State’s Obamacare Exchange Beats Goal, Ranks High In CNBC Efficiency Rating

by Categorized: Health Care, marketing, Public finance Date:

Connecticut’s health exchange enrolled nearly 200,000 people between Oct. 1 and the deadline Monday — and the number will rise as people who eked into the system by March 31 finish their applications.

Here is the final tally from Access Health CT:

Total Enrollment: 197,878

Total Enrolled On March 31:  5,917

Private Plans: 76,597 (informal goal: 70,000)

Medicaid Enrollees: 121,281 (informal goal: 30,000)

Website Visitors Since Oct. 1: 801,509

Call Center Queries: 366,975

Enrollment Fairs: 78

Anyone who left a voicemail message or appeared at one of the state’s two storefront locations but did not complete an application will have a chance to do so by May 1 and still meet the federal deadline for a 2014 subsidy.

Maryland to use Connecticut system. Click here for story.

The last-day rush at Access Health CT's New Britain storefront Monday.  Matthew Sturdevant/The Hartford Courant

The last-day rush at Access Health CT’s New Britain storefront Monday.
Matthew Sturdevant/The Hartford Courant

CNBC.com looked at the 14 states plus Washington DC that ran their own exchanges, using federal grant money. California was the most efficient, signing up 1 million people in private plans after receiving $1.07 billion from the feds, for an average cost of $1,046 for every person who signed up for a private plan.

Hawaii was the most expensive, coming in at $35,749 per private-plan enrollee. Obviously, as one commenter pointed out on the CNBC website, bigger states have an efficiency advantage because building a system of any size costs a lot.

Connecticut was more efficient than any small state at $2,552 per enrollee, making us the fifth most efficient state overall.  (Figures did not include the huge last-day rush in Connecticut and elsewhere, which lowered the per-enrollee cost.)

The average cost per enrollee in all of the state-run exchanges was $1,899 — a figure that was brought way down by the size and efficiency of California.

It’s notable that Connecticut barely beat its own informal goal of enrolling 70,000 people in private plans, but crushed its target of 30,000 Medicaid enrollees.  As it turned out, expanded Medicaid brought a much bigger pool than private uninsured residents.

And, said Kevin Counihan, the Access Health CT CEO, Connecticut made a smart decision early on to keep its system simple rather than tying it into the state’s systems for food stamps, temporary welfare payments and other social services. States that failed had more complex databases, he said.

Tallying just the cost of private plan enrollment makes sense if we’re trying to gauge the core goal of Obamacare, but, as Counihan points out, by ignoring Medicaid enrollment it misses the source of the biggest reduction in the ranks of the uninsured.

Any way we look at it, as the final numbers come in, the average cost per person will fall. And future years will cost a whole lot less now that the systems are up and running. That’s the hope, at least.  But remember, the exchanges will have to start charging a tax to operate after 2015.

Magellan Acquisition Highlights Pharmacy Management Profits

by Categorized: Corporate finance, Health Care, Insurance Date:

It really says something that the deal announced today by Magellan Health Services Inc. to buy Newport, R.I.-based CDMI LLC seems routine.

Consider the price Magellan is paying and what that tells us about the profits at CDMI, and at pharmacy management firms generally.

Avon-based Magellan will pay as much as $370 million for the pharma management firm that has health plans as clients. The base price is $205 million in cash and stock and the incentives total $165 million, based on profits and customer retention over the next three years.

With CDMI’s 2013 net revenues totaling $43 million, that’s 8.6 times sales — compared with Magellan’s own market value, at about 50 percent of sales.

And that means that if CDMI had a net profit last year of, say, 30 percent of sales, or $13 million `– a healthy figure — the full price Magellan could pay would translate to a price-to-earnings ratio of 28.6.  A net profit of 20 percent would mean Magellan is paying a whopping 43 times net earnings.

That compares with Magellan’s own value at 13 times trailing 12-month net profits, as the company earned $125 million in 2013.

So CDMI is hugely profitable and it’s not the only privately owned health management or underwriting consultancy that can make that claim. Last year the CEO of South Windsor-based Medical Risk Managers Inc., The No. 1 company among small employers for the Courant/Fox CT Top Workplace awards in 2013, said his firm was more profitable than Google — which had a 31 percent margin.

That’s a great industry for Connecticut to nurture and for companies such as Magellan and Aetna to acquire.

 

 

 

Shut Out of Boston Casino License, Foxwoods Takes Key Spot On Fenway’s ‘Green Monster’

by Categorized: Entertainment/Tourism, marketing, Media Date:

Five days before Friday’s opening day at Fenway Park, Foxwoods Resort Casino said Monday it upped the ante on its Red Sox advertising package, taking “center position signage” on the Green Monster in left field.

The sign on the iconic wall is part of a new agreement between Foxwoods and Fenway that runs through 2018. Terms were not disclosed.

This year marks the eighth year in which the Connecticut casino has been an “official partner” with Fenway and the Sox — and it’s all the more crucial now that Foxwoods will face more competition from Massachusetts gaming resorts.  Foxwoods vied for the Boston area casino license with a $1 billion proposal in Milford but was defeated by residents of that town in a referendum.

Now Foxwoods is in a partnership hoping to build a casino in Fall River, vying for the Massachusetts license in that part of the state — a decision that’s months away.

“We believe the Red Sox are one of the finest organizations in professional sports and like Foxwoods, provide unique, once in a lifetime experiences for its guests,” said Foxwoods Resort Casino CEO Scott Butera in a written release. “The ‘Green Monster’ is the most iconic element of any stadium in the world.”

Even Yankee fans can’t argue that point, especially now that the center field monuments are

Foxwoods will have other Fenway visibility, including promotions. But the main Green Monster ad won’t be unveiled until Thursday.

In addition to its Fenway Park deal, Foxwoods has been an active advertiser in New York Yankees broadcasts, including its current status with the Yankees Radio Network.

Bill Would Require Labor Breakdown For Companies Receiving Big State Aid

by Categorized: Economic Development, Government, Labor, Politics, Public finance Date:

State taxpayers want to get their money’s worth when they give a company a huge aid package, and to that end, many lawmakers want to add a new hurdle.

Any firm that gets at least $10 million in state assistance would have to file a report showing how it intends to favor Connecticut-based contractors for any construction work covered by the aid, under a bill that advanced Thursday in the legislature.

The firms would also have to report on the names of construction contractors, the total number of full-time construction employees on the site and the wages paid, and the total number of construction workers on the project who live in Connecticut.

“We want to see more Connecticut construction jobs as a result of these state investments,” said state Sen. Gary D. LeBeau, co-chairman of the legislature’s Commerce Committee, which advanced the bill to the Senate floor in a 12-5 vote.

The bill is part of a long debate over how much the state should demand of the companies it backs with economic development aid. Unions support the bill and the Connecticut Business and Industry Association opposes it, saying it’s onerous.

Gov. Dannel P. Malloy’s development commissioner, Catherine H. Smith, told lawmakers she’s concerned the bill “may dissuade some larger companies from considering the state.

The administration’s caution is probably wise. Promoting local jobs is great but we wouldn’t want other states to shut out Connecticut-based construction workers. And when it comes to new business regulations, Connecticut is on the watch list — so we should pass up even some decent ideas, for the greater good.

WWE’s McMahon Takes Big Pay Cut — But Powerslams An Extra $1 Billion

by Categorized: Entertainment/Tourism, Politics, Wall Street, Wealth Date:

Vince McMahon’s pay at World Wrestling Entertainment Inc. fell by 30 percent last year to $1.7 million, a $732,000 decline. But the Stamford company’s CEO is hardly taking a face plant on the mat.

Oh yes, he happens to own 52 percent of WWE and his wife, former company CEO and professional political candidate Linda McMahon, holds another 12 percent share. Together, they saw the value of their stock rise by $419 million in 2013 alone.

Vince McMahon, second from left, and Linda McMahon, pose with family members in 2012.  Cloe Poisson/The Hartford Courant

Vince McMahon, second from left, and Linda McMahon, pose with family members in 2012.
Cloe Poisson/The Hartford Courant

Take that!

And since January 1, WWE shares are up another 88 percent, closing at $31.14 Wednesday on the New york Stock Exchange.  So the McMahons’ headlock on Wall Street has yielded another $700 million — not bad for less than three months of work.

If you’re counting, that’s $1.1 billion in added value since the start of 2012. No wonder Forbes named McMahon a billionaire for the first time earlier this month.

The company’s dramatic stock run-up in 2014 could be the result of an upcoming TV deal or a live streaming site. But it’s also most likely related to speculation of a buyout — especially since the McMahons, well into their 60s, own more than two-thirds of the company along with a daughter.

Vince McMahon with WWE's Triple H in Las Vegas in 2009. Getty Images

Vince McMahon with WWE’s Triple H in Las Vegas in 2009.
Getty Images

Bloomberg this week reported on the speculation, saying likely buyers would be giant media firms especially Comcast, already a distribution partner, or Disney, or perhaps The Madison Square Garden Co., controlled by Cablevision’s Dolan family.

The Motley Fool speculated on a sale to AMC Networks, another Cablevision spinoff that could become the wrestling juggernaut’s new TV home. But no one has reported any talks, and no one can predict what the McMahons will do — in the ring, on the air or in the boardroom.

We might learn more at the company’s April 25 annual meeting at its headquarters in Stamford, announced Wednesday. But don’t count on it. Even though investors own a third of the company, the McMahons control virtually all of the voting rights — so their hold on the firm is tighter than John Cena’s iron grip.

CareCentrix To Add 150 Downtown Hartford Jobs In 2014

by Categorized: Economic Development, Health Care, Real Estate Date:

CareCentrix, the health care management company that moved from East Hartford to downtown Hartford in 2012, is aiming to add 150 local jobs in 2014 and is taking an additional floor of the “Stilts” building at 20 Church St.

The new jobs, largely staffing the company’s call center operations but also including management, would bring the total staff in downtown Hartford to 500 — three years before the company said it would reach that number in an agreement with Gov. Dannel P. Malloy for $24 million in state aid.

It is, in short, one of Malloy’s successes in the First Five program, though the price Malloy paid — $80,000 per new job, or $48,000 per job including those that were already in Connecticut — is considered steep, especially since many of the jobs pay less than $40,000 a year.

CareCentrix, which manages home health care, also has large operations in the Tampa, Fla. area, where costs are lower. The company could have moved its headquarters there or elsewhere, and then-CEO Eric Reimer told The Courant’s Mara Lee in early 2013 that the labor cost difference was a big factor in the company’s ability to extract the $24 million from Malloy.

For the state, the numbers add up based on the taxes paid and purchases made by the employees. Adding life to downtown Hartford boosts the economic value of the jobs if it helps the city center attract more people from out of the region.

The firm also fits with the economic development strategy for Metro Hartford, and especially downtown, as a center for health care management — anchored by the health insurers.

“Connecticut has a proud history of supporting health care companies. We are honored to be part of this history as we continue to grow,” said John Driscoll, CareCentrix CEO, in a written statement.

The company scheduled an event on Tuesday at 1 p.m. to mark its lease of a new floor at 20 Church Street. CareCentrix now occupies floors 9, 11 and 12 for a total of 73,000 square feet, a spokeswoman said. “Stay tuned for more details on an upcoming job fair,” she said.

Mayor Pedro Segarra, who was set to be at Tuesday’s event, had said recently that a company planned to bring about 200 jobs downtown. He didn’t name the firm.

It’s unclear whether Segarra was referring to CareCenrix, or CohnReznick, the accounting and management consulting firm that said this month it will consolidate offices in Glastonbury and Farmington to Metro Center, down church Street from the Stilts Building, with about 200 employees and the promise to add 40 more in exchange for a state loan of $1.2 million.

Or, Segarra might have been talking about a third firm that we haven’t yet heard about.

Ted Kennedy Jr. Joins Board of Health Consultancy

by Categorized: Health Care, Politics Date:

Ted Kennedy Jr. is bringing his name and health care expertise to a consulting firm that works with hospitals and other service providers looking to boost efficiency and improve patient care.

Ted Kennedy Jr. Press Ganey handout

Ted Kennedy Jr.
Press Ganey handout

The 52-year-old Branford resident, a lawyer and health care advocate, has joined the board of Press Ganey, which is based in South Bend, Indiana but has a significant office in Boston.

Kennedy, who holds degrees from Wesleyan University, Yale and UConn, is active in the Connecticut Bar Association’s health care section and has long experience in hospital and other health regulation.

“As a champion for the health care needs of the disabled and an advocate for the Affordable Care Act, Ted understands the important role of the patient experience, particularly during this pivotal time in our country’s health care system,” said Patrick T. Ryan, the Press Ganey CEO, who lives in Massachusetts and is on the board of Avon Old Farms school.

Kennedy, a registered voter in Branford, kicked around the idea of running for U.S. Senate in Massachusetts in 2013 after former John Kerry was tapped to be Secretary of State.

The Boston Globe in December 2012 cited sources who said Kennedy considered himself a Connecticut resident although he has a home in Hyannis, Mass. — and that he might want to run for office in Connecticut someday.

February Report: Slow Progress For Metro Hartford House Sales

by Categorized: Economy, Housing Date:

The frozen month of February brought more slow improvement to the housing market in central Connecticut, not a realization of the high hopes from a strong January report, but progress nonetheless.

The median price was up by 2.7 percent for single-family houses that sold in the 57-town area of the Greater Hartford Association of Realtors, the group said Monday. The number of closed sales 478, was up by nearly 5 percent from the same month in 2013.

The number of new listings rose by 5 percent to 1,055, but the number of days on the market also increased by more than 6 percent, to 82 days.

“It’s encouraging that even with this harsh winter, closed sales continue to rise in our housing market,” said Jeff Arakelian, the association’s president and CEO.

The modest year-over-year price increase, to $194,000, followed a 10 percent jump in January, to $220,000.

All in all, the market heads into the spring season as it has in recent years: with some momentum but no clear sign of a breakout year — other than a prediction by CoreLogic, a California-based firm, that Metro Hartford will be one of the nation’s hot housing markets in 2014.

Tracking CEO Pay for Connecticut — An Up-And-Down Year At Top

by Categorized: Corporate finance, Wall Street, Wealth Date:

You may be angry about CEO pay in the tens of millions, or you may be proud to live in a land of opportunity — but you’re likely to react if you’re following reports of compensation from publicly traded companies, which come out this time of year as part of shareholder proxy forms.  This blog post compiles the reports for central Connecticut companies in one place.

Nolan Archibald, the $123 Million Man.

Nolan Archibald, the $123 Million Man.

Whatever you believe, it’s hard not to see many of these paydays as a national disgrace.

Check back often as I update the listing throughout proxy season, with links to stories in The Courant and other news outlets.

We’re still leading off with this one: Nolan Archibald, the former Stanley Black & Decker chairman, hauled in $123 million in 2013, one of the biggest payoffs in U.S. corporate history, and perhaps the biggest ever for a takeover ransom. The money was part of his 2010 deal to sell Black & Decker to Stanley.

Travelers’ Jay Fishman hauls in a $40 million catch but there’s plenty left over for the guys in Hartford.

Much less take-home in 2013 for Mark Bertolini at Aetna, but his promise of future stock totaled $28 million.

Thomas May of Northeast Utilities. Courant Photo

Thomas May of Northeast Utilities.
Courant Photo

NU transmits and distributes $11.8 million to CEO Thomas May in 2013, less than he earned in 2012 as his options exercises and stock vesting declined.

Recovery brings an $11.7 million package to The Hartford’s Liam McGee, with deferred compensation from 2010 coming due and higher share values for vested stock.

 

UTC's Louis Chênevert John Woike/The Hartford Courant

UTC’s Louis Chênevert
John Woike/The Hartford Courant

UTC’s board powered up Louis Chênevert’s 2013 package by 26 percent to $24.7 million, and it’s a good thing — since his CFO, Greg Hayes, cracked $20 million.

René Lerer, retired CEO of Magellan Health Services, navigates his way to a $17.8 million treasure including a $6 million bonus even though he was chairman throughout 2013, not CEO.

A slight decline to $8 million for George Aylward at high-flying Virtus.

At MetLife, West Hartford native and Hall High graduate Steven Kandarian brings in less than he did in 2012, $7.3 millio

Stanley CEO John F. Lundgren collected $28.6 million, a typical year for this cost-conscious, aggressive acquirer. (Same story as above by my colleague Brian Dowling.)

Cigna reported that its CEO, David Cordani, saw his total package mushroom to $17.8 million in 2013, as he has $11 million in stock vest last year.

Kaman’s Neal J. Keating sees his pay drop to $2.5 million, but he’ll really get closer to $4.9 million for 2013, when all is said and done.

Webster Bank’s Jim Smith endures a pay decline to $2.4 million, with no exercise of options of vesting of shares. Former president Jerry Plush, who resigned abruptly last fall, earned $3.2 million including a severance.

At People’s United Bank, Jack Barnes gains a $3.6 million package, an increase driven by vesting shares.

General Electric’s Jeffrey Immelt received sharply less in 2013, for a package totaling $11.3 million.

Hospitals aren’t public companies but the state compiles salary data for them, later in the year. Since hospital finances and layoffs are so much in the news, here’s last year’s story showing 18 Connecticut hospital executives pulling in at least $1 million in the prior year. We’re eager for an update.

Here is a March 15 Post by former Labor Secretary Robert Reich, the most widely read critic of U.S. CEO pay.
Chart from Reich post

Chart from Reich post

Here’s my 2013 overview for the 2012 pay year, with links to AFL-CIO’s “Executive Paywatch” database. Please note, AFL-CIO and others calculate CEO pay differently from The Courant. They count the current value of stocks and options in the year granted; we count stocks and options in the year when they are vested or exercised.

UTC Forecast Hurts Shares On Down Day For Markets

by Categorized: Aerospace, Manufacturing, Wall Street Date:

United Technologies Corp. delivered a less-than-stellar profit forecast Thursday, sending its shares down $2.92, or 2.5 percent, to $112.89 on a day when every company in the Dow Jones Industrial Average lost ground.

UTC said it expects to earn a net $1.25 a share in the current quarter, down from $1.39 in the 2013 first quarter, as the Pratt & Whitney union settlement, one-time restructuring and “headwinds” in commercial aerospace sales dragged down organic gains.

For the full year, the Hartford-based conglomerate repeated an earlier estimate for per-share income of $6.55 to $6.85 a share, up from $6.21 in 2013, with sales up less than 1 percent to $64 billion.

The first-quarter numbers, coming from a company known for consistent, double-digit growth, fell short of estimates by analysts surveyed by Bloomberg.  Markets were already spooked by fears of a growth slowdown in China, as the Dow fell by 231 points, or 1.4 percent and UTC, with major exposure in China, was the second-biggest percentage loser in the bellwether index.

UTC’s own presentation to financial analysts showed a forecast for a smaller increase in commercial construction in China this year.