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The Insurance industry is failing the consumer. The concept of fraud is being used by the insurance industry to deceive the public. "Our current national health care system is simple: don't get sick."

 

     
 

Blue Cross paid former CEO $16.4 million in retirement benefits



By RODRIQUE NGOWI
Associated Press Writer

BOSTON
Blue Cross and Blue Shield of Massachusetts paid its chairman, William C. Van Fassen, $2.96 million in salary and incentives last year, along with an additional $16.4 million in a lump sum retirement cash benefit, according to a Thursday filing with state regulators.

Van Faasen's retirement package reflects the extraordinary work he did for the company that lost $8 million on the year he became its CEO in 1992, turning it into the state's largest health insurance company that generated $265 million in profits in 2005 - the last year he worked as its chief executive officer, said company spokesman Chris Murphy.

State Sen. Mark Montigny, who has led the Senate's insurance, health care as well as ways and means committees, criticized the $7 billion nonprofit health insurance company's executive compensation as "outrageous. "

"There's a lot of room, to me, for abuse, particularly when we are in the climate where we are trying to get people to sign up for the plan and Blue Cross is the dominant player in the state," Montigny said, referring to the state's mandatory universal health insurance program.

"The plans are not affordable and yet we have to tell struggling people 'buy this plan from this charity, and by the way this is the kind of compensation that their top executives make,'" said Montigny. "It's just wrong."

     



Murphy said the company has to offer an attractive package to compete with public, private, for-profit and not-for-profit companies.

"We need to pay a competitive industry wage to get the best talent to run our business," he said. "And this amount of money we are referring to was analyzed and approved by several independent human resource firms."

Blue Cross and Blue Shield generated $110.4 million in profits in the third quarter of this year, compared with $140.1 million in the period last year - which included $51 million in tax gains from a favorable resolution to a dispute with the IRS, Murphy said.

Current President and Chief Executive Officer Cleve Killingworth Jr. received nearly $2.3 million in salary and incentives, together with $598,398 in benefits and $58.043 in other unspecified compensation, according to the filing with regulators.

     



Chief Financial Officer Allen P. Maltz received nearly $1.1 million in salary and other income, $16,000 in benefits and $32,102 in other unspecified compensation, according to the filing.

"What I am arguing is, if you are going to operate in this state as a charity, you should be fully transparent, you should be seriously regulated and audited, there should be compensation limits, lobbying limits, and there are none," Montigny said.

http://www.theledge r.com/article/ 20071115/ APF/711150992