At Saint Agnes Healthcare, CEO Bonnie Phipps took a voluntary pay cut in fiscal year 2013 and would do so again in 2014. Saint Agnes said in a statement the decision was made "in order to compensate for major financial decisions outside of Saint Agnes' control, that have affected Maryland hospitals."

She also donated two previous pay increases, in fiscal years 2011 and 2012, to the Saint Agnes Foundation, dedicated to supporting the hospital and its patients, but those donations had to be reported as income in the tax filings, the statement said.

According to Saint Agnes tax filings, Phipps received $1.9 million in the 2012 fiscal year, 4.4 percent more compensation than a year earlier.

Saint Agnes noted that Phipps' job has expanded to more than overseeing the South Baltimore hospital. In 2011, in her role as Baltimore market leader for parent Ascension Health, she took on oversight of other hospitals in Missouri, Idaho and Washington.

Multiple roles

Mercy officials said Mullen's job also involves more than just running the hospital and noted that the institution has been recognized nationally as an urban hospital success story.

"As a result of Mr. Mullen's leadership, vision and skillful stewardship, Mercy has been an economic engine for the city, infusing additional jobs into the local economy," the hospital said in a statement.

Johns Hopkins pointed out that Peterson plays three roles heading the hospital and medical system and acting as executive vice president of Johns Hopkins Medicine, the umbrella group overseeing the main hospital, the hospital group and the medical school.

"Each of those three roles are held responsible for stringent quantitative measures" in such areas as financial performance, patient safety and service excellence, spokeswoman Kim Hoppe said in a statement.

MedStar spokeswoman Jean Hitchcock also noted Samet oversees a large system and that his pay is tied to performance goals. 

Hospital executive pay is typically approved by the organization's board of trustees on the recommendation of a compensation committee. The medical institutions say they hire independent consultants and look at the pay of executives at comparable health systems when making their decisions. They also follow certain IRS guidelines.

"UMMS hospital executives are compensated in line with national benchmarks," Carver said. "The reason hospitals in Maryland are in a difficult place financially is because of four years of below-inflation reimbursement, not CEO salaries."

The hospitals have said years of below-inflation rate increases set by the Health Services Cost Review Commission, including a 1.65 percent increase approved in June, have left the institutions with barely enough revenue to operate.

Many are operating at a loss, according to a recent survey by the Maryland Hospital Association.

As a group, the hospitals' operating margin was 0.8 percent for the first eight months of the 2013 fiscal year, their second-lowest return in 14 years.

In June, the University of Maryland Medical Center in Baltimore said it would reduce labor costs by 3 percent through layoffs and attrition because of financial pressures, including federal budget cuts.

Where the cuts come

Representatives for the Maryland/DC division of 1199 SEIU Healthcare Workers East, the labor union that represents 9,000 Maryland health care workers, criticized hospitals for cutting costs on the "backs of rank-and-file workers."

"Maryland CEOs complain about the most recent state hospital rate increases and how low they are but, at the same time, these so-called low increases have not stopped executives from increasing their own pay," said Vanessa Johnson, vice president at large for the union.

Community Catalyst, the advocacy group, contends that CEO compensation should be evaluated on an individual hospital basis. One of the factors that should be considered, it says, is the role of nonprofit hospitals in the community and in providing charity care. These institutions receive tax breaks to meet this need.

"We see a lot of tightening of the belt right now," said Curtis, of the hospital accountability project.

The issue of CEO pay could become more challenging as health care shifts toward trying to treat fewer people at hospitals.

"You end up with a situation where you have a smaller institution and technically people pay less to CEOs of smaller institutions," said Harold Miller, executive director of the Center for Healthcare Quality and Payment Reform.

"But do we say as a CEO we want you to do all this hard work and be able to improve quality and reduce costs and then we're going to cut your pay because your institution is smaller?"

A previous version of this story gave an incorrect title and organization for Ronald A. Peterson.

andrea.walker@baltsun.com

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