Opinion ID: 2603565
Heading Depth: 1
Heading Rank: 2

Heading: evidence supporting deduction

Text: During the trial Group Health produced the testimony of Mr. Ralph Bremer and Dr. David Goldsmith. Mr. Bremer, a past president of the Board of Trustees, testified in general about the services Group Health provides and about the organization itself. Mr. Bremer stated that Group Health is governed by an 11-person Board elected by the membership. Board members are not compensated. The bylaws of the organization provide for four officers: President, Vice-President, Secretary and Treasurer. The Board may also approve additional vice-presidents for purposes of executive management. Mr. Bremer identified the following as senior or top management: Executive Vice-President (also called the Chief Executive); Vice-President of Finance and Administration; Vice-President for Health Care; Central and Eastside Regional Administrators; General Counsel; Director of Policy and Planning; and Director of Public and Employee Relations. The latter three executives report directly to the Executive Vice-President. All of these positions have significant contacts with the Board. In addition, the top level medical staff position, Chief of Staff, has extensive contacts with the Board. Some middle-level staff on occasion report to the Board; lesser management has little contact. Mr. Bremer testified as to salary-setting procedures. The Executive Vice-President has overall responsibility for establishing salary and compensation policy. Mr. Bremer stated that the employees and executives of Group Health are not paid anything above actual services rendered. Dr. Goldsmith testified as an expert in the area of wage and salary studies. Dr. Goldsmith had conducted a study of the salaries received by the executives of Group Health as compared with the salaries received by public sector employees in like positions. Dr. Goldsmith identified the following Group Health positions as executive: Executive Vice-President, Vice-President for Finance and Administration, Vice-President for Health Care, Chief of Medical Staff, Regional Administrator, General Counsel, Director of Policy and Planning, and Director of Public and Employee Relations. The data for Dr. Goldsmith's analysis included organizational charts, job descriptions and salary records. This same type of data had been utilized in wage and salary studies by his firm since 1974. Professional colleagues in the same field rely on this type of data for their work. Dr. Goldsmith outlined the procedures used to analyze the data that had been collected. First, he identified the criteria employed for the selection of executive positions at Group Health, and for the selection of comparable organizations from which possible comparisons might be drawn. A probable comparable set was identified. Second, Dr. Goldsmith sought to validate the collected data through interviews with at least one person within each identified comparable organization. Over 20 such interviews were conducted by his assistants. Third, the salaries of Group Health's executives were compared with the salaries of those in positions identified as comparable. To validate the information gained to this point, Dr. Goldsmith used the Willis System, a method utilized by the State of Washington since 1973. Based on his analysis and the results of the validation technique, Dr. Goldsmith testified that in his opinion the public service positions selected for comparison to Group Health positions were comparable both in terms of the content of positions and in terms of salary ranges for such positions. Group Health offered into evidence a Group Health Cooperative Retrospective Compensation Study. This study comprised a series of charts prepared by Dr. Goldsmith comparing, among other things, the monthly salary range of Group Health's executives with those in like positions. The trial court admitted this exhibit solely as a basis for Dr. Goldsmith's expert opinion and not as proof of the matter asserted. Group Health also offered a Retrospective Compensation Study compiled by Dr. Goldsmith for the 11 nonexecutive positions at Group Health immediately below the positions he deemed executive. This also was admitted into evidence. At the conclusion of Dr. Goldsmith's testimony, the trial court denied the Department's motion for dismissal. The Department then published the depositions of 12 lower-level Group Health employees. With the exception of one person these depositions were from employees not considered to be executive by Dr. Goldsmith. The Department asserted that these employees were also executives, and that therefore, Group Health must prove that they also met statutory requirements. On rebuttal, Dr. Goldsmith extended his analysis beyond the 8 positions he identified at Group Health as executive, to include the 11 positions immediately below. Dr. Goldsmith testified that these Group Health employees were paid salaries or compensation comparable to employees in like positions in public service.