Some of the most highly compensated healthcare and academic leaders in the country also pad their incomes as members of the boards of publicly traded healthcare companies, raising conflict of interest concerns, according to a new study published in the British Medical Journal.
Researchers looked at 279 academically affiliated directors on the boards of 442 companies in 2013. These leaders included 17 CEOs and 11 vice presidents or executive officers of health systems and hospitals, as well as 15 university presidents and eight medical school deans or presidents. On average, these leaders earned $193,000 a year and got at least 50,000 shares of stock in exchange for serving on the boards.
In total, they earned $55 million in compensation and owned roughly $60 million in stock options.
The research team, led by Timothy S. Anderson, chief medical resident at the department of internal medicine at the University of Pittsburgh Medical Center, did not reveal the names of these healthcare leaders in order to highlight the their main point--that the obligations these leaders have to for-profit company shareholders and non-profit clinical institutions raises serious personal, financial and institutional conflicts of interest.
Although there are benefits to having greater representation of the non-profit healthcare sector in the corporate boardroom, the connections can also be a conflict and have never been fully addressed, according to a study announcement.
"These people who are on boards are among the most famous, the most sought-after academics in the country," Jerome Kassirer, M.D., editor in chief emeritus of the New England Journal of Medicine told The Washington Post.
"At the same time they are making very large incomes, based on their positions, so what they're doing is simply padding their incomes, with a lot of extra money. I think it's a bad idea, and I think it's widespread."
In an accompanying opinion piece in BMJ, David Rothman, a professor at the Columbia College of Physicians & Surgeons in New York, said the findings strengthen the case for more stringent conflict-of-interest policies. He argued that the only credible policy would be to exclude these leaders from the board.
Marcia Angell, senior lecturer at Harvard Medical School and the former editor of the New England Journal of Medicine, agreed. She told The Washington Post the relationships must always be prohibited. The leaders she said, serve as "double-agents" and an effective sales force for the pharmaceuticals and device industries.