NPR: Nonprofit Hospital CEOs Earn Big $. Do Patients Benefit? Nearly 1/2 US Hosp Are Non- Profits [View all]

CEOs earn big bucks at nonprofit hospitals. But does that benefit patients? NPR, Aug. 19, 2024.

There are more than 4,600 hospitals in the U.S., and 49% of them are nonprofit and therefore tax-exempt. The CEOs of these nonprofit health systems now earn, on average, $1.3 million a year. There are more than 4,600 hospitals in the U.S., and 49% of them are nonprofit and therefore tax-exempt. The CEOs of these nonprofit health systems now earn, on average, $1.3 million a year.

Nearly half of hospitals in the U.S. are nonprofits, which means they don’t pay local, state or federal taxes. In return, the hospitals provide medical care, a social benefit, to their communities. They’re also expected to provide some charity care to patients who cannot pay, and deliver services that promote community health, such as vaccine clinics or cancer screenings.

But despite their community-focused missions, the CEOs in charge of these nonprofits command large paychecks, that now top $1 million, on average. And their salaries keep rising. Compensation for CEOs of nonprofit hospitals and medical systems grew by 30% between 2012 and 2019, according to a new study from Rice University’s Baker Institute for Public Policy.

That means the average paycheck for a top executive went from just under $1 million to $1.3 million, according to Vivian Ho, a health economist at Rice University.

The generous pay for health CEOs isn’t necessarily a problem, Ho says, if nonprofit health systems consistently deliver on their mission, which is to provide quality, affordable care. But Ho worries these big salaries may be incentivizing CEOs to make decisions that don’t benefit patients, citing a study she published last year showing that larger hospital profit margins don't result in more charity care...
https://www.npr.org/sections/shots-health-news/2024/08/19/nx-s1-5078495/nonprofit-hospitals-ceo-compensation-community-benefit-uninsured-mission-tax-exempt-management