Not a Surprise

A study has shown that nominally nonprofit hospitals spend very little on charity while grossly overpaying senior executives.

Our for-proof system of healthcare is so bad that it corrupts our charities: 

Nonprofit hospitals are under increasing scrutiny for skimping on charity care, relentlessly pursuing payments from low-income patients, and paying executives massive multi-million-dollar salaries—all while earning tax breaks totaling billions.

One such hospital system is RWJBarnabas Health, a large nonprofit chain in New Jersey, whose CEO made a whopping $17 million in 2021, while the hospital system only spent 1.65 percent of its nearly $6 billion in revenue on charity care.

To compare apples to apples, so one chief executive gets about ⅙ of its total spending on charity.

This is unjustifiable.

………

RWJBarnabas Health is far from alone in having plump executive pay and slim charity care spending. A HELP committee staff report released earlier this month examined the financial data on 16 of the country's largest nonprofit, tax-exempt hospital systems. The systems collectively make more than $3 billion in revenue each year, but in 2021, 12 of the 16 systems spent less than 2 percent of their revenue on charity care—even though, as nonprofits, they earn federal, state, and local tax exemptions for providing charity care to low-income people and other charitable community benefits. Of those 12 spending less than 2 percent, six of them spent less than 1 percent.

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Meanwhile, CEO compensation for the 16 systems averaged over $8 million, with a collective total of over $140 million. By far, the biggest earner was the CEO of CommonSpirit Health, a massive Catholic nonprofit system that runs 139 hospitals in 21 states. In 2021, CommonSpirit's CEO made $32 million. In the same year, the system spent $507 million on charity care, or 1.5 percent of its $33 billion revenue.

There is a simple solution to all of this, place a cap on maximum salaries at charities.  I would suggest a base salary limit $400,000.00, that of the President of the United States, with total remuneration, which would include bonuses, housing, travel, etc., being pegged to twice that.

That college football coaches in some programs would lose over 80% of their wages is just an unintended benefit.