The CEO Who Made a Fortune While His Hospital Chain Collapsed

https://www.wsj.com/business/steward-health-ceo-ralph-de-la-torre-deabfe4b

by ViktorRay • 2 years ago

19 18 2 years ago

siva7• 2 years ago

Dr. de la Torre made more money as a heart surgeon than in his first years as a corporate CEO

Something is going wrong if you're making as a heart surgeon more than a corporate CEO because who pays for this? Is this making healthcare inaccessible to those who need it so someone can buy a yacht or two?

christophilus• 2 years ago

I’m willing to bet you can find a capable CEO more easily than you can find a capable heart surgeon. There is no rigorous CEO school. MBAs aren’t a prerequisite. There is a fairly rigorous medical degree requirement if you want to be a highly specialized surgeon...

eesmith• 2 years ago

Which leads back to the supply of doctors, which depends on the limited number of med schools available and residency slots, and scope-of-care restrictions. (Eg, see https://skeptics.stackexchange.com/questions/4561/does-the-a... and https://blog.petrieflom.law.harvard.edu/2022/03/15/ama-scope... )

borbulon• 2 years ago

Something is wrong with the whole system of how people are compensated for their work; a Starbucks employee shouldn’t have to rely upon the good graces of their customers (tips) to earn a living wage, either.

That being said, a heart surgeon has a very specific and wide-ranging set of knowledge and skills which not many people could have, not to mention the incredible amount of stress they’re under.

legacynl3• 2 years ago

Honestly in a 'Just' system I think the heart surgeon is supposed to make more than a CEO

Ekaros• 2 years ago

I don't really know. Both should be doing reasonable well, but what is the impact of single surgeon? How many people can they heal a day?

Where as well managed hospital run by CEO could impact lot more people effectively each and every day. Not that that pay should be insane either...

tivert• 2 years ago

Honestly in a 'Just' system I think the heart surgeon is supposed to make more than a CEO

Yes, but in a just system they'd both also make less than they do now. Maybe ~$200k/year total compensation, say?

IIRC, surgeons had the prestige and power when the fundamentals of the modern American medical billing system were established, so "procedures" pay better than office visits, and surgeons get compensated waaay more than other doctors because they do lots of procedures.

legacynl3• 2 years ago

While it was losing hundreds of millions of dollars a year, Steward paid at least $250 million to its chief executive officer

Can somebody explain to me the reasoning behind these payouts? Isn't this an incredible incentive for ceo's to make unsustainable changes, that look good by the time the bonus is payed out, but then destroys the company in the long run? But at that point this CEO is ofc already long gone with his 250mil ?

Eddy_Viscosity22• 2 years ago

Theoretically, the board of directors would intervene to prevent this. But in practice, boards are 'captured' entities filled with relatives and cronies of the CEO. So, the answer is that yes, the incentive exists for CEOs to rape a company for personal benefit. And it happens frequently.

josefritzishere• 2 years ago

Is there a legal mechanism which might prevent, or penalize the capture of boards of directors? It's an obvious conflcit of interest, but I'm not sure if it's illegal.

bananapub2• 2 years ago

Can somebody explain to me the reasoning behind these payouts? Isn't this an incredible incentive for ceo's to make unsustainable changes, that look good by the time the bonus is payed out, but then destroys the company in the long run? But at that point this CEO is ofc already long gone with his 250mil ?

the reasoning is the board were negligent

morgango• 2 years ago

https://archive.is/3ofL4

toomuchtodo• 2 years ago

The CEO Who Made a Fortune While His Hospital Chain Collapsed

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