Average CEO pay by hospital size

Nonprofit hospital CEOs make an average of eight times more than workers without advanced degrees, according to an analysis by the Lown Institute of more than 1,000 hospitals. 

The study, published in Health Affairs Feb. 10, found the gap between CEO pay and average worker pay varied widely. Some hospital CEOs were paid twice the rate of other workers, while the highest paid received 60 times the hourly pay of general workers. 

The analysis revealed a relationship between hospital size and executive compensation.

"Although both CEO compensation and worker wage increase in a stepwise fashion as hospital size increases, increase in CEO compensation tends to exceed that of worker pay for larger hospitals, giving them a higher pay equity ratio," according to the authors of the study. 

Across all nonprofit hospitals, the average CEO compensation per hour was $249, and the average hourly worker wage was $29.

Here is the average hospital CEO pay per hour by hospital size and the ratio of CEO wage to other workers wage: 

Hospitals with less than 50 beds

  • Average hospital CEO compensation per hour: $130 
  • Ratio of CEO wage to other workers wage: 6:1 

Hospitals with 50-99 beds

  • Average hospital CEO compensation per hour: $179
  • Ratio of CEO wage to other workers wage: 6:1

Hospitals with 100-199 beds

  • Average hospital CEO compensation per hour: $239
  • Ratio of CEO wage to other workers wage: 8:1  

Hospitals with 200-399 beds

  • Average hospital CEO compensation per hour: $335
  • Ratio of CEO wage to other workers wage: 10:1

Hospitals with more 400 or more beds 

  • Average hospital CEO compensation per hour: $517
  • Ratio of CEO wage to other workers wage: 14:1

Among larger hospitals with 400 or more beds, hourly CEO compensation ranged from $88 to $3,289. Urban location and teaching status were associated with higher executive hourly compensation, according to the study. 

The analysis supported previous research showing hospital CEOs are compensated primarily for the volume of patients entering their hospitals. 

"This is part of the underlying business model that drives the nonprofit hospital landscape: Volume matters, and high-margin volume matters the most for the bottom line," the Lown Institute researchers said. 

An analysis published in Health Affairs last year by researchers with Arizona State University's health policy center found no association between hospital CEO compensation and the value scores received by the hospitals they oversee. Another study of 35 CEOs of Connecticut nonprofit hospitals found that they were incentivized from 1998 to 2006 to increase the volume of privately insured patients at the expense of uncompensated care and public-pay patients. 



Copyright © 2022 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

 

Featured Whitepapers

Featured Webinars