Top RI Lawmaker Criticizes Rising Salaries of Healthcare CEOs, As Layoffs Hit
GoLocalProv News Team
Top RI Lawmaker Criticizes Rising Salaries of Healthcare CEOs, As Layoffs Hit
Serpa, in an interview with GoLocal on Friday, said, “It's not right. It's not fair. It's outrageous.”
She has introduced legislation that she hopes would bring some transparency to the issue.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTTwo examples of CEO compensation have infuriated Serpa in particular.
47% Increase in 5 Years
On Thursday, Providence Community Health Centers (PCHC) announced it was laying off 70 employees. The cutbacks represent 12% of the workforce.
Over the past five years, according to PCHC’s 990 filing, CEO Merrill Thomas has seen his salary jump 47% from $421,180 in 2019 to $621,513 in 2023.
With additional benefits, his total compensation in 2023 was $650,669.
“A CEO of a nonprofit is compensating themselves to the tune of $650,000 and laying off valuable workers, that sends a message to me that they really don't appreciate the mission of their agency and the time working experience of their employees,” said Serpa.
Brett Davey, a spokesperson for the non-profit PCHC, defended Thomas's compensation: "Compensation for the CEO at PCHC is set by the Board of Directors and is guided by a market survey of health care executives leading similarly-sized organizations."
Davey also said PCHC has grown substantially under Thomas' tenure, but refused to answer questions about whether it was appropriate for the head of a community health organization to receive a compensation package of more than $650,000 while serving the poor.
According to PCHC's website, the mission of the organization is to "serve by providing high quality, accessible, patient-centered care regardless of cultural background, social barriers, race, ethnicity, gender, sexual orientation, belief systems or ability to pay."
And while Thomas’s salary increases may raise eyebrows, it is nothing compared to the mega compensation package of Lifespan/Brown Health’s former CEO.
In 2023, Lifespan (now Brown Health), just months after getting tens of millions in federal and state funding, turned around and gave outgoing CEO Timothy Babineau $6,453,503 in salary and $383,339 in additional compensation.
The total compensation to Babineau in 2023 was $6,836,842.
“You know, these CEOs complain about low Medicaid reimbursement rates, and that is certainly part of the problem. I'm not denying that. This compensation is usually awarded to the CEO of any nonprofit by a governing board,” said Serpa.
“Where are the heads of the governing boards who think it's okay in this fiscal climate to award these salaries to the head of any nonprofit?” she added.
Serpa said the General Assembly should demand some accountability of these non-profits and their boards. She has introduced legislation to improve the transparency of these compensation packages.
“That's the point of my legislation — the House bill is 2025-H 6265. Let's consider how the CEOs are compensated, and how that, and it definitely factors into, services," Serpa said.
"It's borderline avaricious, self-centered, self-important, period,” said Serpa of the compensation levels.
“There's all kinds of ways to compensate the CEOs. Some of them have expensive cars, 401ks, health care coverage, deferred compensation," said Serpa. "You know, the average $20 to $25 an hour worker doesn't have those luxuries, but they're the ones who get laid off."
Serpa's bill would require nonprofit organizations to disclose their top salaries before receiving grants or funding from the General Assembly. The House Committee on State Government and Elections recently heard testimony on the bill.
2025-H 6265 would require any nonprofit, as a condition for requesting state funds from the General Assembly, to submit and to post on their website a detailed list of 10 of their highest paid director, officer and employee salaries, and any forms of compensation provided to those individuals.
“As long as the General Assembly is spending taxpayers’ money on grants and funding for nonprofit organizations, the people have a clear right to know how that money is being spent,” said Serpa, a Democrat who represents District 27 (West Warwick, Coventry). “The salaries of state employees are public and easy to find online because we believe the people are best served by this sort of financial transparency. As long as state money is going to these organizations, they should share in that transparency.”
The legislation would also require the disclosure to include fundraising, endowments, trusts, memorial giving and/or any and all activities that fund the nonprofit.
Similar legislation (2025-S 0579) has been introduced in the Senate by Sen. John P. Burke (D-Dist. 9 West Warwick).