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Hospital CEO Pay Out of Alignment with Quality of Care

Cheryl Clark, for HealthLeaders Media, October 16, 2013

"If I, as a practicing physician, have part of my salary tied to quality of care that I deliver, which by the way, I do as a practicing physician at the VA (Veteran's Affairs Boston Healthcare System), I wondered if this was happening in the management ranks as well.

Governance a Factor
"And what we found is that it really didn't seem to be happening. So we said, boy, we think there's an opportunity here for improvement, for hospital boards of directors to focus on this and make it part of a CEO's compensation package. It would, at least, give us one more lever to drive some change."

In fact, the study found that hospitals with low 30-day mortality rates paid their CEOs $4,667 less than did hospitals with the highest mortality rates.

The study included salaries for 1,877 top executives who are responsible for 2,681 non-profit hospitals, and found they earned $595,781 in unadjusted mean compensation. CEOs in the lowest 10% received a median compensation of $117,933, and were largely in charge of rural, small hospitals, most frequently in the Midwest.

In the highest 10%, CEOs made $1,662,548. They oversaw large urban hospitals that often included medical schools.

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1 comments on "Hospital CEO Pay Out of Alignment with Quality of Care"


Suresh Nirody (10/21/2013 at 3:01 PM)
"mortality rates for 19 medical and surgical conditions" ??? That may refer to the number of measures on Hospital Compare (?), but it is NOT what they looked at in their study, quote: "composite measures of performance on processes of care for acute myocardial infarction, congestive heart failure, and pneumonia... from which we built patient-level hierarchical logistic regression models to calculate 30-day risk adjusted mortality and readmission rates..." Let's not overstate the case!