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Top health care CEOs made $1.7 billion last year

The 64 health care CEOs in the S&P 500 cumulatively made almost $1.7 billion in 2017, according to a new Axios analysis of their compensation. That total is 74% higher than the $949 million that is normally highlighted in company proxy documents.

The details: Within the compensation totals, Axios' Bob Herman calculated the actual realized gains of CEOs’ stock options and awards (shares that were actually exercised and taxed), versus the estimated fair value of their stock (a guess of future stock value that is prominently featured in SEC filings and headlines).

  • Actual realized gains is a more accurate representation of an executive’s take-home income.
Data: Axios analysis of Securities and Exchange Commission filings. Chart: Andrew Witherspoon, Kerrie Vila, Lazaro Gamio/Axios

Winners: Neal Patterson, the former CEO of health IT firm Cerner, was the highest-paid health care CEO, with $148.6 million in compensation in 2017. Patterson died last year from cancer, so his stock ownership immediately vested. After him, these were the highest-paid CEOs based on actual realized gains:

  1. Leonard Schleifer, Regeneron: $95.3 million
  2. Dave Wichmann, UnitedHealth Group: $83.2 million
  3. Jeff Leiden, Vertex Pharmaceuticals: $78.5 million
  4. John Hammergren, McKesson: $63.2 million
  5. Mark Bertolini, Aetna: $58.7 million

The other side: Several company spokespeople said the CEO pay packages represent the companies’ strong stock market growth and years of awarded shares.

  • As an example, UnitedHealth spokesperson Tyler Mason said Wichmann’s pay “reflects the positive performance of the company over many years” and that Wichmann reinvested a lot of his payout into more UnitedHealth stock.

The bottom line: Many health care CEOs, and other top executives at large companies, make more than you think.

Go deeper: The entire S&P 500.

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