Health Plan Weekly

For two years in a row, the CEO of the nonprofit Health Care Service Corp. (HCSC) received compensation that outstripped the chief executives of all the major publicly traded health insurance companies, including Centene Corp., CVS Health Corp.’s Aetna, Elevance Health, Inc., Molina Healthcare, Inc., The Cigna Group and UnitedHealth Group. 

HCSC, which owns Blue Cross Blue Shield plans in Illinois, Montana, New Mexico, Oklahoma, and Texas, has been led by CEO Maurice Smith since 2020. In 2023, Smith outearned every health insurance CEO except for Oscar Health, Inc.’s Mark Bertolini, whose total compensation was $44.5 million, according to AIS Health’s latest analysis of executive compensation data from the country’s largest health insurers. Smith also outearned every other CEO in 2022 except John Kao, the CEO of another newly public insurtech company, Alignment Healthcare, Inc.  

The CEOs of seven major publicly traded health insurance companies together received more than $144 million in total compensation in 2023, AIS Health’s Executive Compensation Database shows. The database includes major health insurers’ executive compensation from 2019 to 2023 — collected from individual companies, state insurance documents and U.S. Securities and Exchange Commission filings — and their national membership information as of the third quarter of 2024, per AIS’s Directory of Health Plans. The database will be updated annually.

Several states do not disclose compensation data for specific executives at health insurance companies or do not collect compensation data. Some insurance companies made leadership changes over the years.

House Republicans released a 2025 budget resolution on Feb. 12 calling for deep Medicaid funding cuts that could impact millions of people. While the Association for Community Affiliated Plans (ACAP) and other advocacy groups warn of major disruptions to Medicaid, Wall Street analysts indicated they are uncertain whether the proposals will pass because of the program’s popularity among voters. 

As Republicans look for ways to pay for President Donald Trump’s proposed tax cuts, their budget resolution calls for the House Energy and Commerce Committee to cut federal spending by at least $880 billion from fiscal years 2025 through 2034, a large portion of which could come from Medicaid. The Energy and Commerce Committee oversees Medicaid, which covers more than 79 million Americans, per KFF. 

After a tumultuous several months that culminated in the ouster of former CEO Karen Lynch, CVS Health Corp.’s fourth-quarter 2024 results beat Wall Street consensus estimates. And while the company reported lower year-over-year operating income, executives said the struggling Aetna business is finally stabilizing. 

The company’s adjusted earnings per share (EPS) for the fourth quarter came to $1.91, well above the consensus of 91 cents. Medical loss ratio (MLR) was 94.8%, which was lower (better) than the 95.5% guidance. And CVS posted revenue of $97.7 billion, beating the $97.1 billion consensus. 

While Humana Inc. posted a net loss in the fourth quarter of 2024 as it continued to adapt to a changing Medicare Advantage landscape, the company’s earnings released on Feb. 11 slightly exceeded analysts' expectations. The insurer stopped offering MA plans in some unprofitable markets this year, leading to a decline in membership but also contributing to Humana’s confidence it will reach its guidance for 2025.  

Humana had an adjusted earnings per share (EPS) loss of $2.16 for the fourth quarter, better than the consensus estimate of a $2.23 loss, while the company’s $29.2 billion in quarterly revenue was above the $28.8 billion consensus. The company’s consolidated medical loss ratio (MLR) was 91.3%, slightly above (worse than) the 91% consensus.