As PeaceHealth repeatedly laid off employees and listed or sold several properties over the past year while undertaking major capital expansions, some have wondered about the Catholic nonprofit’s financial health.
With the annual release of the health system’s recently filed tax returns, the public is now getting a rare glimpse into a small portion of the facility’s often opaque operations.
As with all tax-exempt nonprofit organizations, PeaceHealth’s tax returns are publicly available. The data that the healthcare provider is required to provide to the Internal Revenue Service provides some high-level information but provides little in-depth insight, particularly at the local level. PeaceHealth’s tax returns are filed as a system and therefore are not broken down by individual hospital or local market.
The most recently available tax documents overlap President Donald Trump’s second term by just six months, so the impact of disruptions to the federal government’s health care system, including Medicaid cuts that are expected to hit some hospitals’ profits, may not yet be fully reflected.
On May 6, the health system filed its tax return for the tax year ending June 30, 2025. During that period, the private health system made a profit of more than $24 million after being in the red for three years in a row.
With hospitals along the Interstate 5 corridor in Oregon and Washington, one in Ketchikan, Alaska, and dozens of clinics and specialty services in between, PeaceHealth’s revenues topped $4 billion while expenses reached $3.9 billion, according to the organization’s tax records, which were visually reconstructed by ProPublica, an investigative newsroom.
Overall, the system’s revenues and expenses have increased over the past decade – and with it, expenses for legal fees, executive compensation and travel.
In the last reporting year, 20,135 people were employed in the health system, around 1,000 more than five years earlier. In the most recent available year, PeaceHealth spent more than $7 million on legal fees, more than triple what it spent just five years earlier.
The health system’s top executive at the time, Liz Dunne, earned a total compensation package of more than $4.4 million – an increase of more than $1 million from the previous year and more than $2.6 million more than she earned in the position a decade ago.
That puts the compensation for the top executive at PeaceHealth — a nine-hospital system — well above the compensation for comparable positions at even larger systems in the region. The chief executive of CommonSpirit’s 12 hospitals in the Pacific Northwest region, which includes Virginia Mason Franciscan Health, earned nearly $2 million less annually in recent years, according to Washington state data.
PeaceHealth also paid more than $1 million in severance payments, including to Brian Shipley, the system’s former top lobbyist; Dr. Douglas Koekkoek, the former chief medical officer; Dr. Scott Foster, former CEO of PeaceHealth Medical Group; and Sean Gregory, the system’s former Vancouver hospital chief executive, who resigned in 2023.
Tax filings also show that PeaceHealth provides first-class or charter travel, companion travel, and housing benefits or personal use housing to an undisclosed number of its highest-compensated employees, according to tax filings. The entire system spent nearly $13 million on travel in the year recorded in tax returns, more than double what the nonprofit spent five years earlier.
The health system also spent $31 million in Central America and the Caribbean, where it has a decade-long mission in El Salvador, $1.4 million on advertising and promotions and $273,000 on lobbying, according to the findings.
Unlike previous years in which staffing groups cost the health system the most in contracting, Quest Diagnostics, the laboratory services company, remains PeaceHealth’s most expensive contractor, charging nearly $41 million in the year.
As with many hospitals across the country, the operating environment of the U.S. healthcare system has led to private equity playing an important role. The extent to which Bellingham’s local hospitals partner with, and in some cases rely on, private equity firms can be seen in the staffing groups with which PeaceHealth has contracted. At the system level, recently released tax filings show even larger private equity connections.
TriMedx Holdings, a private equity-backed technology management company based in Indiana, billed PeaceHealth $30 million during the year, the system’s second-most expensive contractor. In addition to the contracting, the tax returns shed light on the hospital’s financial support, which the attorney general’s office investigated in 2023 and found the hospital had defaulted on, resulting in millions of dollars in patient reimbursements.
In order for nonprofit hospitals to maintain their tax-exempt status, the IRS requires them to give back to the community. This “community benefit” requirement is vaguely outlined in IRS Form 990 and can be satisfied through a variety of charitable offerings, including unreimbursed Medicaid services, financial assistance, and subsidized health care services. If hospitals don’t comply, the IRS can revoke a nonprofit hospital’s tax-exempt status, although this is rare, although it is required to review a hospital’s community benefit at least every three years.
According to PeaceHealth filings, the system spent about $288 million on charitable causes in the most recent reporting year. Some of those funds went to Bellingham nonprofits, with $583,474 going to the Opportunity Council, $152,000 to the Whatcom Council on Aging, $79,974 to the Bellingham Food Bank, $67,500 to the Chuckanut Health Foundation, $60,125 to the Whatcom Family YMCA and $50,000 to Dementia Support NW.
Owen Racer is a Report for America Corps member covering healthcare and public health in Whatcom and Skagit counties. Reach him at owenracer@cascadiadaily.com; 360-922-3090 ext 101. Learn more and donate at cascadiadaily.com/rfa.
https://www.cascadiadaily.com/2026/jul/09/follow-the-money-peacehealths-executive-pay-and-rising-legal-fees-revenue/
