Dive Brief:
- Executives saw their compensation rise last year, despite continued losses on their ACA business, at Health Care Service Corp. (HCSC), which operates Blue Cross and Blue Shield plans in Illinois, Montana, New Mexico, Oklahoma, and Texas, according to a recent analysis by Modern Healthcare.
- The company's top 10 executives saw their combined earnings rise 57%, going from a total of $36.1 million in 2014 to $56.7 million in 2015, the findings showed.
- The largest compensation package went to CEO Patricia Hemingway Hall, who has since retired. She increased her earnings by 42%, from $11.7 million in 2014 to $16.6 million in 2015.
Dive Insight:
The move at HCSC comes as executive pay in healthcare, health insurance and pharmaceuticals draws increasing scrutiny. Nonprofit health systems are taking particular heat, and industry watchdogs have been looking at whether rising executive pay is contributing to rising healthcare costs, while federal and some state officials have looked at the concept of hospital executive pay caps.
Meanwhile, in a proactive move, Humana announced earlier this year that it would tie its executive compensation not just to company finances, but to enrollee health outcomes.
Other companies that have garnered substantial attention over executive pay include Blue Shield of California, which was accused last year of cloaking massive sums paid to outgoing execs, and drug company Mylan, whose CEO Heather Bresch was noted by The Washington Post to have seen her compensation rise 671% during the period from 2007 to 2015 when the company controversially hiked its EpiPen price. Numerous Massachusetts hospital execs were also recently called out after a report showed their pay had outpaced state healthcare spending.
Even with the hullabaloo, however, much of the matter remains shrouded in mystery. While HCSC records showed Hall's compensation to be comprised of a $1.5 million salary plus bonuses amounting to almost $15 million, the company did not reveal anything about its performance metrics or bonus calculation methods, telling Modern Healthcare only that the methodology was “proprietary.”