Health Care Care Service Corp., the nation’s fourth-largest health insurer, said Paula Steiner is leaving the company after less than four years in the CEO’s job, the health plan disclosed Wednesday afternoon.
Steiner, who is 62 years old and has led HCSC since the beginning of 2016, is departing the operator of Blue Cross and Blue Shield plans in five states: Illinois, Texas, Oklahoma, New Mexico and Montana.
No reason was given for Steiner’s departure by the insurer, which said a search for a permanent successor would begin immediately. Sources close to the company said Steiner and the HCSC board clashed about long-term strategy amid an increasingly competitive environment among rival health insurers nationally that are growing via acquisition. Steiner could not be reached Wednesday for comment.
The board, though, praised Steiner’s leadership in a statement.
“Paula led the company through significant industry change and oversaw our continued diversification and steady growth,” Milton Carroll, chairman of the Health Care Service Corp. (HSCH) board of directors said in a statement. “We are grateful to Paula for her many years of leadership and service to HCSC and our 16 million members, and we wish her well in future endeavors.”
The announcement was a surprise to company insiders and those in the health insurance industry. HCSC historically has CEOs who serve in their role for several years.
Steiner replaced Patricia Hemingway Hall who retired after seven years as HCSC’s CEO in what at the time was an orderly transition with Hemingway Hall’s departure announced six months prior to her leaving.
On Wednesday, HCSC said “board member and former energy executive David J. Lesar will serve as interim CEO until Steiner’s replacement is named.” Meanwhile, Maurice Smith, a HCSC veteran of more than two decades, most recently as president of Blue Cross and Blue Shield of Illinois, has been named president of the company.
HCSC is a mutual health insurance company owned by policyholders and is a powerful force in the markets in which it operates, particularly in Illinois where Blue Cross and Blue Shield of Illinois is the largest health insurance company in Chicago and the rest of the state.
Blue Cross plans do, however, face challenges in their ability to grow and compete nationally with publicly-traded giants like CVS Health, which last year bought Aetna, the nation’s third largest health insurance company with more than 22 million members.
HCSC also competes with other publicly traded giants like UnitedHealth Group, the nation’s largest health insurance company with more than 43 million health plan members. The nation’s second largest health insurer is Anthem, which is publicly-traded and operates Blue Cross and Blue Shield plans in 14 states.
Date: July 25, 2019