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Health Care CEOs Earn Top Pay

The scrutiny of CEO salaries has now turned to chief executives in the health care field, often ignoring the specific reasons why the salary levels rank high. Health-care company chief executives had the highest median pay of any industry captured by the recent The Wall Street Journal CEO Compensation Study.

The scrutiny of CEO salaries has now turned to chief executives in the health care field, often ignoring the specific reasons why the salary levels rank high. Health-care company chief executives had the highest median pay of any industry captured by the recent The Wall Street Journal CEO Compensation Study. But their salaries were often increased by such things as bonuses, long-term incentives, and stock options.

For example, Stephen Hemsley, the CEO of UnitedHealth Group, with a 198 percent jump in total direct compensation, had among the biggest year-over-year percentage gains in pay among health-care CEOs. Hemsley also had $99 million in realized long-term incentives, which mostly came from gains in options exercised in the past fiscal year. That gave him the second-largest realized long-term incentive windfall among the CEOs analyzed.

The median CEO pay in the industry was $10 million, according to the study, which was done in conjunction with consulting firm Hay Group. That beat out consumer goods at $8.9 million and telecom and oil and gas, both with median CEO pay of $8.6 million.

Paul Dorf, managing director of Compensation Resources Inc., a compensation consulting firm, said the resiliency of the sector as a whole led to high pay in health care.

The total shareholder return for Thermo Fisher Scientific, for example, where CEO Marc Casper received total compensation of $33 million, was 40 percent in fiscal year 2009.

For more about health-care CEO salaries from The Wall Street Journal, please click here.

About ceo briefing - nov. 23 2010