Health System

Columbus health system CEO transitions complicated executive paychecks

Dave Blom retired from OhioHealth in 2019 after 36 years with Central Ohio’s largest health system and the hospitals that united to form it. (Photo: Jeffry Konczal for Columbus Business First.)

COLUMBUS, Ohio (Columbus Business First) — No one spent a full year as CEO of a Columbus hospital system in 2019. With seven chiefs at four institutions, the unprecedented year of change complicated the picture of annual executive compensation.

One top spot had been unfilled for two years, two systems promoted longtime executives to replace retiring leaders, and one chief resigned following a series of crises.

The median base salary was $1.4 million and median cash compensation including bonus was $2.1 million in 2019 for systems with more than $3 billion in revenue, according to an annual survey by compensation consulting firm SullivanCotter for the trade journal Modern Healthcare. Of course, that’s for a full year, pre-pandemic.

Dave Blom retired as OhioHealth Corp. CEO at the end of June 2019 after 36 years with Central Ohio’s largest health system and its predecessor hospitals. He was classified as an employee through that September and was paid a $904,000 base salary and $1.9 million bonus, according to the organization’s most recent IRS return for nonprofit institutions.

Dr. Steve Markovich succeeded him in July after a yearlong transition as executive vice president, during which Blom shifted increasing responsibilities.

Blom also received a $16.3 million payout from his retirement account, built up from several years deferred compensation plus investment earnings that were reportable to the IRS, a system spokesman said.

The 12-hospital system’s revenue was $4.4 billion for the fiscal year that ended June 30, 2020. The executive compensation portion of an IRS 990 form always reflects the calendar year in which the fiscal year starts, in this case 2019.

OhioHealth executive bonuses are based on a four-part performance measurement: finances, clinical quality, corporate culture and patient satisfaction, a spokesman said in response to questions from Business First. The bonus incorporates both the year in question and a separate long-term incentive for performance over three consecutive years. Moody’s Investors Service ranked OhioHealth’s finances in the 94th percentile nationally for fiscal 2020.

Base salaries also are compared against those at similar systems. For example, two-thirds of peer executives reviewed by trustees had pay higher than Markovich, the spokesman said.

At Nationwide Children’s Hospital, Dr. Steve Allen retired after 12 years as CEO. He was succeeded in July 2019 by Tim Robinsonwho in 25 years there most recently had been executive vice president and CFO.

The pediatric hospital, which also runs a huge Medicaid primary care network through Central and Southeast Ohio, had $2.7 billion revenue in 2019. Trustees base a percentage of compensation on performance against goals including budget, clinical quality and patient satisfaction.

Ohio State University completely changed the job description for its Wexner Medical Center CEO when Dr. Hal Paz joined from Aetna in June 2019, so the pay is not exactly comparable to past CEOs.

Besides leading the hospitals and faculty physician practice, Paz took on university titles as executive vice president and chancellor for health affairs, in charge of leading all colleges in the healthcare professions. Medical Center revenue for the fiscal year was $4.3 billion.

At Mount Carmel Health SystemEd Lamb resigned in mid-July 2019 after two years as CEO, in the aftermath of a Legionnaire’s outbreak and the investigation and murder charges against a since-fired doctor. Parent organization Trinity Health sent internal executive Michael Englehart as interim chief through April 2020. Both were paid by Michigan-based Trinity, not Mount Carmel itself, where system revenue was $1.85 billion.

With all that backdrop, here is the list of 2019 cash compensation from salary and bonus, with the percentage representing incentive pay. Ohio State’s figures come from a database on the university website; the others are from their 990 forms:

  • OhioHealth, Dave Blom (Jan.-June, CEO; July-Sept., emeritus): $2.85M, 68%, plus payout of $16.3M from retirement account.
  • Nationwide Children’s, Dr. Steve Allen, (Jan.-June): $2.77M, 57%.
  • OhioHealth, Dr. Steve Markovich (Jan-June, EVP; July-Dec., CEO): $2.22M, 51%.
  • Nationwide Children’s, Tim Robinson (Jan-June, EVP/CFO; July-Dec., CEO): $1.49M, 27%.
  • Mount Carmel (paid by Trinity), Michael Englehart (interim July-Dec.): $878K, 21%.
  • OSU Wexner Medical, Dr. Hal Paz (June-Dec.): $858K, 6%.
  • Mount Carmel (paid by Trinity), Ed Lamb (Jan.- July): $786K, 31%, plus $204K severance pay in calendar 2019 and $934K severance scheduled over 2020-21.

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