Some publicly traded health insurer CEOs received modest pay raises in 2019 as their companies grew revenue and profits or successfully combined with other businesses.
Michael Neidorff, CEO of government-sponsored plans provider Centene Corp., received $26.4 million in total compensation last year, an increase of 1.2% over his 2018 pay, according to the insurer's definitive proxy statement filed with the U.S. Securities and Exchange Commission. His compensation was 383 times that of the company's median employee pay.
While Centene did not respond to requests for comment on Neidorff's compensation, the proxy explains that his pay tracks with the company's growth revenue, income and earnings per share and recognizes his 23 years of experience as CEO. Neidorff was awarded a $3.6 million cash bonus for meetings goals for those metrics and completing the integration of insurer Fidelis Care, which Centene acquired in July 2018.
Centene grew revenue 24% to $74.6 billion and profit 46% to $1.3 billion in 2019. Diluted earnings per share grew 39% over 2018.
The bulk of Neidorff's total compensation comes from performance-based and service-based stock awards that may not vest for several years. When taking into account only stock awards vested and option awards exercised in 2019, Neidorff's realized compensation was $37.4 million. Neidorff was the top-paid executive among publicly traded insurers in 2017 and 2018.
Cigna CEO David Cordani received total 2019 compensation of $19.3 million, up 1.9% over the year before. His total pay was 307 times Cigna's median employee's pay, according to the company's definitive proxy.
About 92% of Cordani's compensation is driven by the company's performance meeting pre-set goals for income, revenue and deal success or other strategic priorities. Most of his pay comes in the form of stock awards based on long-term performance.
But Cordani also received a $3.6 million annual cash bonus, which was a nod to his helping Cigna grow its top and bottom lines while delivering cost savings and quality service amid its integration with pharmacy benefit manager Express Scripts, which it bought for $67 billion in December 2018.
Thanks to that merger, Cigna nearly tripled its revenue in 2019 to $153.6 billion while almost doubling its net income to $5.1 billion. Cigna representatives were unable to comment by deadline.
Meanwhile, Humana CEO Bruce Broussard made $16.7 million in total pay, an increase of 2.5%. That's 227 times the company's median employee compensation.
"Humana's CEO and executive team pay closely reflects the company's financial performance and success, which includes improving the health outcomes of our members," a company spokesman explained in an emailed statement. "We have added measures over the years to incentivize our leaders—and all of our employees—to take actions that will improve relationships with providers, improve member health and position the organization for long-term sustainable growth."
According to Humana's proxy statement, performance on metrics including earnings per share, membership growth and net promoter scores drive most of executives' annual incentive pay, while 10% of that is based on improving health and provider relationships.
Humana reported revenue of $56.9 billion, a 14% increase over 2018, and profit of $2.7 billion, an increase of 61%.
When taking into account stocks that vested or options that were excercised in 2019, Broussard's realized compensation for the year totaled $25 million.
Anthem, CVS Health, Molina and UnitedHealth Group have not yet reported their CEOs' 2019 pay.