Friday, February 24, 2017

February Be Kind to Rich Executives Month


Kindred's board of directors showed more executive love this past week with its wholesale granting of free shares of stock to the all male executive review at Kindred HQ.  I found it odd in light of my hospice coworkers struggling to pay uncovered healthcare costs from last year.

Low to no raises have employees scrimping to set aside any money in the restarted 401k.  For every $40 an employee contributes Kindred will contribute $4.  Gentiva would've given $8.

Prior earnings calls contained verbal panders to employees but executive actions shouted the opposite since Paul Diaz snagged Gentiva.  For that the board granted Paul a $6 million check and kicked him upstairs.  Pay and benefits wise our hospice has gone down a rung since his multi-million dollar payday.

I'm glad there's Kindred love to give.  I wish employees were feeling some of it.

Anonymous (from Kindredful)

Sunday, February 12, 2017

Causby's Latest Stock Award

Strange Tony,

On 2/02/2017 EVP & President Kindred at Home David Causby received 17,692 new shares of common stock bringing his total Kindred holdings to 179,162.

Pursuant to his Employment Agreement, the reporting person (David A. Causby) was granted 53,077 restricted stock units, vesting in three equal annual installments beginning February 2, 2016.

And what did the company give employees the last few months?  A co-worker remarked we didn't get candy for Christmas in 2016.  Executives sent sweets our first year under Kindred ownership.

Causby will get another $1 million bonus for showing up to work on August 1, 2017.  So that's where our candy money went.  Will they go after our lunch money next?

Anonymous (from Kindred loves executives)

Saturday, February 11, 2017

Kindred's Dealing with Ventas

Strange Tony,

Kindred President Ben Breier opened his portion of the third quarter earnings call with:

"Last night we announced the strategic decision to exit the skilled nursing facility business, which is the final step in a process that began for us 15 years ago when Kindred operated over 300 skilled nursing facilities.'

'A full exit of this business, together with the significant cost realignment initiative we are undertaking in connection with the exit, are substantial steps forward in our effort to continue to transform Kindred's strategy and growth profile to enhance shareholder value. We're pleased to be working with Ventas to finalize an agreement that will create value for Ventas and Kindred shareholders, and facilitate Kindred's exit from the skilled nursing business."

Most people don't know but Ventas birthed Kindred via a spinoff on May 1, 1998.  The two companies remained intertwined ever since.

Kindred reduced its significant nursing home division by selling facilities in 2013 and 2015. Breaking Ventas leases cost Kindred serious money:

In January 2015 Kindred paid Ventas a $40 million early termination fee associated with nine leased facilities.  In 2013 Ventas received a $20 million early termination fee associated with fifty nine leased facilities.

Kindred paid $521 million in rent to Ventas over the last three years. 

  • $172 million for the year ended December 31, 2015
  • $192 million for the year ended December 31, 2014
  • $248 million for the year ended December 31, 2013

That relationship will be tested in Kindred's decision to exit the nursing center business, which Breier said is struggling to meet budget targets.

"Our exposure to the challenges facing the nursing center industry are expected to amount to $40 million to $50 million worse than our 2016 operating plan."

Kindred plans to sell its remaining nursing homes during 2017, but it will need to buy them from Ventas before reselling them.  McKnight's said "Kindred's skilled nursing portfolio includes the 36 Ventas facilities, 26 facilities the company owns and 25 that are rented from other companies. Kindred expects to bring in $100 million to $300 million from the sale of the portfolio."

In prior nursing home asset sales Kindred recorded an asset impairment charge of $8 million and a loss on divestiture of $2 million.

The nursing center wheel is about to fall off the Kindred wagon.  Oddly, it could fall to Care Capital Properties, Ventas skilled nursing REIT spinoff.  That might explain Kindred executives clarity on how much they expect to make on the sale.

“We expect the after-tax net proceeds from the sale of these assets will range from $100 million to $300 million after transaction costs, severance expenses, and the amount payable to Ventas for the sale of the Ventas Properties,” he said. “We expect to apply these anticipated net proceeds to reduce funded debt, which combined with the impact of our cost realignment initiative, the elimination of approximately $90 million of annual rents, and the reduction of approximately $30 million of annual capital expenditures will reduce our leverage.”

Why should anyone at hospice care what happens in the nursing center division?  With $1.2 billion in revenue gone executives will likely provide us more attention.  In Gentiva or Kindred that is generally an uncomfortable thing.  Their plans didn't work for the nursing center segment, likely because they were divorced from reality.  There is a limit to staff's ability to endure executive ignorance, aggression and impatience.  It's a harsh contrast to the hospice movement's core founding principles.

Anonymous (from Kindredful)

Saturday, February 4, 2017

Retirement Plan for Non Executives: Keep Working


Gentiva employees experienced a series of benefit reductions in 2014, the very year executives agreed to sell the company to Kindred.  That pattern continued while Kindred executives kept telling employees we were "better together."  That was clearly not the case in the retirement arena.

Gentiva COO David Causby did not want to hear employees voice and he does not look after them now as Kindred at Home President.  Yet the company continues his obscene pay levels, which includes another $1 million bonus for showing up to work on August 1, 2017.

Kindred plans to restore a minuscule 401k match beginning in February 2017.  It will match $1 for every $10 an employee contributes.  That's well below Gentiva's 401k contribution level.  For an employee to take advantage of this benefit they would need lots of discretionary income.  Most of my hospice coworkers don't have funds to contribute given years of nonexistent to paltry raises and shifting significant first dollar health care costs to employees.  That occurred with the elimination of the physician copay benefit in 2016. 

It looks like another Kindred benefit for wealthy executives.  Kindred continues to be Better Together for this exclusive bunch.

Anonymous (from Kindredpoor)