James Guthrie, senior consultant of executive compensation and governance at IHS, analyzed 62 non-profit health systems with average net operating revenue of $2.2 billion in 2011. The modest increase of long-term incentive plans over that decade span was due in part to 16 percent of the sample organizations adding a long-term plan and 10 percent eliminating their plan.
Organizations may eliminate a long-term incentive plan for CEOs because they are overly complex and may be ineffective in measuring goals over a multi-year performance cycle, according to the report.
Average long-term incentive opportunities for hospital CEOs in the sample also went from 20 percent of salary to 30 percent in that 10-year span.
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