UniCare is a subsidiary of WellPoint Health Networks, which is based in Thousand Oaks, CA. Currently, WellPoint has 14 million members and posted gross revenues of $17.3 billion in 2002. Of that amount, WellPoint made a $703 million profit.

WellPoint's intended merger partner, Anthem Inc, is based in Indianapolis, IN. Anthem, with more than 12 million members, had over $12 billion in revenue in 2002, with a $549 million profit.

Both companies manage Blue Cross and Blue Shield networks. While having limited exposure throughout the country, WellPoint's main area of coverage is California through its BCBS membership. Based in the Midwest, Anthem has membership in 18 states in the nation's heartland.

The merger will create the nation's largest health care provider, with over 26 million members and nearly $30 billion in annual revenue. At the present time, it does not appear that the move will have any direct impact on the operations of UniCare, as the state Group Insurance Commission's (GIC) indemnity plan provider.

"Consumer groups around the country have voiced some very serious concerns as to the impact that this merger will have on the overall healthcare industry. With every merger, the number of healthcare options become fewer and fewer," said Association Legislative Liaison Shawn Duhamel. "We don't see any immediate impact on our state plans, but it is something that we will keep a close eye on."

One detail of the merger between WellPoint and Anthem that has certainly caught the attention of industry insiders and consumer groups is the huge financial benefits to be paid to WellPoint CEO Leonard Schaeffer.

The foundation for Taxpayer and Consumer rights reports that after receiving a combined salary/bonus of $6.9 million in 2002, Schaeffer is set to be paid a lump sum of $27.5 million and receive $10 million in retirement once the merger is complete. In addition, he will own 3.3 million in company stock, which is estimated to be valued at over $300 million.

As the company's founder, Schaeffer has enjoyed a lucrative career with a generous contract that, in addition to his annual compensation, provides him with a leased car, memberships at three different exclusive clubs, and an additional bonus of $2 million a year to offset the taxes paid on his regular bonus.

However, a company spokesman defends Schaeffer's contract and compensation by pointing to the success of WellPoint. Since founding the company in 1992, Schaeffer has grown WellPoint into one of the largest most profitable healthcare firms in the nation.

Similarly, Anthem's Larry Glasscock is also one of the country's highest paid healthcare executives. In 2002, Glasscock, who will be President/CEO of the new WellPoint Inc., received a compensation package worth a reported $3.5 million. This follows a huge payout in 2001, when Glasscock was paid over $15 million ($12.4 in a long-term cash payout).

"When you look at what our members have to go through to pay their health insurance premiums, these numbers are outrageous. Every time we turn around the costs on our members keep going up, while these people are living in extreme wealth - something just is not right," comments Association President Ralph White. "I am not against people making a good living and being rewarded for their hard work, but within reason.

"I hope that Delores Mitchell (GIC executive director) and the GIC Commissioners keep this sort of thing in mind when they are writing the next indemnity plan contract. Obviously, a company paying out these sort of salaries and posting billion dollar profits is not hurting."