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Chief Nursing Executive Jan Keys, left, leaves the Emergency Department with Erlanger CEO Kevin Spiegel, as the top executive accompanies her on her rounds in this 2014 file photo.
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Erlanger Hospital is seen from the UTC library's balcony in this Dec. 9, 2014, file photo.
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Staff Photo by Dan Henry / The Chattanooga Times Free Press- 6/22/15. Kevin Spiegel, president and CEO of Erlanger Hospital speaks during a groundbreaking event for Erlanger East Hospital's new $50-million expansion that will include a new patient tower with additional beds, operating rooms and a cauterization suite. The hospital also plans to launch a mile long walking trail which they are calling a "pathway to better health".
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Erlanger CEO Kevin Spiegel

Erlanger Health System will give its employees a record $3.5 million in bonuses next month after the hospital boosted its earnings last year to the highest level in the hospital's 126-year history.

Pending final approval by Erlanger trustees on Thursday, Chattanooga's biggest hospital will give $400 to each of the more than 3,300 non-managers  employees of Erlanger. The bonuses, which total $1.4 million, are the first companywide bonus checks given all Erlanger employees in 11 years and should be paid Oct. 2.

"This is a way for management to acknowledge all of the employees  —  both full-time and part-time -- that really added to Erlanger's to unprecedented success," Erlanger CEO Kevin Spiegel said. 

The bonuses are in addition to a 3 percent raise to be granted to employees in January and other raises granted a year ago and in January to most Erlanger nurses.

Erlanger's budget and finance committee endorsed the one-time payments tonight and Erlanger's full board will vote on the bonus payments Thursday night.

Erlanger trustees decided to hand out bonuses to all employees after the hospital more than tripled its earnings in 2015 to a record high $37.3 million, reversing more than $36 million the hospital previously lost from 2008 to 2013.

Brett Tabor, Erlanger's chief financial officer, said the turnaround at Erlanger has been the most remarkable in his 29 years at the hospital. Erlanger revenues in fiscal 2015 grew to $669.8 million, up from $571.2 million in revenues the previous year.

"We were able to grow revenues, and better manage costs and we achieved this turnaround without laying off any employees," he said.

In fact, Erlanger has added more than 250 employees over the past year and 300 workers in the past two and a half years since Spiegel became president. The hospital boosted inpatient admissions by 9.4 percent and increased the number of surgeries by more than 7 percent, Tabor said.

Executives of Erlanger will not share in the $400 bonuses, but they will be paid $2.1 million in bonus payments shared among 124 executives. Last year Erlanger paid $1.7 million in bonuses to 99 employees.

Spiegel will get a $244,966 bonus, bringing his total compensation in fiscal 2015 to $981,000. Last year, Spiegel was paid a total of $914,669.

Last year's bonuses drew fire from state lawmakers who complained that Erlanger was too quick to reward its executives and did so without enough public discussion and review.

"Our problem was with the way they awarded these bonuses in secret and in violation of the Sunshine Act," state Sen. Todd Gardenhire said today.

Last year, Eranger trustees had to revote on the bonus payments to executives at a second public meeting to address concerns over how the payments were approved by trustees.

Read more in tomorrow's Times Free Press

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