Posted by PNHP on: Friday, May 30, 2014
by Mike Dennison
Independent Record (Helena, Mont.), May 28, 2014
The parent firm of Blue Cross and Blue Shield of Montana has been sued by a benefits-administration group that says the Chicago-based insurance giant is hoarding excess profits and unduly enriching its executives.
The lawsuit, filed last week in federal court in Chicago, said Health Care Service Corp. is breaching its contract with customers by running up excess profits of nearly $5 billion.
The Chicago Tribune first reported on the lawsuit, which said that money should have been distributed to HCSC customers as a paid dividend, reduced prescription drugs costs or lower premiums. Instead, HCSC used some of the money to pay nearly $100 million in bonuses to its top executives from 2011-2013, the suit said.
The Lee Newspapers State Bureau reported last year that HCSC Chief Executive Patricia Hemingway Hall received $16 million in compensation in 2012, including a $14.9 million bonus.