In the final months of 2016, leaders at Cherry Hospital, the state’s psychiatric facility in Goldsboro, alerted state officials about a problem: Psychiatrists didn’t want to come work there because of poor wages.
The solution – blessed by officials at two state agencies – was to dole out hefty raises to the Cherry psychiatrists and medical directors. They would then recruit psychiatrists by advertising a handsome new salary: $230,000.
The raises have caused significant pay disparities among doctors who treat mentally ill patients across the state’s three psychiatric hospitals. Now, a psychiatrist with decades of experience and years of service at Central Regional Hospital in Butner earns $47,000 less than a 36-year-old psychiatrist hired to work at Cherry Hospital in 2015. The median salary for psychiatrists at Central Regional and Broughton Hospital, the other two state mental hospitals, is $189,000.
“We don’t begrudge any employee a pay raise to get closer to market rate,” said Ardis Watkins, legislative affairs director with the State Employees Association of North Carolina. “But there have to be rules. [Without them] you get cherry picking and inequitable resources.”
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The Cherry raises, which kicked in on Jan. 1, have also flummoxed some state officials who came into their posts with Gov. Roy Cooper’s administration. The raises were approved last December by two divisions at the state Department of Health and Human Services and the Office of State Human Resources.
“We will be working with DHHS to review those decisions made in December, as well as reviewing pay data for all psychiatrists across the state,” said Ronnie Condrey, a senior adviser with the state Office of Human Resources.
Administrators at Cherry Hospital reported problems recruiting psychiatrists since opening a new and expanded facility last September. They blamed unattractive salary packages and said they had no serious job candidates since September 2015, according to Jim Jones, a DHHS spokesman.
“In an effort to attract more psychiatrists to the Wayne County area, the decision was made to increase the recruiting salary to $230,000, which is more consistent with the current job market for psychiatrists. Psychiatrists currently employed at Cherry also received increases to $230,000 to ensure equity with new recruits,” Jones said in an email.
In addition to seeking an increase for current staff, Cherry Hospital administrators secured permission from state human resources officials to increase the top of the state salary range for psychiatrists from $249,000 to $300,000, Condrey said.
The News & Observer attempted to contact all psychiatrists working for the three state mental hospitals, as well as medical directors for each facility. None responded to requests to speak about the raises.
Jesse Luckey Welsh, director of Cherry Hospital and former head of the DHHS Division of State Operated Healthcare Facilities, could not be reached for comment.
Ahead of peers
Raises to Cherry psychiatrists ranged from 8.6 to 19.3 percent. The last raise that their peers at Central Regional and Broughton received was in July, a 1.5 percent adjustment awarded to all state employees. The doctors at Cherry had also collected that annual legislative increase in July.
They include a raise of nearly $41,000 for Paul Kartheiser, a psychiatrist who helps supervise other doctors; he now earns $274,000. Joshua Pagano, a forensic psychiatrist who finished his medical fellowship in 2015, was given a $37,000 raise in January; his annual salary now matches all other Cherry psychiatrists at $230,000 annually.
In addition to the 15 psychiatrists working to treat patients at Cherry, four other doctors in supervisory positions also received significant raises – between 15 and 17.5 percent – on Jan. 1. James P. Mayo, medical director overseeing medical staff at Cherry, now earns $288,000, nearly $50,000 more than his peers performing the same job at the two other state psychiatric facilities. The raises were funded by available funds in Cherry’s prior operating budget, according to Jones.
The national median salary for psychiatrists working at psychiatrist and substance abuse hospitals in 2015 was $180,350, according to survey data collected by the U.S. Bureau of Labor Statistics. The mean wage for all psychiatrists in the U.S. was $191,150.
In 2015, before the raises, Cherry Hospital officials hired Pagano and another young psychiatrist. They were hired at annual salaries of about $190,000 and $205,000. The hospital has not hired any new psychiatrists since the pay raise went into effect Jan. 1, records show.
According to records Cherry administrators provided DHHS last fall, officials at Cherry worried about how they would replenish staff if five of the psychiatrists eligible for retirement left.
Unfair to others?
At SEANC, Watkins said it’s not unusual for the state to need to adjust pay for certain staff to compete for hires as markets change. Those raises, though, are typically handed out to staff who share the same job classification and applied as a percentage of their base pay.
“Why this happened in one location and not others is curious,” Watkins said. Watkins said the raises are particularly insulting to long-time Cherry Hospital employees who struggle to earn a living wage.
Kathy Merritt, who has worked at Cherry Hospital for 27 years, helps teach residents job skills to help them gain independence. She earns about $30,000 and must work extra shifts every weekend to try to earn more.
“You’ve got staff struggling to make ends meet, some of them applying for food stamps,” she said.
Locke: 919-829-8927 or @MandyLockeNews
Big differences in pay
A January raise for some staff at Cherry Hospital has created wide ranges in compensation to psychiatrists and select other medical staff at the three state psychiatric hospitals.
James A. Disney
Position: Psychiatrist at Cherry Hospital in Goldsboro
Last raise: 1/1/2017
Raise amount: $21,925
Percentage raise increase: 10.5
Years working with state: 1.5
Education: Residency at Johns Hopkins Hospital, 2011
Position: Psychiatrist at Central Regional Hospital in Butner
Last raise: 7/1/2016
Raise amount: $2,717
Percentage raise increase: 1.5
Years working with state: 25
Education: Residency at Duke Hospital, 1992
Linda Lee Northam
Position: Psychiatrist at Broughton Hospital in Morganton
Last raise: 7/1/2016
Raise amount: $2,818
Percentage raise increase: 1.5
Years working with state: 13
Education: Residency at Brown University, 2001, followed by child and adolescent psychiatry fellowship, 2003
Source: State salary data from the state Office of Human Resources, N.C. Medical Board license search
At a glance
County median income: $39,360
Nearest city: Asheville, about 60 miles
Capacity: 280, about 100 more to be added in two years at new facility
Total treating psychiatrists: 12
* Psychiatrist-patient ratio: 1:23
County median income: $40,390
Nearest city: Raleigh, 50 miles
Capacity: 290, expected to be 313 when final new unit opens
Total treating psychiatrists: 15
* Psychiatrist-patient ratio: 1:19
Central Regional Hospital
County median income: $50,225
Nearest city: Durham, 14 miles
Total treating psychiatrists: 24 full-time, 5 part-time
* Psychiatrist-patient ratio: 1:14
* Assumes full capacity (all hospitals had a wait to be admitted in 2016), treating psychiatrists excludes those in management
Sources: Census, state employment records