- Median base salaries for executives at healthcare companies increased by 4.5% from 2021 to 2022, according to a report from consulting firm SullivanCotter.
- Executives also saw incentive payouts similar to those before the pandemic, after those awards fell below historic levels last year due to COVID-19-driven financial challenges.
- Ultimately, median total cash compensation, which equates to base salary plus annual incentives, rose by 9.7% over the past year for healthcare executives, according to a statement. SullivanCotter did not make the full report available to Healthcare Dive.
The findings reflect a competitive labor market and confirm that the search for talented employees in the healthcare sector extends beyond physicians, nurses and other staff facing pandemic-driven burnout.
This year’s rebound in executive compensation is partially due to improved financial metrics, but is also driven by high demand for talent that is outpacing supply because of burnout and accelerated retirements, according to the report, based on survey data collected from executives at more than 3,000 organizations.
Executives saw modest base salary increased in 2021 after many organizations froze those salaries at the beginning of the pandemic, according to the report.
Salary growth for other healthcare roles did outpace that of healthcare executives though amid widespread recruitment and retention challenges.
Most clinical roles saw median base salaries rise 5% or higher, with registered nurses seeing over 8% growth, according to the report.
While total compensation for executives grew year over year, there were no shifts in annual incentive plan prevalence or award opportunity levels.
Growth in total cash compensation instead is being driven by higher incentives awards in light of improved organizational performances in the aftermath of the first years of the pandemic, according to the release.
“It shows that the performance-based incentive programs are operating as designed by tempering awards in challenging years and increasing them when performance improves,” Bruce Greenblatt, managing director at SullivanCotter said in the release.
Organizations should anticipate salary increases above norms of 3% in 2023 if they want to retain key talent, mitigate the impacts of inflation and address pay equity issues, the report said.