WellPoint management team gets board support, CFO says

Almost two weeks after Angela Braly was forced out as WellPoint Inc. CEO, the management team she put in place has been told by the board it will stay, said Chief Financial Officer Wayne Deveydt.

The executive team is committed to remaining at Indianapolis-based WellPoint, the second-biggest U.S. health insurer, Deveydt said at a conference Monday in New York.

WellPoint shares declined 2 percent Monday afternoon, to $59.06 each, erasing an earlier gain.

Braly resigned as head of the company Aug. 28 after shareholders, some publicly, expressed discontent with her leadership. John Cannon, WellPoint’s general counsel, will serve as interim CEO during the search for a replacement, the insurer said at the time.

“Our board very proactively wants to maintain the management team and they’ve reached out to us in that manner,” Deveydt said.

Cannon isn’t interested in taking the job on a permanent basis, Deveydt said. The board will conduct an internal and external search, and no timeline has been set to choose a replacement.

Braly, 51, took over the CEO job in June 2007. During her tenure, Braly became a high-profile foe of President Barack Obama’s health-care overhaul and, more recently, sparked the ire of investors after WellPoint missed earnings estimates and cut its forecast twice in four months.

“The stockholders want to see dramatic changes in Wellpoint’s performance,” said Erik Gordon, a professor at the University of Michigan’s Steven M. Ross School of Business in Ann Arbor, in an e-mail. “The changes start at the top, but they don’t end there.”

Braly’s successor will have to right the company’s financial performance and oversee WellPoint’s integration of insurer Amerigroup Corp. and vision company 1-800-Contacts Inc.

In June, WellPoint agreed to buy eye-wear provider 1-800-Contacts Inc. for about $900 million. In July, the company announced the $4.9 billion acquisition of Amerigroup to become the biggest private provider of plans for Medicaid, the federal-state program for the poor.

The Amerigroup deal may close in the fourth quarter, Deveydt said Monday. He has been touted as a potential CEO candidate, according to analysts.

DeVeydt said the insurer isn't prepared yet to provide guidance for its 2013 results. He cited several reasons for the reluctance, including changes associated with the Affordable Care Act.