Executive Compensation at Memorial Hermann (2022)

Memorial Hermann Health System (MHHS) is a Houston-based tax-exempt, non-profit healthcare provider with more than 33,000 employees and 6,600 physicians that serve in 17 hospitals (14 that the organization owns and 3 in which they have joint ventures) and 260 care delivery sites in the Houston, Texas metropolitan area.

MHHS consists of many organizations (non-profits, corporations, trusts, and partnerships) but for the purpose of this post, the executive compensation reported on MHHS – a 501 (c) (3) – is addressed.

Key financial information on MHHS, as reported on the Form 990 (2021 for the year ending June 30, 2022) include:

1. There are 23  members (directors) in the governing body (Board of Directors), 19 of whom are independent, although there are 29 listed on the Form 990, Part VII (due to timing differences).  24 of the 29 (83%) directors are male while 5 of the 29 (17%) are female.
2. Total revenue was $7.3 billion (compared to $6.8 billion in 2021, $5.6 billion in 2020, $5.4 billion in 2019 and $4.8 billion in 2018) most of which came from patient services (net):  $6.6 billion.
3. Expenses totaled $6.4 billion (including $337 million in depreciation) with the five largest expenses reported to be:  compensation ($3.0 billion), fees for services ($1.2 billion), medical supplies ($1.1 billion), office-related expenses ($393 million), and equipment rental and maintenance ($174 million).
4. Net assets increased from $4.1 billion to $4.7 billion from 2018 to 2019 and from $4.7 billion to $5.1 billion from 2019 to 2020, and $5.1 billion to $6.8 billion from 2020 to 2021, due primarily to spending less than received, net unrealizable gains on investments, and adjustments to assets (primarily changes in pension obligations). Net assets increased from $6.8 billion to $7.2 billion from 2021-2022 primarily because the organization spent nearly $1 billion less than they collected (which was partially offset by more than $600 million in net unrealizable losses on investments). In other words MHHS has increased net assets from $4.1 billion in 2018 to $7.2 billion in 2022 – more than $3 billion in 4 years primarily by not spending as much as they receive.  MHHS may want to consider lowering their prices instead of adding about $800 million a year to the general fund.

32,313 employees received $3 billion in compensation, which equates to an average compensation of $94,000.  7,013 employees received more than $100,000 in compensation with the 31 most highly compensated reported to be:

• $3,554,199:  David Callender, CEO/President 9/1 to Present
• $2,034,888:  Erin S Asprec, EVP, COO
• $1,781,169:  Deborah Gordon, EVP, CAO, CLO, Secretary
• $1,653,262:  James McCarthy, EVP, CPE
• $1,444,449:  Joshua Urban, SVP, President, Community Hospital
• $1,434,462:  Feby Abraham, EVP, CSO
• $1,423,750:  Gregory L Haralson, SVP, CEO-TMC
• $1,368,282:  Alec King, EVP, CFO, Treasurer
• $1,250,589:  Kyle Price, SVP, Service Lines
• $1,195,810:  Paul C O’Sullivan, SVP, CEO-Memorial City and GH
• $1,169,473:  Eric Smith, SVP, CDO
• $1,146,621:  Lori P Knowles, SVP, CHRO
• $1,120,949:  Heath Rushing, SVP, SRVC Lines
• $1,076,300:  Amanda Hammel, SVP, CIO
• $  984,262:  Malisha S Patel, SVP/CEO-SW & SL
• $  910,017:  Christopher J Langan, VP/CMO, WDLS & NE
• $  897,102:  Anne Neeson, EVP/CEO, Foundation
• $  869,525:  Jeffrey Katz, VP/CMO-TMC
• $  859,840:  Justin P Kendrick, SVP, CEO-NE & TW
• $  857,333:  Howard Scott, VP/CMO, MC & GH
• $  849,998:  Jerry A Ashworth, SVP, CEO-CY&KT
• $  839,029:  Teal Holden, SVP, Amb and Post Acute Services
• $  821,634:  Thomas Flanagan, VP, Trauma Service Line and System Integration
• $  816,473:  Carol J Paret, SVP, CCHO
• $  813,576:  Noel J Cardenas, SVP/CEO, SE & PL
• $  795,486:  Richard Lyman SVP, Revenue Cycle
• $  774,245:  Cynthia De Moya, Former  CFO
• $  678,800:  Warren Shea, VP, Asst Secretary
• $  677,617:  Alexander Greengold, SVP,CEO
• $  544,810:  Amalia Maislos Stanton, SVP, Strategic Communications and Marketing
• $  408,932:  Charles Stokes, Former CEO and President

The 31 most highly compensated employees received $35 million in compensation. 20 of the 31 (75%) most highly compensated employees are male while 11 of the 31 (25%) are female.

14 of most highly compensated employees who received more than $1 million in compensation in 2022 (and the past President and CEO) received $75 million in compensation from 2019-2022:

Charles D Stokes:  Total Compensation 2019-2022:  $11 million

• 2022:  $  408,932
• 2021:  $3,692,550
• 2020:  $3,587,445
• 2019:  $2,825,968

David Callender:  Total Compensation 2020-2022:  $7 million

• 2022:  $3,554,199
• 2021:  $2,642,628
• 2020:  $  699,625

Erin S Asprec:  Total Compensaton 2019-2022:  $8.5 million

• 2022:  $2,034,888
• 2021:  $2,633,996
• 2020:  $1,708,435
• 2019:  $2,204,477

Deborah Gordon:  Total Compensation 2019-2022:  $7 million

• 2022:  $1,781,169
• 2021:  $2,433,848
• 2020:  $1,486,246
• 2019;  $1,288,251

James McCarthy:  Total Compensation 2019-2022:  $6 million

• 2022:  $1,653,262
• 2021:  $1,990,730
• 2020:  $1,281,658
• 2019:  $  757,633

Alec King:  Total Compensation 2022:  $2 million

• 2022:  $1,368,282
• 2021:  $  375,913

Lori P Knowles:  Total Compensation 2020-2022: $3.5 million

• 2022:  $1,146,621
• 2021:  $1,358,489
• 2020:  $  910,508

Amanda Hammel:  Total Compensation 2019-2022:  $4 million

• 2022:  $1,076,300
• 2021:  $1,310,281
• 2020:  $  875,241
• 2019:  $  627,972

Gregory L Haralson:  Total Compensation 2019-2022:  $5 million

• 2022:  $1,423,750
• 2021:  $1,238,918
• 2020:  $1,137,381
• 2019:  $  896,257

Joshua Urban:  Total Compensation 2019-2022:  $5 million

• 2022:  $1,444,449
• 2021:  $1,216,612
• 2020:  $1,094,902
• 2019:  $  974,469

Paul C O’Sullivan:  Total Compensation 2019-2022:  $4 million

• 2022:  $1,195,810
• 2021:  $1,117,090
• 2020:  $1,019,062
• 2019:  $  884,608

Feby Abraham:  Total Compensation 2021-2022:  $2.5 million

• 2022:  $1,434,462
• 2021:  $1,050,419

Kyle Price:  Total Compensation 2019-2022:  $4 million

• 2022:  $1,250,589
• 2021:  $1,089,895
• 2020:  $  957,802
• 2019:  $  757,108

Eric Smith:  Total Compensation 2021-2022:  $2 million

• 2022:  $1,169,473
• 2021:  $  621,180

Heath Rushing:  Total Compensation 2019-2022:  $3 million

• 2022:  $1,120,949
• 2021:  $1,040,492
• 2020:  Not Listed
• 2019:  $  829,126

To read about contributions to the non-qualified supplemental retirement plan, see Schedule J, Part III, Supplemental Information on the Form 990.

500 independent contractors received more than $100,000 in compensation with the five (5) most highly compensated reported to be:

• $84 million:  Austin Commercial, of Dallas, TX for construction
• $33  million:  Crothall Healthcare, of Chicago, IL for housekeeping
• $32 million:  AYA Healthcare, of Dallas, TX for contract services
• $14 million:  3M Health Information Services, of Dallas,  TX for contract services
• $14 million:  Ninth Wonder, of Houston, TX for media services

To read the IRS Form 990 (2021 for the year ending June 30, 2022), click here.