Strong Company Financial Performance, Surging Stock Market Led to Robust Health Plan CEO Salaries in 2012, Atlantic Information Services's Health Plan Week Finds
Atlantic Information Services, Inc. (AIS) - June 26, 2013 - Washington, DC

Most CEOs of publicly traded health plans saw their compensation rise in 2012, but others fluctuated on stock and incentive programs unrelated to base pay, according to Atlantic Information Services’s (AIS) annual survey of health insurance company CEOs’ compensation. Using information from company statements, AIS compiled a list of total compensation for CEOs at 11 health plans in 2012, and found that the leader among publicly traded health insurers in executive compensation last year was UnitedHealth Group’s Stephen Hemsley. The analysis was published in the June 24, 2013 issue of AIS’s industry-leading newsletter Health Plan Week (HPW).

Hemsley, on the job since November 2006, collected $13.9 million in total pay, including $6.9 million in salary and bonuses and $7.0 million in stock, an HPW analysis of Securities and Exchange Commission (SEC) proxy filings showed. He edged out Aetna Inc. CEO Mark Bertolini, who saw his total compensation increase 26% to $13.3 million in 2012 from $10.6 million in 2011. Cigna Corp.’s CEO David Cordani, who topped the 2011 list with $19.1 million in total compensation, saw a 33% decrease in salary in 2012 to $12.9 million due to a more than $7 million drop in incentive compensation. His whopping overall compensation in 2011 raised the ire of shareholders.

HPW also found that the stream of money to these top executives has not generated much, if any, public outcry, given Wall Street’s overall strength, but Paul Dorf, managing director of Compensation Resources Inc. and a leading compensation analyst, says insurers are beefing up their executives’ pay ahead of possible premium rate spikes in 2014, which may cause blowback for heavily compensated executives by consumers and regulators. “The insurance companies are really taking advantage of the Affordable Care Act and trying to put things in place before 2014 when things will start being much more regulated. So we’re seeing huge increases, and that’s across the board.” He adds that companies’ boards of directors recently have become more involved in the compensation process and are taking their jobs much more seriously.

Visit http://aishealth.com/archive/nhpw062413-01 to read the article in its entirety, which also includes analysis of “say-on-pay” executive compensation rules and a table of total compensation. Total compensation includes base salary, bonuses, stock awards, options/stock appreciation right (SAR) awards, non-equity incentive plan compensation, non-qualified deferred compensation earnings and all other compensation.

About Health Plan Week
Published since 1991, the 8-page weekly newsletter Health Plan Week provides timely, objective business, financial and regulatory news of the health insurance industry. Coverage includes new benefit designs and underwriting practices, new products and marketing strategies, mergers and alliances, financial performance and results, Medicare and Medicaid opportunities, disease management, and the flood of reform-driven regulatory initiatives including medical loss ratios, exchanges, ACOs and myriad benefit design changes that are mandated.

About Atlantic Information Services
Atlantic Information Services, Inc. (AIS) is a publishing and information company that has been serving the health care industry for more than 25 years. It develops highly targeted news, data and strategic information for managers in hospitals, health plans, medical group practices, pharmaceutical companies and other health care organizations. AIS products include print and electronic newsletters, websites, looseleafs, books, strategic reports, databases, webinars and conferences. Learn more at http://www.AISHealth.com.

Contact
Jill Brown, Executive Editor
Atlantic Information Services, Inc.
(202) 775-9008, ext. 3058
jbrown@aishealth.com

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