Healthcare Business News

More not-for-profit board members receiving compensation: survey

By Melanie Evans
Posted: November 6, 2011 - 12:01 am ET

Compensation of not-for-profit hospital and health system board members increased during the past two years, results of a newly released survey show.

Conducted by the consulting and education company the Governance Institute, the 2011 biennial survey found 15% of hospitals and systems compensated some or all board members compared with 10% in 2009. The jump “marks the first significant increase in the overall percentage of organizations that compensate their board chair and other board members,” said an executive summary of a 110-page report on survey results. Board chairman receive compensation from 12% of survey respondents compared with 10% two years earlier, the report said.

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“A safe assumption can be made that this is connected to the increasing complexity of both the healthcare industry as well as the role of a non-profit hospital or health system director,” Kathryn C. Peisert, the institute's managing editor, said in a news release announcing the results. Institute members and governance experts have found recruiting hospital board members more difficult, she continued. “It is possible that more organizations are feeling the need to offer compensation for board members' time to help narrow the gap in recruitment efforts.”

Federal and state hospitals were excluded from the mail and e-mail survey of 4,250 tax-exempt hospitals conducted last March. The survey had a response rate of 15.5%.

Hospitals' and systems' use of online portals for board materials is increasing. Thirty-four percent of respondents said boards use an existing portal. Another 19% of hospitals and systems said they were adopting such an online board tool. Thirty percent said board members are provided laptops or iPads to access online board material.

Performance and adoption of a list of 95 recommended practices showed only modest increase or no increase in most areas of the fiduciary duties and core responsibilities from the 2009 report, the release said.

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