Friday, January 22, 2016

Kindred Best Practice: Executive Enrichment at Employee Expense


Thought you might be interested in Kindred's recent presentation at the J.P. Morgan Healthcare Conference.  Kindred President Ben Breier began with an overview of the company.  In that segment he said, "We now have over 100,000 teammates across the country, most of those are front line caregivers."  He said these caregivers and Kindred's culture focuses on caring for patients, providers, referral sources and family

Kindred's capital structure is strong with over $300 million in operating cash flow and $150 million in free cash flow.  You might think this is great news for employees, many of whom have gone years without raises.

Nope.  It's hard to believe Kindred's executives could take more from employees than Gentiva's mendacious lot.   Kindred's Chief Peephole Officer promised a robust choice of health insurance plans to legacy Gentiva employees.  He failed to mention not one plan had a physician co-pay benefit.  There was no coaching from Kindred leaders on how employees should plan to keep seeing any specialty physicians.

I'll venture most Legacy Gentiva employees have no idea what is happening with their 401(k) other than it shifted from Milliman to T. Rowe Price.  Apparently Kindred's harmonizing of benefits involves treating the information as if it belongs in Fort Knox.  Kindred does not talk about reductions in health insurance or retirement benefits for acquired Gentiva employees.  Workers have to stumble over it when they try to get healthcare or struggle to set aside money for retirement.

Contrast Kindred's practice of not being up front with benefit changes and why they are needed with this:

"We admire the hard work and dedication you have put into making Gentiva an outstanding organization and want to share our mutual best practices as we become an even stronger organization."

Kindred's benefit cuts and corresponding silence don't fit with admiration.  It feels like dishonesty with a dash of condescension.

The presentation listed a Q&A session, often held in a different room at the event site.  The replay lacked this often critical and informative piece.  So we don't know if any analysts asked about the Justice Department settlement.  I'm sure none of them asked how Kindred takes care of its people.

Kindred pursues the lowest bar in its treatment of legacy Gentiva employees.  We endured the unjust enrichment of Gentiva's senior leaders as former CEO Tony Strange praised "employees for creating the company's value."  Kindred's crop of C-Suiters wants to ride us harder.

Kindred senior leaders behave much like the sorry Gentiva lot.  Breier failed to mention how employees should respond to questions about Kindred's recent $125 million settlement with the Justice Department for improper therapy billing through its RehabCare division. 

When Kindred bought out Gentiva proforma revenues for the combined company stood at $7.2 billion.  That's now down to $7.1 billion (estimated for 2015).  Actual 2015 revenue ended up $7.05 billion.  It brings back Gentiva's revenue destructing integration of Harden.

Big bonuses for under-performing: It's a mutual best practice for leaders no longer admired.

Anonymous (from Gendred)

1 comment:

  1. Just keeps on getting worse. Greed will get you everytime.