Arbor Update

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Highest U salary shoots $500k higher

5. May 2007 • Murph
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Dr. Robert Kelch, the UMich Executive Vice President for Medical Affairs (UMHS and hospital) currently received the highest base salary at the University – $656,910, plus a $500,000 after-tax bonus if he stays with the U through 2008. But apparently that’s not enough – the Regents have approved an additional $500,000 after-tax bonus for Kelch to stay on through 2009 – effectively boosting his 2009 salary to the range of $1.2 million, plus whatever the taxes on $500k are.

What was the competing offer that required a $1.5 million salary to keep Kelch on?

At a regular faculty meeting Monday, Coleman said keeping Kelch for an extra year was an important priority for her. “I had to beg and plead for him to stay one more year,’‘ she said. “He’s looking forward to his retirement with his grandchildren.’‘

Not bad work, if you can get it.



  1. Well, as the article states: “As executive vice president for medical affairs, Kelch leads an organization with 19,465 employees and operating revenues of $2.6 billion in the university hospitals, health centers and medical school.” So it is an enormous job. With the recent sale of M-Care and the implications of that for the University, the need to hire a new Dean of the Medical School, and his success at fund-raising and fiscal management, Coleman’s move to keep him on for another year seems like a pretty good move.


       —Juliew    May. 7 '07 - 03:53AM    #
  2. Makes me feel great that my MCare (soon to be Blue Cross) premium is going up by 26% this year. At least i’ll have a supremely well paid transition leader!


       —Ken A.    May. 7 '07 - 12:21PM    #
  3. My question is, why was money the answer to his desire to retire? Another half-million for one year seems pointless for someone who was already going to give up his salary and take a (presumably reduced income of a) pension. Wasn’t he going to retire to have more time?


       —Dale    May. 7 '07 - 01:57PM    #
  4. Makes me feel great that my MCare (soon to be Blue Cross) premium is going up by 26% this year. At least i’ll have a supremely well paid transition leader!

    I guess you have to look at it this way: Kelch was the director of MCare when the premium was 26% lower than what you are going to pay when he isn’t director. Blue Cross has no connection to the U, but it seems better to have Kelch in this position to help negotiate the best deal with Blue Cross, both in price and services, because he actually ran MCare.

    My question is, why was money the answer to his desire to retire?

    Because it was enough money. Everyone has their price.


       —Juliew    May. 7 '07 - 03:38PM    #
  5. I suspect they also want him to stay to make sure the new children’s hospital stays on track.


       —Cooler Heads    May. 7 '07 - 04:23PM    #
  6. “My question is, why was money the answer to his desire to retire?

    Because it was enough money. Everyone has their price.”

    I’m thinking of a Simpsons episode when Chief Wiggum explains he doesn’t have a retirement plan because he’s planning to get shot on his last day of work, leaving a life insurance payout for his widow. He explains it happens all the time: “We call that ‘retirony.’”

    When someone suggests maybe he won’t die in such a way, his wife bursts into tears and Wiggum angrily retorts, “That’s a terrible thing to say.”


       —Dale    May. 7 '07 - 04:52PM    #
  7. According to this Boston Globe article, the CEO of the corp that run Mass General and Brigham and Women’s Hospitals received $1.9mm in 2005. So Kelch’s compensation is probably comparable to other people in his position.


       —Tom Brandt    May. 7 '07 - 06:48PM    #
  8. No Juliew, you are wrong. Everyone does not have their price. There are still a few honest, hardworking individuals left in this world who aren’t out for personal gain. Don’t kid yourself.


       —Can't be bought    May. 8 '07 - 11:58AM    #
  9. “Everyone has their price” doesn’t necessarily imply financial gain or even personal gain. Some people even sacrifice those things in exchange for something that they consider to be of greater worth.


       —John Q.    May. 8 '07 - 07:15PM    #
  10. juliew is right. One could say everyone has to have their price; I cannot eat my ethics, nor trade on their virtue. I must put a value on my work and that value has a relationship to the marketplace.

    This is not about ethics. Clearly Kelch’s decision is that this is an amount for which he will forego his retirement for a year. Maybe he thinks it will make his grandchildren more secure, or maybe he is setting up an endowment with his money, or maybe he is just greedy. We will not know. Clearly the decision was that Kelch was worth it and it seems unlikely that there is a qualified candidate out there willing to do the job for say half that.


       —abc    May. 8 '07 - 08:22PM    #
  11. Leaving aside these issues, I thought if there were a concession or enticement it would be one of time (more vacation or freedom from an office), which he seemed to lack, rather than money, which he already had plenty of.


       —Dale    May. 9 '07 - 04:26AM    #
  12. No – it’s a golden parachute at the taxpayer’s expense. If he weren’t interested in soaking the cash strapped citizens of this state for his personal financial gain, and really just wanted to help Mary Sue through a difficult transition, he could easily retire and live extraordinarily well-off while volunteering his services for a year, for the benefit of the medical system and the citizens of the state.

    The sale of M-Care was necessitated by the clear conflict of interest caused by UM’s dual role. Should they provide HMO coverage for their employees with the intent of keeping costs low while providing high quality medical treatment or should they focus on using the hospitals and clinics to provide the maximum possible billible procedures and collect the largest sums possible from all third party payers? Non-profit institutions don’t keep costs lower – they just divide the windfall each year among the top executives.


       —Can't be bought    May. 10 '07 - 11:55AM    #