Executive Compensation at AdventHealth (2020)

AdventHealth (formerly known as Adventist Health System until 2019 when the 501 (c) (3) “rebranded” itself) is one of the largest non-profit health care providers in the United States with nearly 51 hospitals and hundreds of care sites in 9 states. Based in Altamonte Springs, Florida, AdventHealth is a very large system with dozens of separate 501 (c) (3)’s for the hospitals, physician care, patient care, and more.

This post looks at the executive compensation at  Adventist Health System Sunbelt Healthcare Corporation (AHSSHC), the tax-exempt, non profit organization that provides management, leadership, and oversight to all the subsidiaries.  It is important to note there are dozens of other related and affiliated non-profits and for profit organizations  related to AdventHealth that are not covered in this post.

AHSSHC

AHSSHC provided executive leadership and other professional support services to the subsidiaries and affiliates of its healthcare network.  Consequently, most revenue is from affiliated organizations within the network who pay AHSSHC for management and reimbursement for salaries, wages, and other expenses.  However, it is important to note AHSSHC has more than $765 million in net assets which indicates AHSSHC has historically spent less than the organization received.

In 2020, AHSSHC reported having 5,089 employees who received $613 million (compared to 4,940 employees who were compensated $568 million in 2019 or an average of $115,000), which equates to an average compensation of $120,000.

Think about the concept of having nearly 5,100 employees to oversee 51 hospitals (who all have their own CEO, COO, CFO, and administrative staff) and other service centers (who have their own management, billing and administrative staff). If we just consider hospitals, that’s about 100 employees for every hospital over and above their own management and administrative staff.  How is it that healthcare has become so complicated that an organization needs additional sets of CEO’s, COO’s, CFO’s and administrative staff to oversee CEO’s, COO’s, CFO’s and administrative staff?

1,457 employees received more than $100,000 in compensation with the 20 most highly compensated employees listed below:

• $4,569,104:  Paul Rathbun, Director (beg 9/18; end 9/20). SEVP/CFO
• 3,198,492:  Terry D Shaw, Director/President/CEO
• $3,085,628:  Randall L Haffner, Director/SEVP/CEO Multi-state Division (end 9/20)
• $2,467,518:  Lars D Houmann, Director/COO
• $2,190,031:  Daryl Tol, SEVP/CEO Central Florida Division, Director (end 9/20)
• $1,676,366:  David Banks, EVP, Chief Strategy Officer
• $1,639,497:  Michael Schultz, SEVP, CEO West Florida Division, Director (end 9/20)
• $1,613,817:  David Moorhead, SEO, Chief Clinical Officer (beg 12/18)
• $1,567,554:  Todd Goodman, SVP/CFO, Central Florida Division
• $1,520,804:  Kenneth A Finch, President/CEO, Southwest Region (end 1/20)
• $1,436,268:  Brent G Snyder, Director/ EVP/CIO (end 9/20)
• $1,397,998:  Eddie Soler, EVP/Senior Finance Officer
• $1,342,246:  Bruce Bergherm, SEO, Acute Health, West Florida Division
• $1,323,096:  Richard J Carroll, CMO, Bollingbook/Glen Oaks
• $1,319,748:  Sandra K Johnson, Director (end 9.20)/EVP/Chief Admin Officer
• $1,310,505:  Jeffrey Bromme, EVP, Chief Legal Officer
• $1,102,810:  Kathleen Clem, Former EVP, Chief Clinical Officer (end 12/18)
• $1,051,552:  Bryan Stiltz, EVP, Business Units
• $  970,346:  Olesea Azevedo, SVP, Chief HR Officer
• $  707,200:  Patricia Celano, SVP/Assoc Chief Clinical Officer

The 20 most highly compensated employees received $36 million, which equates to an average compensation of $1.8 million.

16 of the 20 (80%) most highly compensated employees are male while 4 of the 20 (20%) are female. Of the 10 most highly compensated employees, all are male.  It is also important to note AHSSHC has 22 voting members of a governing body, 16 of whom are independent, although the Form 990 (2020) lists 70 directors (due to timing differences), 60 of whom are male (86%) and 10 of whom are female (14%).

6 of the most highly compensated employees (all male) received $76 million in compensation over the past 5 years:

Terry Shaw: $17 million

• 2020:  $3,198,492
• 2019:  $4,712,219
• 2018:  $4,495,072
• 2017:  $3,538,936
• 2016:  $2,113,738

Randall Haffner:  $14 million

• 2020:  $3,085,628
• 2019:  $3,041,828
• 2018:  $3,273,659
• 2017:  $2,654,661
• 2016:  $1,973,223

Lars Houmann:  $14 million

• 2020:  $2,467,518
• 2019:  $2,905,971
• 2018:  $3,394,902
• 2017:  $2,760,536
• 2016:  $2,188,638

Daryl Tol:  $10 million

• 2020:  $2,190,031
• 2019:  $2,150,623
• 2018:  $2,073,454
• 2017:  $1,573,978
• 2016:  $1,413,783

Michael Schultz:   $10 million

• 2020:  $1,639,497
• 2019:  $1,908,196
• 2018:  $2,471,106
• 2017:  $1,919,025
• 2016:  $1,592,650

Paul Rathbun:  $11 million

• 2020:  $4,569,104
• 2019:  $1,843,957
• 2018:  $1,949,110
• 2017:  $1,576,022
• 2016:  $1,274,006

AHSSHC paid for first class or charter travel, travel for companions, health of social club dues or initiation fees, discretionary spending accounts, and gross up payments and tax indemnification. For details on these expenses, see Form 990, Schedule J, Part III, Supplemental Information.  In addition, information on the SERP and SEDB (Senior Executive Dean Benefit) Plans are also detailed.

To read the IRS Form 990 (2020), click here.