Labor & Employment Law

Small Business Group, HCAN Blast WellPoint CEO Pay, Consumer Rate Hikes

By Mike Hall

The CEO and board of directors of health insurance giant WellPoint faced tough questions about the company’s excessive rate hikes, its campaign to kill health care reform and executive pay from shareholders?including small business owners?at its annual board meeting yesterday.

WellPoint shareholders from the small business group Main Street Alliance and the coalition Health Care for America Now (HCAN) blasted the recent increase in CEO Angela Braly’s total compensation?which skyrocketed by 51 percent in 2009 to $13.1 million. They also challenged as inaccurate the company’s submission of data to California regulators to convince them to permit double-digit premium increases for individuals in 2010. The company withdrew its plans to raise rates by as much as 39 percent after regulators questioned the figures submitted by WellPoint subsidiary Anthem Blue Cross.

Arlene Zaremba, who owns a small St. Louis law firm, urged WellPoint to support proposed federal legislation (H.R. 4757 and S. 3078) that would create a Health Insurance Authority power to block unreasonable premium increases before they are allowed to take effect.

I’m getting crushed by their rate increases?most recently their attempt to raise my rate 41 percent, an attempt they could not justify with the math. Health insurance is now the second largest cost of my business and is exceeded only by my payroll.

For more on the health insurance industry’s premium increases and soaring profits, click here.

Main Street Alliance Director Sam Blair urged the board to adopt a lobbying disclosure policy in light of the revelations in January by the National Journal that WellPoint and five other of the nation’s biggest health insurers quietly funneled about $20 million to the U.S. Chamber of Commerce to air lie-filled, scare-mongering ads about health care reform. But he was ruled out of order. Says Blair:

Angela Braly and WellPoint call it “out of order” to give small businesses two minutes to be heard on this important issue. What’s truly out of order is WellPoint’s treatment of small businesses across America. We deserve to know how much money WellPoint [ quietly gave] the U.S. Chamber to run deceptive ads attacking health reform, in the name of the business community when those ads were really funded with insurance industry dollars.

Full post as published by AFL-CIO NOW BLOG on May 19, 2010 (boomark / email).