According to an article in The Wall Street Journal, The hospital says it paid him $5.45 million in salary, bonus and deferred compensation in its fiscal year ended August 31, 2006, and an additional $10.95 million when he retired the next day. To which Velvel comments, The very next day? This guy got $5.45 million one day and more than doubled it a day later? Wow. Thats nice work if you can get it.
Velvel writes the fat cat charitable hospitals that pay fortunes to their executives have gotten fat in the absence of anti-trust laws over the past 28 years by merging like crazy and thereby (have) gotten power over prices.
They charge list prices that are several times cost. They focus on expensive procedures. They engage in a form of arbitrage (which I always thought was illegal); they issue tax exempt bonds and use the bond proceeds to buy securities that pay more than the hospitals are paying in interest on the tax exempt bonds, Velvel writes.
He goes on to say, They sell patients debts to tax collection companies --- who are great fun to deal with, right? They sue the poor, who cant pay, for their last nickel or the equivalent. And---just so you dont forget---who gets all the money? Well, lots of it goes to the administrators, just like in for profit health insurance companies and just as with university presidents. As the president of a true nonprofit hospital, and therefore a struggling nonprofit hospital, said to the (Wall Street) Journal, Nonprofit is a misnomer---When youre making hundreds of millions of dollars a year, how can you call yourself a not-for-profit?
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