Academic Health Care Executive Pay Is Lower at Public than at Private Organizations; According to a Clark Consulting Survey.

MINNEAPOLIS -- Executives at public integrated academic health care organizations (IAHCOs) are not paid as well as their peers at private integrated IAHCOs, according to the Clark Consulting Executive Compensation Survey for Integrated Academic Health Care Organizations. The survey examined academic health care organizations that are part of a university, or tightly integrated with a medical school and faulty practice. According to the survey, base salaries, incentive opportunity and actual cash compensation paid (salaries plus incentives) are significantly lower at integrated IAHCOs than they are at private IAHCOs.

"We chose to launch this survey because integrated academic medical centers are unique, relative to other health care organizations and often more complex," said David Bjork, Managing Director of Clark Consulting's Healthcare Group. "With fewer professional peers, getting accurate, objective information on compensation levels for these executives can be very difficult." Bjork continued, "Also, because of their close connection to universities, some are tempted to associate the compensation of integrated academic medical center executives with that of university administrators rather than their true peers--executives in other medical centers."

The survey examined the compensation for 24 executive positions. One representative finding was that the CEOs at public IAHCOs made only 68% of what their peers at private IAHCOs brought home: $471,500 as compared to $659,300 at private organizations.

"The reason for the pay difference may be that public IAHCOs face two significant constraints that private IAHCOs don't face," Bjork said. "Their budgets are often limited and executive pay at public IAHCOs is often subject to close public scrutiny." Bjork also commented that "since many of these IAHCOs are a part of a university and report to academic administrators, they are subsidiaries of the university, and we know that subsidiary healthcare organizations often have lower executive pay than free-standing organizations of similar size."

The Clark Consulting Executive Compensation Survey for Integrated Academic Healthcare Organizations is the only survey of its kind that focuses exclusively on the executive compensation practices of these kinds of academic health care organizations. In addition to examining the differences between public and private IAHCOs, the survey also compared the pay practices of IAHCOs with those of academic health care organizations that operate independently of a university or medical school. According to the survey, pay is significantly lower at IAHCOs than at those other academic health care organizations.

The Clark Consulting Executive Compensation Survey for Integrated Academic Healthcare Organizations surveyed 30 academic health care organizations. Clark Consulting expects that the 2005 survey will be available for purchase this coming July. Academic health care organizations interested in purchasing the survey should contact Elaine Sitterson at 800-327-9335 or [e-mail] to learn more.

Clark Consulting's Healthcare Group is the nation's healthcare industry specialist and a leader in attracting, retaining and motivating key executives and physicians in not-for-profit healthcare organizations. The Healthcare group designs, implements and provides administrative support for tailored programs in the areas of total compensation and benefits, corporate governance, physician-hospital consulting, leadership transition planning, human resource consulting, employee opinion surveys, and labor relations. For additional information, please visit http://www.clarkconsulting.com/hg .

Clark Consulting (NYSE:CLK) is the leading public executive compensation and benefits consulting firm. Founded in 1967 and now with over 70 offices nationwide, Clark Consulting helps more than 3,900 corporate, healthcare and banking clients to keep their best people. Clark Consulting's compensation consultants specialize in designing innovative programs that attract, retain, motivate and reward executives, employees and Directors. The company's benefits consultants provide leading edge advice on the design, financing and plan administration of benefits programs. For additional information, please visit http://www.clarkconsulting.com.