Cumberland Times-News

October 11, 2012

No easy task

WMHS should look at executives’ pay as part of cost-cutting


Cumberland Times-News

— The difficult financial conditions for the Western Maryland Health System are likely to continue for the indefinite future — given the uncertainty of federal spending for health care.

As stated in a story on Page 1A of today’s Times-News, hospital leaders believe the elimination of about 95 full-time positions is more than a quick fix, it is a move that better positions the health system for future financial challenges.

Along with those manpower reductions, we would urge the health system to reassess compensation across the board — especially those of mid- and high-level management. Although two high-level adminstration positions are being eliminated because of retirements, the WMHS board has not signaled an intention of making other high-level cuts at this time, or adjusting downward any of the higher compensation it pays.

According to Guidestar, which publishes salary and financial information for non-profit organizations like the WMHS, 2010 compensation for the two positions being eliminated was $322,014 for the Chief Operating Officer and $218,073 for the Vice President of Human Resources. There are several other administration compensation packages that were $200,000 or more, including $990,287 of compensation for the health system’s CEO, Barry Ronan.

The health system’s board of directors said in a statement provided to the Times-News that it should be noted that Ronan’s compensation for 2010 included a one-time, three-year deferred pension plan that was held until the successful opening of the new Western Maryland Regional Medical Center at the end of 2009. His base salary for that year was approximately $475,000, the board said.

Nevertheless, these are high compensation amounts — especially for an area like Cumberland that has nearly 20 percent of its residents labeled by the U.S. Census Bureau as being in poverty. We would hope as the WMHS board moves forward, these compensation payments will be carefully weighed — not only in terms of local cost-of-living factors and expectations, but in terms of how compensation reduction might put the health system on better financial footing.

Saving jobs and regaining financial stability — while at the same time maintaining quality health care — is no easy task. We applaud the effort being made by the WMHS board and Ronan and his administrative team under what obviously are challenging and difficult times.

Some sound and prudent changes have already been implemented. More apparently will be necessary in the future — and they must necessarily impact everyone from the top on down.