Saturday, December 12, 2015

Executives Provide No Peep into Kindred's 2016 Benefit Contributions


Kindred's Chief People Officer spoke the usual nice words in his pre-enrollment employee benefit presentation.  He said benefits have become "very strategic" for companies and that Kindred will spend over $250 million on benefits in 2016.  That $250 million is spread over 100,000 employees, roughly $2,500 per employee.

The Chief People Officer said benefits can "distinguish an employer."  He went on to talk about the new benefits platform that would supposedly look familiar to Gentiva employees.  He said legacy Gentiva would experience a similar platform, process and providers. 

Kindred went to bid with 50,000 covered lives, which means the company provides health insurance to less than half of  their employees (as the 50,000 includes dependents).

Kindred hired Mercer to run their health exchange in order to "leverage scale to drive cost, quality and choice."  He noted Kindred's history of passing reduced benefit costs to employees and the company's bearing the lion's share of any cost increases.

He did not speak to Gentiva's benefit history of doing the opposite by taking savings and passing increases to employees.  Over the last two years the company cut its contribution to employee health insurance 17%Employee contributions increased 18% from 2012 to 2014.

Dental insurance painted a similar picture.  Employee costs for dental rose 21%, while the company cut its contribution by 3%.   

Kindred's Chief People Officer did not address Gentiva's going long periods of time with no raises.

Gentiva employees, with our mostly stagnant wages, entered Kindred's benefit renewal having picked up the lion's share of cost increases and gotten no medical or dental savings.  Gentiva executives pocketed the windfall in the corporate vault, which likely upped executive pay.

Gentiva employees know Rod Windley, Tony Strange, Eric Slusser, Jeff Shaner and Charlotte Weaver took their change in control money and ran.  Given Gentiva COO David Causby is now President of Kindred at Home continued benefit reductions are likely the order of the day.

Acquired Gentiva employees experienced open enrollment only to find lesser insurance.  The company omitted office visit copays for both primary care and specialty physician visits.  Dental insurance looks to nearly double for lesser coverage.  It's clear benefits are strategic to Kindred in a Gentiva-like manner.  However, Kindred is sneakier than Gentiva executives in that they won't reveal the company's benefit contributions on the paystub.

I believe the man who spoke to legacy Gentiva employees should be re-titled Chief Peephole Officer.  His peephole peers into Kindred's corporate vault, where even more buyout synergies will accumulate courtesy of employees paying a greater share of 2016 benefit costs.  Kindred's dash for benefit cash hit directly in the pocketbook.  How big will the savings be for the company?

Anonymous (from executive enriching Gentiva-Kindred)