Executive Pay
5:17 pm
Fri March 15, 2013

Striking Providence Hospital Workers Criticize Nonprofit CEO’s $6 Million Pay

More than 500 workers at Providence St. Peter Hospital in Olympia are on strike.

The strikers say Providence has cut their health care benefits, even as the nonprofit hospital system has boosted executive pay into the millions.

Along with housekeepers, nursing assistants and other staff, surgical technologist Bob Wilson is a member of the Service Employees International Union local 1199NW.

“You see all the guys on TV that hand the doctor the scalpel? That’s me,” he said from the picket line on Friday. “We’re out here because we think we deserve affordable health care.”

The union and Providence St. Peter have been in contract negotiations since last summer. SEIU represents about one fourth of the hospital's employees.

In January, employees' health insurance changed. The union says the higher deductibles and out of pocket expenses hurt for a union whose median member makes $31,000 a year.

“I’m forgoing care,” Wilson said. “I’m not going and seeing a doctor unless I absolutely have to. A lot of people here at Providence are doing the same thing: They’re trying to save their money.”

Providence St. Peter is part of Providence Health & Services. The Catholic organization runs hospitals in five western states. Its headquarters is in Renton. The nonprofit’s mission:

... reveal God’s love for all, especially the poor and vulnerable, through our compassionate service.

Providence officials declined to be interviewed for this story. But in emails, they said that Providence St. Peter’s latest contract offer and its new health plans are both very competitive with other health care providers. The contract offer includes a wage increase as well as medical, dental and retirement plans.

The union says Providence can afford to do better given what it pays its CEO, John Koster.

The union just learned of Koster’s 2011 pay on Thursday after reading Providence’s latest filing with the IRS. Providence reported Koster’s compensation as $6.4 million, up from $3.1 million in 2010.

“That fired us up a little on the picket line and got a few more people chanting,” Wilson said.

Providence’s IRS filing reveals that 19 employees of the Catholic ministry earned at least $1 million in 2011. Eight of those employees earned at least $2 million. The top five executives earned more than $3 million each. (Providence won't file its 2012 return until November.)

In an email, Providence spokeswoman Colleen Wadden said Providence sets its compensation the same way, whether it’s for housekeepers or executives: Base salaries are set at the middle of the market.

Of course, housekeepers don’t get multimillion-dollar bonuses on top of their base salaries, as top Providence executives do. Providence reported paying Koster $1.1 million in base pay in 2011, bonuses of $3.6 million and deferred compensation of $1.6 million.

Wadden said John Koster’s compensation was boosted in 2011 by retirement benefits that he had accumulated over many years.