OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has affirmed the financial strength rating of C++ (Marginal) and issuer credit rating of "b+" of Community Health Plan (CHP) and its subsidiary, Community Health Plan Insurance Company (CHPIC) (St. Joseph, MO). The rating outlook is negative.

Concurrently, A.M. Best has withdrawn the ratings at the company's request and assigned an NR-4 to the FSR and an "nr" to the ICR.

The ratings of CHP and CHPIC reflect its poor operating results, weak absolute and risk-adjusted capitalization and a continued decline in commercial membership. Offsetting factors include the financial strength of the parent organization, Heartland Health, and the strategic role CHP has played within that organization.

CHP continued to experience underwriting losses in 2008, while CHPIC had a small underwriting gain for the year. Historically, earnings have worsened and are inconsistent in the HMO and PPO product lines. These underwriting losses have affected capital, and Best's Capital Adequacy Ratio (BCAR) implies that the health plan is undercapitalized for its current rating. Additionally, a substantial portion of the capital structure is comprised of interest payable remaining from a surplus note that was forgiven by the parent. CHP continue to experience declines in commercial membership due to the competitive pricing environment.


The ratings also partially reflect the strength of CHP's ultimate parent, Heartland Health, a health system which has had continued strong operating performance, good liquidity and a robust market share in its primary service area.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.

A.M. Best Co.

Analysts

Joseph Zazzera, 908-439-2200, ext. 5797

joseph.zazzera@ambest.com

or

Jennifer Afriyie, 908-439-2200, ext. 5203

jennifer.afriyie@ambest.com

or

Public Relations

Jim Peavy, 908-439-2200, ext. 5644

james.peavy@ambest.com

or

Rachelle Morrow, 908-439-2200, ext. 5378

rachelle.morrow@ambest.com



Source: A.M. Best Co.