This was a tight one.
Shareholders of Community Health Systems last week voted definitively to reinstall the company's board, stick with Deloitte & Touche as the hospital operator's auditor and give a nod to its executive compensation plans. But shareholder requests to expand how the company might claw back some of its executives' compensation as well as make it easier for investors to nominate board candidates were much closer.
Earlier this spring, CHS executives had encouraged shareholders to turn down both proposals, saying the clawback push was too vague and that the proxy access proposal "advances a solution for a problem that does not exist."
In the case of the second of those proposals — advanced by the Connecticut Retirement Plans and Trust Funds — CHS barely got the negative result it wanted: With more than 99 million shares voted at the meeting, the difference between the nays and ayes was only 423,000, or 0.4 percent. Check the numbers here.
We will not be at all surprised next spring to see the Connecticut pension managers return with their plan — if it isn't quietly adopted before CHS' 2016 proxy filing deadline.
Community Health Systems has secured two loans totaling $4.54 billion that will be used to pay off a $4.6 billion loan due in 2021, according to a filing with the Securities and Exchange Commission.
The first, a $1.6 billion loan, has an interest rate of LIBOR plus 275 basis points and matures at the end of 2019. The second loan of $2.94 billion matures in January 2021 and carries an interest rate of LIBOR plus 300 basis points. The 2021 loan being paid off has a rate of LIBOR plus 325 basis points.
HCA Holdings will pay $2.3 million to the federal government in a Medicare fraud settlement.
According to The Wall Street Journal, four HCA hospitals are among nine facilities accused of benefiting from medically unnecessary ambulance rides.
The nine hospitals, which include Jacksonville-based Baptist Health facilities and a University of Florida hospital, will pay a total of $7.5 million to settle allegations that non-emergency patients were being transported from hospitals to residences and nursing homes in ambulances.
The hospitals didn’t directly profit from the ambulance rides at issue because ambulance companies bill Medicare themselves for rides they provide, but prosecutors found that the hospitals benefited indirectly by speeding up their admissions and discharges—a key contributor to hospital profitability dubbed “throughput."
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Shares of HCA (Ticker: HCA) were up 1 percent to $80.72 Monday morning. Year to date, they're up almost 10 percent.
Another senior executive at HCA Holdings has booked a juicy profit on some of his stock options holdings. Senior Vice President Vic Campbell, who leads the hospital giant's government and investor relations group, last Friday exercised almost 37,000 options that would have expired next January before selling that many shares on the open market. His gains on those transactions totaled more than $2.6 million.
Campbell's sale came shortly after Jon Foster and Juan Vallarino last week booked combined profits of $3.5 million. Shares of HCA (Ticker: HCA) were changing hands late this morning at $78.81, up 1.4 percent. Year to date, they've climbed 7 percent.
Two HCA Holdings executives last week booked some profits on their stock options. A trading plan set up earlier this year by Jon Foster (pictured here), president of HCA's American group of 80 hospitals, was able to bank more than $2.3 million by exercising 36,000 options and then selling that number of shares for more than six times as much. In addition, Juan Vallarino, senior vice president of employer and payer engagement, exercised about 17,000 options that would have expired in mid-2019 and then sold the same number of shares. His profit on the transaction totals a little more than $1.2 million.
Shares of HCA (Ticker: HCA) are changing hands this morning at $77.12. They've risen 12 percent over the past three months and 5 percent year to date.
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