Nashville, Tenn.-based HCA Healthcare’s executive compensation structure underscores a clear industry reality: financial performance — particularly EBITDA — remains the dominant driver of leadership pay.
According to HCA’s 2025 proxy report, published March 13, 80% of executive incentive compensation is tied to EBITDA performance, with the remaining 20% linked to quality and patient care metrics such as infection rates, mortality and patient experience scores. This weighting reflects a strong emphasis on financial outcomes, even as health systems face increasing pressure to prioritize quality, access and workforce stability.
The structure also reinforces how the for-profit hospital operator defines success.
EBITDA targets are set within a relatively narrow range — with threshold performance at 4% below target and maximum at 4% above — and can yield payouts of up to 200% for that portion of incentives. In 2025, HCA executives achieved near-maximum performance, contributing to total bonus payouts of nearly 196% of target.
For example, HCA CEO Sam Hazen saw his overall compensation increase by $2.7 million in 2025 as the health system reported a $6.8 billion in net income on revenue of $75.6 billion, according to the report. Mr. Hazen earned more than $5.4 million in nonequity incentive plan compensation in 2025.
Notably, quality metrics — while present — are partially dependent on financial performance.
If EBITDA falls below 90% of target, no payout is awarded for the quality portion of incentives. This design positions financial performance as a gatekeeper, even for measures tied to patient outcomes and experience.
The emphasis on financial performance aligns with broader critiques of how hospital economics — and executive incentives — are structured.
Speaking on “The Healthcare Bridge” podcast, Mark Cuban — entrepreneur and co-founder of Cost Plus Drugs Co. — argued that hospital performance is often driven less by operational efficiency and more by market leverage.
“One, I have market dominance, and I get to say, ‘f— you,’ to everybody and the insurance companies, right? I don’t need you, because I’m going to get my own patients too,” Mr. Cuban, who said. “Two, I don’t have enough patient flow, so I need you insurance companies to send me patients, and so I’ll do the deal that you want me to do, because otherwise I don’t have a patient funnel.”
He also suggested that executive compensation structures can incentivize growth for scale rather than long-term sustainability.
“I think part of the challenge is [how] most CEOs are rewarded. Hospital CEOs are rewarded by revenues and scale, and so they default to more buildings,” he said. “If this 100-bed hospital is not my final destination, I want to be the 60-hospital, 6 zillion beds, because that’s where I’m making $10 million a year.”
For hospital and health system leaders, this model — and Mr. Cuban’s critique — highlight a key tension: whether compensation structures are truly aligned with long-term value, or primarily with financial growth and market position.
“HCA Healthcare’s primary objective is to provide high-quality healthcare to our patients, and our executive compensation philosophy is centered around creating a strong, positive link between our performance and compensation,” a spokesperson for the health system said in a statement provided to Becker’s. “Executive compensation is determined by the compensation committee of the board of directors, in consultation with an independent third-party advisor, and we believe it is in line with the pay structure of executives at other comparably sized healthcare companies.”
