NEW YORK: Legislators Target Health Plans’ Rate Hikes
State Sen. Guy Velella (R) and state Rep. Audrey Pheffer (D) proposed legislation Tuesday that "would block salary and compensation increases of any insurance company employee making more than $125,000 in the three years following a rate increase of more than 5%," the Albany Times Union reports (Tully, 2/25). According to the AP/New York Daily News, two HMOs have already made plans to raise rates. Oxford Health Plans has requested a "57% increase on individual plans [while] its department chairman received $1.08 million in compensation in 1996. Empire Blue Cross and Blue Shield is seeking a 46% increase." Its president and CEO received $498,035 in 1996.
"You Don't Deserve A Raise"
The AP/Daily News reports that the two legislators say consumers are suffering from the "'gross fiscal mismanagement' of insurance companies." Pheffer said, "These companies are losing money because they keep on raising the salaries of their overpaid executives, instead of investing in a plan to provide quality care at an affordable price" (2/25). Velella said, "If your company is doing so badly that you need an increase, then we say: 'You don't deserve a raise.'" The two legislators said the "salaries of top executives at seven large [HMOs] ... ranged from $244,000 to $1.08 million" (Times Union, 2/25). The AP/Daily News reports that the HMO Conference of New York State had no comment on the legislation (2/25).