A former physician at the MetroHealth System in Cleveland has called for a cap on CEO pay after the health system's top executive allegedly awarded himself and others more than $2.2 million in unauthorized bonuses last year.
Kenneth Frisof, MD, a retired family medicine doctor, wrote in a that CEO pay should be capped at $800,000.
"A MetroHealth physician friend of mine says that we need to view health care as a public service rather than as a profit-oriented industry," Frisof wrote in the letter. "And, as part of that, let's cap hospital system CEO salaries at $800,000, twice the salary of our most powerful public servant, the president of the United States."
The MetroHealth System Board of Trustees fired former CEO Akram Boutros, MD, last month alleging that he gave himself $1.9 million in bonuses between 2018 and 2022 without the board's approval. Boutros was set to step down from his role at the end of this month, according to reports.
Boutros, who led the MetroHealth System for nearly 10 years, allegedly gave himself bonuses after conducting "self-assessments" of his job performance, in which he established metrics and rewarded himself based on his ability to meet them. Social justice initiatives, including efforts to address the opioid epidemic and expand hospital reach within the community, , Cleveland.com reported.
"We all recognize the wonderful things Dr. Boutros has done for our hospital and for the community," Vanessa Whiting, chair of the MetroHealth System, said on Boutros's termination. "However, we know of no organization permitting its CEO to self-evaluate and determine their entitlement to an additional bonus and at what amount, as Dr. Boutros has done."
Since 2018, MetroHealth System paid Boutros $10.6 million, $4.2 million of which was supplemental bonuses. Boutros' base salary since 2018 was $869,000, but records show that he actually earned between $1.7 and $2.7 million each year after bonuses.
In 2021 alone, Boutros paid his executive team $2.26 million in additional bonuses, . He paid himself the largest share, totaling more than $450,000, and paid the subsequent largest bonuses to the chief financial officer, the chief clinical transformation officer, and outgoing chief of staff. A total of 20 executives received payments under this bonus system between 2017 and 2021, according to reports.
Following his termination, Boutros sued the MetroHealth System twice in Cuyahoga County Common Pleas Court. The , filed at the end of November, claimed that the board violated open meetings rules in Ohio, disregarding policies about how it would choose Boutros's successor and the investigation of his pay. The , which Boutros filed in mid-December, claimed defamation of character, wrongful termination, and breach of contract.
While the board of trustees claims Boutros' bonus payments were unauthorized, board member Terry Monnolly resigned over the controversy. Monnolly , stating that he believed "that the board had authorized Dr. Boutros to take all actions that he took."
Laura McBride, MetroHealth's general counsel, that the controversy between the health system and the former CEO does not center around his authorization of bonuses for the executive team. She stated that Boutros had the authority to authorize those payments under the conditions that salaries and bonuses did not exceed a certain limit.
However, only the hospital board had the ability to set the CEO's pay, McBride said. She alleged that Boutros hid part of his bonuses from the board.
A hospital audit looking into why Boutros's supplemental bonuses went undetected is underway and will likely be released in January, the hospital stated.
On Oct. 31, Boutros repaid $2.1 million to MetroHealth System for bonuses paid without approval between 2017 and 2021, as well as more than $100,00 in interest, the hospital statement noted. The former CEO also reported himself to the Ohio Ethics Commission immediately following repayment.