Top management at Chattanooga, Tenn.-based Erlanger Health System are expected to receive $1.7 million in bonuses, according to a Chattanooga Times Free Press report.
The bonuses, which will be given for financial performance, were voted on by trustees and come after Erlanger froze employees' vacation time and warned of financial crisis earlier this year, according to the report.
But the report states the bonuses are possible because Erlanger was able to change things around, thanks largely to $19 million in federal funds via the Public Hospital Supplemental Payment Pool.
The average bonus size will be $17,100, with Erlanger CEO Kevin Spiegel collecting $234,669 in bonus pay, according to the report.
According to the report, trustees also gave the go-ahead for Mr. Spiegel to receive a 10 percent raise next year, and approved a 2 percent nonbudgeted pay raise for hospital employees.
"Management has performed exceedingly well," Chairman Donnie Hutcherson said in the report. "This is well deserved. They have put in long, long hours."
But board member Gerald Webb, who, according to the report, voted against the bonus payments, as well as changes to Mr. Spiegel's contract, told the Chattanooga Times Free Press, "Erlanger has had financial issues for a while. For the first time we're seeing positive numbers. My thinking is that more of a percentage of that money needs to go to into reserves or to employees, instead of vice presidents and executives. I had to vote my conscience."
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