Justin D. Pitt
COMMUNITY HEALTH SYSTEMSAbout Justin D. Pitt
Justin D. Pitt is President and Chief Legal and Administrative Officer and Assistant Secretary at Community Health Systems (CYH), promoted in February 2025 after serving as EVP & General Counsel since March 2022; he joined CYH in 2009 as Litigation Counsel and became SVP & Chief Litigation Counsel in 2017 . He is age 50, holds a J.D. (Order of the Coif) from Washington University School of Law, and his remit spans legal, strategy/operational alignment, government relations, enterprise risk management, HR, and governance . CYH’s 2024 performance context: net operating revenue $12.634B (+1.2% YoY) and Adjusted EBITDA $1.540B (+6.0% YoY); FY24 cash from operations $480M (up 128.6% YoY) . Over 2022–2024 the company’s three-year PSUs for NEOs paid below target (CEO/CFO earned 16.8%; others 21%), reflecting challenging TSR and EBITDA targets .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Community Health Systems | President & Chief Legal and Administrative Officer; Assistant Secretary | 2025–present | Leads legal, ERM, HR, government relations, and governance; aligns legal strategy with operations . |
| Community Health Systems | EVP & General Counsel | 2022–2025 | Principal legal advisor; oversaw legal ops and government relations . |
| Community Health Systems | SVP & Chief Litigation Counsel | 2017–2022 | Led litigation, managed care, reimbursement matters; ran legal and government relations depts . |
| Community Health Systems | Litigation Counsel | 2009–2017 | Handled litigation portfolio; built in-house capabilities . |
| Private practice | Litigator & lobbyist (Tennessee General Assembly) | Pre‑2009 | Advocacy and legislative engagement experience supporting later government relations remit . |
External Roles
| Organization | Role | Years |
|---|---|---|
| Federation of American Hospitals | Board of Governors (member) | n/d |
| American Health Lawyers Association | Member | n/d |
| Nashville Health Care Council | Fellow | n/d |
| Legal Services Corporation | Leaders Council (member) | n/d |
| Cumberland University | Board of Trustees (member) | n/d |
Fixed Compensation
- CYH did not disclose Mr. Pitt’s specific 2024 or 2025 base salary or bonus targets in the 2025 proxy or the Feb 14, 2025 executive compensation 8‑K (the latter covered the CEO, CFO, EVP Ops & Dev, and a Regional President) .
- CYH’s program-level context for NEOs in 2024 (for reference): CEO salary $1,326,125; other NEO salaries and bonus outcomes are disclosed, but Mr. Pitt was not an NEO for 2024 .
Performance Compensation
CYH incentive design (company framework applicable to executives; Mr. Pitt’s individual targets/outcomes not disclosed):
- Annual cash incentive (EPIP): multi-metric with threshold/target/over‑achievement grids, including Consolidated Adjusted EBITDA, Net Revenues, EBITDA Margin Improvement, and (for CEO/CFO) Adjusted EPS, plus strategic/operational improvement goals .
- Long-term incentives: 75% at-risk (by shares) via performance-based restricted stock (PSUs) and stock options; remaining 25% time-based RSUs; grants generally made March 1 and vest ratably (options, time RS) over three years; PSUs cliff vest after 3 years against cumulative EBITDA growth, same-store net revenue growth, and (CEO/CFO) TSR percentile rank .
CYH 2024 incentive framework and results (CEO reference)
| Metric | Weighting (CEO) | Target | Actual | Payout (as % of base) | Vesting |
|---|---|---|---|---|---|
| Consolidated Adjusted EBITDA | 160% (of base opportunity allocation) | $1.55B | $1.540B | 154.7% | Annual cash, FY24 plan . |
| Net Revenues | 25% | $12.5B | $12.634B | 25.0% | Annual cash, FY24 plan . |
| EBITDA Margin Improvement | 30% | +0.80% pts | +0.60% pts | 22.5% | Annual cash, FY24 plan . |
| Adjusted EPS (CEO/CFO only) | 10% | $(0.30) | $(1.03) | 0% | Annual cash, FY24 plan . |
| Strategic/Operational improvements | 40% (add-on) | Qualitative | Achieved | 40.0% | Annual cash, FY24 plan . |
| Over-achievement add-on | Up to 35% | Grid-based | Minimal | 1.0% | Annual cash, FY24 plan . |
- CEO 2024 payout equated to 108% of target (target = 225% of base), i.e., ~243% of base achieved; PSUs for the 2022–2024 cycle paid at 16.8% for CEO/CFO and 21% for other NEOs (below threshold on cumulative EBITDA; 84.5% of target on cumulative same-store revenue; sub‑25th percentile TSR) .
Equity Ownership & Alignment
| Policy/Metric | CYH practice |
|---|---|
| Ownership guidelines | Multiples of compensation: Board (incl. executives) 5x annual cash stipend; “Officers Named in the Proxy Statement and Executive Vice Presidents” 3x; Other officers above VP 1.5x; VPs 1.0x. Expectation to meet within five years; 100% net‑after‑tax retention until met . |
| Hedging/pledging | Prohibited for directors, officers and designated employees (short sales, derivatives, margin/pledge accounts) . |
| Clawback | NYSE/SEC‑compliant clawback requires recovery of erroneously awarded incentive compensation from Section 16 officers after a restatement; discretionary recovery for misconduct causing a restatement . |
| Beneficial ownership | Not disclosed for Mr. Pitt in the 2025 proxy security ownership table (covers >5% holders, directors, NEOs) . |
Note: Mr. Pitt’s specific holdings, vested/unvested breakdown, and any transactions were not disclosed in the 2025 proxy. CYH’s plan features (no pledging; holding requirements; three-year PSU cliff) reduce near‑term selling pressure versus pure time-based grants .
Employment Terms
| Term | CYH policy |
|---|---|
| Employment agreements | CYH states none for executive officers; at‑will employment . |
| Severance policy (non‑CIC) | For NEOs: 24 months of base salary upon qualifying termination; pro‑rated cash incentive (based on actuals); COBRA at active employee rate for the severance period; equity acceleration for death/disability; similar policy framework typically applies across officers though only NEO terms are quantified in proxy . |
| Change-in-control (CIC) agreements | “Double‑trigger” CIC agreements cover each officer; for CEO, CFO, Presidents, EVPs, Regional Presidents, SVPs: severance window 36 months (Company termination without cause) / 24 months (good reason resignation post‑CIC); cash severance equals 3x (2x for VPs) base + higher of last 3-year highest bonus or target bonus; 36 months benefits continuation; up to $25k outplacement; no tax gross‑ups . |
| Equity on termination/CIC | If awards are not assumed at CIC, unvested equity accelerates (performance awards at target); if assumed and an officer is terminated without cause/for good reason within 2 years post‑CIC, unvested awards accelerate . |
Performance & Track Record
- CYH performance (YoY): Net operating revenues $12.634B in 2024 vs $12.490B in 2023 (+1.2%); Adjusted EBITDA $1.540B vs $1.453B (+6.0%); Cash from operations $480M vs $210M (+128.6%) .
- Pay-for-performance discipline: 2022–2024 PSU cycle paid well below target (16.8% CEO/CFO; 21% others), reflecting sub-threshold cumulative EBITDA and below-25th percentile TSR, despite some same-store revenue growth (84.5% of target) .
- Stockholder support: 2024 Say‑on‑Pay approval ~97% .
Company TSR index values (Pay vs Performance disclosure)
| Year | CYH TSR index ($100 base at 12/31/2019) |
|---|---|
| 2020 | 256 |
| 2021 | 459 |
| 2022 | 149 |
| 2023 | 108 |
| 2024 | 103 |
Compensation Committee/Peer Group Context
- Peer group used for 2024: Aflac; Brookdale; DaVita; Encompass Health; HCA Healthcare; Henry Schein; Molina; Owens & Minor; Quest Diagnostics; Select Medical; Tenet; UHS; Unum .
- 2024 LTI structure: 50% PSUs (3‑yr EBITDA and same‑store revenue growth; plus TSR for CEO/CFO), 25% options, 25% time‑based RSUs; shares generally granted March 1; options and time‑based RSUs vest 1/3 annually; PSUs cliff vest at 3 years .
Equity Grant/Vesting Schedules and Potential Selling Pressure
- Typical cadence: Annual equity grants on/around March 1, vesting in equal thirds (options, time‑based RSUs) with PSUs cliff‑vesting after three years upon certification of results .
- 2024 PSU outcomes (reference): 2022–2024 PSU cycle vested at 16.8% (CEO/CFO) and 21% (other NEOs), reducing incremental share delivery; indicates lower PSU-driven selling pressure vs cycles with target/above-target payouts .
Governance & Risk Indicators
- Anti‑hedging/pledging: Prohibited (reduces misalignment risk) .
- Clawback: Robust, NYSE/SEC‑aligned .
- Board/leadership: Separation of CEO and Chair roles; independent Lead Director; settlement obligates split for five years from Jan 2024 .
- Related‑party: No disclosed related‑party transactions tied to Mr. Pitt; one disclosed consulting arrangement (former CMO) approved by Audit Committee .
Investment Implications
- Alignment: CYH’s program uses rigorous multi‑metric annual incentives and 3‑year PSUs with tough hurdles and TSR gating at the top two seats, with a strong clawback and anti‑hedging/pledging regime—key positives for investor alignment .
- Realized pay sensitivity: Sub‑threshold PSU vesting for 2022–2024 demonstrates realized pay tracks performance; watch whether 2025–2027 PSU targets embed realistic but demanding growth assumptions given margin and payer mix headwinds .
- Retention risk: No employment contracts, but double‑trigger CIC at 3x cash (for Presidents) and time‑based equity vesting plus COBRA mitigate flight risk; absence of disclosed large scheduled equity vests for Mr. Pitt reduces near‑term selling pressure indicators (monitor future DEF 14A/Form 4s) .
- Execution focus: 2024 momentum in EBITDA and operating cash flow alongside multi‑year ERP and shared-services execution supports long‑term incentives tied to growth and margin; sustained improvement should translate into higher PSU outcomes and reduced legal/professional liability volatility over time .
- Monitoring: Look for inclusion of Mr. Pitt as an NEO in the next proxy (to quantify salary, bonus, and equity awards), any Form 4 activity, and any refinements to PSU metrics/peer TSR construct that could influence future realized pay and selling pressure .