So as a consequence of the Wellpoint/Anthem merger some two hundred plus top execs are going to get payouts that total between $150m and $350m, depending on whether or not they are kept on for three years by the new company. As you may have guessed this money won’t necessarily be shared out evenly. Len Schaeffer, the outgoing Wellpoint CEO (and former HCFA head in the 1970s) is likely to get a package of $76m, not of course counting the $184m in stock and options he’s already got.
Now the cynics among you might be thinking that ex-Wellpoint exec Ron Williams who went over to Aetna a while back and got a nice payout, should have stayed in southern California. But the real issue is that the California legislature, influenced heavily by the CMA and the Foundation for Taxpayer and Consumer Rights, is not happy! California legislators need to approve the deal, and that won’t happen with this kind of publicity.
UPDATE: California insurance commisioner John Garamendi hinted pretty strongly at yesterday’s hearings that he won’t approve the deal. It’s hard to believe that the whole thing will be scuppered, especially as there aren’t any real anti-trust issues in local markets because the two companies don’t really compete at present. But maybe Len will have to toss some of his pay-off back into the pot to make nice with the state.