Executive Compensation at Henry Ford Health System

The Henry Ford Health System (HFHS) is a 501 (c) (3) non-profit healthcare organization with eight hospitals, numerous medical centers and one of the nation’s largest group practices, the Henry Ford Medical Group with more than 1,200 physicians practicing in over 40 specialties.  With more than 30,000 employees, HFHS is one of the largest employers in the Detroit metro area.

The most recent IRS Form 990 (2016) reports HFHS spends less than the organization receives (in 2016, the organization reported $2.8 billion in revenue but spent $2.7 billion leaving $100 million added to the fund assets, which had a net fund balance at year-end of $766 million, up from $700 million at the beginning of the year). As with most health care systems, there are numerous non-profits (foundations and other organizations) that are affiliated with HFHS. This post addresses the primary organization, HFHS.

In 2016, HFHS reported having 21,462 employees who were compensated $1.5 billion (about half of total reported revenue), which equates to an average compensation of $70,500.  2,231 employees received more than $100,000 in compensation with the 17 most highly compensated employees listed below:

• $4,746,145:  Nancy M Schlicting, CEO, Trustee
• $2,550,153:  Wright L Lassiter, III, President
• $2,338,921:  James M Connelly, Former CEO (HAP)
• $2,183,976:  Robert G Riney, SVP and COO
• $1,842,759:  John Popovich, Jr, MD, CEO HF Hospital/Physician
• $1,647,799:  William W O’Neill, MD, Physician
• $1,559,854:  William A Conway, MD, Physician Trustee
• $1,321,221:  Edward G Chadwick, Treasurer, CFO
• $1,180,709:  Theodore W Parsons, MD, Physician
• $1,157,923:  Steven N Kalkanis, MD, Physician
• $1,139,829:  Muwaffak M Abdulhak, MD, Physician
• $1,103,366:  Mary Alice Annecharico, SVP, CIO
• $  891,125:  John J Polanski, CEO Community Care Service
• $  863,444:  Adrian K Munkarah, MD, Physician Trustee
• $  834,648:  Joseph E Schmitt, SVP, Former Int CFO
• $  803,928:  Lynn M Torossian, CEO West Bloomfield Hospital
• $  380,318:  Edith L Eisenmann, Secretary

13 of the 17 (76%) of the most highly compensated employees are male while 4 of the 17 (24%) are female. Of the 10 most highly compensated employees, 9 are male while 1 (the most highly compensated employee) is a female.

The Form 990 also reports “it is the organization’s policy to pay or reimburse employees for bona fide business travel based on the most cost effective means available. Generally, when air travel is involved this equates to coach class air fare. Under certain circumstances, such as when coach class is not available or the trip is of an extensive duration, senior leadership has approved business class, first class or charter travel. In such circumstances, the travel is considered to be for a bonafide business purpose.”  There were no payments or reimbursements of first class during 2016 but there is no statement indicating there was no business class or charter travel in 2016.

In addition, the Form 990 reports that in connection with recruitment and employement of leaders and physicians, the organization agrees to provide temporary housing and relocation services.

To read about the senior leadership supplemental retirement plan, see Schedule J, Part III, Supplemental Information (link below).