Squeezed by fallout from the faltering economy, Blue Cross and Blue Shield of Massachusetts has plans to make substantial operational changes designed to cut costs by millions of dollars.
The BCBS plan, which seeks to cut costs between $10 million and $25 million, includes cutting CEO Cleve Killingsworth's total compensation for this year by 50 percent, and other senior managers' compensations by 30 percent. Meanwhile, the plan will freeze pay this year for all employees, cut worker bonuses by 20 percent, make no long-term incentive bonus payments to senior execs and stop hiring for the remainder of the year.
In a recent statement, CFO Allen Maltz said the Blue plan is preparing to deal with membership reductions triggered by rising unemployment, as well as losses from drops in the value of its investment portfolio.
To learn more about this effort:
- read this Modern Healthcare article (reg. req.)
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