Business

Pay continues to rise for CEOs of major hospitals

Dr. David Torchiana, the head of Massachusetts General Hospital’s physicians organization in 2013, earned $2.7 million that year, including a $1.1 million base salary. Torchiana is now chief executive of Partners HealthCare.

Suzanne Kreiter/Globe staff

Dr. David Torchiana, the head of Massachusetts General Hospital’s physicians organization in 2013, earned $2.7 million that year, including a $1.1 million base salary. Torchiana is now chief executive of Partners HealthCare.

The compensation of chief executives at many of Massachusetts’ biggest teaching hospitals rose faster than overall health care spending in the state, boosted in some instances by payouts to retiring chief executives, according to filings submitted Monday with the Internal Revenue Service.

The raises for chief executives, all of whom earned at least $1 million a year in salary, benefits, and other compensation, ranged from about 4 percent to more than 70 percent in 2013, the most recent year for which figures are available. Overall health care spending rose 2.3 percent that year, according to the Center for Health Information and Analysis, a state agency.

Advertisement

Dr. David Torchiana, the head of Massachusetts General Hospital’s physicians organization in 2013, saw his compensation jump 73 percent, to $2.7 million. Torchiana’s base salary was $1.1 million; most of the increase came in payments to his retirement plan, some of which was reported in previous years, according to Partners HealthCare, the parent of Mass. General and its doctors network. Torchiana became chief executive of Partners earlier this year.

Boston Children’s Hospital paid its former chief executive, Dr. James Mandell, nearly $2.4 million in 2013, the year he retired. That was 60 percent more than the previous year, but much of the increase was in retirement benefits and also was reported in previous years, according to the hospital.

Get Talking Points in your inbox:
An afternoon recap of the day’s most important business news, delivered weekdays.
Thank you for signing up! Sign up for more newsletters here

Children’s and Partners are known for providing specialized medical care, but have also been cited as among the highest-cost providers in the state. Officials at the two providers said their compensation is competitive with other teaching hospitals in the country.

John Tlumacki/Globe Staff/File 2005

Former UMass Memorial Health Care chief executive John G. O’Brien, who retired in 2013, earned $3.5 million that year.

Compensation for chief executives ranges at other teaching hospitals, from about $1.9 million at the Mayo Clinic in Minnesota to more than $15 million at Johns Hopkins Hospital in Baltimore.

The market for senior health care executives, particularly physicians, is a national one and we must provide competitive wages and benefits in order to attract and retain the best individuals at a time when health care is undergoing sweeping change,” said Edward P. Lawrence, the chairman of Partners’ board. “The competition for excellent managers and leaders is especially strong at this time.”

Advertisement

Margaret Coughlin , chief marketing and communications officer at Children’s, said the board aims to pay executives in line with other teaching hospitals while keeping costs in control.

“We attempt to be competitive,” she said. “We’re trying not to be the highest paid in any way, shape, or form.”

Hospitals are under intense pressure to control costs to comply with state and federal mandates. In Massachusetts, the state has set a limit of 3.6 percent for annual increases in health care spending

In Massachusetts, the highest-paid nonprofit hospital executive for the second straight year was John G. O’Brien of UMass Memorial Health Care in Worcester. O’Brien received $3.5 million in 2013, when he worked only a few months before retiring.

That was down from $4.8 million the previous year. Much of O’Brien’s compensation in those two years came from retirement benefits that accrued during his tenure, according to UMass Memorial.

Compensation for Partners’ former chief executive, Dr. Gary L. Gottlieb, dipped slightly to just under $2.6 million in 2013. Gottlieb left Partners, the state’s largest health system, earlier this year.

Pat Greenhouse/Globe Staff

Dr. Gary Gottlieb left Partners, the state’s largest health system, earlier this year.

The chiefs of Partners’ big teaching hospitals saw their compensation rise about 4 percent. Dr. Peter L. Slavin of Mass. General made about $2.3 million, while Dr. Elizabeth G. Nabel of Brigham and Women’s Hospital made about $2.5 million.

‘We’re trying not to be the highest paid in any way, shape, or form.’

Margaret Coughlin, Children’s Hospital chief marketing and communications officer 
Quote Icon

Former Tufts Medical Center chief Eric Beyer made $1.3 million, a 45 percent boost from the previous year. Beyer earned deferred payments as he left Tufts in 2013. Dana-Farber Cancer Institute’s chief, Dr. Edward J. Benz Jr., received total compensation of nearly $1.4 million, up nearly 6 percent.

The former head of Springfield-based Baystate Health, Mark R. Tolosky , made $1.7 million, up about 7 percent from 2012.

Dr. Howard R. Grant of Burlington-based Lahey Health earned more than $1.7 million, a 4 percent increase.

Compensation stayed close to flat for two other chief executives, Dr. Kevin Tabb of Beth Israel Deaconess Medical Center, who made about $1.4 million, and Kate Walsh of Boston Medical Center, who made about $1.3 million.

Priyanka Dayal McCluskey can be reached at priyanka.mccluskey@globe.com. Follow her on Twitter @Priyanka_Dayal.
Loading comments...
Real journalists. Real journalism. Subscribe to The Boston Globe today.