In the years since Democrats passed the Affordable Care Act into law, the CEOs of 70 of the largest healthcare companies have raked in a cumulative $9.8 billion in earnings, according to a new report.
The survey, released Monday by Axios, found that these CEOs’ earnings “have grown faster than most Americans’ during that time.”
“The ACA has not hurt the health care industry,” Axios’ Bob Herman reported. “Stock prices have boomed, and CEOs took home nearly 11% more money on average every year since 2010 — far outstripping the wage growth of nearly all Americans.”
The survey also analyzed how CEOs stock earnings, which generate a major chunk of their total compensation, “don’t give them incentives to control health care spending,” erecting a critical obstacle to industry reform.
“A gigantic portion of what CEOs make comes in the form of vested stock, and those incentives drive their decision-making,” Herman wrote. “The analysis shows that since the ACA was passed, health care executives routinely took measures to inflate stock prices — such as repurchasing shares or issuing dividends to shareholders — that led to higher take-home pay.”
“Stock-heavy pay,” Herman continued, “also drives CEOs to do the exact opposite of their buzzword-laden goals of creating a ‘patient-centered’ health system that focuses on ‘value.'”
Axios found that CEOs are less focused on taking actions that would benefit the system than actions that would boost stock prices, such as selling more prescription drugs, performing more procedures and tests, creating new medical therapies that may not add value to someone’s life, and raising prices above inflation.
Emily Jashinsky is a commentary writer for the Washington Examiner.
