CHARLOTTE, N.C. --Carolinas HealthCare System paid its CEO $4.2 million in 2011, $523,000 more than the year before, as the system celebrated a profitable year and met all of its systemwide goals, according to hospital officials.
Chief Executive Officer Michael Tarwater, 58, who has led the $6 billion public hospital system for 10 years, received a base salary of about $1 million, two bonuses totaling $2.5 million, and other compensation, including retirement and health benefits, of about $700,000.
That represents a 9 percent increase in base salary and a 14 percent overall increase compared to 2010, when Tarwater's salary was $986,172 and total compensation was $3.7 million.
We've had extremely good performance, said Debra Plousha Moore, the system's chief of human resources. All performance goals this year were either met or exceeded.
This week's announcement marked the fourth consecutive year that Carolinas HealthCare has made public how much it pays top executives in salaries and bonuses.
In prior years, the system released only salaries. But a state law that took effect in 2009 requires public hospitals to disclose total compensation - not just base salaries - of its highest-paid executives. That is the same information already available through IRS reports from private, nonprofit hospitals such as Novant Health, the competing system that owns Presbyterian Healthcare in Charlotte.
Novant, a $3 billion private, non-profit company based in Winston-Salem, has not yet filed its IRS Form 990 for 2011. The most recent compensation figures for Novant executives are from 2010. In that year, Novant's CEO Paul Wiles, 64, received total compensation of $3.2 million, including his salary of $1 million, a bonus of about $837,000, and $1.37 million in other income, including retirement and health benefits.
Wiles retired at the end of 2011 and was succeeded by Carl Armato, who was previously chief operating officer for Novant.
Both systems use consultants to guide them in setting executive pay. Towers Watson, a human resources consulting firm, analyzes published surveys of comparable organizations, including health-care systems, and works with Carolinas HealthCare.
Among systems with about $6 billion in annual net patient revenues, the median CEO salary was $1.2 million, according to senior consultant Robert Gormley. The median salary plus annual bonus (excluding retirement, health benefits and long-term bonus) was $2 million.
By comparison, Tarwater's salary and annual bonus totaled about $2.3 million.
Once again in 2012, compensation for CHS executives is in line with pay levels at institutions of similar size, Gormley said.
A survey of 32 private hospital systems with a median of $3.4 billion in net revenues showed the median salary for chief executives is $1,060,000, according to Kevin Talbot of Integrated Healthcare Strategies, a firm that assists Novant Health in setting executive compensation. The median total direct compensation for CEOs (excluding retirement and health benefits) is $1,576,000.
At Carolinas HealthCare, top executives weren't the only ones who benefited from meeting systemwide goals. More than 23,000 lower-level employees received bonuses ranging from $255 to $850 in mid-January. That amounted to $17.6 million.
It was the second year that the system paid bonuses to staff-level employees, such as nurses, laboratory technicians and clerks, as part of its Performance Plus program based on systemwide goals. For 2010, the system paid a total of $12.8 million in bonuses, ranging from $195 to $650, to 22,664 employees.
Carolinas HealthCare is the second-largest public multihospital system in the country and the largest employer in the Charlotte region. It owns, leases or manages about 30 hospitals in the Carolinas, including the flagship Carolinas Medical Center in Charlotte. The total enterprise has about 48,000 employees, including 28,000 in the greater Charlotte area.
The system is a tax-exempt public hospital authority, created by state law. It is not county-owned, but the county has for decades provided millions of dollars in taxpayer funds to pay for the care of indigent patients.
Last spring, as commissioners faced a county budget crisis and observed the hospital system's increasing profitability, they voted to end the subsidy. Carolinas HealthCare had been receiving about $16 million a year, and Presbyterian Healthcare about $1 million, based on the number of uninsured patients treated at each.
Presbyterian Healthcare includes four hospitals in the Charlotte area: Presbyterian, Presbyterian Orthopaedic, Presbyterian Matthews and Presbyterian Huntersville. All are part of Novant, which has 26,000 employees and owns 13 hospitals in North Carolina, South Carolina, Virginia and Georgia.
Carolinas HealthCare System
Michael Tarwater, CEO: $4,236,305
Joseph Piemont, president and chief operating officer: $2,536,792
Greg Gombar, chief financial officer: $1,751,798
Laurence Hinsdale, executive vice president: $1,693,314
Paul Franz, executive vice president: $1,575,927
Dennis Phillips, executive vice president: $1,351,138
John Knox, chief administrative officer: $1,197,528
Dr. Roger Ray, chief medical officer: $1, 080,159
Russell Guerin, executive vice president: $1,060,931
David Dunlap, president, Roper St. Francis Healthcare, $1,043,275
Suzanne Freeman, president, Carolinas Medical Center: $889,643
Spencer Lilly, chief operating officer and CMC interim president: $515,442
Robert Larrison, president, Carolinas Rehabilitation: $278,287
Douglas Roush, president, CMC-Mercy: $228,218
Christopher Hummer, president, CMC-Pineville: $491,235
William Leonard, president, CMC-University (second half year): $330,077
Phyllis Wingate-Jones, president, CMC-NorthEast: $600,278
Peter Acker, president, CMC-Lincoln: $362,753
Novant Health - 2010 (2011 not available)
Paul Wiles, CEO: $3,232,140
Greg Beier, president, Novant Health Operations: $1,878,740
Dr. Stephen Wallenhaupt, chief medical officer: $1,432,275
Carl Armato, president, Novant Health Markets: $1,286,384
Sallye Liner, chief clinical officer: $1,224,027
Lawrence McGee, general counsel: $1,081,211
Jacque Daniels, chief administrative officer: $949,899
Fred Hargett, chief financial officer: $871,919
Mark Billings, president Presbyterian Healthcare: $735,918
Dr. Herb Clegg, co-president, Novant Medical Group: $735,531
Dr. John Phipps, co-president, Novant Medical Group: $645,591
Roland Bibeau, president, Presbyterian Hospital Matthews: $363,170
Tanya Blackmon, president, Presbyterian Hospital Huntersville: $252,418
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