Selfless Institutions That Pay Their Executives Like Royalty
| Thanks to Ed M. |
Ed note: This article must make one think about what a tax exemptnon-profit really is. I checked with ChatGPT to ask about the incomes in our area in the “non-profit” Providence-Swedish system: ‘Providence system executives are listed here.
- Erik Wexler – ~$5–8.5M
- Greg Hoffman – ~$3–3.8M
- Hoda Asmar – ~$2.6–3.4M
- Anna Newsom – ~$2.6M
- Wasif Rasheed – ~$3.1M
- Michael Marshall – ~$2.4M
- plus several others in the $1–2M range
There I sat, in a simple auditorium, surrounded by a sea of silver hair and orthopedic shoes, watching a PowerPoint presentation by a prestigious hospital consortium. The slides were magnificent. The technology was breathtaking. The buzzwords—“innovation,” “patient-centered care,” “cutting-edge outcomes”—cascaded across the screen like a symphony of self-congratulation. I half-expected a standing ovation.
Then came the Director of Philanthropy. Distinguished. Earnest. Her smart red suit looked like a Prada. She leaned into the microphone and gazed out at this assembled crowd of retirees with the practiced look of a woman who has perfected the art of the ask.
“We need your support,” she intoned, “because we are a non-profit hospital.”
I left the room. Not dramatically. I didn’t overturn my folding chair or deliver a soliloquy on the way out. I simply stood up, smiled politely at my neighbor’s confused expression, and escaped into the hallway. Life, as I have come to understand it, is a finite and precious resource. And I have resolved to spend as little of it as possible listening to extraordinarily wealthy institutions explain why they deserve more of my money.
I pause here to perform a small but vital public service: defining what “non-profit” actually means, since the term does an enormous amount of work it was never designed to do.
Non-profit does not mean “we scrape by on donations and good intentions.” It does not mean “our staff subsists on ramen noodles.” It does not even mean “we are indifferent to money.” What it means, in the cold, technical, legally precise sense, is that the organization is not owned by investors who receive dividends. That’s it. That is the whole magic trick.
A non-profit hospital can make colossal amounts of money. It can sit atop revenue streams that would make a Fortune 500 CFO envious. The only requirement is that it doesn’t distribute those profits to shareholders, since there are none. Instead, it channels the money into… well, into whatever it likes, really. Executive compensation. Lavish campuses. Administrative bloat. And, in the most theatrical of gestures, “community benefit,” a category so loosely defined it could theoretically include the parking garage.
Allow me to introduce you to a victim of circumstance. The CEO of this particular non-profit hospital consortium took home a mere $3.6 million in 2024. I use the word “mere” advisedly, because that figure is actually below the industry standard for non-profit hospital executives.
Yes. The industry standard. For non-profits. Let that phrase settle into your consciousness. Somewhere out there is a non-profit hospital CEO making more than $3.6 million a year while accepting donations from retired schoolteachers and widowed veterans. I picture him accepting a plaque at a gala, surrounded by floral centerpieces, gravely explaining that the real reward is serving the community. Then he gets in his car, a modest, let’s say a mid-range Mercedes, and drives home to his not-for-profit life.
One has to admire the audacity. It takes a special kind of institutional confidence to stand before a room full of retirees on fixed incomes and explain that your hospital, the one with the marble lobby, the celebrity surgeon wing, and the annual revenue of a small nation, is in need of their generosity.
I am particularly fond of the word “panoply.” It is a word that suggests abundance and spectacle, a sweeping display. It is the right word for what non-profit hospital executives receive in compensation beyond their salaries: a panoply of perks so comprehensive, so thoughtfully assembled, that one almost forgets it is all being funded by an institution that exists, ostensibly, for the public good.
These may include deferred compensation plans, executive health insurance that would make the average patient’s coverage weep, club memberships, housing allowances, car allowances, and, in the more baroque examples, private aircraft usage. All of it is legal. All of it faithfully disclosed in IRS Form 990, a public document that almost no one reads, which is presumably the point.
And meanwhile, out in the waiting room, a woman is deciding whether to fill her prescription or pay her electric bill.
In exchange for their tax-exempt status—which saves non-profit hospitals billions of dollars annually in federal, state, and local taxes—these institutions are required to provide “community benefit.” This sounds meaningful. It sounds like a promise.
It is, in practice, a suggestion. (continued on Page 2 or here)