April 11, 2008 | Read Time: 1 minute
Massachusetts hospitals are under fire from state officials who argue the groups pay excessive compensation to their executives.
Paul Levy, chief executive of Beth Israel Deaconess Medical Center, in Boston, writes that cases of excessive salaries are probably rare nationwide and that nonprofit medical institutions operate very much like commercial ones and need to offer competitive salaries to attract top talent.
But on his Running a Hospital blog he emphasizes that there is “fundamental difference” between nonprofit and for-profit entities.
“The nonprofit does not have shareholders who benefit financially from its operations. Its fundamental constituency is the community it serves,” he writes. “I know that our board and I would be making very different decisions about patient care, research, and training expenditures if we operated under a for-profit rubric.”
What do you think of the scrutiny of nonprofit hospitals? Should the state place a ceiling on charity salaries, as a Massachusetts state senator has proposed?
