Board of Trustees Statement Regarding CEO Evaluation
The LMH Health Board of Trustees has conducted its annual evaluation of LMH Health President and CEO Russ Johnson and concluded that Johnson provided strong leadership to the community hospital system over a challenging 2019.
In light of the 2019 financial results, all of the LMH Health senior leadership team voluntarily elected not to receive any increase in salary for 2020. As such, Johnson’s base compensation did not change, and variable compensation was not awarded. The 2019 budgetary shortfall was due to short-term issues, including a decrease in volume of services and reductions in payments from some commercial payers.
Overall, market share increased in 2019, and the hospital has improved agreements with key payers and will continue to focus diligently on those contracts. Despite financial challenges, LMH Health still provided more than $25 million in charitable care during the calendar year.
Cindy Yulich, chairperson of the LMH Health Board of Trustees said that Johnson’s leadership has been vital as LMH Health has taken important steps to affirm its position as a leader in quality and affordable care for patients.
“Russ has been a strategic and visionary leader for LMH Health,” said Yulich. “He recognized three years ago that changes at the local, regional and national levels in healthcare meant that LMH Health would have to evolve. We definitely saw a window of opportunity that allowed us to make some very strategic investments to prepare us for the future and we are becoming an even stronger community hospital.”
Yulich said the board reviewed progress on Destination Health, the strategic roadmap for LMH Health.
“The trustees believe Russ has made outstanding progress on the goals we set with him last year,” said Yulich. “Over 2019, LMH Health added 10 clinicians to the community in new and expanded specialties, opened a new clinic in East Lawrence, expanded operating rooms and built a new sterile processing center, and partnered with a number of organizations in the community to improve the delivery of care for patients in the midst of substance use or behavioral health crises.”
The board regularly consults compensation studies to determine that Johnson’s salary is competitive with his peers, taking into account the pay of CEOs at other health systems that are similar to LMH Health in size and revenue.
Johnson, who has more than 35 years of healthcare leadership experience, has been employed at LMH Health since August 2016. Last year, the board sought and received an additional five-year employment commitment from Johnson.
“Russ is passionate about providing the absolute best care for everyone who comes to LMH Health, regardless of their personal or financial situation,” said Yulich. “His leadership over the past year has ensured our hospital’s ability to provide outstanding services, including our charitable care, for generations to come. We are confident in the directions and strategies underway at LMH Health, and we are proud of the organization’s role as a true partner for lifelong health.”