SecProbe.io

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October 13, 2005

Mr. Jim B. Rosenberg
Senior Assistant Chief Accountant
United States Securities and Exchange Commission
Division of Corporation Finance
100 F Street NE
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 September 29, 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 appreciate your assistance with our compliance with the applicable
disclosurerequirements and efforts to enhance the overall disclosures
in our filings.

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. Consolidated Financial Statements, page 14, Discontinued Operations

We have read your response to prior comment one.  We note that you
believe that the winding down of your commercial insurance business was
an abandonment and that abandonment was the only available method to
discontinue the business. Please refer to paragraph 27 of SFAS 144,
which in summary states that a long-lived asset to be disposed of other
than by sale (for example, by abandonment) shall continue to be
classified as held and used until it has been disposed of.  Further,
as noted in paragraph 27 if a long-lived asset is to be abandoned,
paragraphs 41-44 shall apply to the disposal group at the date it is
disposed of.  Based on your response it appears that the business has
not beendisposed of as a result of not renewing these insurance
contracts.  Therefore, we continue to believe that until the commercial
insurance business has been disposed of or is classified as held for
sale it should not be reported as discontinued operations under SFAS
144.  Please amend your 2004 10-K and 2005 Forms 10-Q to report this
business as continuing operations or advise us further.

We continue to believe the winding down of the commercial insured
business meets the requirements of SFAS 144 to be reported as
discontinued operations. We elected to abandon the insurance operations
in 2003 by not renewing insurance contracts. There was no revenue
generated in 2004 from the insurance line of business and this line of
business was in fact discontinued in 2004. It is important to note that
the insurance line of business had essentially no long-lived assets for
physical abandonment or disposal. The assets of the insurance business
consisted primarily of cash and investments that were required by the
Washington State Office of Insurance Commissioner to be held for a
period of time to ensure that claims related to 2003 that may be
submitted for payment in 2004 could be paid in accordance with the
policies in place in 2003.

Paragraph 28 of SFAS 144 states the following:  "For purposes of
this Statement, a long-lived asset to be abandoned is disposed of when
it ceases to be used." The remaining cash and investments of the
insurance business were being held until we received regulatory approval
to distribute the cash and investments from the insurance plan. We
received regulatory approval from the Office of Insurance Commissioner
to pay a special dividend in 2004 and distributed a significant portion
of our assets at that time. The assets of the insurance plan held at the
end of 2004 were being held until a final dissolution is approved by the
Washington State Office of Insurance Commissioner. Essentially all
claims related to 2003 had been paid and the assets of the insurance
plan were no longer being used in the insurance business.  In 2005,
we received approval for the distribution of the remaining assets of the
insurance business.

A significant consideration of SFAS 144 is on operations and cash flow
activity and there is no strict requirement that all assets need to be
disposed of in order to consider the business as discontinued.  This
is conveyed within the comments and discussions undertaken by the
Board as stated in the basis of conclusion to SFAS 144 in paragraph
B106, "The Board also decided to eliminate the requirement
proposed in the Exposure Draft that assets be eliminated in a disposal
transaction
as a condition for reporting discontinued operations.  The Board
observed that the emphasis on assets would preclude a component of an
entity from being reported as a discontinued operation unless the
disposal transaction involved all of the assets of the component".
Paragraph B107 goes on to state, "the requirements for reporting
discontinued operations focus on whether a component of an entity has
operations and cash flows that can be clearly distinguished from the
rest of the entity and whether those operations and cash flows have
been (or will be) eliminated from the ongoing operations of the
entity in the disposal transaction. Given the emphasis on operations,
the Board decided to incorporate as a condition for reporting
discontinued operations the requirement that an entity have no
significant continuing involvement in the operations of a component
after it is disposed of."  As we have indicated, we stopped writing
any new policies after January 1, 2003 and stopped collecting any
premiums at the end of 2003.  The cash and securities were held only
to pay claims incurred on these non-renewed insurance contracts and
to satisfy reserve requirements until we could obtain approval from
the Washington State Insurance Commissioner to distribute the funds.

We believe that the presentation we have made is consistent with the
intent of SFAS 144 and most fairly presents the continuing operations
of FCH going forward.

2. Note 3, Redeemable Equity Participation, page 23

Based on the redemption provisions described in your response to
prior comment two, it appears the triggering events that would cause
redemption are solely within the control of First Choice and the
classification of this Participation Agreement as temporary equity
is not appropriate under EITF Topic D-98.  Please amend your 2004
10-K and 2005 Forms 10-Q to classify this amount as permanent equity
or tell us why classifying this amount as permanent equity is not
appropriate, including authoritative literature relied upon.

We will reclassify the Participation Agreement as permanent equity.
We will file an amendment to our Form 10-K for the year ended
December 31, 2004 and amendments to our Form 10-Q's for the quarters
ended March 31, 2005 and June 30, 2005 that incorporate this
reclassification.

We hope this is responsive to your questions.  Please contact me at
(206) 268-2411 or our current Chief Financial Officer, Stacy Kessel
at (206) 268-2476 should you have any questions or want to further
discuss our response.

Sincerely,

Kenneth A. Hamm
Executive Vice President and Chief Operating Officer

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