Saturday, May 25, 2013

Gentiva Courting Wall Street


Gentiva executives are barnstorming Wall Street after the second year in a row of shareholders voting against the company's executive incentive compensation proposal.

May 14 - Bank of America-Merrill Lynch Health Care Conference
May 21 - Barclays High Yield Bond and Syndicated Loan Conference
May 22 - UBS Global Health Care Conference
May 29 - Deutsche Bank 38th Annual Healthcare Conference 
June 4 - Jefferies Global Healthcare Conference

Bank of America - Merrill Lynch - President Tony Strange & Eric Slusher CFO

Strange suggested Medicare does not pay for medicines when patients are treated at home.  Yet hospice must provide medicines that relate to their hospice diagnosis.  

Gentiva has over one thousand sales professionals on street every day pushing home health and hospice.

A Memory Care specialty program will be rolled out by end of third quarter.

Strange expects a look at rebasing in next three months.  In Q&A Strange spoke to consolidation, both Gentiva's exiting specific markets and acquiring struggling providers in other geographic areas.  Home Health will undergo increased scrutiny from payors, similar to hospice in early 2012.

Barclays: - Eric Slusher, EVP & CFO

Medicare rate cuts are intended to drive consolidation in Home Health and Hospice. Small operators won't have the scale to survive and will need to sell to larger firms or close.  Gentiva intends to be a consolidator.

Hospice division experienced higher deaths and discharges in the first quarter than expected.  This oddity has resolved as of mid April..

The new Memory Care specialty program will have staff trained by the end of summer.

Gentiva is "sitting on a boatload of cash," despite paying out executive incentive compensation in Q1  Overall, it was a "good quarter." 

Home Health growth was in 5% range.  Hospice admissions grew, but length of stay and average daily census declined more than budgeted. 

The CFO danced around the request for a "same store sales"analysis.  He expects the company to get a feel on rebasing in next month and a half.

UBS - Link to Barclays Presentation

No audio available.

Gentiva executives never mentioned the shareholder "say on pay" vote.  Yet, I believe it could be one reason for Gentiva's hitting so many investor meetings in 2013..  Then again, it may not.


Tuesday, May 21, 2013

Box Laden Coworkers

It happened again last week.  I came across another coworker. carrying a loaded box.  By their side stood a stern looking manager.  Coworker sobs revealed the soul-ectomy taking place in a public hallway.  Executive glares indicated I'd encroached on a confidential interaction and that I needed to do one of two things, leave or cease to exist.

This is hospice, where staff go to extra lengths to preserve people's dignity.  Yet, a worker's core identity is at constant risk for random attack from above.  Harsh judgement occurs in an instant, the penalty phase not so fast.  It can take months for the wheels of mendacity to grind one's livelihood to litter.

Sitting in the eye of the discipline hurricane gave workers the impression things had improved, until devastating force struck from the complete opposite direction.

It seems two people are always on the hit list.  When one leaves, another rises to take their place.  Two left.  That means two new names have ascended to the gates of executive judgement.  

Toxic management:  It's the Generic Hospice way.  BYOB.  Bring your own box, because, if the timeline's long enough, everyone will be gone.


Friday, May 17, 2013

Misery Multiplied

I think it's going to be a long, long time.  The Pres has a sign in his office which states:

The beatings will continue until morale improves.


Investors Smack Gentiva Again on Executive Pay


Shareholders voted down Gentiva's Executive Pay via the annual proxy for the second year in a row!  Despite leadership's shareholder outreach, the percentage voting against executive pay increased.

We believe that our executive compensation program has been effective in aligning the interests of shareholders and executives, incentivizing the accomplishment of corporate goals, and attracting and retaining talented executives. In deciding how to vote on this Say-on-Pay proposal, please consider that we take into account the following factors regarding developing and overseeing our compensation program, which are described in detail in this proxy statement under the heading “Executive Compensation—Compensation Discussion and Analysis”: 

  • Enhancing shareholder value by focusing our executives’ efforts on the specific performance metrics that help drive shareholder value; 
  • Attracting, motivating and retaining executive talent willing to commit to long-term shareholder value creation; 
  • Incorporating meaningful input from our shareholders based on our shareholder outreach efforts; 
  • Aligning executive decision making with our business strategy and goal setting;
  • Reflecting industry standards, offering competitive total compensation opportunities and balancing the need for talent with reasonable compensation expense; and 
  • Providing executives with information so that they understand their total compensation and how rewards are generally a function of both organizational and individual performance. 

Our Board of Directors, therefore, urges you to approve the compensation of our named executive officers by voting in favor. 

Nearly three out of five voting Gentiva shareholders said no, that they opposed the Board's recommendation.  I wonder how the employee shareholder vote went.

How are things at Generic Hospice?  Any sign of raises?  Let me know,


Sunday, May 5, 2013

Executive Compensation Proxy Conflict Deepens


Get this.  Last year Gentiva's top management experienced the wrath of shareholders on executive compensation.  The fight appears to have escalated with proxy firms recommending a second "No" vote on Gentiva's executive pay and "No votes" for three members of the Compensation Committee.

Gentiva Chairman Rod Windley sent a letter to shareholders explaining the company's position on the matter.  The company's actions during the last year did not resolve the conflict

In the spring of 2012, the Company was surprised by the position taken by the proxy advisory firms and conducted a substantial program of shareholder outreach. Prior to the 2012 annual meeting, the Company contacted the holders of 82% of all outstanding shares and had one-on-one discussions with approximately 68% of the holders of its stock.

For leaders fluent in the language of business, why are they unable to get their points across?  Gentiva's annual meeting is May 9th.   We'll find out about the success of the company's shareholder outreach program.