‘Obscene’: 70 Top Healthcare CEOs Raked In $9.8 Billion Since 2010

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Above Photo: “Stock-heavy pay drives CEOs to do the exact opposite of their buzzword-laden goals of creating a ‘patient-centered’ health system that focuses on ‘value,’” writes Axios’s Bob Herman. (Photo: Elvert Barnes/Flickr/cc)

“The median household income in 2015 was $56,515, which the average healthcare CEO made in less than a day.”

While the Senate GOP’s plan to repeal the Affordable Care Act (ACA) has been denounced as potentially devastating to the poor, the sick, women, people of color, children, and those with pre-existing conditions, a new analysis published Monday finds that no matter what happens, the CEOs of large healthcare companies are likely to continue living lavishly.

“The median household income in 2015 was $56,515, which the average healthcare CEO made in less than a day.”
—Bob Herman, Axios

Since the Affordable Care Act (ACA) passed in 2010, the “CEOs of 70 of the largest U.S. healthcare companies cumulatively have earned $9.8 billion,” according to a report by Axios‘s Bob Herman.

Herman goes on to add that the CEOs’ earnings “far outstrip[ped] the wage growth of nearly all Americans.”

“The richest year [for healthcare CEOs] was 2015, when 70 healthcare CEOs collectively made $2 billion,” Herman notes. “That was an average of about $28.5 million per CEO and a median of about $17.3 million per CEO. The median household income in 2015 was $56,515, which the average healthcare CEO made in less than a day.”

John Martin, former CEO of the pharma giant Gilead Sciences, topped Axios‘s list: he pulled in $863 million in the “ACA era.”

Despite President Donald Trump’s repeated insistence that Obamacare has been a “nightmare” and that the entire system is collapsing, Herman observes, “The ACA has not hurt the healthcare industry. Stock prices have boomed, and CEOs took home nearly 11 percent more money on average every year since 2010.” And the Senate GOP’s alternative, which Trump has enthusiastically endorsed, would likely be a further boon to industry executives, who would stand to benefit from the bill’s massive tax cuts for the wealthy.

Axios‘s analysis focused on 70 of the largest publicly traded healthcare companies—including some of the largest insurance and pharmaceutical companies—in the United States.

Perhaps the most consequential component of healthcare CEO pay, Herman observes, is the fact that “a gigantic portion of what CEOs make comes in the form of vested stock, and those incentives drive their decision-making.”

This means that CEOs are incentivized not to take actions that would benefit the healthcare system overall, but rather to “inflate stock prices” using methods “such as repurchasing shares or issuing dividends to shareholders.”

Such moves lead to higher salaries for CEOs, but not to widely shared benefits.

“Stock-heavy pay,” Herman concludes, “drives CEOs to do the exact opposite of their buzzword-laden goals of creating a ‘patient-centered’ health system that focuses on ‘value.’”

Some commentators portrayed the analysis as both indicative of the fundamental injustice at the heart of the for-profit insurance model and proof of the need for Medicare for All.

  • eight.of.wands

    But wait a minute, i thought America had the best health care system in the world….i can’t even count the number of times we’ve been told this…..hmmm….beginning to wonder if it’s not just one big mthrfckng lie…

  • kevinzeese

    You got it. There is no study that shows we are the best healthcare system in the world, we are not even in the top ten. Most show us lower than 35th. Many much poorer countries have been healthcare than the US.

  • eight.of.wands

    American exceptionalism!!….”We’re Number One!”….Greatest Country on Earth, dammit….we enjoy the highest per capita levels of self delusion of any population worldwide, by far….Wiley Coyote in midair, clueless and unaware of the chasm below…..uh oh…..”meep meep”

  • Robert Hodge

    “Daddy? why can’t I get my lifesaving treatment?”
    “Because, Mr/Mrs. Greed needs another yacht/house/offshore account. That’s why.

  • Jon

    If we self-organize into large medical coops, using Medicare as our model, we can dismiss such terrible examples of corporate greed run amuck. Fire them! That should at least be plan B if we cannot get the corporate lovers in congress to abandon their financial base!