David Maughan
DAVITAAbout David Maughan
David P. Maughan, 48, is Chief Operating Officer, DaVita Kidney Care, appointed effective September 15, 2024, after joining DaVita in 2006 and serving in progressively senior operating roles; he holds a B.A. from Brigham Young University and an MBA from Harvard Business School . Company performance in 2024 featured 43% stock price appreciation, operating income of $2,090 million, adjusted operating income of $1,981 million, and free cash flow of $1,162 million, with Maughan’s 2024 short-term incentive (STI) payout at 181.2% of target, consistent with strong performance against financial and strategic metrics .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| DaVita Kidney Care | Senior Vice President, Kidney Care | Nov 2019 – Sep 2024 | Oversight of Hospital Services and national Home businesses; led HR, talent strategy, IT, state government affairs, marketing, communications |
| DaVita | Various field operations roles | 2006 – 2019 | Increasing operational responsibilities across U.S. operations |
| Goldman Sachs | Finance (NYC/London) | 2001 – 2004 | Financial/analytical experience prior to DaVita |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Goldman Sachs | Finance | 2001 – 2004 | Pre-DaVita capital markets/finance foundation |
Fixed Compensation
| Component | 2024 Amount | Notes |
|---|---|---|
| Base Salary | $725,000 | Set upon assumption of COO role in 2024 |
| All Other Compensation | $3,840 | Life insurance premiums $240 and defined contribution plan $3,600 |
Performance Compensation
2024 Short-Term Incentive Program Metrics and Results
| Metric | Weight | Target | Actual | Payout % |
|---|---|---|---|---|
| Adjusted Operating Income | 50.0% | $1,902M | $2,053M | 200.0% |
| Adjusted Free Cash Flow | 20.0% | $1,021M | $1,220M | 200.0% |
| Home modalities penetration (Q4) | 7.5% | 15.75% | 15.63% | 76.0% |
| CKCC patient contact composite | 7.5% | 60.0% | 63.10% | 162.0% |
| Teammate engagement | 3.0% | 80.0% | 83.97% | 199.3% |
| Water savings projects | 3.0% | 75M gallons | 75M gallons | 100.0% |
| Custom strategic objectives (Maughan) | 9.0% | N/A | N/A | 160.0% |
2024 STI Outcome (Maughan)
| Item | Value |
|---|---|
| Target Bonus | $725,000 |
| Eligible Payout Achieved | 181.2% |
| Actual STI Award | $1,313,899 |
2024 Long-Term Incentive (LTI) Awards (Granted March 15, 2024)
| Award Type | Grant Date | Shares/Units | Grant Date Fair Value | Vesting Terms |
|---|---|---|---|---|
| RSUs | 3/15/2024 | 21,954 | $3,000,014 | Back-loaded: 50% on Mar 15, 2027; 50% on Mar 15, 2028 |
• Program design: NEO LTI is 60% PSUs (Adjusted EPS 75%; Relative TSR 25%) and 40% RSUs; Maughan, not an NEO at March grant setting, received 100% RSUs under non-NEO practice in 2024 .
• PSU performance rigor (context): 2021 PSUs vested at 90% (Adjusted EPS 74%; Relative TSR 136%); 2022 PSUs vested at 89% (Adjusted EPS 69%; Relative TSR 149%) .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (3/31/2025) | 20,584 shares; <1% of common stock |
| Ownership Guidelines | 3x base salary; Compliant as of 12/31/2024 |
| Hedging/Pledging | Hedging prohibited; pledging prohibited for directors/executives and VP+ |
| 2024 Insider Activity | 35,868 shares acquired on SSAR exercise; value realized $4,411,875; 27,933 shares acquired on vesting; value realized $3,817,044 |
| Unvested RSUs at 12/31/2024 (by grant) | 11,476 (3/15/2021) ; 24,406 (3/15/2022) ; 34,290 (9/22/2022) ; 35,508 (3/15/2023) ; 21,954 (3/15/2024) |
| Market Value of Unvested RSUs | Valued at $149.55 per share as of 12/31/2024, per table methodology |
Employment Terms
| Term | Provision |
|---|---|
| Role & Duties | COO, Kidney Care; full-time devotion; work out of Denver, CO; travel as necessary; board/advisory service requires CEO or Nominating & Governance approval |
| Base Salary | $725,000 per annum |
| Annual Incentive | Target 100% of salary for 2024; performance goals set by Compensation Committee |
| Severance (termination without material cause/disability/death) | Benefits per Severance Plan (salary continuation 1 year; offset by other earnings); subject to release, continued cooperation, compliance |
| Resignation for Good Cause | Severance Plan benefits, not less than 1 year base salary continuation; 2 years if resignation within 60 days following a good cause event occurring within 2 years post-change in control; if termination after April, lump-sum pro-rated prior-year bonus |
| Change-in-Control Equity Treatment | Double-trigger acceleration generally if awards not assumed/replaced, or upon termination without cause/resignation for good reason in defined post-CIC window |
| Clawbacks | Dodd-Frank Section 10D clawback on restatement; separate misconduct policy allows recoupment up to three years of incentive comp, including time-based equity |
Performance & Track Record
- Executive appointment: Elevated to COO effective September 15, 2024 following 18 years in operations leadership at DaVita .
- Company’s 2024 performance context: 43% stock price appreciation; operating income $2,090M; adjusted operating income $1,981M; free cash flow $1,162M .
- No related party transactions: None involving Maughan requiring Item 404(a) disclosure .
Compensation Structure Analysis
- High at-risk pay: STI payout driven by formulaic financial metrics (70%) and strategic objectives (21% common + 9% custom); Maughan’s STI at 181.2% of target reflects strong performance .
- Equity mix shift: 2024 grant for Maughan was RSUs only (non-NEO practice), back-loaded vesting that increases retention incentive and may defer liquidity until 2027–2028 .
- Governance protections: Double-trigger CIC equity vesting, prohibition of hedging/pledging, no change-of-control tax gross-ups .
Say-On-Pay & Shareholder Feedback
- 2024 say-on-pay approval ~95%, with continued shareholder support for pay-for-performance design .
Investment Implications
- Alignment: Compliance with 3x salary ownership guideline and prohibition on hedging/pledging support alignment; substantial unvested RSUs create long-dated retention incentives and staggered future vest-driven liquidity windows (notably March 2027 and March 2028 for 2024 grant) .
- Selling pressure: 2024 included meaningful SSAR exercises and stock vesting; upcoming back-loaded RSU vesting could produce episodic selling pressure near vest dates, subject to 10b5-1 plans and blackout policies .
- Retention risk: Baseline severance equals one year salary continuation, rising to two years after qualifying CIC triggers; custom objectives set annually link payouts to execution in operations, teammate experience and clinical initiatives, signaling performance-contingent pay with reasonable protection .
- Performance sensitivity: STI metrics emphasize Adjusted Operating Income and Adjusted Free Cash Flow, reinforcing focus on margin discipline and cash generation; PSU structure (for NEOs generally) ties multi-year outcomes to Adjusted EPS and Relative TSR, aligning value creation with shareholder returns .