Explanation of Benefits

 

Doctors and hospitals are complaining about how long insurance companies take to pay. Almost everyone in the healthcare delivery system knows their costs are going up and their profits are going down.

It is a complicated system, and there are many factors to explain almost every problem. But one thing is clear, insurance company executives are making out very well. The CEO of one of the biggest companies, United Health Group’s William W. McGuire, pulled in a whopping $94 million in 2003 (the most recent reported). That’s an 896 percent raise.

Not everyone in our big nine did quite that well, only two of these masters of the healthcare universe failed to more than double his earnings, but even so, the median annual compensation for these insurance moguls was $14 million, and the average rate of increase topped 300 percent.

Physicians will tell you, "I'm being paid a lot less than I was being paid." Hospitals will tell you the same thing. Employers all say, "I'm paying way too much for healthcare costs." They're all looking to us for an alternative or an answer.

Alike Hill, chief executive officer, Evergreen Medical Group

Insurance Carrier / CEO	Total Amount	Percent Change
Aetna -- John W. Rowe	18,227,653	up 104.19
Cigna -- H. Edward Hanway	8,639,600	up 27.02
Coventry Health Care -- Allen F. Wise	20,046,910	down 1.32
Health Net -- Jay M. Gellert	14,164,414	up 827.71
Humana -- Michael B. McCallister	6,108,440	up 270.44
PacifiCare Health Systems -- Howard G. Phanstiel	6,378,023	up 112.19
United Health Group -- William W. McGuire	94,177,531	up 896.05
WellChoice -- Michael A. Stocker	5,018,276	up 153.89
WellPoint Health Networks -- Larry C. Glasscock	46,212,719	up 573.87

Sources: Insurance company proxy statements

A three-year (2001-2003) insurance CEO compensation analysis is available here. Do you have some favorite insurance carriers that you would like to see included here? Tell us who they are.