Insurers rake in earnings at ten times 2010 profits
The four largest health insurers in Massachusetts fared extremely well in 2011, as fewer people sought medical care and as insurers renegotiated provider contracts, which helped them stifle healthcare costs, the Boston Business Journal and Worcester Telegram & Gazette reported.
Blue Cross Blue Shield of Massachusetts, the state's largest health insurer, which reported a net $136.1 million last year in 2011--more than 10 times the $13.4 million it earned in 2010, according to The Boston Globe.
Harvard Pilgrim Health Care reported a 2011 net income of $93.5 million, up from $49.6 million the prior year. Part of Harvard Pilgrim's success, according to CEO Eric Schultz, was its ability to lower the average premium increase base rate to 1.8 percent for April reinsurance renewals, compared to 3.8 percent a year ago. Additionally, Tufts Health Plan posted a net income of $87.6 million last year, an increase from $58.8 million in 2010. And Fallon Community Health Plan's $38.5 million net income reversed it loss of $8.8 million the prior year.
The Massachusetts insurers also disclosed compensation data that, although still remains high, doesn't reach the heavily criticized level of Blue Cross CEO Cleve Killingsworth's $11 million payout last year. Here's the breakdown of CEO pay packages:
- Blue Cross CEO Andrew Dreyfus received $874,000, up from $800,000 in 2010
- Tufts CEO James Roosevelt Jr. received $1.7 million, up from $1.2 million in 2010
- Harvard Pilgrim CEO Eric Schultz received $1.2 million, up from $795,000 in 2010
- Fallon CEO W. Patrick Hughes, received $810,000, up from $649,000 in 2010
Dreyfus chose not to receive a bonus last year--a choice he made to demonstrate his commitment to healthcare affordability; four former Blue Cross senior executives actually received higher pay than he did, noted the Globe.
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