Charlie Baker saved Harvard Pilgrim. Can we stop debating it?
Here we go again on Charlie Baker, and what he did and didn’t do as CEO of Harvard Pilgrim.
Baker, the Republican candidate for governor, will tell you he saved the company from bankruptcy and made it the country’s best health insurer. He’s said that before, but this time he’s got his daughter Caroline making the case in a TV ad, as well as his wife Lauren and a parade of former employees vouching for him in online videos.
The Democrats will tell you — and they are, in a super PAC ad — that Baker “profits at our expense” when he raised premiums 150 percent and tripled his own salary to $1.7 million during his decade at Harvard Pilgrim. This attack ad is good, complete with the image of clinking wine glasses.
So which Charlie Baker is running for governor?
It’s true that Baker raised rates by a lot, but so did other insurers at the time. The increases, however, weren’t onerous enough to prevent Harvard Pilgrim from growing. Membership rose from a low of 750,000 to more than 1 million on his watch.
Yes, Baker was well paid, but his compensation package was in line with his peers in 2008, the last full year he was CEO. He still doesn’t hold a gold coin to Ted Kelly, who made out with nearly $50 million a year as CEO and chairman of Liberty Mutual.
As for Baker rescuing Harvard Pilgrim, let’s get this straight because you’re going to hear a lot from Martha Coakley, the attorney general and Democrat gubernatorial candidate who will tell you Charlie was no hero. He got a state bailout. Slashed jobs. Hiked prices. Is this leadership?
So this is what you need to know: After serving in the Weld and Cellucci administrations, Baker went off to work in health care, and in 1999, he was brought in to fix a company in deep trouble. He did so with a plan, a firm hand on the rudder, and grit. He pulled out of Rhode Island. He cut jobs, even outsourced them. He invested in technology to improve customer satisfaction.
By the time he left, Harvard Pilgrim was rated the best health insurer in America in annual rankings conducted by a respected nonprofit. So give the guy credit where credit is due.
“Facts are important, even in politics,” said Tom Reilly, the attorney general who worked closely with Baker when Harvard Pilgrim was put into state receivership so members wouldn’t lose coverage. “The bottom line is that he did a very good job in the turnaround and restoring it to financial health.”
This is big coming from Reilly, a Democrat who supports Coakley, a former colleague and longtime friend, after backing Baker in his unsuccessful bid to unseat Deval Patrick in 2010.
Reilly said there was no bailout from the state. In fact, not a single taxpayer dollar was given to Harvard Pilgrim. When Reilly first met Baker in January 2000 after the company went into receivership, the attorney general figured the insurer’s survival depended on it being sold.
Baker asked for a chance to save it, and Reilly was willing to give him a shot. Still, Reilly made him talk to prospective buyers, including Texas billionaire and former presidential candidate Ross Perot.
“This is an example of how government and business should work together and can work together and get things done,” said Reilly, himself a former gubernatorial candidate and now at the law firm of Manion Gaynor & Manning.
Baker, in a phone interview, said he is proud of what he did at Harvard Pilgrim and certainly didn’t save it by himself.
“It was a collaboration,” he said of working with the state and his employees. “We live in a world where they want Republicans and Democrats to work together to get stuff done. Harvard Pilgrim is a great example.”
There are a lot of things the Democrats can get on Baker’s case about. Let me suggest a few: Creating the Big Dig financing plan and not admitting how involved he was, flip-flopping on tax cuts, softening his staunch opposition to Cape Wind, and putting his foot in his mouth on women’s issues from Hobby Lobby to NFL domestic violence.
But on Harvard Pilgrim, Baker was the real deal. Quit giving him a hard time about it.