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TagsBY PAM LOBLEY
NEWJERSEYNEWSROOM.COM
NOW THAT'S FUNNY
Last year, while Horizon Blue Cross Blue Shield of New Jersey laid off 200 employees, and raised premiums for their customers, they also paid out $30 million dollars in bonuses to top executives, including a $7.8 million dollar bonus to its CEO, William Marino.
Horizon is a nonprofit company. Except, of course, for Mr. Marino. He makes a great profit.
Horizon is the largest insurer in New Jersey, insuring 3.6 million people, including 400,000 on Medicaid. A big portion of its income comes from taxpayers, so the high executive compensation has prompted outrage, and where there's outrage, there's a Senate investigation.
Senator Loretta Weinberg, (D-Bergen) and the Senate Health, Human Services and Senior Citizens Committee, questioned the Horizon executives this week about their pay scale, and were assured that this compensation was reasonable and "in line" with compensation for other similar firms. (HA! I'll just bet it is!) Senator Weinberg disagreed, and is planning on exploring legal options to restrict how much public funding could be used to compensate executives at non-profits.
I know how to fix this problem. Remember when managed care first came along, and the whole idea was that insurers would be able to bring down the outrageous costs which doctors and hospitals were charging for their services? Well, we'll just use managed care for insurers. It will work just like your own insurance plan.
For instance, you go to the doctor, he charges you $200 for an office visit. You pay your $20 co-pay, and then the rest of the $180 will be paid by your insurance, right? No. The insurance pays what they call the "allowable" price, and the doctor will accept it. If the insurance "allows" $65 to the doctor for that visit, that's all he gets.
Here are some of my recent benefit statements and their discounts: lab work for $257 — insurance allowed $50.57. Annual OB-GYN checkup: $150, insurance says $104.04. X-ray of arthritic hip: $50, insurance allowed $12.11. People, I can't even get a pedicure for $12. And they expect someone to shoot and read an x-ray for $12?
If we're going to band together and bully the doctors and hospitals into taking less money, I say we bring it right up to the top of the insurance food chain. A Senior Vice President at Horizon Blue Cross bills a salary of $300,000, plus a hefty bonus? We'll allow $125,000, no bonus. CEO William Marino charges $935,000 in salary and $7.8 million in bonus? Our policy says the allowable amount will be $440,000 with an extra months' pay IF he can freeze premiums while maintaining coverage.
Gov. Chris Christie has already made it policy that there is a limited amount of public funding that can be used to compensate executives of nonprofit organizations that work for the state. Senator Weinberg wants to extend that policy to nonprofit insurers. Of course, if their pay drops drastically, the executives may leave their jobs, causing the ranks of insurance executives to thin dramatically.
This idea is sounding better and better.
Pam Lobley writes the "Now That's Funny" column. Sign up for her mailing list at www.pamlobley.com.
If you think you can do the job for the salary you propose, perhaps you should replace Mr. Marino. You have no idea what the job entails or the hours the executives work. Perhaps you should take a cut in pay. Whatever you make is more than you deserve.