TRENTON — At a time Gov. Chris Christie’s administration is limiting how much public money can be spent to pay CEOs from nonprofit social service agencies working for the state, one prominent senator today proposed giving the same treatment to the executives at New Jersey’s largest health insurance company. Sen. Loretta Weinberg (D-Bergen) and the Senate Health, Human Services...
The Horizon Blue Cross Blue Shield blimp in this Star-Ledger file photo.TRENTON — At a time Gov. Chris Christie’s administration is limiting how much public money can be spent to pay CEOs from nonprofit social service agencies working for the state, one prominent senator today proposed giving the same treatment to the executives at New Jersey’s largest health insurance company.
Sen. Loretta Weinberg (D-Bergen) and the Senate Health, Human Services and Senior Citizens Committee she chairs grilled executives from the nonprofit Horizon-Blue Cross Blue Shield of New Jersey over their generous pay packages, taking aim at chairman and CEO William J. Marino, who earned $8.7 million in salary and bonuses last year.
Peggy Coons, vice president for Horizon’s Human Resources, said the rigorous process includes the board of directors hiring a consultant to survey executive pay scales at 200 companies, one-half of them nonprofit. A board committee then reviews that survey and hires its own consultant to perform an independent analysis.
When compared to a Fortune 500 company of similar size and revenue — Horizon employs 4,700 and made total revenues of $8.3 billion — that CEO earned $14 million last year, Horizon board member Aristides Georgantas said.
Weinberg said she was still troubled by the executive pay scale, and would investigate the state legal options.
"You are the largest insurer in New Jersey," Weinberg said. "You are being paid a tremendous amount of money which is covered by the taxpayers of New Jersey. Since we are talking statewide about the necessity of capping the salaries of other people from other organizations that get a portion of their money from tax payers, I firmly believe this should be part of that landscape."
Weinberg got the idea from the state departments of Human Services and Children and Families, which recently told nonprofit agencies who work for the state finding foster homes, working with people with mental illness and intellectual disabilities. These departments said the state would restrict how much public money could be used to compensate top officials.
During the hearing at the Statehouse in Trenton, Horizon officials said 200 people were laid-off while paying out about $30 million in bonuses to a wide range of employees last year. The layoffs saved the company about $15 million, officials said.
Sen. Fred Madden (D-Gloucester), said the layoffs could have been avoided. "You would have still have had enough money for bonuses,’’ he said.
John Leyman, Horizon's government affairs director, pointed out the company is not a traditional nonprofit in the way social service agencies are, like the Red Cross. The company is not supported by charitable gifts, he said. "Horizon is not a tax-exempt company. In fact, Horizon paid $172 million in federal and state taxes last year,'' he said.