Joel Ackerman
DAVITAAbout Joel Ackerman
Joel Ackerman, 59, is DaVita’s Chief Financial Officer (since February 2017) and Treasurer (since April 2019), with prior roles including CEO/Chairman at Champions Oncology and Managing Director leading healthcare services at Warburg Pincus . His 2024 pay mix emphasizes performance: STI metrics weighted 70% toward financial results (Adjusted Operating Income and Adjusted Free Cash Flow) and 30% strategic objectives, yielding a 183% of target payout; LTI PSUs are 75% Adjusted EPS and 25% Relative TSR, vesting in 2027, indicating strong pay-for-performance alignment . He is retirement-eligible under DaVita’s “Rule of 65,” impacting vesting and retention dynamics (RSUs/PSUs continue on schedule post-qualifying retirement) . He is compliant with 3x base salary stock ownership guidelines and is subject to prohibitions on hedging and pledging, supporting alignment with shareholders .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Champions Oncology, Inc. | CEO; Board member; Chairman of the Board | CEO since Oct 2010; Chairman current | Led a publicly traded precision oncology services firm; governance leadership as Chair |
| Warburg Pincus | Managing Director, led healthcare services team | Jan 1999 – Sep 2008 | Directed private equity investments in healthcare services; operational and M&A experience |
| Kindred Healthcare, Inc. | Director | Dec 2008 – Jul 2018 | Board oversight at major healthcare services provider |
| Coventry Health Care, Inc. | Director | Sep 1999 – May 2013 | Board role until acquisition by Aetna; managed care expertise |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| One Acre Fund | Board member | Current | Not-for-profit serving ~5,000,000 subsistence farmers in Africa |
| Champions Oncology, Inc. | Chairman of the Board | Current | Ongoing external public company board leadership |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary paid ($) | 700,000 | 700,000 | 769,231 |
| Base salary (year-end rate) ($) | — | 700,000 | 800,000 |
| Target bonus ($) | — | — | 800,000 |
| Target bonus as % of salary | — | — | 100% |
| All other compensation ($) | 3,840 | 3,840 | 3,840 |
Performance Compensation
Short-Term Incentive (STI) – 2024
| Metric | Weighting | Criteria Range | Actual Performance | Payout Achieved |
|---|---|---|---|---|
| Adjusted Operating Income | 50.0% | $1,790–$2,052mm (Target $1,902mm) | $2,053mm | 200.0% |
| Adjusted Free Cash Flow | 20.0% | $908–$1,171mm (Target $1,021mm) | $1,220mm | 200.0% |
| Home modalities penetration (Q4) | 7.5% | 15.40%–16.75% (Target 15.75%) | 15.63% | 76.0% |
| CKCC patient contact composite | 7.5% | 40.0%–65.0% (Target 60.0%) | 63.10% | 162.0% |
| Teammate engagement | 3.0% | 76.0%–84.0% (Target 80.0%) | 83.97% | 199.3% |
| Water savings projects | 3.0% | 50–100mm gallons (Target 75mm) | 75mm gallons | 100.0% |
| Custom objectives | 9.0% | Varies by NEO | Varies by NEO | Varies (cap 200%) |
| Total weighted eligible payout achieved | — | — | — | 183.0% (Joel Ackerman) |
| Target incentive opportunity ($) | — | — | — | $800,000 |
| Actual STI award ($) | — | — | — | $1,464,220 |
Context: Committee noted management’s strong crisis response (Change Healthcare outage; Hurricane Helene supply disruption), supporting above-target payout .
Long-Term Incentive (LTI) – 2024 Program
| Element | Structure | Metrics | Criteria | Vesting |
|---|---|---|---|---|
| PSUs (60% of LTI target) | Performance-based | Adjusted EPS 75%; Relative TSR vs S&P Health Care Services Select Industry Index 25% | Adjusted EPS: $28.66–$31.21 (Target $29.74); TSR: 10th–90th percentile (Target 55th) | 100% on Mar 15, 2027 (subject to performance) |
| RSUs (40% of LTI target) | Time-based | — | — | 50% on Mar 15, 2027; 50% on Mar 15, 2028 |
| 2024 LTI Targets for Joel Ackerman | PSUs Grant Date Value ($) | RSUs Grant Date Value ($) |
|---|---|---|
| Target values | 2,250,000 | 1,500,000 |
Note: The 2024 Grants table footnote states RSUs vest 33%/33%/34% over 3 years from grant, while the LTI Program narrative specifies a back-loaded 50%/50% vest in 2027/2028; DaVita’s final 2024 LTI program disclosure indicates back-loaded RSU vesting for March 2024 grants .
Historical PSU Results (context)
| Grant | Metric | Actual | Payout Achieved |
|---|---|---|---|
| 2021 PSUs | 2024 Adjusted EPS | $10.31 | 74% |
| 2021 PSUs | Relative TSR (2024 vesting) | 37th percentile | 70% |
| 2021 PSUs | Relative TSR (2025 vesting) | 67th percentile | 136% |
| 2022 PSUs | 2024 Adjusted EPS | $10.31 | 69% |
| 2022 PSUs | Relative TSR (2025 vesting) | 72nd percentile | 149% |
Equity Ownership & Alignment
Beneficial Ownership and Compliance
| Item | Value |
|---|---|
| Shares beneficially owned | 119,687; less than 1% of outstanding shares |
| SSARs exercisable (included in beneficial table footnote) | 18,691 as of Mar 31, 2025 |
| Ownership guideline | 3x base salary; status: compliant as of Dec 31, 2024 |
| Hedging and pledging | Prohibited for executives and directors |
Outstanding Equity Awards (as of Dec 31, 2024)
| Grant Date | Options/SSARs Exercisable (#) | Options/SSARs Unexercisable (#) | Exercise Price ($) | Expiration | Unvested RSUs (#) | RSU Market Value ($) | Unearned PSUs (#) | PSU Market/Payout Value ($) |
|---|---|---|---|---|---|---|---|---|
| 3/15/2021 | 22,032 | 22,033 | 108.93 | 3/15/2026 | 4,595 | 687,182 | 4,130 | 617,642 |
| 3/15/2022 | — | 43,388 | 110.63 | 3/15/2027 | 7,221 | 1,079,901 | 8,134 | 1,216,440 |
| 3/15/2023 | — | — | — | — | 23,672 | 3,540,148 | 71,016 | 10,620,443 |
| 3/15/2024 | — | — | — | — | 10,977 | 1,641,610 | 32,930 | 4,924,682 |
Market values reflect $149.55 closing price on Dec 31, 2024 .
Exercised/Vested in 2024
| Item | Quantity | Value Realized ($) |
|---|---|---|
| SSARs exercised | 107,471 | 15,326,752 |
| Shares acquired on vesting (RSUs/PSUs) | 15,794 | 2,147,984 |
Retirement Eligibility – Rule of 65
- Ackerman is retirement-eligible; upon qualifying retirement, RSUs/PSUs remain outstanding and continue vesting per original schedules; SSARs remain exercisable per normal schedules. PSUs vest based on actual performance for the applicable period; full vesting occurs on death/disability with PSUs at target for incomplete periods .
Employment Terms
Severance and Change-of-Control Economics
| Scenario (assumed event 12/31/2024) | Salary ($) | Bonus ($) | Health Benefits ($) | Value of SSARs ($) | Value of Stock Awards ($) | Total ($) |
|---|---|---|---|---|---|---|
| Death/Disability/Qualified Retirement | — | — | — | 2,583,641 | 16,246,664 | 18,830,305 |
| Involuntary Termination Without Cause | 800,000 | 1,402,688 | 36,716 | 2,583,641 | 16,246,664 | 21,069,709 |
| Resignation for Good Reason | 800,000 | 1,402,688 | 36,716 | 2,583,641 | 16,246,664 | 21,069,709 |
| Resignation for Good Reason or Company Without Cause after CoC | 1,600,000 | 1,402,688 | 36,716 | 2,583,641 | 24,432,582 | 30,055,627 |
- Change-of-control acceleration: Double-trigger applies; stock awards automatically vest on termination within 24 months post-CoC; PSUs with incomplete performance periods convert to Relative TSR measured over the 30 days preceding CoC; vesting based on resultant TSR outcomes .
- CFO-specific CoC cash terms: If terminated or resigns for good reason within 12 months following CoC, lump-sum equal to 2x base salary plus prior-year bonus; continued health benefits at active rates for 18 months or until eligible elsewhere .
- Standard severance: Base salary continuation for one year (offset by new employer compensation during severance period), prior-year bonus pro-rated, 18 months of health benefits at active teammate rates if Ackerman resigns for good reason; Severance Plan governs terms .
Clawbacks, Hedging/Pledging, Ownership
- Clawbacks: Dodd-Frank compliant clawback for financial restatements (3-year lookback of excess incentive-based compensation); additional misconduct recoupment policy enables recovery of up to three years of incentive compensation, including time-based equity, for “significant misconduct” .
- Hedging/Pledging: Hedging prohibited for all; pledging prohibited for directors, executive officers, and VPs+ .
- Ownership policy: Executives must meet salary-multiple ownership (Ackerman: 3x) and were compliant as of Dec 31, 2024 .
Compensation Structure Analysis
- Year-over-year changes: Base salary increased from $700,000 to $800,000 in 2024 (+14%), reflecting market alignment and performance recognition; target bonus increased to $800,000 (100% of salary) .
- Cash vs equity mix: 2024 total comp of $6.35m included $4.11m stock awards and $1.46m STI, reinforcing high at-risk compensation and equity alignment .
- Performance metrics: STI centered on Adjusted Operating Income and Adjusted FCF with clear ranges and payouts; PSUs tied to multi-year Adjusted EPS and Relative TSR, with payouts formulaically determined; no positive discretion and caps when TSR is negative .
- Repricing/modification: Company policy prohibits repricing/replacing underwater SSARs/options and change-of-control tax gross-ups; supports shareholder-friendly design .
Say-on-Pay & Shareholder Feedback
- 2024: Company reports strong stockholder support for executive compensation program and continued emphasis on pay-for-performance; ongoing engagement noted (no specific percentage disclosed in the cited section) .
Equity Ownership & Alignment
| Component | Detail |
|---|---|
| Beneficial ownership | 119,687 shares; <1% of outstanding |
| Vested vs unvested | Significant unvested RSUs/PSUs scheduled into 2027/2028; retirement-eligible status extends vesting continuity |
| Options (SSARs) | 2011/2022 grants with strikes $108.93 and $110.63; expirations in 2026 and 2027; 22,032 exercisable; 65,421 unexercisable combined as of YE 2024 |
| In-the-money value | SSARs aggregate in-the-money reference $2,583,641 (used in severance valuation context at 12/31/2024 close) |
| Ownership guidelines | 3x base salary; compliant |
| Pledging | Not permitted |
Employment Terms
| Term | Summary |
|---|---|
| Employment start | CFO since Feb 2017; Treasurer since Apr 2019 |
| Severance plan | Base salary continuation one year; pro-rated prior-year bonus; 18 months health benefits upon good reason resignation; offsets for other employment |
| Change-of-control | Double-trigger vesting; PSUs convert to Relative TSR for incomplete periods; 2x base + prior-year bonus lump sum if terminated/resigns for good reason within 12 months post-CoC; 18 months health benefits |
| Clawbacks | Dodd-Frank restatement clawback; separate misconduct recoupment up to three years |
| Deferred comp | Aggregate balance $1,886,385; 2024 earnings $139,731; no 2024 contributions reported for Ackerman |
Investment Implications
- Performance linkage: High share of at-risk comp with explicit, multi-year metrics (Adjusted EPS/Relative TSR) and formulaic STI design indicates alignment with shareholder value creation; negative discretion and TSR caps temper windfalls .
- Selling pressure and liquidity: 2024 exercises of 107,471 SSARs ($15.3m realized) and vesting of 15,794 shares ($2.15m) indicate meaningful liquidity events; continued sizable unvested RSUs/PSUs may constrain discretionary selling due to ownership guidelines and blackout policies .
- Retention risk: Retirement eligibility (Rule of 65) reduces forfeiture risk and preserves vesting, potentially lowering retention pressure; however, double-trigger CoC provisions and clear severance terms provide stability .
- Alignment safeguards: Prohibitions on hedging/pledging, robust clawbacks, and ownership requirements mitigate misalignment risk; no option repricing or tax gross-ups further support governance quality .
- Execution track record: Above-target STI payout driven by strong Adjusted Operating Income/FCF and effective crisis management in 2024 suggests operational discipline; historical PSU TSR outcomes (e.g., 149% payout for 2025 vesting tranche) reinforce competitive performance vs peers .