North Carolina State Treasurer Highlights Exorbitant Hospital Executive Pay
By Consumers for Quality Care, on March 8, 2023
North Carolina State Treasurer Dale Folwell has issued a series of new reports highlighting how executive pay among the state’s nine largest health systems has drastically increased at the same time consumers are paying more for their health care, as reported by Raleigh News & Observer and MedPage Today.
According to Folwell’s reports, most CEOs of nonprofit hospital systems in the state doubled their seven-figure compensation over a period of 5 years or less. The report also determined there was no link between executive compensation and patient safety or charitable mission.
The lack of charity care is especially alarming. Nonprofit hospitals billed more than $149 million to consumers who were eligible for charity care. North Carolina hospitals also encouraged consumers to sign up for medical credit cards with interest rates as high as 18 percent.
State Treasurer Folwell has gone so far as to refer to the health care industry as a “cartel,” saying, “We’re seeing a massive transfer of wealth from workers to hospital executives. We’re seeing that these increased payments have a lot to do with the concentration of health care in the hands of fewer and fewer people.”
Another concerning factor State Treasurer Folwell addressed is the consolidation among hospital providers. North Carolina has seen multiple consolidations within the past few years leading to consumer complaints about diminished quality of care.
Folwell stated, “The fact is this consolidation and concentration of health care into the hands of fewer and fewer of these multi-billion-dollar corporations who mainly disguise themselves as nonprofits is resulting in lower quality, lower access and higher cost.”
The researchers involved in the reports believe government officials need to intervene and determine if large nonprofit hospitals are maintaining the standards of charity care expected of them to keep their tax-exempt status.
As charitable organizations, nonprofit hospitals should not be raking in massive profits for their executives to the detriment of their patients. CQC urges lawmakers and regulators ensure that nonprofit health systems are prioritizing patients over profits.