SecProbe.io

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                                                             FIRST CHOICE HEALTH
                                                             -------------------

August 16, 2005

Mr. Jim B. Rosenberg
Senior Assistant Chief Accountant
United States Securities and Exchange Commission
Division of Corporate Finance
450 Fifth Street N.W.
Washington, D.C. 20549

Re:    First Choice Health Network, Inc. ("FCH")
       Form 10-K for the fiscal year ended December 31, 2004
       File No. 000-23998

Dear Mr. Rosenberg:

We are in receipt of your letter  dated August 2, 2005 with  comments  regarding
our financial statements and related disclosures  contained in our Form 10-K for
the fiscal year ended December 31, 2004.

We acknowledge that:
   o  We are  responsible for the adequacy and accuracy of the disclosure in our
      filings;
   o  SEC staff  comments or changes to disclosure in response to staff comments
      in the filings  reviewed by the staff do not foreclose the SEC from taking
      any action with respect to the filing; and
   o  We may not  assert  SEC  staff  comments  as a defense  in any  proceeding
      initiated  by the SEC or any person under the federal  securities  laws of
      the United States.

We appreciate your assistance with our compliance with the applicable disclosure
requirements and efforts to enhance the overall disclosures in our filing.

The  responses  set forth  below  correspond  to the  numbered  comments in your
letter.  For your  convenience,  we have  included  your  original  comment  and
followed it with our response.

1. Item 6. Selected Financial Data, page 7

      Please refer to your  presentation of "operating  revenue,  continuing and
discontinued operations" and address the following:

      Please explain to us how your  presentation of operating revenue meets the
requirements of Item 301 of Regulations S-K. For example, tell us how combining

--------------------------------------------------------------------------------
      One Union Square * 600 University St., Ste 1400 Seattle, WA 98101 *
          (206) 292-8255 * Fax (206) 667-8060 * www.1stchoiceofwa.com
<PAGE>

Mr. Jim Rosenberg
United States Securities and Exchange Commission
Page 2

revenues from  continuing  and  discontinued  operations  highlight  significant
trends in your results of operations for investors.

We included the  presentation  showing total revenues  arising out of continuing
and  discontinued  operations  due to our belief that it shows our  shareholders
important  trends  in  our  operating  revenues  and  volume  of  business,  and
demonstrates  the scope of the changes in our business  that have  occurred as a
result of the FCH's  decision  to  transition  out of the  insured  health  plan
business.  During 2004,  FCH had nominal  operating  revenue  from  discontinued
operations ($78,927 or .3% of operating revenue from continuing operations).

      It  appears  that your  presentation  of  operating  revenue is a non-GAAP
financial  measure.  Tell us how your  disclosure  complies  with Item  10(e) of
Regulation S-K.

We agree  including  discontinued  operations in operating  revenue results in a
non-GAAP disclosure.  We inadvertently overlooked the requirements of Item 10(e)
of Regulation  S-K in preparing this aspect of our 10-K. In future  filings,  we
will  disclose  only  GAAP  operating  revenue  from  continuing  operations  in
"Selected Financial Data" and other disclosures.

Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations, page 7

2. Critical Accounting Policies and Estimates, page 11

      Your disclosure in Note 1 to the  Consolidated  Financial  Statements list
certain  material  estimates  that are  particularly  susceptible to significant
change.  Please tell us why only the estimate  related to the  determination  of
unpaid claims and claims adjustment expenses is critical and the other estimates
are not.

For FCH's business,  for the period covered by the 10-K, the estimate related to
unpaid claims and claims  adjustment  expenses was the most critical  accounting
estimate.  Other estimates cited in Note 1 to the financial  statements include:
the  write-down of the  investment  in the Plan,  the allowance for service fees
receivable and deferred income taxes. The estimates  required for the write-down
of the  investment  in the  Plan  ($0 in 2004  and  $260,793  in  2003)  and the
allowance for service fees  receivable  (less than $100,000 in 2004 and 2003) do
not  involve  significant  sums of money and are not  nearly as  susceptible  to
change as the other estimates. Thus, these estimates were not deemed critical by
management.

The component of the estimate  related to deferred  income taxes that has become
critical is related to net operating losses (NOLs). Historically,  the NOLs have
been  fully  reserved,  and  therefore,  resulted  only  in a  contingent  gain.
Beginning with the 10-Q for the quarter ended March 31, 2005, we began including
a discussion  about the NOLs as

<PAGE>

Mr. Jim Rosenberg
United States Securities and Exchange Commission
Page 3

we are anticipating that some time in the near future we will have an event that
will  trigger  the  ability  for us to use  some of the  NOLs,  and the  reserve
estimate will be revised.  We will continue to include this discussion in future
filings as a critical accounting estimate.

3. Item 7A. Quantitative and Qualitative Disclosures About Market Risk, page 12

      It appears that your  investment  securities  are subject to interest rate
risk.  Tell us why you  believe  that the  disclosures  required  by Item 305 of
Regulation S-K are not applicable.

Historically,  FCH held  investments in variable rate  securities  that were not
materially  susceptible to interest rate risk. As our  investment  portfolio has
moved primarily to long-term municipal bonds, our exposure to interest rate risk
has increased.  We will include  disclosures  required by Item 305 of Regulation
S-K in future filings.

4. Consolidated Statement of Cash Flows, page 19

      Please provide us with your basis in GAAP and an  explanation  for why you
have  presented  net  discontinued  operations  for  operating,  investing  and,
financing  activities  on  one  line  item.  Also,  please  provide  us  with  a
presentation  of  your  discontinued  operations,   in  disclosure-type  format,
segregated by operating,  investing  and,  financing  activities for each period
presented.

We reviewed FAS 144 and FAS 146 related to reporting of discontinued operations.
Per FAS 144 and 146, the results of the  discontinued  operations is required to
be shown on the income  statement  separately  and below income from  continuing
operations for all periods presented, but require no special presentation on the
face of the  balance  sheet  or cash  flow  statement.  For our  disclosure,  we
referred to other filings noting cash flows from  discontinued  operations  were
shown just as one line item on the cash flow statement.

Following is the  presentation  of our cash flows from  discontinued  operations
segregated by operating, investing and financing for each period presented. This
presentation  reconciles  the beginning and ending cash balances for each period
presented.  Included is a separate line for "Cash flows from continuing business
operations that belong to the discontinued  insurance legal entity".  There were
two components of the discontinued operations that would survive the dissolution
of the health insurance entity.  However,  until it was actually dissolved,  the
assets and liabilities  generated by these activities were legally a part of the
health  insurance  entity.  For this reason,  as the operations would ultimately
continue,  the net income  generated by these  activities was included in income
from continuing  operations.  However,  all of the assets and  liabilities  that
existed as part of the legal  insurance  entity were included as discontinued as
they  legally  belonged  to that entity and would be  dissolved  as part of that
entity's legal dissolution.  This resulted in the impact of the "cash flows from
continuing business  operations that belong to the

<PAGE>

Mr. Jim Rosenberg
United States Securities and Exchange Commission
Page 4

discontinued  insurance  legal entity"  becoming a component of the overall cash
flows of the discontinued operations.

<TABLE>
<CAPTION>

DISCONTINUED OPERATIONS STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2004, 2003 and 2002

                                                             2004             2003             2002
                                                          -----------      -----------      -----------

<S>                                                       <C>              <C>              <C>
CASH FLOWS FROM DISCONTINUED OPERATING ACTIVITIES
  Net income (loss) from discontinued operations          $ 1,144,843      $   754,783      $(3,851,787)
  Adjustments to reconcile net income (loss) to
        net cash from operating activities
     Deferred income taxes, net                           $    34,643      $   122,490      $   576,608
     Changes in operating assets and liabilities
        Premiums receivable                               $   898,489      $ 1,743,648      $   336,809
        Prepaids                                          $    71,288      $   143,385      $   615,698
        Accrued expenses                                  $  (470,246)     $     2,862      $    (5,592)
        Reserve for unpaid losses and loss adjustment
          expenses                                        $(2,880,694)     $(5,568,089)     $(3,177,745)
        Provider settlements payable                      $   (83,787)     $  (141,843)     $(1,128,582)
        Unearned premiums                                 $   (17,099)     $  (746,101)     $  (870,332)
        FIT payable to/from parent                        $    10,376      $ 1,614,420      $(1,607,743)
        Amount due to parent                              $   (13,560)     $   (50,623)     $   866,337
                                                          -----------      -----------      -----------

  Net cash used by discontinued operations                $(1,305,747)     $(2,125,068)     $(8,246,329)

CASH FLOWS FROM INVESTING ACTIVITIES
  Principal paydowns and sales of investments
     available for sale                                   $ 7,407,618      $ 1,025,211      $ 3,666,742
  Decrease/(increase) in restricted indemnity cash and
     investments                                          $    (1,534)     $ 1,690,283      $   (25,265)
                                                          -----------      -----------      -----------

        Net cash used by investing activities             $ 7,406,084      $ 2,715,494      $ 3,641,477

CASH FLOWS FROM FINANCING ACTIVITIES
  Payment of preferred stock dividend                     $  (305,765)     $        --      $        --
  Redemption of preferred stock                           $(3,494,299)     $        --      $        --
  Common stock dividend paid                              $(2,705,701)     $        --      $        --
  Capital contribution                                    $        --      $   213,009      $        --
                                                          -----------      -----------      -----------

        Net cash from financing activities                $(6,505,765)     $   213,009      $        --

CASH FLOWS FROM CONTINUING BUSINESS
  OPERATIONS THAT BELONG TO THE
  DISCONTINUED INSURANCE LEGAL ENTITY                     $   221,774      $ 1,383,139      $ 3,739,562
                                                          -----------      -----------      -----------

NET INCREASE (DECREASE) IN CASH AND CASH
  EQUIVALENTS                                             $  (183,654)     $ 2,186,574      $  (865,290)

CASH AND CASH EQUIVALENTS, beginning of year              $ 2,687,652      $   501,078      $ 1,366,368
                                                          -----------      -----------      -----------
CASH AND CASH EQUIVALENTS, end of year                    $ 2,503,998      $ 2,687,652      $   501,078
                                                          ===========      ===========      ===========

</TABLE>

<PAGE>

Mr. Jim Rosenberg
United States Securities and Exchange Commission
Page 5

We are also  including  the detail of the amounts  included on the  consolidated
statement of cash flows as "Cash Flows From (To)  Discontinued  Operations"  for
each of the periods presented:

<TABLE>
<CAPTION>

Components of Cash Flows From (To) Discontinued Operations
  as included on the Consolidated Statements of Cash Flows

                                                             2004             2003              2002
                                                          -----------      -----------      -----------

<S>                                                       <C>
Common stock dividend received from subsidiary            $ 5,164,452
Preferred stock dividend received from subsidiary         $   262,501
Cash flows from continuing business operations that
  belong to the discontinued insurance legal entity       $  (221,774)     $(1,383,139)     $(1,821,562)
Decrease in unrealized loss                               $    (8,946)     $        --      $        --
Capital contribution                                      $        --      $  (213,009)     $(1,918,000)
Change in provider settlements receivable attributed
  to the subsidiary in 2001                                                                 $   404,518
                                                          -----------      -----------      -----------
                                                          $ 5,196,233      $(1,596,148)     $(3,335,044)
                                                          ===========      ===========      ===========

</TABLE>

Notes to Consolidated Financial Statements

Note 1. Description of Business and Summary of Significant  Accounting Policies,
page 20

4. Principles of consolidation, page 20

      Please tell us your basis under GAAP for  including  certain  intercompany
accounts in the financial statements for a subsidiary's  business presented as a
discontinued operation. Cite authoritative accounting literature to support your
financial statement presentation.

Some immaterial  amounts totaling $55,143 due from the subsidiary  (discontinued
operations),  to the parent are shown on the balance sheet and were disclosed in
accordance   with  Regulation   S-X,  Rule  3A-04.   Because  the   discontinued
intercompany  balances  were  included in the  discontinued  line on the balance
sheet,  it was  necessary  to present the  intercompany  balance  separately.  A
comprehensive research of GAAP was not conducted due to the immateriality of the
amounts.

5. Earnings per share, page 22

      Based on your  disclosure  that you have two  classes of common  stock and
certain

<PAGE>

Mr. Jim Rosenberg
United States Securities and Exchange Commission
Page 6

nonshareholders have equivalent dividend rights as Class B shareholders,  please
tell us why you did not compute earnings per share using the "two-class"  method
as discussed in paragraph 61 of SFAS 128 and EITF 03-6.

It was an oversight not to use the "two-class"  method as discussed in paragraph
61 of SFAS 128 and EITF 03-6 for  reporting  of  earnings  per share.  In future
filings,  including the 10-Q for the current quarter,  the "two class" method of
reporting will be applied. As our stock is not traded on any market, there is no
active investing in or selling of our stock.

As a result of the timing of the receipt of you