Kindred's Putrid Management Practices

Strange Tony,

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)

Kindred Executives Rewarded for Bad Year

Strange Tony,

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)

Discounted Farber Home Hits Market Again

Strange Tony,

Kindred put CFO Stephen Farber's former home back on the market for just under $2 million.  Before Christmas the company asked $2.4 million for the executive estate. 

The revised price of $1.95 million is $200,000 less than the $2.15 million the company paid Farber in December 2015.  Kindred spent $60,000 designing the separate driveway and up to $300,000 for construction.

Farber's compensation for 2015 should have enabled him to sell his house and find more appropriate neighbors.

The Committee increased Mr. Farber’s base salary from $500,000 to $600,000 to reflect his high level of performance associated with significantly replacing the Company’s capital structure.

Mr. Farber was awarded $350,000 from this special cash award pool for his efforts in connection with these acquisitions.

Mr. Farber’s target award as a percentage of base salary was increased to 60% from 50% in 2015 in connection with his exemplary performance as Chief Financial Officer.

Mr. Farber received a one-time payment of $250,000 to offset relocation and other costs incurred in connection with his relocation

The company awarded stock valued at $841,000 to Mr. Farber for his oversight and leadership of the Company’s financial matters, including his efforts to expand and restructure the Company’s capital structure.

The company used that capital structure to buy Farber's house after giving him another $250,000 in "moving expenses."  That was on top of $110,000 in moving expenses the prior year.  For some reason Farber's exemplary performance did not transfer to successful neighbor relations.

Kindred's housing subsidy for Stephen Farber could cost the company dearly.  If the house sells for asking price Farber's subsidy, direct and indirect, could be $800,000 or more.

Anonymous (from Kindredpoor)

Kindred's Top People Face Against Employees

Strange Tony,

Human Resources was once counted on to balance senior executives who preferred finance, marketing or legal/compliance over people.  Many top dogs got to their lofty slot by flattening their peers.  Such leaders view HR as touchy feely stuff.  True human resources makes many senior leaders uncomfortable.

When executive incentive pay reached stratospheric levels HR became a means for top dogs to achieve obscene pay and cash/stock bonuses.  HR Vice Presidents turned into Chief People Officers, surreptitiously advancing their fortunes and those of fellow C Suiters. 

Kindred's Chief People person has done little to aid employees in my two years plus with the company.   Our health insurance worsened markedly.  Getting paid for one sick day requires a herculean effort.  Kindred cut the retirement match by 40%, eliminated it completely and then brought it back at a fraction of Gentiva's former level.  Where Gentiva would have contributed $2.50 Kindred now gives $1.  That's a 60% cut for some employees.

Legacy Gentiva employees experienced a series of HR intrusions courtesy of two faced executives.  One face publicly highlights employees as the people producing the results.  The other face peers down to pull money out of our wallets and stuff it into their own.  Every benefit reduction that cost employees falls to the bottom line and boosts executive incentive pay.

The company's annual report filed with the Securities and Exchange Commission has no human resource measures like employee satisfaction or turnover. Such metrics disappeared after the ascent of Kindred President Ben Breier and Kindred at Home President David Causby.

The company's board granted our Chief People person 10,000 shares per year his first three years with Kindred.  It's now 12,000 shares a year. That's a 20% bump up in one area of his overall compensation.

Kindred gifted him another 38,000 shares outside the two numbers previously mentioned, bringing his current holdings to 85,500 shares.  Remember this your next doctor visit when you get to pay the whole bill. 

It will take a few weeks to find out how much our CPO and his executive cabal profited from our 2016 pain.  Right now they are hatching plans for 2018's benefits. If you see our Chief People person please ask him how much more they plan to cut?  Some of us need to begin planning.

Anonymous (from Legacy Gentiva)

Kindred Closes on Dreadful 2016

Strange Tony,

Kindred executives told their 2016 financial story to Wall Street analysts on Tuesday.  This is the group that just got free stock from Kindred's Board for losing $7.65 a share.

President Ben Breier opened the call with his usual pander to employees, "I'd like to start my comments by thanking everyone who helped make 2016 such a successful year for Kindred."  So successful that Breier had to cut the employee Christmas gift.   Employees wouldn't have had time to eat it, not with our increased workload.

Kindred at Home delivered another quarter of solid volume.  Hospice delivered same-store revenue growth of 6.5% on same-store admissions growth of 4.4%.

Core EBITDAR margins for both home health and hospice contracted due primarily to nursing labor headwinds. These headwinds came from a combination of the macro labor conditions we spoken about and quite frankly some self-inflicted costs stemming from our continued integration of pay practices and electronic medical record systems. We expect to make meaningful progress on the controllable part of this labor equation in 2017.

There are some exogenous related issues around some wage rate creep in that business but I would view Q4 as much more of a self-inflicted wound as I would and exogenous issue. We have gone through sort of the final stages in that business of consolidating our electronic medical records of consolidating pay practices and what I would really describe the fourth quarter in our Kindred at Home labor line being is really more of a productivity issue than an average wage rate issue.

Productivity is associated with creep and executives in many employee's minds. Consider Breier's comment to analysts:

On the hospice side you may even see high single-digit growth rates there and that you should expect that you know depending on how we're able to deal with our labor issues that a significant portion of that can drop through (to the bottom line and executive incentive pay).

I don't know one coworker who has gotten a high single digit raise in pay in a year, much less a series of years. 

Look we left some dollars on the table clearly because of some of the premium labor issues we're dealing with and I would expect that you'll see some improvement in that number  

Who knew Ben Breier's wager table is our paycheck?  Some employees earned too much last year for the Creep Suiters.  However, most have continued falling behind financially doing the work we love. 

"We have a very focused initiative right here on trying to take more cost out"

As for productivity many of my coworkers donate time to patients.  How much extra free time will executives subconsciously demand as they control the labor equation and take more costs out?  This group wants more than the few thousand free shares they recently received and they will do it on employees backs.

Anonymous (from Kindredful)