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Amid criticism, Blue Shield CEO promises accountability

But the insurer and regulators may still clash over exec pay disclosures

CEO Paul Markovich has pledged to improve Blue Shield of California's service to members and disclose more about its executives' compensation as the insurer faces continued scrutiny from both consumer advocates and the state, the Los Angeles Times reports.

Blue Shield has been under the microscope since California revoked its long-held tax-exempt status in March. Noting the nonprofit insurer's $4 billion in surpluses, state officials have accused it of "not operating exclusively for the promotion of civic betterment or social welfare." Blue Shield also boosted its executives' pay by $24 million in 2012.

In a recent interview with Markovich, the L.A. Times notes that state regulators say Blue Shield falls short in offering provider directories and adequate access to care. In response, Markovich acknowledges that the insurer needs to do better, but adds that based on a variety of measures, he thinks Blue Shield does reasonably well.

Markovich also says the company will disclose more about executive pay, but adds that it will not hand the information over right away, nor does it plan to revisit past executives' pay to "satisfy idle curiosity."

Still, California Insurance Commissioner Dave Jones is investigating whether Blue Shield misled state regulators when it kept compensation information for former CEO Bruce Bodaken out of public filings, according to the article.

Blue Shield's acquisition of Medicaid health plan Care1st also has proved controversial, as consumer advocates took issue with the state's recent deal with the insurer that allows the merger to proceed. The California Department of Managed Health Care, however, claims it won important concessions from Blue Shield, including getting it to spend $200 million to improve patient care and $50 million for the creation of two new healthcare databases.

To learn more:
- read the article

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