Blue Shield of California has 4.5 million plan members, so all of these executive salaries combined add up to 49 cents per member per month. It's not a significant factor in premium costs.
I think that's highly significant. Keep in mind that that's only one provider in the system. You've also got to pay the executive salaries of your hospital system, your pharmacy chain, your drug company, medical equipment company, etc.
If we figure that every company involved in your $15k/year healthcare cost is paying 0.1-0.5% of their revenue to executive compensation (Cleveland Clinic as a random example pays 0.4% of revenue to the executives, $30 million) then we are talking about a small streaming video subscription worth of cost just which is allocated not on paying a productive group of administrators to keep the lights on, but instead paying excess incentives to an extremely small group of people.
In reality, if CEO compensation was capped to something reasonable like $500,000/year or 10x the pay of the lowest paid employee, there would still be CEOs and the quality of CEOs would not decline because it would still be the highest paid job on the market. Everyone involved in our economy would be just that much richer if the wealth wasn't getting unnecessarily concentrated.
$500,000 is a lot of money, I don't want to minimize that, but it would not be the highest paid job on the market. There's a number of roles in medicine, law, finance, and nowadays software that pay more for fewer managerial duties. There really isn't much room to argue for cutting executive pay without arguing that it's unimportant to get the best people in executive roles.
And that's an argument you can certainly have, but it seems strange to make it a precondition to fixing the healthcare system, when cutting executive pay would resolve only a small fraction of the problem.
And all of those things listed requires far more skill set/experience or education to achieve. You would be hard pressed to identify c-suite skills of any established corporation that can't be found in abundance among lower employees if anybody bothered to look instead of doing the 95% networking and politics games that most c-suite are chosen from.
It would be the highest paid job on the market if the law limited executive pay.
Maybe this idea is sacrilege to the hyper-capitalist brain but it is entirely reasonable to limit personal salary and assets because income inequality has known and proven negative impacts on society.
No one person should make a salary greater than ~$1 million/year nor should they be able to control more than ~$100 million in assets. Prove me wrong on that concept. What possible reason could an individual have to require such excessive wealth?
As far as your second paragraph, your argument is that we can’t fix one piece of a multi-faceted problem without fixing the other pieces, which is logically weak. Paying executives less would make non-zero progress toward cost reduction.
Sweet. Let's charge 49 cents per million dollars of unrealized capital gains per month, it's not significant and less of a burden than 49 cents per month for healthcare.
I don't understand what connection you're trying to draw here. Why would we set the rate for a new tax based on the per-subscriber compensation of Blue Shield California's executives?
While you’re right on paper, the incentive plan (the PDF I linked further up) discloses that the a good chunk of executive compensation is based on performance metrics that would essentially mimic stock incentives for any other company.
50% of the executive incentive is based on membership targets and operating income.
Blue shield discloses that their CEO pay is about 70x their median employee. This is less than the for-profit organizations’ 250x ratio but that only serves to distort the spectrum of ethics.
We can call these organizations non-profits all day long because they fit our secular corporate law definitions but I’m not sure how a company that pays an employee enough money to own multiple homes with a Ferrari parked at each one would be considered non-profit in the eyes of God. [1]
[1] Not claiming the dude exists but you get the point I am making here.
