The Erlanger board of trustees on Thursday night approved a seven percent salary increase for CEO Kevin Spiegel, who has led a resurgence of the public hospital.
Mr. Spiegel's base pay goes from $748,000 to $840,000. The raise is retroactive to July.
If he meets all the goals for his incentive bonus, his total compensation would go just above $1 million, said Jose Pagoaga. His Sullivan Cotter compensation consultant firm recommended the increase.
Mr. Pagoaga said Mr. Spiegel is now at 25th out of 50th of his hospital peers. With the increase, he goes to 17th out of 50.
If he met all the incentive goals, he would go to 12th.
The consultant said prior to last year, when Mr. Spiegel got another sizable raise, the Erlanger CEO pay level was "close to the bottom."
Mr. Pagoaga said the seven percent includes three percent based on keeping pace with his peers and four percent based on the hospital's record-breaking performance.
For the first quarter of the fiscal year, Erlanger had a $6.3 million profit. That is above the $4.5 million goal, but below last year's $7.7 million.
Britt Tabor, finance director, said Erlanger has not yet received the first quarter's Disproportionate Share funds from the state of about $2.1 million.
He said revenues were $178 million - up 16 percent. Expenses rose 18 percent.
Mr. Tabor said beds opened recently at Erlanger North in Red Bank have not been used as much as expected, but he said Erlanger East on Gunbarrel Road "is exceeding expectations dramatically." He said when it fully comes on line in December 2016 "it should be a game changer."
He said market share is shifting to Erlanger and that should continue to climb with the opening of new orthopaedic and vascular suites.
Mr. Tabor said the payor mix for Erlanger "is really, really good for a public hospital. To have a 33 percent payor share is dramatic."
Dr. Nita Shumaker said she wants hospital officials to continue to work on a performance pay plan for hospital employees. Mr. Spiegel said that is under study.
Donnie Hutcherson, board chairman, said it is difficult to have an incentive pay plan that works for over 4,000 employees.