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October 10, 2019

Executive Compensation at the American Hospital Association

by Anne Paddock

The American Hospital Association (AHA) is a trade organization that is a tax-exempt non-profit 501 (c) (6) that represents and works on behalf of its members (hospitals/owners of hospitals) to advocate their positions to government entities (i.e. Congress, Senate, etc) and provide education and assistance to its members.

In 2017, the AHA raised $137 million (primarily through membership dues, education and licensing) and spent $123 million  (not including $3 million in depreciation), with unspent revenue allocated to the fund balance.  With more than $218 million in net fund assets, the organization reported about $10 million in investment income/net gain on the sale of assets for the year.

Based in Chicago, Illinois, the AHA has 417 employees who were compensated $60.3 million in 2017, which equates to an average compensation of $145,000.  However, only 152 employees received more than $100,000 in compensation which means a smaller amount of employees received significant higher compensation.  The 17 most highly compensated employees were compensated $12 million and were reported to be:

  • $2,503,597:  Richard J Pollack, President and CEO
  • $1,301,946:  Thomas P Nickels, SVP Fed Relations
  • $1,202,570:  Melinda R Hatton, SVP and General Counsel
  • $1,188,929:  Maryjane Wurth, EVP COO, Pres HF
  • $  618,494:  Ashley Thompson, SVP Public Policy
  • $  612,646:  Lisa M Allen, SVP, Chief HR Officer
  • $  548,610:  Alicia N Mitchell, SVP Communications
  • $  513,928:  Christina Y Fisher, SVP CFO
  • $  464,620:  John R Combes, Former SVP AHA and COO CHG
  • $  430,832:  Susan M Solomon, Group VP, Deputy General Counsel
  • $  391,272:  John Evans, Former SVP/CFO
  • $  388,457:  Gail M Lovinger, VP Secretary
  • $  383,503:  Jack A MacKay, VP/CIO – Part Year
  • $  370,807:  Eileen O’Keefe, Acting Sr Exec Member Relations- Part Year
  • $  367,765:  Gloria J Kupferman, Chief Data Strategy Officer
  • $  323,924:  Dale L Woodin, Sr Ed Infrastructure
  • $  285,497:  Ryan L Frazier, AHA SVP Member Relations

10 of the 17 (or 59%) most highly compensated employees are female while 7 of the 17 (or 41%) are male.

The Form 990 (2017) also reports:

AHA paid for first class travel. Specifically, first class travel was made available to 3 board members and Executive Vice Presidents.

AHA paid for companion travel. Specifically, spousal travel was provided to 4 officers and Executive Vice Presidents.

AHA provided discretionary spending accounts. Specifically, stipends were made available to the Chairman, Immediate Past Chairman, and Chairman Elect of the Board. Taxable benefit allowances were made available to Senior Vice Presidents and above.

AHA paid for a housing allowance or a residence for private use.

AHA paid severance payments to:  $361,168 to R John Evans; $464,320 to John Combes; $187,110 to Jack MacKay.

AHA maintained a supplemental non-qualified deferred compensation plan. The following contributions were made by the AHA to the plan for the following employees:

  • $399,809:  Richard J Pollack
  • $177,256:  Thomas P Nickels
  • $169,108:  Mary Jane Wurth
  • $ 98,948:  Melinda R Hatton
  • $ 68,316:  Ashley Thompson
  • $ 62,926:  Lisa M Allen
  • $ 57,925:  Alicia N Mitchell
  • $ 56,745:  Christina Fisher
  • $ 33,037:  Gail M Lovinger
  • $ 31,132:  Ryan L Frazier

AHA made the following distributions from the supplemental non-qualified deferred compensation plan:

  • $342,395:  Melinda R Hatton
  • $177,256:  Thomas P Nickels
  • $173,370:  Richard J Pollack
  • $ 48,753:  Alicia N Mitchell
  • $ 48,246:  Lisa M Allen

Bottom Line

The AHA has more than $200 million in net fund assets and generates about $130 million annually primarily through membership fees, education fees, and licensing.  This tax exempt non-profit employs about 400 employees who are compensated on average $145,000, although only 152 employees received more than $100,000 in compensation. The 17 most highly compensated employees were compensated $12 million, ranging from just under $300,000 to more than $2.5 million. The perks to employees – first class travel, travel for companions, discretionary spending accounts, and the supplemental non-qualified deferred compensation plan are extremely generous for a trade organization.

To read the IRS Form (2017) for AHA, click here.

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