Anthem Blue Cross President Pam Kehaly has healthy outlook


The gig: Pam Kehaly, 51, is president of Anthem Blue Cross in California, the state’s largest for-profit health insurer and a unit of WellPoint Inc. The executive said she wrestles with how to control rising medical costs and find ways to keep coverage affordable for millions of employers and consumers.

Strike up a conversation: Her family moved to Southern California from Michigan when Kehaly was 3. Her parents divorced and her mother worked two jobs — mail clerk at the Pacific Coast Stock Exchange by day and cocktail waitress by night. Kehaly admired her mother’s work ethic and started cleaning houses when she was 12. A few years later, she spent summers at county fairs selling Clean N Brite rug cleaner using a grimy carpet sample in her product demonstrations. She earned a dollar for each can sold. “I was a hawker,” Kehaly said. “I was always shy, so it forced me to get out there and have conversations with people I didn’t know.”

Stick it out: Motivated by her mother’s ascension to senior vice president at the stock exchange, Kehaly earned a business degree at Cal State Stanislaus and managed stores for two years after college. She didn’t see a future there, so she jumped at a friend’s suggestion to join Blue Cross as a claims supervisor. Kehaly was quickly overwhelmed by insurance jargon. “I thought I had made a real serious mistake,” she said. “They are going to catch on to the fact I don’t know the business.”


But she didn’t overreact. Her patience paid off when she took a call from an irate customer who was fed up with his insurance bills while he was trying to care for his dying wife. Kehaly sorted through his paperwork and resolved his problems. “That was a turning point for me,” she said. “I recognized in that job I had the ability to make a positive impact on people’s lives.”

Change is calling: Kehaly climbed the ladder at Blue Cross and thought she might spend her entire career there. Then in 2006, rival Aetna Inc. offered her a job managing its Western region. It was a hard decision, but switching jobs so often at Blue Cross had shown Kehaly the importance of embracing change to grow professionally. “I had learned how easy it is to slip into a rut and not recognize you are in a rut,” she said, “until you pull yourself out and force yourself to do something different.”

Too many frequent flier miles: Kehaly thrived at Aetna and soon she was overseeing employer accounts nationwide. But the job required nearly nonstop travel, and she was rarely with her husband and son. “You feel like their life is progressing and you are missing big chunks of it, and you will never get that back,” she said.

The 75-25 rule: That experience helped forge a philosophy Kehaly applies even today. She calls it the 75-25 rule on happiness, and she urges co-workers to take stock of their career through that lens. “If I’m unhappy with a situation more than 25% of the time, I always step back and see how can I change that,” she said. “When I see people struggling or unhappy in their role at work, I tell them to think about it in this context.”

Kehaly’s happiness level turned around when she got a call in 2010 from Anthem asking her to come back to run the California business. She jumped at the chance to return to her roots professionally and see her second son off to school each morning.

Personal: She is married to Bill Kehaly, a technology entrepreneur. They have two sons, Trevor, 23, and Ryan, 15. Pam Kehaly enjoys skiing and hiking. She serves on the board of the Wellness Community, which supports families dealing with cancer, and state officials recently appointed her to the Let’s Get Healthy California task force.

Customer service: Much of the unhappiness she deals with now is among policyholders frustrated by rate hikes and decisions to deny certain kinds of care. It bothers her, Kehaly said, because she sees how passionate her employees are about helping people. She said she’s trying to keep rates down and turn around customer frustration by working with doctors and hospitals to provide more coordinated care for the sickest patients, who drive the majority of medical spending.

Work ahead: Challenges remain, she acknowledged. “We are not angels, and there are a lot of things we could do better.”