Golden parachutes come under scrutiny

State governments desperate to close yawning budget gaps aren't just complaining about hospital executives' salaries. As the recession drags on, and even more Medicaid cuts loom, states are eyeing hospital directors' pension plans too.

Most recently, in California, a state Assembly panel will review the retirement package offered to one of its top-paid hospital execs, Samuel Downing, who just retired as head of the publicly funded Salinas Valley Memorial Healthcare District, according to the Los Angeles Times.

The hospital paid Downing $4 million on top of his $150,000 per year pension, and is coming under fire from union groups, the LA Times reports. Union reps point out that the hospital's revenues have been declining in the past few years, culminating in more than 600 layoffs in 2010. At the same time, Downing's pension plan has been growing, reps complain.

Other states, like New Hampshire, Maine and New York, are digging into executive compensation at health facilities, including retirement packages.

And industry watchers note that the IRS ultimately may wade into the fray. Under the Affordable Care Act, the agency is required to review nonprofit hospital's community benefit activities every three years. The process gives the IRS the authority to determine if overall executive compensation is "reasonable," according to the Health Beat Blog.

To learn more:
- read the Los Angeles Times article
- check out HealthBeatBlog's coverage
- find out about some states' plans