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Health Care Executive Cheated Half a Million Dollars

April 8, 2015 Legal Team

Former Chief Technology Officer for Blue Shield of California is suing the company for wrongful termination and breach of contract, alleging he was due almost half a million dollars for a bonus just prior to his termination.

Aaron Kaufman accused the health insurance giant of retaliation. Kaufman claims he questioned the company’s $4.6 million contracts with a vendor called “Veritas data project.” The terms of the contract allowed the unfamiliar vendor to continually bill the company without a fixed rate. With no cap, the vendor was essentially issued a “carte blanche” by Blue Shield.

The company’s dispute with Kaufman elevated when the former CTO offered an alternative vendor whose offer would have cost a fraction of what was spent. Michael Mathias, the Chief Information Officer, disagreed with Kaufman’s choice and continued on with Veritas.

From that point on, Mathias did all he could to get Kaufman terminated until ultimately the CTO was discharged from service on March 10, 2015. The date of termination was purportedly one day before Kaufman’s $450,000 bonus was supposed to be paid.

Blue Shield responded, stating they disagreed with the suit but did not comment further on any allegations of wrongdoing.  The insurance company has been riddled with misfortune in the last year. Its high profile corporate spending and high executive payouts led to a revocation of its tax-exempt status last summer, resulting in a large payment for back taxes–$62 million. Compared to that Kaufman’s bonus just seems like change in the pocket.

Source: LA Times