Magazine article Workforce Management

Wellpoint Exec Churn Reaches Down to Top 5

Magazine article Workforce Management

Wellpoint Exec Churn Reaches Down to Top 5

Article excerpt

MANAGEMENT OVERHAUL

New WellPoint CEO Angela Braly is quite the agent of change. With three more top executives set to leave in the coming year, much of the old management team is gone, raising concerns about turnover in the upper ranks of the No. 2 health insurer.

WellPoint's announcement that three more top executives plan to leave within the next year follows the departures of former longtime CEO Larry Glasscock, who retired in June, and former CFO David Colby, who was forced to resign in late May regarding unspecified violations of WellPoint's code of conduct.

By this time next year, the Indianapolis-based company will no longer employ any of the five highest-paid officers listed in April on its most recent proxy. According to published reports, the departures will increase the total number of senior-level departures to 14 since WellPoint was created in November 2004 by the merger of Anthem and WellPoint Health Networks.

The management shuffle was part of a larger restructuring of WellPoint's business lines, which analysts viewed as Braly's first strategic move. The company separated its consumer and commercial business into two units, while a new division, called the comprehensive health solutions business unit, will focus on health care quality and care management costs. The commercial business unit will include small and large local group customers, national accounts, UniCare and the specialty products division. The separate consumer business unit will include senior and Medicaid programs and the individuals-under-65 segment.

Each new segment will have a new president and CEO leading the division, all of whom were hired internally, which is a good sign because "they are people who know the organization," says Sally Rosen, a senior financial analyst with Oldwick, New Jersey-based A.M. Best Co.

The changes will not affect the day-to-day operations of the company that have the greatest impact on buyers, such as pricing and claims processing, analysts say. …

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