Red Cross pay to ex-president, aide scrutinized

Board hires consultants to compare practices with those of other groups


WASHINGTON - During Bernadine Healy's tumultuous final six months as president of the American Red Cross, the nonprofit agency awarded her $1.9 million.

As a result, Healy's replacement, former Rear Adm. Marsha Evans, and the agency's board have launched separate reviews of the way the Red Cross compensates its senior employees.

Healy wept in public frustration when she was forced out of the top American Red Cross job in the tense and confusing aftermath of the Sept. 11 terror attacks in the fall of 2001.

After a dispute with some board members over how to handle donations, she was relieved as chief executive officer Oct. 26 but allowed to retain the title of president until the end of that year.

Tax documents disclosed by the congressionally chartered organization show that in the six months between July and December 2001, the Red Cross awarded her $1,340,701 in deferred compensation, $296,661 in salary, $228,929 in severance pay, $50,000 in expense allowances and $5,622 in benefits.

"Based on the organization's agreement with Dr. Healy, we are unable to provide any further information on her compensation and severance," senior American Red Cross spokesman Phil Zepeda said yesterday.

Healy's confidante, former chief of staff Catharine "Kate" Berry, was let go 11 days after Healy.

Between July 1 and Nov. 6, Berry was awarded $73,602 in salary and benefits, $132,509 in severance pay and $403,473 in deferred compensation.

None of the funds came from donations earmarked for Sept. 11 victims or for other disaster victims, Zepeda emphasized. The bulk of the organization's $4.5 billion in revenue that year came from other sources, such as the sale of blood.

Evans, who had been running Girl Scouts of the USA, was recruited by the Red Cross last August to be its new president and chief executive officer. She initiated a staff study of current pay and benefits for senior employees.

In addition, Zepeda said, the 50-member all-volunteer board has hired consultants to compare Red Cross figures with those at other nonprofits and to suggest ways to "tie financial rewards directly to the achievement of results."

Healy's $1.9 million during the final six months of 2001 was more than twice the $912,373 in pay and benefits that she had received during her first 22 months at the Red Cross, which began in September 1999.

That golden farewell "is certainly high for the nonprofit world," said H. Art Taylor, a Red Cross critic who is president and chief executive officer of the BBB Wise Giving Alliance, which monitors charitable groups. "But the Red Cross is a big organization."

The Chronicle of Philanthropy reported in October that 34 of the 282 large nonprofits surveyed by the magazine paid their chief executives more than $500,000. The highest salary was $690,000 for University of Pennsylvania President Judith Rodin. Healy's salary, bonuses and benefits were listed at $519,000.

"The Red Cross board has done what it should have - full disclosure of its decision," Taylor said. "Now the public can decide if it was equitable and fair and appropriate."

After the loss of her job, Healy, a physician and researcher who had previously served as dean of the Ohio State University medical school and director of the National Institutes of Health, landed on her feet.

She now lists her occupation as senior writer at U.S. News and World Report, where she writes a monthly medical-and-health column. Messages left on her voice mail there yesterday were not returned.

Healy is also a paid director on the boards of at least four corporations - including Progressive Corp. and National City Corp.

Moreover, she also serves as one of the 22 unpaid members of the President's Council of Advisors on Science and Technology. President Bush, honorary chairman of the American Red Cross, praised her work at a White House ceremony just 10 days before she was forced into retirement.

He named her to his advisory council several weeks after her departure from the Red Cross was announced.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.