Wash. hospital executive salaries may threaten nonprofit status

Andrew Van Dam

About Andrew Van Dam

Andrew Van Dam of The Wall Street Journal previously worked at the AHCJ offices while earning his master’s degree at the Missouri School of Journalism.

KUOW’s John Ryan, who has been using public records to investigate pay for nonprofit hospital executives, dove deeper into the series when he discovered a law on the state’s books that appears to limit the pay of nonprofit execs to something near that paid to equivalent employees in the public sector. On the face of it, it appears many execs aren’t satisfying this requirement, which may place their hospitals’ tax breaks in jeopardy.

KUOW has learned that 15 hospital executives in Washington made $1 million or more in 2009. That elite group includes 14 nonprofit executives and one head of a government hospital.

For their part, hospital spokespeople pointed out that there may be no equivalent in Washington’s public sector to the work they do, and that some state hospital executives do pretty well for themselves anyway. Those claims haven’t stopped legislators from taking action based on Ryan’s work.

After learning of KUOW’s findings, state senators Cheryl Pflug and Karen Keiser co-sponsored a bill that would require nonprofit hospitals to publish their top executives’ incomes each year. They’d also have to provide proof to tax collectors that the paychecks aren’t out of line with comparable pay in the public sector.

If you’re looking to re-create Ryan’s work in your neck of the woods, he’s written a nifty little “How I did it” that should get you started, although he tells Covering Health that Washington’s law requiring nonprofit executive pay to be comparable to public-sector pay might be unique. But for looking into all kinds of executive compensation stories, AHCJ members should refer to tip sheets such as:

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