Schultz to Lead Harvard Pilgrim Health Care

Massachusetts’s number two health insurance carrier Harvard Pilgrim Health Care has tapped Eric H. Schultz, head of a rival health insurer, as chief executive starting March 1.

Schultz, 50, will replace Charles D. Baker, who recently stepped down in July to launch a bid for the Republican Party’s nomination for governor, Harvard Pilgrim’s board of directors announced Thursday.

After serving as chief executive of Fallon Community Health Plan in Worcester for a decade, Schultz will soon lead a much larger company, as Harvard Pilgrim provides insurance to more than 1 million people in Massachusetts, New Hampshire, and Maine.

Schultz, who oversaw Fallon’s expansion from a local health insurance provider to the state’s fourth largest health insurer, said in an interview with The Boston Globe that he would work to make health care more affordable for Harvard Pilgrim’s members.

Fallon spokesperson Christine Cassidy praised Schultz’ leadership skills and relevant experience.

“In addition to his experiences within the health care system, Eric also is a dynamic leader and provides an informed, articulate voice on Massachusetts and national health care reform,” Cassidy said.

When Schultz arrived at Fallon in 1999, the company had lost $21 million in 1998 and $18 million in 1999, according to a 2002 article in the magazine Managed Healthcare Executive.

To rein in Fallon’s finances, Schultz raised premiums, cut administrative costs, severed select provider contracts, and retreated from underperforming markets, according to the article.

W. Patrick Hughes, a division president at Fallon, has been named interim president and CEO. Fallon’s board will brainstorm ideas for a permanent successor at a meeting in March.