Erlanger backs away from $1.7M in executive bonuses amid legislators criticism

Facing criticism and questions from state lawmakers after voting to award executives $1.7 million in bonuses, Erlanger Health System officials said Thursday night they will put the payments on hold and review their actions, reports the Chattanooga TFP.

Trustees for the public hospital voted Dec. 4 to approve bonuses for 99 managers, including more than $234,000 for CEO Kevin Spiegel.

The Hamilton County legislative delegation — which appointed three trustees to the 11-member board — harshly criticized the move, saying the hospital had not proven it could afford such bonuses after ending the last three years in the red and relying on a federal funding pool to end this year with a profit.

Legislators also questioned whether the board discussed the bonuses privately before the vote, possibly violating the state’s open meetings law.

“In light of those questions and in the spirit of cooperation, the board and management decided to hold payments until this issue has been addressed,” hospital officials said in a statement Thursday night.

Hospital trustee Jennifer Stanley said the decision to have an internal legal review is the “appropriate action” in order to be “respectful of a dialogue with our legislators.”

But state Sen. Todd Gardenhire, R-Chattanooga, who has led criticism of the board, said an internal review of the process is “like a fox determining the security of the hen house.”

“[The hospital attorney] is on the payroll of Erlanger. He’s one of the people that gets a bonus. He is not impartial,” Gardenhire said. “The board needs to hire a truly independent outside counsel who will rule on it and give them an opinion.”