Blue Cross Blue Shield CEO of Michigan operations, Dan Loepp, earned a total of $2.75 million in compensation for 2010, according to the BCBS' financial report, filed with the state Office of Financial and Insurance Regulation. His earnings marked an increase of 56 percent from $1.76 million in 2009.
Those figures, however, are on the deceptive side because Loepp, along with other senior executives of the company, took a 5% base pay cut in 2009. The CEO also voluntarily reduced his performance-based compensation by $340,000, said vice president of corporate communications Andy Hetzel.
"It looks like a $1 million increase, but he really got a $660,000" pay increase after the 2009 reductions, Hetzel added.
Loepp's total compensation in 2010 includes his base salary of $1.27 million and performance incentives totaling $1.27 million. The value of Loepp's non-cash earnings amounted to roughly $207,000, which includes life and automobile insurance benefits.
Compared to other BCBS plan CEOs, Loepp's compensation ranked at the lower end, Hetzel said. When viewed from a per-member perspective, his total compensation was in fact the second-lowest. On total compensation, Loepp ranked 18th highest on the list of CEOs, added Hetzel.
The insurance giant also reported its financials to OFIR based on statutory accounting principles (SAP).
In 2010, BCBS claimed to have earned $205.3 million in net income for 2010. In 2009, its net income was $12.6 million.
The accounting methods of SAP differ from that of GAAP or "generally accepted accounting principles," which was the financial statement the provider reported earlier in the week.
A primary reason SAP and GAAP figures are different is that OFIR is mostly interested in BCBS' insured business, which includes sales from HMO (health maintenance organization) and (PPO) preferred provider organization products. An overwhelming majority of the Blue's business stems from large, self-insured employer accounts.
For example, BCBS specializes in offering insurance packages for broad scope of employers, such as Detroit doctors and their staff members, large commercial manufacturing and production companies, and even vehicle logistics providers that offer express services for freight, automobile transport, and highly complex car shipping.
As a result, the total revenue in 2010 for BCBS was $6.57 billion, compared with $6.98 billion the previous year, according to SAP reporting. When company factors in its self-insured market based on GAAP financial reporting, its revenue plummeted to $19.2 billion in 2010, 11 percent lower than the $21.6 billion in 2009.
Subscribe to:
Post Comments (Atom)
I am really impressed by the way you detailed out everything. It is really going to help me a lot. Thanks.
ReplyDeleteOnline Auto Shipping Quote