America’s healthcare system is being challenged like never before. Mergers and consolidations, constantly shifting regulatory requirements, and the unprecedented demands and skyrocketing costs associated with an aging nation and a growing number of Americans with obesity and comorbid conditions – these are among the contemporary issues that fall squarely in the lap of healthcare administrators. Add to this the introduction of a true game changer – a worldwide pandemic – and everything we thought we knew about healthcare has been effectively turned on its head.
Now, more than ever, we need professionals who don’t just manage these systems, but who work to improve them and fix longstanding issues along the way. We need administrative leaders who can support clinicians, create and maintain efficient and cost-effective operations, and handle the next curveball that gets thrown at the healthcare industry.
When it comes to handling these gargantuan challenges, only the most qualified will do, which is why the Masters of Health Administration (MHA) has become the standard qualification for hospital and healthcare managers, administrators, and executives and why salaries for top-level professionals these days are more impressive than ever.
Top-Paying Industries and Cities for Health Administrators
Healthcare administration is no longer just about keeping an eye on the bottom line (although this is certainly vital) – it’s about creating healthcare environments where the newest technologies and innovations thrive, where care is focused as much on quality as it on cost, and where healthcare outcomes are the best they possibly can be. Because of the high level of expertise needed to assume these positions, salaries among healthcare executives and administrators are among some of the highest in the industry, rivaling that of even medical specialists.
According to the Bureau of Labor Statistics (BLS), as of May 2019 medical and health services managers earned an average salary of $100,980. And among those in the top 10% – likely those with graduate-level degrees and a number of years of relevant experience – the average salary skyrocketed to $189,000.
BLS stats showed that the highest paid healthcare administrators (according to average annual salary) worked in the following industries:
- Pharmaceutical and Medicine Manufacturing: $204,300
- Scientific research and development services: $169,240
- Wholesale electronic markets and agents and brokers: $162,880
- Navigational, Measuring, Electromedical, and Control Instruments Manufacturing: $159,910
- Chemical manufacturing: $155,180
The top-paying states (according to annual, mean salary) for healthcare administrators in the nation during this time were in states that traditionally have a high cost of living. Geographic location continues to play a big part in a healthcare administrator’s earning potential:
- Washington D.C.: $150,040
- New York: $147,000
- Hawaii: $133,320
- California: $133,040
- Massachusetts: $132,960
Similarly, the highest-paying metro areas for healthcare administrators during this time were also in areas where cost of living is significantly higher than in other parts of the country:
- Santa Cruz-Watsonville, CA: $163,280
- Vallejo-Fairfield, CA: $159,190
- Bridgeport-Stamford-Norwalk, CT: $154,570
- Salinas, CA: $154,440
- Hanford-Corcoran, CA: $145,340
- San Jose-Sunnyvale-Santa Clara, CA: $144,530
- New York-Newark-Jersey City, NY/NJ/PA: $144,370
It’s Not Just About the Salary…
It’s important to note that for most healthcare administrators, an annual salary is just part of the total compensation picture. Bonuses, executive retirement benefits, and other cash incentives based on performance are all part of a healthcare administrator’s annual income. A 2019 Hospital Executive Compensation Report by Total Compensation Solutions, which examined salaries of 15 executive and director-level positions from 1,345 hospitals, found that a base salary accounted for just 68-76% of an administrator’s total compensation.
Factors Influencing Salaries for Healthcare Administrators
Education, experience, and professional designations remain the largest factors that influence the earning potential among health administrators:
Education
You’ll find degrees in health administration at every level, from associate’s to master’s degrees. Most health administrators come into the field with a bachelor’s degree. Most bachelor’s degrees in the health and hospital management/administration field are in health administration, health management, and health services administration, although some students prefer to earn a bachelor’s degree in business administration with a healthcare focus.
Rising through the ranks of health administration calls for plenty of years of relevant experience and a master’s degree. The Master of Health Administration (MHA) remains the gold standard in graduate education for healthcare administrators.
Other variations of the degree include the following, all of which offer a similar blend of courses to prepare you for an understanding of the business side of healthcare:
- Master of Management in Healthcare Management
- Master of Health Care Organization Management
- Master in Organizational Leadership – Healthcare Organization
- Master of Science in Public Health
- MBA in Health Administration
A graduate degree like the MHA prepares health administrators to assume top-level positions in health administration, such as:
- Chief operating officer
- Chief financial officer
- Chief medical officer
- Hospital administrator
Salaries for these top administrative positions are among the highest on the payroll at any given healthcare organization. For example, the Modern Healthcare Executive Compensation Survey revealed the following average salaries for top executives, as of 2018:
- President and CEO, stand-alone hospital (hospitals with revenues of less than $300 million): $495,000
- Chief medical officer, stand-alone hospital (hospitals with revenues of less than $300 million): $325,000
- Chief financial officer, stand-alone hospital (hospitals with revenues of less than $300 million): $207,000
- Chief operating officer, stand-alone hospital (hospitals with revenues of less than $300 million): $198,000
- President and CEO, stand-alone hospital (hospitals with revenues of more than $300 million): $800,000
- Chief financial officer, stand-alone hospital (hospitals with revenues of more than $300 million): $438,000
- Chief medical officer, stand-alone hospital (hospitals with revenues of more than $300 million): $366,000
- Chief operating officer, stand-alone hospital (hospitals with revenues of more than $300 million): $280,000
Professional Certification
One or more professional designations can go a long way toward establishing yourself as a leader in the healthcare administration field and earning a salary to match. Top professional certifications in the field include:
- Fellow of the American College of Healthcare Executives (FACHE) – Certification holders are recognized as FACHE fellows. To qualify, you’ll need to be an ACHE member and you’ll need a master’s degree, a current position in executive healthcare management, and at least five years of experience in healthcare management.
- Certified Professional in Healthcare Information and Management Systems (CPHIMS)– Certification through the Healthcare Information and Management Systems Society (HIMSS) displays your commitment to the improvement of healthcare through technology. To qualify, you’ll need a bachelor’s degree and at least five years of experience in information and management systems; a master’s degree and at least three years of experience in information and management systems; or a at least ten years of experience in information and management systems.
- Certified Professional in Healthcare Risk Management (CPHRM) – This certification requires applicants to pass a certification exam that assesses their ability as a healthcare management professional.
- American Association of Healthcare Administrative Management (AAHAM) – The AAHAM offers the following designations that are achieved by passing an online exam:
- The AAHAM Certified Revenue Cycle Executive
- The AAHAM Certified Revenue Cycle Professional
- The AAHAM Certified Revenue Integrity Professional
- The AAHAM Certified Revenue Cycle Specialist
- The AAHAM Certified Compliance Technician
Top States for Health Administration Jobs
The Bureau of Labor Statistics provides a breakdown of the number of health and services managers by state, along with average salaries at both the median level and the top 10%:
- Alabama: $82,960 – $145,590
- Alaska: $102,750 – $184,650 (approximately 1,030 medical and health services managers)
- Arizona: $103,960 – $204,990 (approximately 8,050 medical and health services managers)
- Arkansas: $76,580 – $129,500 (approximately 5,680 medical and health services managers)
- California: $122,880 – $207,610 (approximately 36,940 medical and health services managers)
- Colorado: $108,940 – $188,510 (approximately 5,790 medical and health services managers)
- Connecticut: $108,520 – * (approximately 6,270 medical and health services managers)
- Delaware: $115,290 – * (approximately 1,050 medical and health services managers)
- District of Columbia: $133,680 – * (approximately 1,600 medical and health services managers)
- Florida: $92,810 – $177,790
- Georgia: $94,320 – $185,800
- Hawaii: $118,350 – * (approximately 1,540 medical and health services managers)
- Idaho: $88,160 – $148,560 (approximately 2,170 medical and health services managers)
- Illinois: $105,270 – * (approximately 14,510 medical and health services managers)
- Indiana: $90,660 – $159,960 (approximately 7,960 medical and health services managers)
- Iowa: $78,500 – $130,130 (approximately 6,880 medical and health services managers)
- Kansas: $86,040 – $142,200 (approximately 4,110 medical and health services managers)
- Kentucky: $81,660 – $136,120 (approximately 5,340 medical and health services managers)
- Louisiana: $93,260 – $153,080 (approximately 4,990 medical and health services managers)
- Maine: $89,830 – $133,600 (approximately 2,080 medical and health services managers)
- Maryland: $113,150 – $191,660 (approximately 10,890 medical and health services managers)
- Massachusetts: $114,340 – * (approximately 15,810 medical and health services managers)
- Michigan: $93,660 – $179,330 (approximately 12,310 medical and health services managers)
- Minnesota: $101,510 – $166,680 (approximately 8,330 medical and health services managers)
- Mississippi: $84,950 – $152,660 (approximately 3,030 medical and health services managers)
- Missouri: $98,460 – $169,530 (approximately 7,290 medical and health services managers)
- Montana: $90,640 – $139,530 (approximately 1,540 medical and health services managers)
- Nebraska: $102,680 – $201,130 (approximately 2,640 medical and health services managers)
- Nevada: $110,270 – $178,450 (approximately 2,600 medical and health services managers)
- New Hampshire: $102,550 – $194,860 (approximately 2,170 medical and health services managers)
- New Jersey: $113,430 – $167,820 (approximately 12,620 medical and health services managers)
- New Mexico: $106,320 – * (approximately 1,710 medical and health services managers)
- New York: $126,780 – * (approximately 25,740 medical and health services managers
- North Carolina: $101,840 – $187,300 (approximately 10,000 medical and health services managers)
- North Dakota: $109,180 – * (approximately 800 medical and health services managers)
- Ohio: $91,690 – $161,290 (approximately 14,490 medical and health services managers)
- Oklahoma: $81,580 – $147,760 (approximately 6,540 medical and health services managers)
- Oregon: $107,630 – $196,340 (approximately 4,670 medical and health services managers)
- Pennsylvania: $89,420 – $150,070 (approximately 17,330 medical and health services managers)
- Rhode Island: $116,880 – * (approximately 1,920 medical and health services managers)
- South Carolina: $90,830 – $158,040 (approximately 5,770 medical and health services managers)
- South Dakota: $98,940 – $142,670 (approximately 780 medical and health services managers)
- Tennessee: $90,690 – $162,410 (approximately 9,820 medical and health services managers)
- Texas: $97,540 – $167,050 (approximately 33,320 medical and health services managers)
- Utah: $89,310 – $172,880 (approximately 3,800 medical and health services managers)
- Vermont: $92,710 – $159,560 (approximately 1,180 medical and health services managers)
- Virginia: $105,450 – $170,890 (approximately 7,740 medical and health services managers)
- Washington: $109,990 – $197,050 (approximately 7,310 medical and health services managers)
- West Virginia: $96,420 – $165,900 (approximately 1,710 medical and health services managers)
- Wisconsin: $100,610 – $160,740 (approximately 5,800 medical and health services managers)
- Wyoming: $93,290 – $145,120 (approximately 850 medical and health services managers)
*average salary is greater than $208,000
Salary and employment data compiled by the United States Department of Labor’s Bureau of Labor Statistics in May of 2019. Figures represent accumulated data for all employment sectors in which medical and health services managers work. BLS salary data represents average and median earnings for the occupations listed and includes workers at all levels of education and experience. This data does not represent starting salaries.
All salary and employment data accessed June 2020.
