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Halvorson says report was unfair
Star Tribune: Newspaper of the Twin Cities (Minneapolis, MN)
February 4, 2003
Author: Glenn Howatt Staff Writer

In addition to Minnesota Timberwolves owner Glen Taylor, Minnesota Attorney General Mike Hatch has asked a court to appoint Eden Prairie businessman Ed Flaherty to the HealthPartners board, according to legal documents filed Monday.

Flaherty, who has been involved in many businesses, including Rapid Oil Change, local Applebee's franchises, Miller Milling and Signergy Sign Group, was recommended by several local businessmen, Hatch said.

HealthPartners said it was reviewing the legal documents, which were filed in Hennepin County Probate Court, and had no comment Monday on them.

Meanwhile, George Halvorson, former chief executive office of HealthPartners, criticized the conclusions of the attorney general's review of the health plan, saying the expenses attributed to him were taken out of context or put in an unfair light.

Halvorson, who is now chairman and chief executive of Kaiser Permanente in Oakland, Calif., defended the board, which Hatch has called weak.

``This wasn't a board where senior management went on parade every few months with a padded agenda,'' Halvorson said. ``It is not a board that sat and listened to a parade of speakers.''

However, Hatch pointed to documents, filed with the federal government, that showed that board members spent 36 hours a year on board business in 2000, while the board chairman spent 72 hours a year.

``This a multibillion-dollar company, and those board members ought to be putting in more time,'' Hatch said.

Hatch said Taylor and Flaherty, if approved by the court, would sit on the HealthPartners board for 12 to 18 months to help improve board oversight.

On Friday, HealthPartners asked the court to move the case into mediation. It also has said it plans to file a motion to dismiss the case.

Hatch said Monday that he will ask the 15-member board to meet with Taylor and Flaherty.

In the court filing Monday, Hatch's office again said the spending on questionable expenses and travel was lavish, and he criticized the board for attending meetings and retreats at expensive resorts.

Halvorson said that the retreats were important for the board to interact with nonprofit board members from other companies and that the meetings were a good investment.

``I've been disappointed that the audit report focused on the nice hotels and ignored the agendas of the meetings,'' Halvorson said.

He also defended international trips that he took as CEO, several of which were associated with his involvement with an international health plan organization that did not have the funds to reimburse him for travel to events. Other trips were for what he called ``CEO education.''

``If the audit team thinks that type of learning is inappropriate, I disagree with them,'' he said.

Halvorson also said that Vikings and Wild tickets charged to his expense account were, for the most part, used by sales and marketing staff.

``I don't particularly like hockey,'' he said. As for football, he said, ``I much prefer to watch my games on television.''

Halvorson said the board had a thorough system for determining his pay and that contrary to Hatch's criticism, it was not out of line with competitors.

As for asking the board to pay for Lasik surgery for him and his wife, Halvorson said: ``That was probably not a great idea.''

He said that HealthPartners surgeons had offered to do it for free, but he thought that would not be appropriate. Instead, he asked the board to pay the surgeries. The board then discussed paying Halvorson a cash stipend instead of paying directly for the surgery, which is not a covered benefit for HealthPartners members.

HealthPartners board chairman Alan Fletcher said last week that, although the board discussed the issue, it never authorized payment.


- Glenn Howatt is at

Edition:  METRO
Section:  BUSINESS
Page:  3D
Index Terms: appointment; health; insurance
Copyright 2003 Star Tribune: Newspaper of the Twin Cities