Big insurer ousts CEO, chairman

Friday, Feb. 25, 2000 | 11:17 a.m.

THE ASSOCIATED PRESS

NEW YORK -- Aetna Inc. replaced its outspoken CEO and chairman with a Wall Street veteran today as the nation's largest health insurer struggled to cope with rising medical costs and a falling stock price. Chief Executive Dick Huber was succeeded by long-time board member William H. Donaldson.

Donaldson is the co-founder of the investment banking firm of Donaldson, Lufkin and Jenrette. He previously was chairman and CEO of the New York Stock Exchange and has been on the Aetna board of directors since 1977.

"The Board and I share not only pride in the company's leading position in health care and financial services, but also frustration at the recent returns received by Aetna shareholders," Donaldson said in a statement.

Aetna's stock price has slumped from about $100 last spring to $39 today.

Its shares have been under pressure since last fall, when the company became the target of several class-action lawsuits alleging the insurer put profits before patient care. The suits were filed by the same trial attorneys who won big awards against the tobacco companies. The company denies wrongdoing.

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