Blue Cross Blue Shield of Michigan revealed Friday that it paid CEO Daniel Loepp $19.2 million last year. Why so much? According to spokesman Andy Hetzel, “We are keeping health care affordable to the best of our ability here in Michigan. We think he earns the money that he makes.”
The insurer, which is a nonprofit, seems to have confused profitability for affordability. Loepp’s fat paycheck included a bonus of $16.2 million, which seems to have been a reward for the insurer’s massive $559 million profit in 2018—it’s highest in over 10 years.
That profit amounted to a tax of over $100 on every woman, child and man covered by BCBS of Michigan. The company’s profit margin on its insurance business in 2018 was over 6%, which is quite high for a health plan, let alone a nonprofit one.
When it comes to making profits, BCBS of Michigan has a history of utter ruthlessness. Under Loepp’s leadership the company previously cut secret deals with hospitals that were designed to increase health care costs. Here’s how a federal appeals court in 2016 described them: