Scrutiny of hospital executive pay intensifies

Lawmakers are extending their scrutiny of hospital pay packages beyond executive salaries to pension plans.

In California, a new bill seeks to cap benefits of healthcare district CEOs, The Salinas Californian reported. In particular, the bill (AB 130) would prohibit a local healthcare district from paying out retirement plan benefits to the chief exec while he or she is still employed.

The bill stems from Salinas Valley Memorial Healthcare System paying nearly $4 million in retirement compensation to former CEO Sam Downing, who has one of the largest public pensions in California's history, FierceHealthcare previously reported.

The healthcare system's golden parachute arrangements have helped put California at the epicenter of executive payment reform. For instance, in November, California's El Camino Hospital District passed Measure M to cap hospital executive pay at twice that of the governor's salary.

Meanwhile, executives at some nonprofit hospitals in Massachusetts may see a similar pay cut as a state senator plans to introduce executive pay cap legislation this month, the Sentinel and Enterprise reported.

The Massachusetts bill would limit nonprofit executive compensation to no more than $500,000, although nonprofits could be waived from the pay cap if they can demonstrate their execs deserve higher payment, the article noted.

For more:
- read the Salinas Californian article
- check out AB 130 (.pdf)
- here's the Sentinel and Enterprise article