What affects hospital CEO pay the most: Patient satisfaction

What affects hospital CEO pay the most: Patient satisfaction

Dan Diamond (@ddiamond) tweeted this slide from a lecture by Harvard’s Ashish K. Jha at this year’s Association for Healthcare Journalist’s Annual Meeting in Denver. The slide shows how CEO incomes are affected by different variables and contains a few interesting tidbits of information.

First, hospital CEOs earn around $600,000. Far more than most physicians.

Second, hospital CEO salaries are not significantly affected by multiple different, yet seemingly important factors, including “quality” scores, the number of patients who die in their hospitals, the number of readmissions to their hospital, or the amount of charity care they provide. Logically, it would seem that the payment system would want to incentivize hospital administrators to work on those topics: Improve quality scores, decrease hospital deaths, decrease readmissions, increase charity care. But payments systems apparently don’t work that way.

Want to know the thing that affects a hospital CEO’s salary the most? Patient satisfaction.

Highly favorable patient satisfaction scores add an average of $51,000 to the income of hospital CEOs.

When your CEO threatens your job because your satisfaction scores aren’t high enough, when your CEO relies upon the statistically insignificant data reported by companies like Press Ganey, and when your CEO ignores studies showing that highly satisfied patients are more likely to die and suffer adverse consequences, now you know why your CEO may be making those decisions.

Plaintiff attorneys are crazy for not raising this issue in medical malpractice lawsuits. Companies provide invalid statistics to hospital CEOs. Hospital CEOs knowingly rely upon invalid statistics to influence medical care.

Tie patient harm to the CEO’s decisions (and motives) and you have another defendant with deep pockets who isn’t subject to a malpractice insurance cap.

WhiteCoat is an emergency physician who blogs at WhiteCoat’s Call Room at Emergency Physicians Monthly and Dr. Whitecoat.

View 15 Comments >