Blue Cross Blue Shield of Massachusetts provided former CEO Cleve L. Killingsworth with quite a hefty severance package and now the state's attorney general is investigating.
Killingsworth's severance and bonus totaled $8.2 million in 2010. He also gets $1.8 million this year, and $925,000 next year, for a total of $10.9 million, reports the Boston Herald. "The payment I got was consistent with my contract--no more, no less," Killingsworth told the Boston Globe.
"This is a CEO of a not-for-profit," Massachusetts Attorney General Martha Coakley said. "Our job is to understand the thought process of the board, what was the diligence that they employed in determining the terms and amounts, and were there appropriate deliberations in terms of their duty as a nonprofit."
State Sen. Mark Montigny supports Coakley's investigation, telling the Herald, "this is a nonprofit in a very sensitive industry that is unable to keep their costs under control. I have a real concern about this kind of parachute. It's disproportionate, and I don't think it's justifiable."
Blue Cross defended Killinsworth's payout. "Three of the five years that Cleve was CEO were the best years that Blue Cross had. Membership grew under Cleve, and there's little argument that without Cleve's leadership and passion on payment reform, we would not be where we are today," Blue Cross spokesman Jay McQuaide said.
However, McQuade said the insurer will cooperate with Coakley's investigation. "We have been very transparent about this issue from the beginning, and we will continue to be transparent. And of course we would answer any questions that the attorney general's office has."
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2009 Health Insurance CEO Compensation
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