Senate bill would cap nonprofit hospital CEO pay amid WakeMed-Atrium merger

A Senate bill moving through Raleigh would cap nonprofit hospital chief executive pay at 400 times the salary of the lowest-paid worker, putting WakeMed’s proposed combination with Atrium Health under a brighter spotlight. The measure advanced June 11 after lawmakers stripped out language that would have given the state broader power to stop hospital mergers, leaving a narrower but still politically charged challenge to the Triangle’s nonprofit health giants.

Senate Bill 978, titled Healthcare Competition Reforms, was filed April 30 and passed first reading May 4 before being re-referred June 8 to Health Care and then Rules and Operations of the Senate. The committee substitute removed the proposed Article 11C, Preserving Competition in Healthcare Act, but kept the CEO-pay restriction and added a $50,000 appropriation for the North Carolina Medical Care Commission to support reporting provisions. The timing is no accident: the bill emerged as WakeMed and Atrium were assembling a deal that has become one of the most closely watched health care fights in Wake County.

Supporters say the issue is bigger than one merger. North Carolina nonprofit and government hospitals are exempt from property taxes and can receive up to $45 million a year in sales tax refunds, while a separate analysis says local governments lose about $130 million in property-tax revenue under the current exemption. That has fueled a broader argument in Raleigh that systems receiving public tax advantages should face tighter limits on compensation and governance.

The pay debate has sharpened because the numbers are so large. Advocate Health CEO Gene Woods was paid $25.8 million in 2024, up 49% from $17.3 million in 2023, and Advocate Health raised its systemwide minimum hourly wage to $18.85 this year. WakeMed CEO Donald Gintzig’s compensation has also been part of the public discussion. The proposed cap would not directly set patient prices or rewrite hospital contracts, but it would put immediate pressure on executive pay packages and give lawmakers another lever to argue that nonprofit systems should justify their market power.

WakeMed, founded in 1961, now has five hospitals, about 350 physicians, three acute-care hospitals, a rehab facility, a mental health hospital, four standalone emergency departments and outpatient offices across the region. WakeMed and Atrium say the combination would create 3,300 new health care jobs and bring at least $2 billion in new investment to Wake County, helping rebuild the aging flagship campus on New Bern Avenue and add a mental health hospital in Garner.

But the deal has already triggered a political backlash. Wake County commissioners delayed a planned vote by 90 days on May 5, and WakeMed and Atrium executives faced questions at a June work session. WakeMed has said Atrium would become its sole member and no money would change hands, while UNC Health made an unsolicited May 5 counterproposal offering a $5 billion partnership. With the merger already under review, the Senate bill reads less like a fix for patient bills than a warning that state lawmakers intend to keep pressing nonprofit hospitals on accountability, executive pay and public trust.