New Centene CEO London Will Bring Tech, Innovation Chops to Her Role

by Leslie Small

Centene Corp. on March 22 named Sarah London as its next CEO, effective immediately. London, who currently serves as the firm’s vice chairman, will fill the role held by Michael Neidorff for decades, though she has been part of a group of top executives who have handled day-to-day management of Centene since Neidorff took medical leave in late February.

London’s appointment could signal a ‘reset’

• In her previous management role, London was responsible for a “portfolio of companies independent of Centene’s health plans, designing differentiated platform capabilities, and delivering industry-leading products and services to third-party customers,” per a March 22 press release. Before coming to Centene, she worked for UnitedHealth Group’s venture capital arm, Optum Ventures, and its data analytics division.
• London is also one of three members of Centene’s Value Creation Steering Committee, alongside President and Chief Operating Officer Brent Layton and Chief Financial Officer Drew Asher. The strategic review of Centene’s assets that began roughly nine months ago “has resulted in a shareholder value strategy that entails a narrowing of focus, divestiture of non-core businesses (some immediately after acquisition), and net margin improvement to 3.3% (or 3.1% on a more traditional total revenue denominator),” Jefferies analyst David Windley wrote in a March 23 note to investors.
• “The VCP [value creation plan] divestitures are mostly non-health plan and ex-US operations. In other words, the refocus seems to be on the core health plans business,” Windley pointed out.
• “Ms. London’s selection as CEO, with experience in technology, digital, innovation, and new product development (both through Optum Ventures and CNC’s Healthcare Enterprises) rather than health plan leadership, suggests that the divestitures could be a reset rather than an abandonment of that Optum-like diversification strategy. We’ll look forward to hearing Ms. London’s longer-term vision beyond the VCP,” he added.

Neidorff departs with strong legacy

• Neidorff, who helmed Centene starting in 1996, led the company that was once a small, regional insurer into a Medicaid managed care powerhouse and the largest carrier on the Affordable Care Act exchanges.
• The firm has also branched out into Medicare Advantage, yet it is moving to streamline its PBM holdings — a process that includes selecting an outside vendor — after facing a bevy of lawsuits by states alleging the company mismanaged their Medicaid pharmacy benefits.
• Neidorff was set to retire this year before taking his leave of absence.

From Health Plan Weekly

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