholding for a period of up to 30 years, according to the Commerce Department website. Such projects are considered “transformative,” thereby enabling the unusual amount of incentives.

Mohammed said he was “honored to work with Governor Roy Cooper and his team at the Department of Commerce as they utilize the tools provided to give working families a shot and make North Carolina more competitive.”

Centene ranked 51st on last year’s Fortune 500 list. In January, it bought Tampa, Fla.-based WellCare Health Plans for about $17 billion. The combined companies serve 22 million people, including nearly 13 million Medicaid members and about 1 million Medicare Advantage members.

Centene is now the third-largest U.S. publicly traded health insurer behind United Healthcare and Anthem, and fourth overall including Aetna, which is owned by CVS. Its subsidiaries include Health Net, WellCare, Total Carolina Care Inc. and Carolina Complete Health.

Shares of Centene have soared 30-fold since the company went public in 2001. The company was founded in Milwaukee in 1984. CEO Michael Neidorff, who has led the company for 23 years, received total compensation of about $26 million last year.

Last October, Centene’s Carolina Compete Health was awarded the right to provide additional Medicaid managed care services in the Charlotte region. Separately, WellCare was awarded a statewide contract to administer North Carolina’s Medicaid Prepaid Health Plans, according to the company’s most recent quarterly filing with the Securities and Exchange Commission. Those contracts were originally supposed to go into effect in the second half of this year but were delayed until 2021.

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