Executives keep health perks while workers' benefits are cut

[Refugee 7]

Though millions of workers face rising health insurance costs and dwindling benefits in 2011, many CEOs will retain employer-paid medical plans and health benefits worth thousands of dollars.

Hundreds of top corporate managers get medical benefits and supplemental coverage far beyond what's offered to rank-and-file employees. Benefits include "executive" physicals and reimbursements for out-of-pocket costs, deductibles and co-payments, according to corporate filings.

"The great hypocrisy is this is going to the people best able to pay for this stuff," says Nell Minow of The Corporate Library. "Executives should pay for this on their own or be covered by the same plan as everyone else at the company."

Some companies are eliminating gold-plated medical benefits to senior managers, a move that's at the discretion of corporate directors. And the new health care law could make the plans more costly in the future. But, for now, most company plans — covering both rank-and-file employees as well as executives receiving supplemental benefits — are grandfathered at least until 2014.

Lawyer Scott Sims, a health care specialist with corporate consultant Aon Hewitt, estimates up to 50% of publicly held companies offer senior managers enhanced health care plans.

Polaris Industries' "Exec-U-Care" plan provides five senior execs up to $50,000 a year for health coverage, the snowmobile and motorcycle marketer says in Securities and Exchange Commission filings. Polaris also covers yearly Mayo Clinic exams for CEO Scott Wine, other executives and spouses. "Staying healthy is part of our culture," spokeswoman Marlys Knutson says.

Kohls provides senior execs with up to $50,000 in yearly supplemental health pay, a perk needed for "a competitive total rewards package that supports retention of key talent," the retailer says in its latest proxy statement.

Cereal marketer Ralcorp gives execs up to $10,000 "per illness" for expenses not covered by its standard employee health plan. According to Ralcorp's compensation committee, the plan "encourages corporate officers to proactively address health issues."

Health care perks can be an enticement for the newly hired and departed. Last year, grocery chain Fresh Market offered incoming CFO Lisa Klinger up to $50,000 to cover annual medical bills — on top of a $330,000 base salary, $100,000 signing bonus and company car worth up to $65,000. And Penn Virginia CFO Frank Pici, who's resigning Dec. 31, will get $800,000 in severance pay plus a half day "executive health evaluation" at the University of Pennsylvania. (Fresh Market and Penn Virginia did not return calls.)

Typically, the health care costs are a small part of overall compensation and less than, say, personal use of the corporate jet. Wine's medical bills cost Polaris $14,000 last year, while his overall compensation was $1.9 million. Del Monte CEO Richard Wolford got $22,680 for medical bills. Total comp: $8.9 million.

"These are just a small piece of a larger trend. Ultimately, they will go the way of the buffalo," says Alden Bianchi, head of the executive compensation practice at law firm Mintz Levin.

From 2003-09, the average cost of employer-sponsored family health care premiums rose 41%, according to The Commonwealth Fund, which promotes health care reform.

Some firms are cutting back. MetLife and Seagate Technology have cut executive physicals. Burger King stopped providing senior execs and dependents up to $100,000 a year for out-of-pocket costs. But the fast food chain boosted their allowance for discretionary perks by 25%.

"Even if they do away with these programs, companies will find a way to make up the costs," says shareholder activist Eleanor Bloxham of The Value Alliance. "It's the psychology of taking care of those at the top."

[nurktwin 2,143]

doesn't surprise me a bit. we bailed the a-holes out so they have jobs and what do they do to repay or thank us? they jacked up interest rates on credit cards! the a-holes in DC are going to pass a law to extend tax cuts for millionaires cuz they believe millionaires create jobs.....lol. they do in a way, they live in $50 million homes and hire illegal immigrants to clean their house! as if these rich bastards don't have enough, GM's CEO said we have to raise salaries for the top execs to keep them!!! WTF is with that, they are the idiots that ruined the US auto industry, and WE had to pay to bail them out too! how did they repay us? they jacked up the prices of cars! any firm that says they are cutting back is a liar, they just moved the money from 1 fund to another to pay the exec's without being obvious. how dumb is that? am i pissed? you bet, and you should be too.

[Echosoftom 3]

This doesn't surprise me one bit either. You would think with their f*%king high salaries and big over the top bonuses, they could afford to pay their own healthcare benefits. And these are the same assholes that we want to extend tax cuts too. Yeah right! I see nothing has changed.

And you're right Nurk, our hard earned tax dollars were used to bail these S.O.B.'s out and they turn around and do things like refuse to extend loan courtesies to their customers. I know of so many people who lost their jobs and the banks wouldn't even negotitate with them on their mortgage. Then they turned around and sold their homes right out from under them for a cheaper price. Just thinking about those Wallstreet Jackholes pisses me off!!! And what is our government doing about it? NOTHING!!!!

[Beamish 0]

What else is new ? It's been this way for as long as I've been working- the people at the bottom always take the cuts.

[wild1forever 152]

Kohls provides senior execs with up to $50,000 in yearly supplemental health pay, a perk needed for "a competitive total rewards package that supports retention of key talent," the retailer says in its latest proxy statement.

This argument about the need to pay over-the-top benefits in order to "retain key talent" is so much bullshit in this economy. With all the laid-off white-collar professionals in this country, Kohls really can't find someone willing to take the job without the supplemental health pay? :icon_rolleyes:

[agirl 0]

The rich just get richer and look out for each other. I'm still pissed we bailed them out. They just never learn. :mad:

[nurktwin 2,143]

i'd like to know why we didn't get a bail out bonus check for saving these companies. some companies are paying back the bail out money to the Gov only because they don't want to be owned by the Gov and follow the rules. the Gov has made billions on interest from those loans, so where is my check? isn't it our money???

[nurktwin 2,143]

and another thing, if social security is going broke, it's because every department of the Gov has taken loans from the fund to pay for wars (that we don't want), illegal aliens and everything else and never paid those loans back. so why doesn't the returning bail out money go into the social security fund and be used for what the plan was originally intended for?