WellPoint Inc (WLP.N) Chief Executive Angela Braly abruptly stepped down from her post on Tuesday following investor dissatisfaction with the health insurer’s financial performance.
WellPoint, the No. 2 U.S. health insurer, said it will look at both internal and external candidates for a replacement. Shares in the company rose more than 4 percent in after-hours trading.
John Cannon, the company’s executive vice president, general counsel, corporate secretary and chief public affairs officer, will serve as interim president and CEO, WellPoint said. Lead director Jackie Ward was named non-executive chair.
“Our Board continues to believe that time will prove the wisdom of potentially transformative actions taken under Angela’s leadership,” Ward said in a statement. “But now is the right time for a leadership change.”
Braly has shepherded WellPoint as the U.S. healthcare system faces one of the biggest transitions in its history, including a new law that will extend coverage to more than 30 million uninsured Americans and the expansion of private management of government-run health plans Medicare and Medicaid.
More recently, Braly helped orchestrate the company’s planned purchase of Amerigroup Corp (AGP.N) for $4.46 billion, a deal that will nearly double its Medicaid business, managing the U.S. government’s health plan for the poor.
But the company has also made missteps in its expansion, including surprising losses from Medicare plans in northern California that weighed on financial results last year.
In its most recent quarterly report, the company cut its full-year profit forecast, saying it was trying to maintain its pricing levels even with greater competitive pressure from rival health plans.
Cannon will help oversee the integration of Amerigroup, whose shareholders have sued over accusations that its advisers at Goldman Sachs Group Inc (GS.N) had a “hopelessly conflicted” role in the company’s sale. Goldman, according to the lawsuit, pushed Amerigroup toward a quick deal with WellPoint over a more lucrative merger with another unnamed company.
via WellPoint CEO Braly steps down, Cannon named interim CEO | Reuters.