Saturday, May 13, 2017
Financial sharks circle Kindred Healthcare and some are inside the company. Take former CEO Paul Diaz, who received a $6 million cash bonus in May 2015 for closing the deal on Gentiva. Diaz went on to become an operating partner with Cressey and Company. Oddly, his bio on Cressey's website makes no mention of his current Kindred board service. Diaz is Vice Chairman of Kindred's Board of Directors.
Should Kindred sell for a premium to Cressey and Company conflict of interest questions would arise. Should Cressey hire Guidon Partners to co-invest on Kindred more ethical questions would surface. A Generic Hospice commenter educated me about Diaz role with Cressey and Guidon. How many ways could Paul Diaz make money if those possibilities rang true? He'd be on both sides of the deal.
Members of Kindred's executive team and board have leveraged buyout organizations, LBO, in their background. Firms include Warburg Pincus, Bain Capital, TPG, Summit Partners, Blackstone Group, Apollo Global Management and the aforementioned Cressey and Company.
Reuters cited two LBO firms as being interested, Blackstone and Apollo Global. Kindred COO Kent Wallace worked as CEO for Blackstone affiliate, Vanguard Health Systems. Kindred Board member Frederick Kleisner served on the board of an Apollo affiliate, Apollo Residential Mortgage..
Kindred's management operated much like a buyout firm by purchasing companies with copious amounts of debt. The Gentiva buyout bought our hospice into Kindred's wider post acute tent, which it now wants to shrink or exit. The company's obsession with measures and money have been to the detriment of mission and competent management practices at our site. Mostly stagnant pay and deteriorating benefits have been another part of the Kindred employee experience.
Please let our new owner not be the Hannibal Lechter of finance, LBO or better known by its modern name - private equity. Lord keep us safe from corporate predators. For that I pray.
Anonymous (from Kindred-ever-enriching-executives)
Saturday, May 6, 2017
Kindred hosted its earnings call last week. The spin started the day before with the press release on first quarter results:
- Kindred reported a first-quarter loss of $5.7 million, after reporting a profit in the same period a year earlier.
- Consolidated revenues were $1.77 billion, a 3.8% year-over-year decrease. It was below forecasts of $1.78 billion.
- The company expects full-year earnings in the range of 40 cents to 70 cents per share.
It's not a stirring financial report but the stock market reacted positively. With projected earnings of 55 cents/share (midpoint) Kindred's stock has a price-earnings ratio of over 19 for 2017. That's a heady valuation for a company potentially on the sale block, especially as it's carrying $3.2 billion in debt.
Hospice and home health held up our end of the delivery equation by doing more with less.
Mr. Breier continued, "In the first quarter, we delivered very encouraging sequential and year-over-year improvement in our Kindred at Home Division, with strong same-store volume growth in both our home health and hospice businesses. Combined with a sequential reduction of labor costs in the first quarter, we returned to historic growth levels and delivered results in line with our 2017 expectations."
The call opened with Breier's usual hollow pander to employees.
I'd like to start my comments by extending my deep appreciation to our more than 100,000 teammates across the country. Each day our partners at Kindred work hard to improve the lives of the more than 1 million patients we care for annually. We're proud of the excellent care and clinical outcomes we deliver which are direct result of their efforts.
For all the talk of "clinical care" and "results" executives announced the termination of the clinical ladder at the end of 2017 with no plans to replace it. To boot our branch manager informed staff there are no raises in this year's budget.
Ben Breier: "We’re working hard on our merit design and making sure that we're giving people a competitive market increase.We’ve worked hard at our benefit plans, reinstated our 401(k) match, working on a lots of different ways that we can make the employee experience here at Kindred, the teammate experience here at Kindred as best that it can be.We have made great progress I think in terms of measuring employee satisfaction and the various things we’re doing. "
There's no sign of the PwC annual employee survey, which Kindred conducted twice after buying Gentiva. The 2016 survey fell into a management hole at our hospice site. Employees never heard the results and our branch manager said Kindred de-emphasized the survey, which was the direct result of employee feedback efforts. Apparently, executives measured employee satisfaction and ignored the results
Staff turnover within Kindred at Home actually increased in 2016 to 23.6% from 22.6% in 2015. That statistic meant having to hire more replacements.
We’re better and better every quarter at recruiting people into the company and keeping people longer.
Actually when you look at our turnover rates and our retention rates, we continue to really outperform even our own expectations. Our turnover remains at really kind of historical lows across our business settings and our retention rates remain at sort of historical high.So we’re doing we think a lot of the right things, probably not all of the right things. But we are doing a lot of the right things. And I think that it still remains the contested labor market particularly for nurses in the acute setting. And that’s where kind of the real kind of hand to hand fight continues for us.
Executives "hand to hand fight" is against current employees within the company, at least our hospice site. Our "reinstated" 401(k) match is a fraction of Gentiva's and Kindred's health insurance makes it financially difficult to see a physician outside the annual wellness visit.
No voice, no raise, clinical ladder pay cuts and ongoing benefits erosion are the Causby/Kindred way. This might be preparation for the next sellout and another round of executive enrichment.
Gentiva did a number of squirrely things to polish the numbers while Kindred's Paul Diaz courted the company. Our site has experienced similarly strange but different dollar squeezing initiatives. They are an impediment to good patient care and employee retention. Due diligence caused undo harm to employees and patient care in the past. It may well resurface. Brace yourself.
Anonymous (from KindredforSale)
Thursday, April 20, 2017
It seems like yesterday Kindred was the dark suitor for Gentiva, a hospice and home health giant. Gentiva CEO Tony Strange held off Kindred's Paul Diaz until the deal price reached an appropriate premium, meaning Gentiva executives would be set for life.
Kindred has been shopping its long term care division and has multiple bidders. Executives say they could deal the whole company. "The company says there is also interest in a complete buyout, an option it will be 'willing to engage' if the premium makes sense."
Our hospice has been through multiple buyouts and our employees don't get jack. Executives rake it in, as can be seen in their change in control compensation.
Our site has been impacted by a deal every two years on average. Not one has made us better. Not one company has treated employees as partners. Every one has reduced benefits for employees and services for patients.
We should be used to such organizational trauma as often as it happens. Our hospice may have a slick new owner soon, one that mouths the right words while carving up our hides and taking from our wallets.
I pray Kindred becomes employee owned. That is the only way leadership balance can return and the employee voice can actually be heard. Right now it is nonexistent.
Anonymous (from Kindredinplay)
Saturday, April 15, 2017
Kindred has a contingent contract on the Glenview Avenue home it purchased from Chief Financial Officer Stephen Farber to solve an un-neighborly conflict. The contingent sale price is $200,000 below the $2.15 million Kindred paid Farber in December 2015. The company will lose much more on the house as it installed a private driveway, which at one point had an estimated $300,000 price tag.
That's quite an executive subsidy. My hospice co-workers struggle to pay for prescriptions and physician visits under our ever worsening health insurance. For many there is nothing left to set aside for retirement as bills increase far more than company pay.
Kindred President Ben Breier thanked employees for helping him make $7 million last year. His outlandish pay is a "direct result of our efforts." I'm not sure how he and his fellow C-Suiters can sleep at night. Surely they know they can't take it with them.
As social workers, nurses, and chaplains we get the joy of being with, listening to and helping hospice patients and their families. That blessing is the balm for Kindred's dismissive stance on our needs for living.
Happy Easter! May it bring renewal, peace, joy and a focus on things eternal.
Anonymous (from Kindred which has a $7 million man)
Friday, April 7, 2017
Kindred Hospice designed and implemented new procedures that are driving our hospice nurses away. The basic features are:
1) Nurses must enter information into the computer using various forms, including the form the team prepares for our regular Interdisciplinary Team (IDT) meetings.
2) Nurses must have the IDT form completed in the computer two days prior to IDT for supervisors to review.
3) Nurses must update the IDT form with new information that arises in the forty eight hours between electronic submission and the actual IDT meeting. After completing and updating computerized forms nurses must park their electronic medical record device outside the IDT room.
4) Nurses must be prepared to discuss each patient during IDT. As they are not allowed to use the computer they used to perform steps 1-3 nurses must create paper documents that pull together key clinical information from a number of computerized clinical forms. Our nurses are relegated to hand scribing, a tool that existed prior to the printing press, for sharing the written word. The company has no plans to create this optimal IDT discussion document in the computer system so nurses can press print and meet the company's expectations.
5) The nurse cannot make a correction or enter a physician's order during IDT. They must scribble notes on paper to remind them of computer entries they must make after IDT. This separation in time and space from the original doctor's medication order introduces an increased opportunity for error at both the nurse's and physician's end.
6) Phone use is prohibited in IDT. Nurses are not allowed to take calls, text or use any of their smartphone functions during IDT.
7) Management can assign any task at any time to any nurse, a death, patient care crisis or admission, and it does not alleviate expectations 1-6.
8) Nurses must fulfill their clinical load plus the computerized and paper procedures in expectations 1-7 during their 40 hour work week. Overtime is an absolute no no.
9) Any nurse that cannot meet expectations 1-8 with a smile and happy face is clearly incompetent and has a bad attitude. They must be micromanaged, which consists of 99.9% criticism and 0.01% neutral feedback. Positive judgments are prohibited by branch management and Kindred's Human Abuse department.
The rules are different for nurse managers:
10) Nurse manager work is too important to take them away for menial tasks like patient visits or a customer service crisis.
11) Nurse manager work is so stressful that they must take frequent breaks to catch their breath, chit chat in each other's offices and plan what their clique will have for lunch.
12) Nurse manager work is so routine that they can enter the building at 8:00 am and leave at 5:00 pm each and every day.
13) Nurse managers, who don't see patients or know their sex, race or name they like to be called, are allowed to have their computer, use their personal phones for calls and texting, and e-mail one another during the IDT meeting.
14) Nurse managers endorse and enforce Kindred's opposition to multi-tasking, distributed real-time information sharing and timely processing of physician orders to ensure accuracy. Nurse managers say "Comply with what does not make sense and maybe corporate will give us permission to do what does makes sense." That in itself is a form of abuse.
Kindred's nurse turnover strategy is already effective in driving away skilled and competent nurses. It's early in its rollout. An exodus is building at our site.
Kindred loves metrics. Employee turnover increased under Kindred at Home President David Causby. It rose from 22.6% in 2015 to 23.6% in 2016. For driving more people away Causby got $245,344 of his $2.7 million in executive compensation for 2016.
How much of our hospice will be left when Kindred at Home President David Causby qualifies for his next $1 million bonus on August 31, 2017? I expect our nurse quitting statistic to enter record territory.
Anonymous (from the Kindred Kindergarten)
Postscript -- On May 4, 2017 Kindred President Ben Brier said in the first quarter earnings call "We’re going have is we've now talked about, the biggest, I would argue, best run, I would argue most valuable home health, hospice and community care business asset probably anywhere in the country."
Thursday, March 30, 2017
A Vice President of some sort visited our hospice office last week. After hearing him speak I found an image summarizing the message he communicated verbally and non-verbally. It also reflects management practices at our hospice site since Kindred took over. I didn't think things could get worse than under Gentiva but that happened. The stench of synergy is significant.
Anonymous (from Kindred, at least one rung lower than Gentiva)
Wednesday, March 29, 2017
Kindred President Ben Breier has 100,000 new shares of stock thus far in 2017 thanks to a generous Board of Directors. Kindred at Home President David Causby isn't far behind with 85,000 new shares since January 1st. These rewards occurred after Kindred lost $664 million in 2016.
My pay barely budged last year but the cost to see a physician soared without the physician copay benefit I'd had in all my years with our hospice. Kindred cut my benefits and this helped boost executive bonuses and stock grants. Even the Chief People Officer got 12,000 new shares for not watching our backs in the C Suite and Board room.
CFO Stephen Farber received 28,000 new shares. Kindred marked down Farber's former house to $1.95 million. Kindred's housing subsidy for Farber could reach $800,000 should the house sell at this price.
Kindred's pattern has executives enriched at every turn while employees wait for crumbs to fall from their table. This is the antithesis of hospice founding philosophy. Can I join you in retirement?
Anonymous (from Kindred loves executives)