The departed CEO earned $603,000, worked for Manitoba Shared Health for just 4 months last year

The former CEO of Shared Health saw his salary rise to more than $600,000 last year, an increase of nearly 83 percent from the year before, despite working for just four months before unexpectedly leaving the provincial health care organization.

According to recent compensation disclosures, Adam Topp earned $603,604 in 2023.

The same documents show that some executives also claimed additional compensation of $30,000 to $60,000. This extra compensation was attributed in part to the fact that they received retroactive pay raises equal to the pay raises of union health care workers.

Topp led Shared Health for less than four months in 2023 before the organization described his departure as a “resignation” in a brief, two-sentence statement to the media in late April. The announcement of his replacement — Lanette Siragusa, one of the public faces of Manitoba’s COVID-19 response — was made the next day.

Compared to the previous year, Topp’s compensation in his final year on Shared Health’s payroll grew nearly 83 percent, to $272,865 in 2023, up from the nearly $331,000 he earned in 2022. His 2023 compensation is three times that of Manitoba Premier Wab Kinew.

According to a business professor at the University of Manitoba who teaches a course on compensation, the high payout indicates that Topp received severance pay because he was fired, rather than the voluntary departure that Shared Health initially proposed.

Dismissal is likely the result

“It’s hard to imagine them just paying out the remainder of the employment contract,” said Sean MacDonald.

A spokesman for Shared Health declined to comment on Topp’s terms of employment, describing it as a personnel matter.

MacDonald said high severance packages for top executives can lead to public outrage, but he also said these benefits are often written into employment contracts.

“I don’t think people should immediately think that this is scandalous, just because these are high figures for the top executives.”

According to MacDonald, high salaries are necessary to attract top executives, and severance pay protects them from the risk of taking a job they could suddenly lose.

A union leader fighting for better wages for healthcare workers thinks differently.

“That’s downright obscene, frankly, compared to the two and three [per cent pay increases] “Which frontline workers have been receiving annually,” said Shannon McAteer, health care coordinator for the Canadian Union of Public Employees in Manitoba.

McAteer says she understands Topp may be entitled to severance pay, but she’s still surprised at how much that pay might be.

Shared Health declined to disclose details about Topp’s compensation or the implications of his departure.

Topp, who led Shared Health for two years, is currently a partner at a health care consulting firm. He did not respond to a request for comment through his firm.

Under Manitoba’s Public Sector Compensation Disclosure Act, government agencies must disclose the salary of every public sector employee earning more than $85,000 each year. Total salary includes overtime, retirement/severance pay, lump sum payments, vacation pay, and benefits.

The recent Manitoba regional health authority compensation report also found that some executives will earn tens of thousands of dollars more in 2023 than in 2022.

Some of the salary increases for Shared Health management staff included a year-over-year increase from $205,000 to $265,000, $171,000 to $228,000 and $194,000 to $234,000. Their job titles remained the same during this period, according to the disclosure reports.

While these documents do not provide insight into what each person’s salary consists of, Shared Health and the Winnipeg Regional Health Authority indicated that retroactive pay raises contributed to the higher earnings.

In 2023, non-union health care workers received the same percentage increases and back pay that union health care workers had expected.

Same salary increases for managers

Health officials said the pay increases match the pattern set by seven-year contracts reached by several health-care unions, which won overall wage increases of 9.6 percent before they were compounded. Health-care employers were then required to pay years of wages owed, totaling hundreds of millions of dollars. Nurses, for example, received $216.7 million.

MacDonald, a professor at the University of Minnesota’s Asper School of Business, said executives and managers are generally expected to be paid more than their employees. However, he said the tasks they perform in health care and their relative importance vary widely.

He accepts the premise that some health care executives may need a pay raise after being under a pay freeze for some time themselves, he said.

But “we have to accept that the administrators are not always paid more than the patient care providers. And that is because their work, the patient care providers, is seen as more valuable.”

MacDonald said wages for some health care professionals are understandably rising because of the high demand for these roles. The same cannot be said for executives, he said.

“You have to look at it on a case-by-case basis, but not all managers deserve these raises.”

Manitoba’s NDP government has repeatedly stated that it wants to reduce administrative costs in health care and free up money for the front lines.

Shared Health, an organization created by the former PC government during health care reform, initially came under the party’s heaviest criticism before the election. However, the NDP has walked back that promise, promising to reduce bureaucratic costs in health care in general, but not to target any specific entity.

Health Minister Uzoma Asagwara said the government remains committed to spending less on administration.

“Heather Stefanson’s administration paid executives huge sums of money while patients faced longer wait times and health care workers went years without contracts. We have tasked Shared Health to right their financial ship, cut their bureaucracy, and redirect resources back to patients and the front lines of care,” Asagwara said in a statement.

The Canadian Taxpayers Federation warned that the compensation reports show the province is heading in the wrong direction.

“If the government really wants to improve health care and get more people treated and cured, it’s going to be a tough sell if it wants to spend all that money on executives and top officials who aren’t really focused on the cure,” said Gage Haubrich, executive director of the Prairie-based organization.

In May, Shared Health cut about two dozen non-union executive positions, saying at the time that the money would be reinvested in supporting clinical teams and delivering patient care.

Former Shared Health CEO to pocket $603,000 in 2023 after 4 months on the job

The former CEO of Manitoba Shared Health worked for just four months in 2023 but was paid hundreds of thousands of dollars more than the year before. A business expert says big severance packages are part of the cost of doing business with top executives.