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Uber-philanthropist Bill McGuire's name is on a theater at the Walker and it'll soon be on the marquee at the Guthrie, and if you made the kind of dough he does, maybe you'd have a few spaces named after you. United Health chair & CEO McGuire, a bigtime GOP donor and culture maven, made over $10 million in salary in FY04 and $1.6 billion in stock options, for which he's been mightily criticized. Today, United Health's board voted to stop the practice of offering stock options to execs, perhaps sensing that something's a bit off when health-insurance premiums are skyrocketing and the CEOs compensation is keeping pace.
Those are some seriously obscene numbers. Is anyone's work performance really worth a billion and a half a year? And, yes, my health premiums are through the roof. Am I subsidizing Bill's killer salary?
The $1.6b in options is the total value of the unexercised options that he has accumulated during his tenure as CEO; and NOT granted to him in F04 as you imply. Furthermore, UNH stock is up 70-fold during that time; his options are only worth that much due to the significant value he has added to the company and it shareholders.
Great point unregistered bob. I think it's funny that he gives huge to the GOP and Lois Quam gives huge to the DFL, but they both work at the same place. Bipartisanship at it's finest right there.
Yeah, you know something's wrong when somebody like Lois Quam, vice president of looking out the window, becomes a multimillionaire just for showing up every day.
The Lois Quam-Matt Entenza marriage may end up being an interesting issue in the race for Attorney General. Love him or hate him... Mike Hatch has really gone after the health care companies. Will Entenza be as agressive? Imagine the dust-ups at their enormous, multimillionaire, kitchen table...
Mike Hatch goes after health care companies like a dog goes after postmen. Doesn't make either one right.
Not saying it's right or wrong.. just saying it'll be interesting.
Incidentally, dogs going after postmen is very right. It's always right.
Except, Jason, when it goes wrong, and then it's even righter.
FY04 only applies to the salary; the link makes that clear, Bob.
"Imagine the dust-ups at their enormous, multimillionaire, kitchen table..."
How interesting, considering that Mr. E had a people over to his house for breakfast just this very morning.
This is so, so wrong on so many levels. Many people I work with (at a large, reputable institution, no less) had to opt for only catastrophic health insurance because they can't afford standard health insurance anymore. Meanwhile, the insurance companies blame steep increases on the untraceable "rising costs of healthcare."
A Health Insurance CEO with an $8 MILLION salary, plus an extra BILLION in stock options - while public struggles being under-insured or not insured at all - is unforgivable. United Health, along with the other insurers in the same boat, should be ashamed of themselves.
Don't get me wrong, I believe in the merits of capitalism - but I put my foot down when it comes to letting robber barons hide behind the guise of capitalism.
Another greedy repub. No shocker there.
What would be really cool is if we got rid of the "death tax" and then all that money could go directly to his children so we can finally get our own aristocracy. That would be so cool! Then maybe we'd finally get a king!
CitizenJane, good points. The large, reputable institution I work at offered us two options: have our rates skyrocket in the current plan, or go to the high-deductible (i.e. catastrophic) health plan with a Health Savings Account, which was marginally cheaper. I chose the latter, and wow, am I sorry. I traded preventive healthcareyou know, going into the doctor when youre worried about something-for after-the-fact fix-up stuff. I feel like I cant afford to go to the doctor, so I dont, which is worrisome, and worry& well, thats not good for your health. So Bill McGuire is raking in moneywhether its cash or on paper is irrelevant to mewhile Im worried about if that chest pain is heartburn or a heart attack. (Sadly, this is not poetic license.) Nifty.
Tom, by an overwhelming percentage the first symptom of a heart attack is death, so I'm guessing you probably didn't have a heart attack. But if you're that worried, go have it checked out. Or, spend $10 and buy some Zantac 75. If that fixes it, then it was heartburn.
You made the choice for your health plan and I'm not going to feel sorry for you because you can't stop worrying. You clearly do not have the mental capacity to control your own health care costs.
And someone needs to explain to me how stock options lead to higher costs for consumers. I mean, does it actually cost United Health, or anyone else, to offer stock options? If they paid this guy a billion six or whatever then, yeah, I could see how they might have to raise their prices to meet that cost. But if this is stock, then isn't the money paid by people who buy the stock? Not gonna claim to be an expert, but this just doesn't gel w/me.
Actually, kwatt, it does cost the company to pay out stock options. Giving stock options counts as a loss on the balance sheet (last I checked -- accountants, chime in). It's especially questionable practice when a company allows backdating of options, as it did for McGuire, in order for him to achieve the greatest gain possible from those options -- shades of insider trading, to say the least.
Even worse and more flagrantly irresponsible is United's "industry-leading" practice of raising the CEO salary to heretofore unknown levels and forcing the rest of the industry to keep up in order to continue attracting the best and brightest. I'm not just down on health care salaries being out of whack -- the entire C-level exec pay structure is completely out of whack. But it's particularly egregious in United's case. No matter how much you increase a company's value, you're not worth 8 million a year in cash and a ridiculous level of equity compensation.
kwatt, here's a particularly informative article from MPR that helps explain the cost of McGuire's stock options to United Health and other shareholders.
It makes sense now. The backdating thing sounds like the biggest fraud I've ever heard. I have no idea how that could not be considered illegal or why anyone paying out would agree to go along with it. Simply retarded.
But let's not pretend this is why health care costs went up. Part of it, maybe. But a small part.
No, it's certainly not the whole picture, but at best, it's nasty PR practices for a company to pay that much to a CEO while jacking up rates to parts unknown. Not to mention give him better health insurance than is available to their rank and file. At worst, it's corporate malfeasance and a near abandonment of their fiduciary responsibility to stock and policy holders. The reality is somewhere in between.
The larger problem, of course, is the simple fact that the U.S. healthcare system is somewhat broken. I'm just wondering when/if the politicos will realize that and take steps.
Well, they're trying. It's just that some would rather have the government take over the entire thing and the others would restore some market forces.
Honestly, I'd lean toward a European model at this point. Market forces have a tendency to want to drain every last bit of money from the market, and I'm not sure that's compatible with quality (and affordable) health care.
Which european model is that? The one where all the hospitals are government facilities and the doctors are salaried government employees and how much treatment you get and when depends on the state of the federal budget? That one? Ok. lol
All you need to know about the quality of the american health care system is that the richest people in the world, the people who can afford to go anywhere in the world, including arab sheiks and kings, come here when they get sick. Go hang out at the Mayo clinic in Rochester sometime. It'll remind you of the UN.
No, dtester, the European model where the risk pool is as large as possible to spread out costs, and even under the shittiest health care system in Europe people are healthier than America at every age level and socioeconomic status.
Of course there are oil sheiks at the Mayo. They're the only ones who can afford health care in the United States anymore.
By the way, dtester, most people use "lol" to signify "I am making a joke," or "I like the joke that you just told." You seem to use it to mean "I am laughing at your idiocy." If you're not intentionally using it that way, you might want to consider that it's coming off that way, and if you are using it that way, you might want to consider not being an asshole.
Just a point of netiquette.
lol
I believe that when I disagree with someone, laughing at our disagreement is healthier than using snotty comments that seeth with hatred for a person or their point of view. Don't you?
How incredibly bi-polar is it to comment with two different names?
One when you are feeling rational and one when you are going to say something stupid?
If you're simply laughing at the disagreements, I have no complaint. But, again, it comes off like you're laughing at the person you disagree with, not with them.
That being said, I do favor directness; if you think someone is an idiot, go ahead and say so. I'm of two minds about this, and both are snotty and seeth with hatred.
City Pages, in naming the Walker's McGuire Theater "best concert venue," lists this caveat: "We understand that United Health CEO William McGuire has parlayed our broken health care system into untold riches and compensation packages for himself totaling hundreds of millions of dollars per year. We just wish the Walker had hit up some of its other fat-cat donorsor added a buck or so to its ticket pricesinstead of giving this spiritual heir to the great robber barons a piece of its noble legacy."
I would like to comment to Bob's comments. McGuire did not add the value himself. It took thousands of employees coming to work everyday to build the company and value. The fact that every UHC insured has to subsidize his name on a building or subsidize his political views is absolutely sickening.
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