News & Events

Health insurer boards fray on pay

View Boston Herald Article here

By Christine McConville
Tuesday, April 5, 2011 – Updated 17 hours ago

Who’s afraid of Martha Coakley?

Not former John Hancock boss Barry L. Shemin, or Bright Horizons operator Mary Ann Tocio, it seems.

They are among the board members, including lawyers, doctors, executives and actuaries, who told a “disappointed” attorney general they’re going to keep getting paid for their work at nonprofit health insurers.

But whether the directors at Harvard Pilgrim Health Care and Tufts Health Plan can sustain that stance remains to be seen.

Already, the lines are shifting.

Susan Windham-Bannister, who sits on the board at Tufts and runs the state’s Life Sciences Center, made public that she recused herself from the board’s discussion and eventual vote on directors’ pay.

Public relations guru Thomas P. O’Neill III earlier decided to donate his Tufts board salary to the city’s homeless.

Deborah Jackson quit the Harvard Pilgrim board. Her new job, as president of Cambridge College, doesn’t leave her with enough time for extracurricular work, the company said.

Harvard Pilgrim said its 12 directors spend an average of about 150 hours a year, or three hours a week, on company business.

Coakley, meanwhile, is finishing up her report on directors’ pay at Harvard Pilgrim, Tufts, Blue Cross Blue Shield of Massachusetts and Fallon Community Health Plan.

Coakley, who oversees the state’s 22,000 tax-exempt organizations, isn’t convinced that the state’s big four health insurers need to pay their directors.

If sprawling and complex institutions such as Boston University and Children’s Hospital don’t pay their boards, she’s argued, why should health insurers?

People on the other side of this debate said health insurance companies aren’t your average charities, and getting top-notch directors means paying them.

Once Coakley’s report lands, things could get interesting for this crowd.

Here’s the rest of the Harvard Pilgrim board: banker Earl W. Baucom; lawyers John H. Budd, Susan V. Duprey, and Katherine Hesse; Harvard Business School professor Herman B. Leonard; internist Dr. Constance Barr; retired accountant Edward F. McCauley; UMass Medical School COO Joyce A. Murphy; and Dartmouth Medical School professor Dr. Joseph F. O’Donnell.

The Tufts board includes: insurance exec Davey S. Scoon; former PricewaterhouseCoopers partner Peter Drotch; Dr. David S. Green; Dr. Paul Kasuba; Wheelock College President Jackie Jenkins-Scott; Hanover Insurance Group executive Greg D. Tranter; retirees James A. McNulty and Robert Spellman; and former Boston Medical Center boss Elaine Ullian.