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Study supports high pay for nonprofit hospital CEOs

A new study by Mercer and Truven Health Analytics says that not-for-profit hospitals that perform best on  finances, patient care  and other objective performance measures tend to pay their chief executive officers more than their peers.

Among the study’s conclusions, as summarized by Modern Healthcare.

• “CEO compensation at hospitals that set national benchmarks on quality, safety and other key measures was higher overall and within its class at teaching and medium-to-large community hospitals with 100 or more beds.”

• “Median CEO compensation increased with hospital class, as measured by bed size and teaching status. Major teaching hospitals provided the highest median CEO compensation and small community hospital had the lowest. There was wide variability in pay within each hospital class.”

• “CEO compensation improved with better hospital performance on such measures as 30-day mortality for heart attack, heart failure, pneumonia, as well as Hospital Consumer Assessment of Healthcare Providers and Systems surveys and core measures. Those measures are key because they are considered as part of the Medicare’s Hospital Value-Based Purchasing Program.”

• “There was a negative association between the amount a CEO earned and how well his or her hospital performed on two performance measures—inpatient care complications and adjusted expense per inpatient discharge.”





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