An ethics professor at Fresno State is calling on Valley Children’s Hospital to “acknowledge mistakes and apologize” for handing out high executive pay.
Philosophy and ethics professor Dr. Andrew Fiala recently spoke to The Business Journal, saying the continued back-and-forth from the hospital will only continue to cause negative press.
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The backstory: Tax returns show that Valley Children’s paid CEO Todd Suntrapak $5.5 million in total compensation in 2020 and $5.1 million in total compensation in 2021, as well as giving him a forgivable $5 million home loan in 2021 as a retention bonus.
- Valley Children’s also paid six executives over $1 million in compensation in 2021, with total executive payroll set at $25.75 million.
- The hospital said its payroll numbers are inflated due to giving out yearly bonuses a month early, meaning the 2022 bonuses were also included in 2021 pay.
- However, Suntrapak’s base salary of $1.7 million – before all bonuses and benefits – was around what the CEOs of other comparable children’s hospitals make in total compensation.
What they’re saying: Speaking to The Business Journal, Fiala said the concept of nonprofit hospitals is ethically ideal, adding that a for-profit model is misplaced in the healthcare industry.
- “Members of the public are certainly entitled to ask critical questions of organizations that claim to benefit the public,” Fiala told The Business Journal. “One obvious ‘how’ issue has to do with where people choose to donate their money or spend their healthcare dollars.”
- Fiala said that the hospital can make superficial moves to smooth over the public, but long-run institution-level responses need to be considered in order regain public trust.
- “I think it is important for institutions to avoid becoming overly defensive when ethical scandals erupt,” Fiala told the publication. “Much better to acknowledge mistakes and apologize.”
Go deeper: One of those moves appears to be the creation of valleychildrensfacts.org, which was registered on April 15.
- The website boasts that Valley Children’s is nationally ranked in seven specialties by U.S. News and World Report.
- It also boasts how Valley Children’s has done everything possible to operate efficiently, invest wisely and work efficiently to support the children and avoid the financial distress facing other hospitals throughout California, noting that the hospital’s total assets have increased from $745 million to $2.2 billion.
