Executives for Lancaster-area hospitals and the regional nonprofit health systems that operate them earned a combined $7.05 million in the most recent fiscal year on record, tax filings show.
CEOs at two of the health systems’ parent organizations — UPMC Health and Penn Medicine — earned a combined $11.52 million.
Nonprofits have to report the compensation of executives, trustees and highly compensated employees who meet certain requirements.
The tax filings don’t provide detailed itemization of the totals, which can include everything from health benefits and life insurance to bonuses, memberships and vehicle allowances. They also count retirement benefits not yet paid out.
According to the Internal Revenue Service, compensation must be “fair and reasonable” but doesn’t set specific limits. It recommends boards consider industry data from comparable organizations.
Following is an overview of executive compensation in the most recent fiscal year on record and how it compares to the previous year.
Penn Medicine Lancaster General Health
CEO pay: Ralph Muller’s compensation dropped more than 7%, from $3.22 million in the year ended June 30, 2017, to $2.98 million in the year ended June 30, 2018.
Muller stepped down as CEO this past summer and joined the law firm Manatt, Phelps & Phillips as a national adviser in its Manatt Health group in January. Kevin Mahoney was named Penn Medicine’s CEO in July.
Annual operating revenue: $7.8 billion.
Number of employees: More than 41,000.
Of note: The local part of Penn Medicine, Lancaster General Health, employs more than 8,650 people, and its annual revenues exceed $1.2 billion.
Lancaster General Hospital’s filing lists 38 people whose combined compensation totaled $26.29 million in the year ended June 30, 2018. Three of them — Muller, Tom Beeman and Regina Mingle — earned a combined $6.36 million, which was paid by Penn Medicine. Beeman and Mingle have retired.
Lancaster General Hospital president and CEO Jan Bergen’s compensation increased 38%, from $1.13 million in the year ended June 30, 2017, to $1.56 million in the year ended June 30, 2018.
Penn State Health
CEO pay: Dr. Craig Hillemeier’s compensation dropped 12%, from $1.78 million in the year ended June 30, 2017, to $1.56 million in the year ended June 30, 2018. Hillemeier announced his retirement last February. Stephen M. Massini was named his successor.
Annual operating revenue: $2.28 billion.
Number of employees: More than 17,000. (Penn State Health is part of Penn State University. This number is their combined number of employees).
Of note: The combined tax filing for the university and the health system lists 12 people with compensation totaling $13.86 million in the year ended June 30, 2018. Half, such as Penn State head football coach James Franklin and university president Eric Barron, are not associated primarily with the health system.
The filing also lists salaries totaling $11.33 million in the year ended June 30, 2018, for 17 doctors with the health system and medical school.
CEO pay: Jeffrey Romoff’s compensation increased more than 39%, from $6.12 million in 2016 to $8.54 million in 2017.
Annual operating revenue: $19 billion.
Number of employees: 89,000.
Of note: The local part of UPMC Health, UPMC Pinnacle, employs about 11,000 people, and its filing lists 13 people with compensation totaling $7.97 million in 2017.
UPMC president and CEO Phil Guarneschelli’s salary in 2017 was $1.23 million. His predecessor, Michael Young, was paid $1.24 million in 2017, or more than 16% less than in 2016, when he earned $1.49 million.
UPMC Pinnacle senior vice president and Lancaster region president Brooks Turkel earned $284,541 in 2017, according to individual hospital filings. They didn’t list anyone else not in UPMC Pinnacle’s main filing.
Health system spokeswoman Kelly McCall noted that for the hospitals it bought in July 2017 — including UPMC Pinnacle Lancaster, which closed last February, and UPMC Pinnacle Lititz — the filing shows only compensation from that July through Dec. 31, 2017. Both Lancaster County hospitals were previously for-profits that didn’t publicly report local salaries.
CEO pay: Dr. Kevin Moser earned $2.19 million in 2017, up 2% from the $2.15 million he was paid the previous year. Following his retirement, he was succeeded by Roxanna L. Gapstur last January.
Annual operating revenue: $2.24 billion.
Number of employees: More than 19,000.
Of note: WellSpan Health’s nonprofit filing lists 19 people whose combined compensation totaled $15.81 million in 2017.
The local filing for WellSpan Ephrata Community Hospital lists compensation for 12 people totaling $8.67 million in 2017, including three people from the health system’s filing whose compensation totals $4.94 million.
Hospital president Carrie Willetts earned $499,732 in 2017, down 28% from the $698,235 she earned the previous year.