WellPoint Inc.’s earnings dipped last year, as the health insurer dealt with losses in its Medicare Advantage business, and the total reimbursement given to Chairwoman and CEO Angela Braly slipped as well.
Braly, who has worked as CEO for nearly five years, received a $1.1 million salary in 2011, a total that has stayed flat since 2008. Her payments also comprise a performance-related bonus of nearly $1.9 million, stock and option awards totaling about $10 million and $216,279 in other compensation.
Health insurers have been criticized in recent years for giving their top executives big compensation hikes while the cost of insurance for many people continues to outdo inflation and wage growth. Insurers hold that executive compensation makes up a small part of their total costs, and the biggest cause behind the growing premiums for their coverage is the rising cost of health care.
Slower growth in health care use helped the performance of many insurers last year, as they paid out fewer claims than they anticipated when they set premiums. But WellPoint also took a $150 million hit from its Medicare Advantage business.
Medicare Advantage plans are privately run, government-subsidized version of the government’s Medicare program for the elderly. The insurer suffered losses when a Northern California plan allured more customers with a higher risk profile than it thought as a competitor left the market. WellPoint has discontinued the plan since then.
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