The head of a powerful health insurance group said her industry is
addressing executive compensation issues, firing back at the White
House for its recent report that highlighted the salaries of senior executives.

Karen
Ignagni, president and CEO of America’s Health Insurance Plans, said
the profits of her sector pale in comparison to others.

{mosads}In the wake of politically unpopular health premium increases in a
handful of states, the Obama administration issued a report last month
noting that the CEOs of America’s five largest insurers were each
compensated up to $24 million in 2008.

Pressed on the issue in an interview taped for C-SPAN’s
“Newsmakers,” Ignagni said, “This issue of executive compensation is a
very important question for boards of directors in every stakeholder
community and every part of our economy. And in fact, we are having
those discussions. Boards of directors are increasingly through proxy
kinds of initiatives in their own discussions are increasingly
demonstrating that the compensation is aligned with productivity and
performance. … I think this is a question that ought to be raised
across the economy.”

The administration’s report stated, “Last year, as working families
struggled with rising health care costs and a recession, the five
largest health insurance companies — WellPoint, UnitedHealthGroup,
Cigna, Aetna, and Humana — took in combined profits of $12.2 billion,
up 56 percent over 2008.”

Ignagni took issue with the presentation of that number, asserting
that few “go the next step” and analyze profit margins. Citing Fortune
magazine, Ignagni said her industry margins are in the two to three
percent range while other health industries have margins between 15 and
25 percent.

She suggested she and her member companies are ready to look “at
ours versus others in the healthcare stakeholder community…We see all
these questions as fair game.”

A year ago, Ignagni told
President Barack Obama that AHIP was ready to work with the White
House. At the time, she said, “You have our commitment to play to
contribute and to help pass healthcare reform this year.” Obama,
appearing surprised, responded, “That’s good news.”

Since then, the White House-AHIP relationship has deteriorated.
Meanwhile, the administration struck deals with other industries on
health reform, including the pharmaceutical sector. Last summer,
Speaker Nancy Pelosi (D-Calif.) labeled the health insurance industry
“villains.”

In the C-SPAN interview, Ignagni suggested that — contrary to GOP
claims — she believes the individual mandate in healthcare reform is
constitutional. However, she criticized Congress for not working on a
bipartisan basis and claimed the Democrats’ legislation does not
adequately address healthcare costs.

“It’s an issue members of Congress can’t ignore,” Ignagni said, adding the common refrain from lawmakers is, “It’s too hard.”

“Newsmakers” will be aired on C-SPAN Sunday at 10 a.m. and 6 p.m.