When Dr. Ed Murphy left Carilion Clinic as its president and CEO in 2011, his final compensation package amounted to $6.2 million, according to recently released tax documents.
Of that amount, $2,561,000 is listed as a severance payment in papers that Carilion must file with the Internal Revenue Service as part of its nonprofit status.
Carilion spokesman Eric Earnhart said that Murphy’s decision to leave was voluntary. However, he declined to say why the severance payment was made.
The reported total of $6,239,118 was not paid to Murphy in a lump sum, and more than third of the amount, $2,503,674, was actually deferred compensation from previous years.
As for the severance payment, Earnhart would only say that Murphy’s decision to leave was his own, citing an article published at the time in The Roanoke Times.
The article quoted Murphy as saying that it was “a difficult decision for me to come to,” but that he had been with the Roanoke-based health care system for a long time and had accomplished most of his goals.
Murphy oversaw Carilion’s conversion to a clinic model, which provides multi-specialty physician services in addition to running eight hospitals in Southwest Virginia. With more than 10,000 employees, Carilion is the region’s largest private employer.
Although the word “severance” might imply a forced departure, there could be another explanation for the payment, said Daniel Borochoff, president of CharityWatch, which monitors nonprofit organizations.
“For regular people, they don’t get a severance unless they’re being forced out,” Borochoff said. “But I suspect this was something that was worked out in advance.”