Erlanger to restore CEO, other leaders' salaries in August

Chattanooga, Tenn.-based Erlanger Health System in August will restore the salaries of its CEO and other leaders that were reduced to offset losses prompted by the COVID-19 pandemic, according to the Chattanooga Times Free Press.

Leaders' pay cuts of 5 percent to 10 percent will be restored starting Aug. 9, and CEO Will Jackson, MD, will see his 15 percent salary cut restored starting Aug. 23, the newspaper reports, citing an internal memo sent to employees. 

Erlanger also ended furloughs and reduced work schedules for staff that were implemented in March due to the pandemic. The health system said it would restore vacation accrual and other benefits later this week.

"We all must recognize and understand there still is a great deal of uncertainty surrounding COVID-19 and as it relates to the national economy. As such, each of us must continue to act thoughtfully and decisively as conditions warrant, including the possibility of another potential surge of this crippling pandemic," Dr. Jackson said in the memo, according to the Times Free Press.

Like other U.S. health systems, Erlanger has lost significant revenue from suspending elective procedures. Its officials estimate the health system's net patient revenue dropped by $35 million in April after suspending those procedures. Lower patient volume and expenses related to COVID-19 were a blow to the health system, according to a separate Times Free Press report.

Cost-cutting measures included furloughing some administrative employees, cutting overtime, halting job recruitment for administrative positions and suspending company retirement contributions. The health system has also cut 93 nonclinical positions and 11 leadership positions

Erlanger board member Jim Coleman told the Times Free Press June 22 that the health system is projecting about $1.1 billion in total operating revenue in fiscal year 2021, which begins July 1.


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