- Executives at PartnersHealthcare, Massachusetts' largest provider, received pay raises of nearly 20% between 2012 and 2013. Although it is difficult to compare executive pay stubs between organizations, according to tax documents, no other provider's executives in the greater Boston area earn more.
- CEO Dr. Gary Gottlieb was the leading earner, earning a 17% pay bump that put him at $2.61 million in total compensation. That $2-million paycheck is made up of a base salary of $1.36 million and a series of other benefits and non-taxable expenses.
- Executives at other area hospitals also received large raises. Dr. Elizabeth Nabel, CEO at Brigham and Women's Hospital, jumped 18% to $2.38 million; Dr. Peter Slavin, president of Massachusetts General Hospital, jumped 19% to $2.17 million. A series of interim CEOs at Beth Israel Deaconess Medical Center made comparison at that institution difficult.
As healthcare executive pay continues to rise—tripling since the 1990s—some physicians are expressing displeasure at the earnings disparity. While CEOs earn an average base pay of $386,000, general doctors earn $185,000. Surgeons are closer with average pay of $306,000. According to a physician compensation report in Medscape, only about half of all doctors surveyed believe that they are fairly compensated.
"I don't need that much money," said Florida-based solo family physician Bernd Wollschlaeger, M.D. "But it would be nice to be acknowledged for the work I do."
The reason for the pay disparity is how the two groups are compensated. Physician pay is based on Current Procedural Terminology (CPT) codes. CEO pay is determined by hospital management. And that number represents what the hospital feels the CEO's contributions to making money for the hospital are worth. (In other words, it's discretionary.) Hospitals with high executive pay maintain that the salaries are necessary to attract and retain top talent.
Still, expect to see further scrutiny of this trend, especially in the not-for-profit world. According to data from 2012, the most recent year with full data available, pay packages for not-for-profit healthcare system CEOs have continue to rise at a much faster rate than average worker salaries. The debate over whether not-for-profit execs should be compensated at the same level as their peers in the for-profit sphere is heating up.
Want to read more? You might enjoy this story about the rising salaries of non-profit hospital CEOs.