Why HEALTH INSURANCE COMPANIES ARE THE PROBLEM!
Health Insurance Company CEO Salaries from 2005 and the total from the previous 5 Years. IT IS IMPOSSIBLE to have true Universal Health CARE when CEOs like these are involved.
* United Health Group
CEO: William W McGuire
2005: 124.8 mil
5-year: 342 mil
* Aetna
CEO: John Rowe
2005: 22.1 mil
5-year:57.8 mil
* Cigna
CEO: H. Edward Hanway
2005:13.3 mil
5-year:62.8 mil
* McKesson
CEO: John Hammergen
2005: 13.4 mil
5-year:31.2 mil
* WellPoint
CEO: Larry Glasscock
2005: 23 mil
5-year: 46.8 mil"
More from a blog comment at sideshoe.me.uk:
The health insurance companies have played a major role in our current healthcare crisis. They make huge profits and their CEOs make millions, while the rest of us are denied care.
ANNUAL COMPENSATION OF HEALTH INSURANCE COMPANY EXECUTIVES (2006 and 2007 figures):
• Ronald A. Williams, Chair/ CEO, Aetna Inc., $23,045,834
• H. Edward Hanway, Chair/ CEO, Cigna Corp, $30.16 million
• David B. Snow, Jr, Chair/ CEO, Medco Health, $21.76 million
• Michael B. MCallister, CEO, Humana Inc, $20.06 million
• Stephen J. Hemsley, CEO, UnitedHealth Group, $13,164,529
• Angela F. Braly, President/ CEO, Wellpoint, $9,094,771
• Dale B. Wolf, CEO, Coventry Health Care, $20.86 million
• Jay M. Gellert, President/ CEO, Health Net, $16.65 million
• William C. Van Faasen, Chairman, Blue Cross Blue Shield of Massachusetts, $3 million plus $16.4 million in retirement benefits
• Charlie Baker, President/ CEO, Harvard Pilgrim Health Care, $1.5 million
• James Roosevelt, Jr., CEO, Tufts Associated Health Plans, $1.3 million
• Cleve L. Killingsworth, President/CEO Blue Cross Blue Shield of Massachusetts, $3.6 million
• Raymond McCaskey, CEO, Health Care Service Corp (Blue Cross Blue Shield), $10.3 million
• Daniel P. McCartney, CEO, Healthcare Services Group, Inc, $ 1,061,513
• Daniel Loepp, CEO, Blue Cross Blue Shield of Michigan, $1,657,555
• Todd S. Farha, CEO, WellCare Health Plans, $5,270,825
• Michael F. Neidorff, CEO, Centene Corp, $8,750,751
• Daniel Loepp, CEO, Blue Cross Blue Shield of Michigan, $1,657,555
• Todd S. Farha, CEO, WellCare Health Plans, $5,270,825
• Michael F. Neidorff, CEO, Centene Corp, $8,750,751
This executive compensation could be used to provide quality healthcare for millions of Americans! We need to get the insurance companies and their lobbyists OUT of healthcare. NON-PROFIT, SINGLE-PAYER IS THE ONLY OPTION.
If you want to learn more, go to:
http://www.insurancecompanyrules.org/learn_more/the_roster/
The solution? The United States National Health Insurance Act, H.R. 676. You can read about it here: http://www.healthcare-now.org/hr-676/
Tell Max Baucus he must put single-payer reform on the table:
http://www.change.org/ideas/
2 comments:
This is from my book "The Death of the American Corporation" Professor Czander
The Health Care Gang
Corporations are not alone in this behavior. We find similar evidence in the health care industry. According to the Daily Planet (2007), several organizations demonstrated outside the annual shareholders meeting of United Health Group the largest HMO in the U.S. to "decry the gap between need and greed.” United Health Group CEO William McGuire, and his replacement Stephen Helmsley, as well as other Minnesota HMO executives, took billions in stock options derived from what they claimed as derived from denying health insurance to half a million Minnesotans. United Health Care is the largest HMO in the United States and McGuire was the highest-paid CEO in Minnesota history, with stock options totaling $2 billion. Helmsley, who replaced McGuire, has stock options in excess of $750 million. McGuire and other executives who were ousted in October, 2006, are under criminal investigation due to stock option backdating fraud. According to Herbert Sacks past President of the American Psychiatric Association, when asked where does this money come from, he replied “from the denial and interruption of…patient care.” (Sacks, 1996).
Patrick Soon-Shiong the CEO of APP Pharmaceuticals stepped down as CEO in the spring of 2008, but the former surgeon still held 83 percent of the company's shares. In July, he agreed to sell APP to a German firm. The sale finalized two months later for an initial $3.7 billion cash payment, as a result Soon-Shiong’s personal fortune gain $3 billion in 2008, (Brunwasser, 2008).
Health care institutions, have lost the confidence of a public that once valued their altruistic mission. In 2006, Michigan Blue Cross paid their president and CEO, the now-retired Richard Whitmer, a compensation package of $4,253,558. His replacement received a 67% raise in 2007 receiving $1.6 million. CEO Loepp’s, VP George Francis received an 83% raise in 2007, bringing his compensation to $1,380,322, and Kathy Elston, former vice president for employee services, with a 155% raise, from $383,453 to $979,434 in 2007.
Michael Tarwater, CEO of Carolinas HealthCare System, was paid $3.5 million in total compensation in 2008. This includes base salary of $940,000, bonuses of $2 million, and other compensation, including retirement and health benefits, of $543,000.
Tom Breitenbach, CEO of MedAmerica Health Systems Corp. and Premier Health Partners, received total compensation $17 million during a 6 year period from 2002 to 2007. After exercising benefit cash out options of $3 million in 2007, Breitenbach made $4.1 million, or four times his 2002 earnings (Esrati, 2009).
Lifespan hospital in Rhode Island CEO George Vecchione’s total compensation in 2007 was nearly $3 million, making him the highest paid hospital executive in New England. In addition, the 10 hospital CEOs in Rhode Island who have stayed in their jobs since 2000 saw their pay increase by an average of 87 percent, while the consumer price index climbed only 20% during the same time period (Brooks, 2009).
Frank Perez, CEO, Kettering Adventist Healthcare, was paid $1.3 million in cash compensation and $1.7 million in total compensation in 2007, or about double from 2002. From 2002 to 2007, his total compensation — including retirement benefits and expense accounts — was $7.9 million (Esrati, 2009).
Paul Wiles, CEO of Novant Health in Charlotte, received $2 million in compensation in 2008. Wiles, based in Winston-Salem, received a salary of $900,000, a bonus of $829,000, and other income, including retirement and health benefits, of about $304,000 (Garloch, 2009).
Jeffrey Romoff, CEO of the University of Pittsburgh Medical Center, earned $3.95 million in 2007.
In 2006, Mike McCallister, CEO at Humana Inc., was paid $3,434,879 last year in total compensation, mostly in stock options, according to the company. Oxford Health Plans, CEO, Norman C. Payson, $76 million, plus unexercised stock options at $25.6 million. Aetna’s CEO John Rowe, MD, $8.9 million in compensation plus $24.1 million in unexercised stock options of $24.1 million. Douglas Hawthorne, CEO of Texas Hospital Resources, received a compensation package of $1.4 million in 2006, and Baylor CEO Joel Allison had compensation of $1.5 million in 2006.
This is the annual compensation given to health care CEO over a 5 year period ending 2005. United Health Group CEO: William W McGuire 5-year: 342 mil
Forest Labs CEO: Howard Solomon 5-year: 295 mil
Caremark Rx CEO: Edwin M Crawford 5-year: 93.6 mil
Abbott Lab CEO: Miles White 5-year: 25.8 mil
Aetna CEO: John Rowe 5-year:57.8 mil
Amgen CEO: Kevin Sharer 5-year:59.5 mil
Bectin-Dickinson CEO: Edwin Ludwig 5-year:18 mil
Cardinal Health CEO: James Tobin 5-year:33.5 mil
Cigna CEO: H. Edward Hanway 5-year:62.8 mil
Genzyme CEO: Henri Termeer 5-year:60.7 mil
Humana CEO: Michael McAllister 5-year:12.9 mil
Johnson & Johnson CEO: William Weldon 5-year:19.7 mil
Laboratory Corp America CEO: Thomas MacMahon 5-year:41.8 mil
Eli Lilly CEO: Sidney Taurel 5-year:37.9 mil
McKesson CEO: John Hammergen 5-year:31.2 mil
Medtronic CEO: Arthur Collins 5-year:39 mil
Merck Raymond Gilmartin CEO:5-year:49.6 mil
PacifiCare Health CEO: Howard Phanstiel 5-year: 8.5 mil
Pfizer CEO: Henry McKinnell 5-year: 74 mil
Well Choice CEO: Michael Stocker 5-year: 10.7 mil
WellPoint CEO: Larry Glasscock 5-year: 46.8 mil
Wyeth CEO: Robert Essner 5-year: 28.9 mil
According to Jodell (2009), in 2005 Howard Solomon CEO of Forest Labs received $92.1 million, Richard Clark Merck's CEO $37.8 million, Edward Ludwig Becton-Dickinson's $10 million.
Below are the compensation packages of health care executives in 2007 from The AFL/CIO Executive Paywatch Database:
Miles White, CEO, Abbott Labs $33.3 million
Ronald Williams, CEO, Aetna $23 million
Daniel Amos, CEO, Aflac $14.8 million
E. Edward Hanway, CEO, Cigna $25.8 million
Michael McCallister, CEO, Humana $10.3 million
William Weldon, CEO, Johnson & Johnson $31.9 million
David Snow, CEO, Medco Health Solutions $10.5 million
Richard Clark, CEO, Merck & Co. $19.8 million
John Hammergren, CEO, McKeeson Corp $39.9 million
Jeffrey Kindler, CEO, Pfizer $ 9.5 million
Stephen Hemsley, CEO, UHC $13.1 million
Massachusetts Blue Cross CEO Cliff Killingsworth received $3.6 million in 2007, including a $1.8M performance bonus, since 2005 his total compensation has increased 38 percent. In 2008 he received another increase of 26 percent bringing his total compensation increase since 2005 64 percent as it’s membership declined and net income fell 49 percent. Also, Killingsworth’s Chief Physician executive Dr. John Fallon earned $1.2 million and between 2005 and 2007 his salary has doubled.
Cigna Health Insurance CEO, H. Edward Hanway received $29.3 million in 2007. In January, 2009 Cigna announced it will cut 1,100 jobs, or about 4% of its workforce, by mid-year to lower costs.
James Roosevelt, CEO at Tufts Health Care, received more than $1.6 million in 2007, a 110 percent jump over his $785,013 compensation in 2005, and Charlie Baker, President and CEO of Harvard Pilgrim, earned just under $1.4 million in 2007, a 26 percent hike since 2005 (Wu, 2009).
William Jew was paid a severance package of $18 million CareFirst Blue Cross Blue Shield.
The United Way of Central Carolina(UWCC), CEO Gloria Pace King received more than $1.2 million in 2008, following the addition of $822,507 to her retirement plan.
Health care researchers also receive significant compensation. David Silvers, clinical professor of dermatology at Columbia University received over $4 million in 2007. Following Silvers was Zev Rosenwaks of Cornell and Jeffrey Moses of Columbia received over $3 million .
Caremark a mail order pharmacy recently merged with CVS. As a result Caremark’s CEO Edwin Crawford will now serve as chairman of the merged company’s. Crawford has been able to negotiate a golden parachute from Caremark by claiming he has departed from the merged Caremark. This parachute ranges from $36 million to $40 million. Crawford has agreed to limit his cash severance to $26 million; however, he will benefit from an accelerated vesting of his stock options. This amounts to $22 million. In total, it is estimated that Crawford will receive $56 million resulting from the merger. This estimate does not include the full value of an insurance policy that will transfer to Crawford’s ownership. The policy’s actual value is $17 million. Additionally, this estimate does not include the $248 million in stock options that Crawford owns that are exercisable. According to The Corporate Library, Crawford could walk away with a total of $287 million, not including the health and welfare benefits he will receive for the remaining eight years of his employment agreement. Crawford has maintained that no other Caremark employee will be allowed to benefit from its merger with CVS.
Jarrad and Kia (2007), explored how compensation CEO’s received following mergers affected their incentives to pursue a merger. They discovered that following the acquisition, company performance suffers; market to book value, return on assets and stock return all drop, and leverage increases. However, the acquiring CEO's compensation and wealth increased substantially. Also, acquiring CEO’s are not penalized in the post-merger period for poor performance. A good example of this is CEO Dr. Ken Melani, when his insurance company Highmark merges with Independence Blue Cross, he would get a $1 million raise with incentives, bringing his total salary to $3.9 million (Pittsburgh Business Times, 2008). Other executives will benefit from the mergers; David O’Brien, executive vice president of government services, $1.55 million from $996,316; Dan Lebish, CEO of Highmark Life and Casualty, $1.08 million from $891,000; and Nanette DeTurk, executive vice president of finance and CFO, $1.7 million from $1.1 million. CEO William “Jerry” Jurgensen of Nationwide Mutual Insurance agreed to buy 34 percent of it’s subsidiary, Nationwide Financial Services. The more Nationwide Insurance pays the more Jugensen receives, he will receive $24 million in a deal described as overpaying or excessive (Mider, 2008).
The CEO of Blue Cross Blue Shield of North Dakota Mike Unhjem receieved a 27 percent raise in March 2009 at the same time they are claiming that their company is in serious financial trouble, also the insurer’s top executives and 33 sales representatives and their guests are currently on a trip to the Cayman Islands. A Blue Cross Blue Shield spokesperson says that the Cayman Islands trip is an annual event to reward the company’s top salespeople.
These are only CEO salaries and do not include Senior VPs', VPs', or other board members' compensation rates. In 2007, the top 6 health plan boards paid themselves a whopping $277,998,793 (Jodell, 2009).
There are many who maintain that executive pay is a significant part of the health care problems in America.
Estimates of the compensation cost for health care CEO’s and their executives total about $7 to 10 billion a year. If their pay was reduced by 80 percent it would cover health insurance for 500,000 families enrolled in a government insurance program at $10,000 per year per family. Also, if health care was nationalized the administrative savings alone would be enough to provide health care coverage for the one million uninsured in America. One third of every dollar spent on health care goes to administrative overhead and half of that goes to executives.
These insurance companies steal from both the public and the providers of services. Many of the fee schedules they permit naive "participating" individuals to be compensated (limited and dictated fee allowances)are not updated in a timely manner. Part of the reason we will have fewer doctors and more limitedly educated health "aides" and foreign professionals in our health system. They profit from the sick persons' loss by avoiding adequate payment for needed services and excessively raise their bottom line at the public's expense. This is evidenced in the outrageous CEO salaries and most likely more elsewhere.
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