Things are certainly looking up for top executives of the not-for-profit Westchester Medical Center. During the height of the Great Recession, when so many were losing jobs, raises and benefits our collective economic bearings these officials were taking home non-recession-like raises totaling tens of thousands of dollars. President and CEO Michael Israel certainly lost no ground: While the hospital poor-mouthed and laid off workers, a 6 percent raise pushed his salary to $1.31 million.
Israel was hardly alone, as a cadre of medical center vice presidents saw raises from 2009 to 2010, most between 5 percent and 8 percent, on 2009 incomes generally ranging from roughly $313,000 to $738,000. Compensation for one post increased 18 percent, to $298,000; compensation for another was trimmed 3 percent, to $305,000, according to the report by staff reporters Cathey ODonnell and Theresa Juva, who reviewed documents secured under the Freedom of Information Act.
Market forces, competitive imperatives and changing duties partly explain the changes, which come to light as Gov. Andrew Cuomo has moved to rein in high pay in the nonprofit sector, or at least the amount of public dollars going to such compensation. Moreover, health care has long been regarded as recession-proof, at least for those holding choice positions, the choicest being those at the top. We have to deal with competition, said hospital board Chairman Mark Tulis. We cant pay [Israel] less than competitors.
The medical center in 2010 laid off 130 workers, instituted a hiring freeze and announced an $18 million budget cut for the following year. Amid such belt-tightening, there is no requirement that top executives forgo raises or bonuses; indeed, many boards, public and private, richly reward executives who turn profits or otherwise stay on track in the midst of economic upheaval. Nonetheless, the combination of raises for execs and job cuts for others presents optical challenges. There is no shared sacrifice, there is no appearance of a shared sacrifice, said Jayne Cammisa, a union representative and a registered nurse. Its awful what they are doing to the bottom-line workers. Weve been asked to sacrifice more and more.
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Reducing administrative overhead in health care is key to solving our crisis in health care one that could grow worse in short order. The Supreme Court last week heard argument on the Affordable Care Act, the health care reform law challenged by 26 states as unconstitutional. In jeopardy are a host of provisions not just a controversial insurance mandate aimed at slowing the unsustainable trajectory of medical spending. How important is that? A study in the March-April Annals of Family Medicine concluded that the cost of a family health insurance premium would equal the median household income by 2033; provisions in the challenged health care law may push the threshold back to 2037.
Drs. Richard Young and Jennifer DeVoe write: Continuing to make incremental changes in U.S. health policy will likely not bend the cost curve, which has eluded policy makers for the past 50 years. Private health insurance will become increasingly unaffordable to low-to-middle-income Americans unless major changes are made in the the U.S. health care system adding more strain on health care, families and our economy.
Their report goes into no detail about all of the reforms required to improve affordability just as well in an age were ideological differences and indifference doom even modest fixes. But they note that reduced administrative overhead could yield cost savings without compromising quality. (Therein, no doubt, is a hint for the medical center and such facilities nationwide.)
Young and DeVoe note that removing certain profit mechanisms from the equation would move the United States closer to a sustainable system. Likewise, demonstration projects aimed at boosting primary care, through a patient-centered medical home concept, have reduced cost and improved quality. The tipping point may come when patients and physicians realize that we cannot provide all possible services to all people; they illustrate this concern by pointing to Medicare approval of a $93,000 drug regimen they say increases the life expectancy of a prostate cancer patient by four months.
Their report concludes with this, which seems like so much fantasy after the Supreme Court arguments, and the ceaseless rancor over health care, including on the presidential campaign stump: For the sake of our children and grandchildren, lets hope that we find the courage to have the difficult discussions now and make the right choices to achieve sustainability.
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Editorial: Reduce health care costs by cutting administrative overhead
