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Tenet CEO's 2003 Pay Was $6.12 Million

The Santa Barbara hospital firm granted former chief Jeffrey Barbakow $1.3million in severance pay.

April 06, 2004|From Staff and Wire Reports

Tenet Healthcare Corp. Chief Executive Trevor Fetter, promoted to his post in September to turn around the hospital chain, received $6.12 million in compensation in 2003, the company disclosed Monday.

The firm's former CEO was granted a $1.3-million severance payment.

Fetter, 44, was paid a salary of $848,539, a bonus of $262,500 and additional compensation totaling $1.28 million, mostly a relocation reimbursement, the Santa Barbara-based company said in a regulatory filing. He also received $3.73 million in restricted stock and options to buy 350,000 shares at $14.98 a share by Sept. 15, 2013.

The severance for Jeffrey C. Barbakow, who resigned as chief executive last May under pressure from the board, was roughly equal to his annual salary when he left. Barbakow also received $585,231 in pro-rated salary for 2003 and $59,666 for automobile use.

Barbakow's compensation has been criticized by some shareholders, who have seen the company's stock plunge since October 2002 when Tenet's fortunes began to unravel.

Earlier in 2002, Barbakow cashed in stock options worth about $111 million. Tenet spokesman Harry Anderson said Monday that Barbakow's severance was based on an existing compensation plan for senior executives at the company.

Tenet is trying to recover from a series of scandals. The company disclosed in 2002 that it raised prices to increase revenue from Medicare, touching off federal probes and reductions in payments from the government and private insurers. Fetter is selling more than a quarter of Tenet's 101 hospitals to cut costs, raise cash and restore investor confidence.

Tenet shares rose 25 cents to $11.25 in New York Stock Exchange trading. The shares have dropped 30% this year.

Tenet also said in the filing that it would reduce its board to eight members with the election of directors at its May 6 annual meeting.

Directors Lawrence Biondi and Sanford Cloud Jr. won't stand for reelection and will resign, according to the filing. Robert C. Nakasone resigned from the board March 22.

Monica C. Lozano, publisher and chief executive of La Opinion newspaper, may not stand for reelection in 2005, Tenet said.

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Bloomberg News was used in compiling this report.

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