The proposal, outlined in a proxy filing with the Securities and Exchange Commission, comes from Kurt Freeman on behalf of the Graphic Benevolent Trust Fund. The trust holds at least 410 shares of HCA stock.
The trust said that while providing high-quality care is the hospital operator’s “primary objective,” the formula used for its executive compensation award program “is strongly weighted toward short-term financial performance.”
According to the trust, 80 percent of the performance excellence program award for executive officers is based on EBITDA, while 20 percent is based on quality metrics. The trust wants HCA to consider increasing the effect quality has on compensation, such as adjusting the weight of current metrics.
HCA’s board of directors said it reviewed the proposal and recommends shareholders vote against it.
“Given our commitment to providing high-quality patient care and our history of responsible compensation program design, enhancement and administration, including multiple enhancements to address quality, the proposal would not provide meaningful information to stockholders, would not be a good use of the company’s resources, and is unnecessary,” the board said in the proxy statement.
The proposal is up for vote at HCA’s annual stockholder meeting April 28.
View the full proposal and the response from HCA’s board here .
For more information on HCA’s executive pay, click here.
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CHS’ top execs get pay raises this year
21 ‘overpaid’ healthcare CEOs
Florida health system to boost employee pay by 5%, upgrade other benefits
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