While hospitals cut jobs, CEO pay continues to rise
June 11, 2013
NOTE: This is not an article on Vermont, as it is about hospital costs trends nationally, but it is relevant to Vermont as well, since hospital costs in Vermont, as elsewhere, are a large part of total health care costs.
By Ron Shinkman
Fierce Health Finance
Although hospitals are cutting jobs and compensation, pay for their chief executive officers continues to rise.
According to the Boston Business Journal, a majority of Massachusetts' hospital systems reported a decline in expenses for compensation and benefits expenses. In northern San Diego County, Palomar Health is cutting 84 jobs, while Tri-City Medical Center is eliminating another 67 positions, the San Diego Union-Tribune reported.
Nationwide, hospital jobs declined by 5,900 last month.
But elsewhere, hospital CEO compensation is rising. In St. Louis, CEOs of not-for-profit hospitals and healthcare systems are receiving double-digit increases in pay and benefits, the St. Louis Post-Dispatch reported. In Connecticut, 18 hospital CEOs received compensation of more than $1 million a year, according to the Connecticut Post. That included Susan Davis, CEO of St. Vincent Health Services, whose $2.4 million pay package in 2012 contrasts with the layoffs recently announced by the hospital system, the Post reported.
Meanwhile, Connecticut's providers are at odds with recent state budget proposals that could reduce state aid to the hospitals by $550 million over the next two years, the Post reported.
But a spokesperson with the Connecticut Hospital Association said such pay packages are required. "Hospitals, like all organizations, need the right leaders to succeed," Michele Sharp told the Post. "To attract the leaders they need, they pay at market-competitive levels, just as they do for all employees."