Alliance Health Under Fire with Layoffs, Resignation, Bankruptcy, Investigation

South Jordan—Alliance Health CEO Jeff Smith resigned last week as the company reorganizes in the face of bankruptcy and layoffs.

Smith resigned on April 14. According to a statement from Brian Watkins, director of corporate communications for Alliance Health, other members of the management team are manning the helm until a trustee can be appointed by the court, as per requirements for the company’s bankruptcy filing.

“Day to day operations are being overseen by management. As part of the Chapter 11 reorganization process, a trustee will be appointed by the court. Alliance Health’s management looks forward to working with the trustee to continue serving our members with chronic conditions," he said.

Alliance Health, which was one of Utah Business‘ Fast 50—a list of the fifty fastest-growing companies in the state, according to revenue information—in 2015 and 2016, filed for Chapter 11 bankruptcy on April 7. Watkins said the company is dedicated to regaining its footing.

“Alliance Health is continuing business operations and expects that the reorganization process will help put the company on a strong path forward. We remain committed to improving the quality of life for people with chronic conditions," he said.

Last month, the company, which was one of Utah Business‘ Best Companies to Work For in 2016, as tabulated by anonymous employee surveys, has also laid off 11 percent of its workforce, said Watkins. The company currently has 759 employees, he said, 627 of which are based in Utah.

“We do not anticipate further layoffs," he said.

In addition, Alliance Health is the subject of a federal investigation regarding some of its practices. Watkins said the company was notified of the investigation in February.

“Alliance Health disagrees with the characterization that it was involved in any wrongdoing," Watkins said. “However, the company has and will continue to cooperate fully with the government’s inquiry. It is our hope and expectation that we will soon be given an opportunity to address the government’s concerns so that the company can focus its resources entirely on improving the quality of life for people with chronic conditions."