Leonard Schaeffer, chairman and chief executive officer of WellPoint Health Networks, is not one to back down from a fight with big adversaries.
Most recently, he took on the pharmaceutical industry and won. In May, the Food and Drug Administration agreed to consider Schaeffer's petition to make the blockbuster allergy medications Claritin, Allegra and Zyrtec available over the counter, a move that he says would reduce unnecessary doctor visits and save WellPoint $90 million per year in drug costs. It was the first time an insurance company had dared to pursue such a petition.
And last November, when a bidding war erupted over Cerulean Health, Schaeffer pounced, raising his offer from $500 million to $700 million. Just a day later, Thousand Oaks, Calif.-based WellPoint emerged victorious.
These are only the most recent examples of Schaeffer's hard-charging personality.
When he took over Blue Cross of California (WellPoint's predecessor) in 1986, the company was on the brink of insolvency, losing $165 million. Schaeffer engineered a dramatic turnaround by ruthlessly slashing overhead and shifting the company away from traditional fee-for-service insurance into managed care. Today, WellPoint is the nation's fourth-largest health insurer.
The 55-year-old executive's extreme focus on the bottom line, however, has repeatedly raised the ire of doctors, who claim WellPoint isn't reimbursing them enough to cover costs. And in 1996, the company's board of directors nearly ousted Schaeffer over his handling of the planned merger between WellPoint and Health Systems International, which broke down in a bitter struggle between Schaeffer and HSI's chairman over control of the new company.