Nebraska\u2019s state auditor calls it inexplicable. A former health insurance CEO suggests it\u2019s excessive. A veteran doctor says it\u2019s unheard of.<\/p>\n
They\u2019re reacting to what a nonprofit hospital paid its gastroenterologist in 2024: Nearly $5 million, according to public tax documents. That same hospital, Faith Health in Norfolk, paid a plastic surgeon $3.8 million.<\/p>\n
Those sums made the doctors the two highest-paid employees of any Nebraska-headquartered nonprofit that year, according to an online database.<\/p>\n
Most of their compensation came from bonus and incentive pay, at least in part determined using a commonly used calculation that is often criticized by doctors and others for rewarding more procedures. In the case of the gastroenterologist, who no longer works for Faith, a former patient told the Flatwater Free Press that he felt the doctor had performed an extra procedure without his permission.<\/p>\n
Hospital leaders declined interview requests and did not answer specific questions emailed to them. In a statement, chief operating officer Brian Blecher said that it\u2019s challenging to recruit and retain doctors in Norfolk, a city of about 26,000 in Northeast Nebraska. Faith sets salaries based on data, and physicians can earn bonuses for hard work, like at other hospitals, Blecher said.<\/p>\n
State auditor Mike Foley, whose office has oversight of state payments to entities that contract with the state, including nonprofits, called the gastroenterologist\u2019s pay \u201ceye-popping.\u201d<\/p>\n
\u201cI\u2019m not a medical professional, but those numbers just seem extraordinary,\u201d he said. \u201cInexplicable.\u201d<\/p>\n
Foley wasn\u2019t the only one shocked by the numbers.<\/p>\n
\u201cThey\u2019re a not-for-profit,\u201d said Steven Martin, retired CEO of Blue Cross Blue Shield of Nebraska. \u201cAsk yourself: Isn\u2019t that a little excessive?\u201d<\/p>\n
\u2018The more you do, the more you get\u2019<\/strong><\/p>\n Matthew Bechtold, who has been practicing gastroenterology in Missouri for more than 20 years, said the highest salary he had heard for a gastroenterologist was about $1.5 million. That would be a nationally prominent physician, he said, who does many procedures while hauling in research and pharmaceutical grants.<\/p>\n \u201cI don\u2019t ever hear of $5 million in our field,\u201d Bechtold said.<\/p>\n Faith Regional Health Services, which recently rebranded as Faith Health, paid Fadi Rzouq $4.9 million, according to the Norfolk hospital\u2019s most recent tax filing. The figure doesn\u2019t include retirement and other benefits. He had made more than $3 million each year since 2021.<\/p>\n Rzouq is board-certified in gastroenterology. He went to medical school in Jordan and the University of Washington for his residency and secured two fellowships at the University of Kansas Medical Center, according to his profile for the clinic in Texas where he\u2019s now listed as on staff. His specialties include pancreatic, upper gastrointestinal and liver diseases.<\/p>\n \u201cGood medicine begins with trust, compassion and taking the time to truly listen to patients,\u201d he\u2019s quoted as saying.<\/p>\n Rzouq owns a house in Norfolk that is on the market for $2.6 million. Reached by phone, Rzouq declined an interview for this story.<\/p>\n Faith\u2019s tax filing shows $3.9 million of Rzouq\u2019s pay \u2014 about 79% \u2014 in 2024 came from bonuses and incentives.<\/p>\n The filing also notes that physicians\u2019 \u201cproduction bonuses\u201d were tied to relative value units \u2014 part of a system that helps the federal government and insurance companies define the worth of a physician\u2019s work. A procedure, for example, has a higher RVU than an office visit.<\/p>\n \u201cPhysicians have an opportunity to earn production bonuses if the provider reaches above relative value unit amounts,\u201d the tax filing reads, and payouts depend on the doctor\u2019s base salary.<\/p>\n Rzouq was listed among five Faith physicians who earned those bonuses in 2024.<\/p>\n It\u2019s typical for a hospital to set a quota for a doctor \u2014 say, 1,000 RVUs \u2014 and figure bonuses based on the surplus number of RVUs they actually tally, said Bechtold, the Missouri-based gastroenterologist. RVU-based models can encourage a doctor to do more procedures, said Bechtold and former insurance CEO Martin.<\/p>\n “There is an incentive in specialty medicine,\u201d Martin said. \u201cIncome can be increased by doing more procedures. In other words: The more you do, the more you get.\u201d<\/p>\n Rzouq\u2019s $5 million is indeed \u201cwell above the norm\u201d and \u201csignificantly higher than the revenue a single gastroenterologist would be expected to generate for a hospital,\u201d said Lawrence Kim, past president of the American Gastroenterological Association Institute.<\/p>\n \u201cThat amount of volume is relatively unheard of \u2014 to make that many RVUs, to get that type of bonus,\u201d Bechtold said.<\/p>\n Kim said he suspects Rzouq had responsibilities beyond direct patient care. Flatwater asked Faith if this was the case but did not receive a response.<\/p>\n Rzouq\u2019s pay wasn\u2019t just exceptional in his field. It also made him the highest-paid employee at any Nebraska-headquartered nonprofit that year, according to a database of tax documents created by the nonprofit news outlet ProPublica.<\/p>\n Tristan Hartzell, a board-certified Faith Health plastic surgeon specializing in the arm, was the state\u2019s second-highest-paid nonprofit employee. The hospital reported paying him $3.8 million, including about $2.8 million in bonuses. He was also among the handful listed as receiving a \u201cproduction bonus.\u201d<\/p>\n Hartzell said in an email that he\u2019s a \u201chighly specialized surgeon\u201d who performs \u201ccomplex procedures for patients from across Nebraska and around the country.\u201d<\/p>\n He went to medical school at Duke University School of Medicine and did his plastic surgery residency at Harvard and a fellowship at UCLA Medical Center and interned at Massachusetts General Hospital. His biography says that he is \u201clikely the busiest replantation surgeon in the upper Midwest\u201d and one of a few in the country who perform a specific reconstructive wrist procedure.<\/p>\n He also specializes in treating athletes, according to his bio.<\/p>\n A recent story by Faith Health published in the Norfolk Daily News featured a patient who praised Hartzell\u2019s care and impact on his life.<\/p>\n Three other Faith doctors made more than $1 million in 2024, and other doctors from Faith and elsewhere were among the state\u2019s highest-paid nonprofit employees, according to ProPublica. But Rzouq and Hartzell were the only physicians to land ahead of Greg McDermott, then Creighton University\u2019s men\u2019s basketball coach, and James Linder, then CEO of the Nebraska Medical Center.<\/p>\n Ed Nierodzik, Rzouq\u2019s former patient, said he got little face time with the doctor himself. Thinking of his experience with Rzouq still brings up strong emotions.<\/p>\n He\u2019d been bleeding for a week and entered Faith through its emergency room. He stayed in the hospital a week, he said, but saw Rzouq for just a few minutes when he did rounds.<\/p>\n Rzouq stopped the bleeding, Nierodzik said. But he also banded a hemorrhoid, he said, which wasn\u2019t discussed beforehand and hadn\u2019t presented issues.<\/p>\n \u201cThere was no, \u2018You need to do this, you need to do that,\u2019 \u201d he said. \u201cIt was simply, \u2018This is what I did.\u2019 \u201d The experience felt like \u201cthis is a way I can rack up a few extra thousand dollars,\u201d he added.<\/p>\n Chronic issues came up after that, making it more difficult for Nierodzik to do things like go to his son\u2019s wrestling tournaments and visit the supermarket. After a year and a half of physical therapy, Nierodzik said he has finally seen improvement.<\/p>\n When a reporter ran basic information about the procedure by Bechtold, the Missouri gastroenterologist, he said the account didn\u2019t immediately raise alarm.<\/p>\n In another case, the hospital settled a lawsuit in 2021 that alleged Rzouq didn\u2019t do what he should have to manage the care of a 67-year-old man who later died.<\/p>\n The lawsuit alleged that Rzouq didn\u2019t take action to manage the man\u2019s risk for inflammation of his pancreas after performing a procedure and that he failed to give orders for treatment or communicate appropriately with the man and his family as symptoms arose and quickly worsened. The truck driver and father of two was transferred to Omaha before he died.<\/p>\n Rzouq and the hospital denied the allegations, saying in court filings that the doctor was not negligent during the man\u2019s care and that Rzouq met the standard of care in Norfolk and similar communities. According to court documents, payment of the settlement shouldn\u2019t be interpreted as an admission of liability.<\/p>\n \u201cDr. Rzouq affirmatively alleges that the medical records speak for themselves,\u201d a court document reads. In another motion, he\u2019s quoted as saying in a deposition that this was the only patient with pancreatitis he had lost in more than 10 years.<\/p>\n Lawyers for the patient\u2019s widow asked that the court allow Rzouq\u2019s pay \u2014 $1.4 million in 2018 \u2014 as evidence. Rzouq was the only gastroenterologist at the hospital, and he had taken a second job at a South Dakota clinic for part of the year. A juror might wonder if he was maintaining a grueling workload to pay off crushing student debt, they wrote, or lower their standards for a \u201csimple country doctor\u201d and hospital with limited resources.<\/p>\n \u201cThe truth is that Faith Regional has the resources to hire a top-notch endoscopist for elective procedures and to pay him $1,423,308.00 per year,\u201d the lawyers wrote.<\/p>\n By 2024, his compensation was about three-and-a-half times higher than that.<\/p>\n \u2018An unethical incentive\u2019<\/strong><\/p>\n Faith, the Nebraska Hospital Association and the AGA all pointed to a fundamental truth that underlies doctors\u2019 salaries: It\u2019s difficult to attract physicians to mostly rural areas, and they\u2019re valuable assets to the surrounding area.<\/p>\n \u201cIn such areas, hospitals may offer significantly higher compensation than average,\u201d said Kim with the AGA Institute. \u201cThis is based upon the physician\u2019s total value to the health system, in order to attract good candidates.\u201d<\/p>\n Those comments align with what Blecher, the hospital\u2019s COO, said in his statement.<\/p>\n \u201cGiven the broad reach of our specialty physicians who serve patients not only from Norfolk, but also from the surrounding region and neighboring states, it is not uncommon for compensation to be higher than some published salary surveys,\u201d he said.<\/p>\n Other nonprofit hospitals in mostly rural areas of Nebraska paid some physicians in the millions in 2024, though none came close to Faith.<\/p>\n Mary Lanning Healthcare paid a Hastings orthopedic surgeon about $1.9 million, according to its filing. A spokesperson said the surgeon also practiced sports medicine as the sole provider at a practice that had previously spread services among three doctors. Great Plains Regional Health in North Platte reported paying a neurosurgeon about $2 million. Regional West Physicians Clinic in Scottsbluff paid a neurosurgeon about $1.7 million.<\/p>\n The strikingly high salaries in Norfolk raised questions for state auditor Foley and others.<\/p>\n \u201cIf you’re filing a public tax return,\u201d Foley said, \u201cseems like you could talk about: Why is that number so high?\u201d<\/p>\n Nonprofits, including hospitals, are barred from overcompensating employees, said Rick Cohen, chief operating officer of the National Council of Nonprofits, but that definition is \u201crather loose.\u201d Salaries can pose a challenge for leadership because nonprofits are required to disclose some information but barred from sharing other context for employee privacy reasons, Cohen said.<\/p>\n Martin, the former health insurance executive, said the situation in Norfolk is indicative of larger issues with the healthcare system that ultimately impact individual patients. One is that a small percentage of specialists account for much of the whole system\u2019s waste and excess care, he said, driving up premiums.<\/p>\n Another is that a hospital can create incentives that enable those specialists.<\/p>\n \u201cIn my opinion, that’s an unethical incentive,\u201d Martin said. \u201cIf you applied that to another industry, you would find that’s an unethical practice.\u201d<\/p>\n The Flatwater Free Press is Nebraska\u2019s first independent, nonprofit newsroom focused on investigations and feature stories that matter.<\/p>\n","protected":false},"excerpt":{"rendered":"Nebraska\u2019s state auditor calls it inexplicable. A former health insurance CEO suggests it\u2019s excessive. 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