Four senior executives at HealthNow New York -- including former BlueCross BlueShield of Western New York head Steve Jepson and former Erie County Executive Dennis T. Gorski -- are among the 17 employees laid off by the health insurer as part of a restructuring, sources said Wednesday. HealthNow cut 17 jobs as it realigns how it operates, tightens its focus on employers and members, and strengthens its competitive posture, the company said Monday.
In addition to Jepson and Gorski, the company also cut Nora K. McGuire, senior vice president of the administrative services only group and broker marketing, and David J. Uba, vice president of strategic planning and initiatives.
The cuts represent 1.3 percent of the company's 1,300 employees in Buffalo and less than 1 percent of its 2,300 overall workers. All the affected people are in Western New York, and officials said more cuts are possible, in small numbers over time, as the company's actions make some jobs duplicative and unnecessary.
The company is stressing a new focus on operating more efficiently and at lower costs, and all four were higly paid.
HealthNow spokeswoman Karen Merkel-Liberatore would not confirm any of the names, citing "our policy that we do not comment publicly on personnel issues." But sources close to the people or familiar with the situation identified the affected executives.
Jepson was one of the company's highest-ranking officials, and is well-known in Western New York business and healthcare circles.
He was senior vice president of major accounts, in charge of the business unit that oversaw the company's relationships with large employer clients that paid the insurer to provide health insurance for workers. He has also overseen pricing and contract management.
Prior to a restructuring several years ago, however, he oversaw corporate sales and served as chief operating officer of BlueCross BlueShield of Western New York, in charge of the region's largest health plan and the company's largest subsidiary. HealthNow also owns Blue Shield of Northeastern New York in Albany and has divisions in other parts of the state as well.
He has been with the company for about 10 years. He earned $670,469 in 2007, the most recent data available.
Gorski, 64, has worked for the Buffalo-based company for about nine years following his unsuccessful bid for a fourth term as county executive in 1999, when he lost to Joel Giambra. He most recently served as a senior vice president, overseeing government affairs and lobbying. In 2007, his salary was $398,302.
Previously, he held the same rank but was in charge of government health programs, such as Medicaid, Medicare, Family Health Plus and Child Health Plus. Prior to that, he was vice president of poicy and representation. He was also a former state lawmaker prior to his three terms in county government starting in 1987.
McGuire oversaw the business unit in charge of relationships with large employers that are self-insured, which means they pay their own health costs for workers, but hire the insurer to administer the plan. Previously, she oversaw corporate marketing and business development. She spent more than 25 years with the company, and earned $490,449 in 2007.
Like the others, Uba had also been a senior vice president previously, but his position was downgraded in the previous restructuring. He also previously oversaw human resources. He had also been with HealthNow for about 10 years. He earned $461,818 in 2007.
All four former executives were unavailable for comment Wednesday. All the other employees who lost jobs were lower-level or middle-management, sources said.
The bloodletting at such a senior rank represents an unusual step for a company, and indicates the degree to which HealthNow appears to be changing direction. All four were longtime executives at the company, but that didn't prevent their departures.
As part of the latest restructuring, the major accounts and administrative services only units were combined into a single "large group" division, responsible for both client groups. As a result, those positions were eliminated.
But rather than name either McGuire or Jepson to head it, sources said, the company instead is naming Larry Thompson, a new senior vice president who was hired just last summer to focus on the brokerage business.
News Staff Reporter Robert J. McCarthy contributed to this report.