For Immediate Release - March 08, 2011

Statement of AG Coakley on Blue Cross Blue Shield Decision to Suspend Director Compensation

"The compensation of board members at public charities is extraordinarily rare in Massachusetts, and for good reason. As part of our ongoing investigation into director compensation, we had asked the boards of the non-profit health insurers to justify the basis by which they are compensated, and have not been satisfied by those responses.

We are encouraged that Blue Cross has taken this positive step today to suspend director compensation. They also have informed us that they will review this practice as part of a broader dialogue about their classification as a public charity and what it takes to compete in the market. We believe it is important that they engage in this discussion, and we are happy to participate in the dialogue while also being mindful of our regulatory and oversight role.

The issue of director compensation is about more than Blue Cross, however. We have urged the boards of the remaining three non-profit health insurers to re-evaluate their practice of compensating directors, and our investigation into this issue is ongoing.

In addition, we are continuing our review into the compensation and separation agreement of the former Blue Cross CEO."