Executive Compensation at Sanford Health (SD)

Sanford Health is a non-profit, tax-exempt healthcare system based in Sioux Falls, South Dakota.  Made up of dozens of non-profits, partnerships, corporations, and trusts that include 46 hospitals, 210 clinics, more than 200 senior community living communities, and more staffed by nearly 50,000 employees, Sanford Health operates in 26 states and 10 countries.

The purpose of this post is to report the executive compensation in 2018 as reported by the Sanford Group Return – a tax-exempt, non-profit 501 (c) (3) managed by 14 trustees, 6 of whom are independent.  11 of the 14 (79%) trustees are male while 3 (21%) are female.

In 2018, the Sanford Group Return reported total revenue of $2.1 billion (compared with $3.9 billion in 2017 which means the organization probably made a sale or reported revenue on another return for an affiliated organization). Expenses totaled $1.9 billion (not including $81 million in depreciation) with the largest expense being compensation ($1.2 billion) for the 34,256 employees, who received an average compensation of $35,000.  3,145 employees received more than $100,000 in compensation with the 28 most highly compensated employees reported to be:

• $3,827,442:  Kelby K Krabbenhoft, Sanford President and CEO
• $2,800,651:  Tomasz Stys, Physician
• $2,749,045:  Scott Pham, Physician
• $2,691,586:  Adam Stys, Physician
• $2,656,090:  William Brunner, Physician
• $2,539,639:  Eric Belanger, Physician
• $1,565,485:  Nate White, COO, President, Fargo
• $1,497,449:  Michael LeBeau, Trustee/SVP/Bismarck Clinic
• $1,340,480:  Paul Richard, Former EVP, Fargo
• $1,307,946:  JoAnn L Kunkel, CFO
• $1,292,864:  Randy Bury, Chief Administrative Officer
• $1,284,331:  Bill Marlette, Treasurer
• $1,116,191:   Allison Wierda-Suttle, SVP, Chief Medical Officer
• $1,092,700:  Paul Hanson, President, Sioux Falls
• $1,082,098:  Micah Aberson, Chief Global Brand Officer
• $  999,957:  Craig Lambrecht, President, Bismarck
• $  978,669:  Bill Gassen, Chief HR Officer
• $  900,188:  Matt Hocks, SVP, Health Service Operations
• $  885,689:  Maria Bell, Trustee/Research Administrator
• $  839,547:  Kim Patrick, Chief Business Development Officer
• $  780,983:  Mark Lundeen, Trustee/Orthopedics Service Chair
• $  771,757:  Jennifer Grennan, Chief Legal Officer
• $  766,774:  Bryan Nermoe, President, Bemidji
• $  736,197:  Michelle Bruhn, SVP, Finance, Health Services
• $  585,376:  Michelle Micka, SVP, Finance, Corporate
• $  358.438:  Daniel Olson, Former EVP, Bemidji
• $  348,801:  Mark Paulson, Chair/Physician Regional Chair
• $  251,522:  Andy North, Trustee

The 28 most highly compensated employees received $38 million in 2018, with the 5 most highly compensated employees receiving $15 million, or an average of $3 million each.

Of the 28 most highly compensated employees, 21 (75%) are male, while 7 (25%) are female.

Sanford Group Return paid for first class or charter travel, travel for companions, health or social club dues or initiation fees, and provided gross up payments or tax indemnification. See Schedule J, Part III of the IRS Form 990 (2018) for more detailed information.

Barb Everist, a Trustee of the organization was involved in a $6 million transaction in which the organization contributed $6 million into Everist Health during the previous two fiscal years.  As a result, Sanford and Barb Everist both owned more than a 10% interest in this company (although its unclear why a contribution by the organization gave Everist an interest in the Everist Health unless she already had an interest in Everist Health).

Michelle Bruhn, one of the most highly compensated employees, received $745,824 when she sold a franchise (presumably to Sanford Health Group or an affiliate).

Annette White, who is related to Nate White, one of the most highly compensated employees received $620,708 in compensation.

To read the IRS Form 990 (2018), click here.