Executive Compensation at Advocate Health and Hospitals Corp

Advocate Health and Hospitals Corp is a tax-exempt non-profit 501 (c) (3) and one of many organizations within Advocate Aurora Health (which was formed when Advocate Health Care (in Illinois) and Aurora Health (in Wisconsin) merged into one healthcare system (Advocate Aurora Health or AAH) in 2018. Based in Downers Grove, Illinois, AAH operates 26 hospitals and more than 500 out patient care sites staffed by 75,000 employees.

Advocate Health and Hospitals Corp (AHHC) is governed by 11 voting members (directors), 8 of whom are independent.  12 directors are reported on the 990 (which appears to be due to timing differences) – 9 of the 12 (75%) are male while 3 of the 12 (25%) are female. 10 of the directors receive between $4,000 – $91,000 annually for an average of 1 hour of work per week.

In 2018, AHHC reported total revenue of $5.5 billion, with the 4 primary sources of revenue reported to be:

• $1.5 billion:  Medicare/Medicaid
• $1.4 billion:  Patient Services
• $1.2 billion:  Blue Cross/Managed Care
• $1.1 billion:  Pharmacy/Lab

Expenses totaled $5.1 billion (not including $235 million in depreciation) with the 6 largest expenses reported to be:

• $2,471 million: Compensation
• $  664 million:  Medical Supplies
• $  592 million:  Other Intracompany Expenses
• $  443 million:  Fees for Services
• $  312 million:  Other Expenses (no detail provided)
• $  305 million:  Office-related Expenses

As listed above, compensation is the largest expense.  34,942 employees received nearly $2.5 billion, which equates to an average compensation of $72,000.  The 42 most highly compensated employees were reported to be:

• $8,511,655:  James Skogsbergh, President and CEO, Director*
• $4,015,559:  William P Santulli, EVP, COO*
• $3,538,897:  Lee B Sacks, EVP, Chief Medical Officer*
• $2,298,969:  Michael Farrell, President of Advocate Children’s Hospital
• $2,689,841:  Dominic J Nakis, SVP, CFO,  Treasurer*
• $2,147,718:  Susan Campbell, SVP, Patient Care, Chief Nursing Officer
• $2,112,967:  Earl J Barnes, II, SVP, General Counsel and Secretary*
• $2,070,518:  Michael Lappin, Secretary*
• $1,955,183:  Kenneth Lukhard, Former President of Christ Medical
• $1,938,807:  Vincent Bufalino, President of Phys and Amb Services*
• $1,859,488:  Kevin Brady, SVP, Chief HR Officer*
• $1,795,969:  Hamad Farhat, Neurosurgeon
• $1,531,013:  Dominica Tallarico, President of Lutheran General (former)
• $1,497,213:  Karen Lambert, President of Good Shepherd and Condell
• $1,430,156:  Scott Powder, SVP, Chief Strategy Officer*
• $1,422,638:  Eric Tower, VP, Associate General Counsel*
• $1,329,194:  Richard Heim, President/ PSA of S Chicago and SS
• $1,285,138:  Michel Ilbawi, Pediatric CV Surgery
• $1,284,365:  Colleen Kannaday, President of Bromenn
• $1,283,884:  Egon Doppenberg, Neurosurgeon
• $1,243,065:  Dean Karahalios, Neurosurgeon
• $1,214,999:  Kelly Jo Golson, SVP, Chief Marketing Officer*
• $1,202,297:  David Fox Jr, President of Good Samaritan
• $1,092,341:  Barbara Byrne, SVP, CIO*
• $1,086,072:  Michael Grebe, Assistant Secretary*
• $1,080,455:  Ryan Trombly, Former Neurosurgeon
• $1,004,157:  Nan Nelson, Assistant Treasurer*
• $  932,278:  Terika R Mbanu, President of Lutheran General, Trinity
• $  926,083:  Kathie Bender, SVP, Mission and Spiritual Care*
• $  906,110:  Rick Floyd, Former President of Lutheran General
• $  688,031:  Leslie Lenzo, Assistant Treasurer
• $  666,880:  Rachelle Hart, Assistant Secretary*
• $  572,573:  James Doheny, VP, Controller and Asst Treasurer
• $  518,279:  Matthew Primack, President of Christ Medical Center
• $  508,566:  Bruce D Smith, SVP, Former CIO
• $  481,864:  Michael Kerns, Assistant Secretary*
• $  452,661:  James Slinkman, Assistant Secretary*
• $  431,009:  Gail D Hasbrouck, Director*
• $  381,956:  Steve Huser, Assistant Treasurer*
• $  247,379:  James Dan, Former Pres Phys and Amb Services
• $  240,969:  Gail Stuck, EVP, Chief Medical Officer, Director
• $  210,804:  Nancy M Tinsley, President of Good Samaritan

The 42 most highly compensated employees received $62 million in compensation.  28 of the 42 (67%) are male while 14 of the 42 (33%) are female.A “*” indicates all or a portion of the compensation was from a related/affiliated organization.

AHHC paid for first class or charter travel, personal services, health or social club dues or initiation fees, and housing allowance or residence for personal use.  For more detail, see the Form 990, Schedule J, Part III, Supplemental Information.

448 independent contractors received more than $100,000 in compensation with the five highest reported to be:

• $76.3 million:  Clifford Law Offices, of Chicago, IL for legal services
• $66.0 million:  Winters, Salzetta, O’Brien, and Richardson, of Chicago, IL for legal services
• $42.0 million:  McNabola and Associates, of Chicago, IL for legal services
• $40.7 million:  University of Chicago, of Chicago, IL for university services
• $27.4 million:  University of Illinois, of Chicago, IL for university services

As illustrated above, more than $186 million was spent on legal services.

And lastly, it is important to note AHHC reported $4.9 billion in net assets at year-end.