Bonuses Drive Up Total Compensation for Managed Care Executives as Use of Stock Options Wanes, Managed Care Week Reports

WASHINGTON, May 10, 2007 — Publicly traded managed care companies increased 2006 bonus compensation to top executives while decreasing reliance on stock-option grants, according to Atlantic Information Services, Inc's Managed Care Week (MCW) newsletter.

CIGNA Corp. CEO H. Edward Hanway earned the highest incentive cash pay of any publicly traded managed care company executive in 2006, pulling down $11.2 million in cash incentives, a $1.1 million salary and a grant of 64,000 stock options — which the company estimates are worth $2.8 million. In 2005, he earned a bonus of $3 million, a salary of $1.1 million and 136,000 stock options.

According to the May 7 issue of MCW, managed care companies are increasing usage of cash incentive pay, restricted stock and other performance-based rewards, the review of MCOs' annual proxy statements finds. That is the result of compliance with new accounting standards rather than a reaction to the scandal last year involving possibly backdated stock options that affected UnitedHealth Group and other companies, compensation experts tell the newsletter.

Other top-earning managed care executives include Aetna, Inc. CEO Ron Williams, who received $7.7 million in 2006 bonus payments, $1.1 million in salary and a grant of 605,000 stock options. In 2005, he was paid a $1.7 million bonus, a $1 million salary and 744,000 options. (Williams took over as Aetna's CEO in February 2006.)

Executive compensation figures for these managed care executives and more are available at http://www.aishealth.com/ManagedCare/CompanyIntel/ExecComp.html. All compensation figures are based on data reported in company proxy statements and 10-K forms filed with the U.S. Securities and Exchange Commission.

Managed Care Week is a weekly subscription newsletter, published by Atlantic Information Services, Inc. (AIS), that is in its 17th year as the market leader in independent business news coverage and analysis of the managed care industry. AIS provides specialized business information for health care managers and advisors. Visit www.AISHealth.com.

CONTACT: Jill Brown of Atlantic Information Services, Inc., 202-775-9008, ext. 3058, jbrown@aispub.com