Wednesday, March 2, 2011

Such A Deal: Another Ripoff

by Gary Snyder

Cleve L. Killingsworth, who abruptly resigned last March as chief executive of the nonprofit Blue Cross Blue Shield of Massachusetts, collected $8.6 million in compensation from the state’s largest health insurer in 2010. The $8.6 million that Killingsworth, 58, took with him is a combination of the $273,040 salary he received for his 2 1/2 months at the insurer last year; a $922,480 bonus for his work in 2009; and $7.4 million in additional compensation, according to the regulatory filing. That additional money represents the severance and retirement payments that accrued over his six years at Blue Cross, including almost five years as chief executive.

To show the strength of its governance,in 2009,the health insurer's membership declined, its net income fell 49 percent, it laid off employees, and received of double-digit premium increases, Killingsworth was rewarded with a 26% increase in salary and bonus.

But this is a deal compared to his predecessor, William Van Faasen, who received $16.4 million in retirement benefits in 2006. Van Faasen, who took over again as acting chief executive after Killingsworth departed, is currently the company’s chairman. Can’t wait to see the remuneration for Van Faasen for his latest roles.

As is frequently the case, the state attorney general is monitoring compensation practices at health care companies and done nothing.
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