Senate rejects health executive pay cap

A motion to cap the salaries of executives working in the US health insurance industry has been spiked by the upper house of Congress.

The Senate has voted against a measure to limit the remuneration structures of executives in the US to $400,000 annually from its current cap at $1 million by 56 votes to 42.

Included as part of the proposal for reforming the country's health care system, the amendment fell four votes short of the number required to approve the passage.

The changes were proposed by the Democrat senator Blanche Lincoln, who suggested that the money saved under the measure could be redirected to the Medicare Trust Fund.

In a statement, Ms Lincoln expressed disappointment at the amendment's failure and described the current cap as "generous"

She said: "I believe it is fair to ask these companies to give up a long-standing taxpayer subsidy that allows them to write off up to $1 million in executive compensation."

Last month, the research provider Aberdeen Group claimed that US healthcare corporations have identified succession planning as a main priority for 2010.