Company: EHC
Filing Date: 2025-04-01
Form Type: DEF 14A
Source: 0000785161-25-000013
Chunk: 55

Company: Encompass Health Corp
Filing Date: 2025-04-01
Form: DEF 14A
Chunk 55
---
 quality of patient outcomes, cost effectiveness, engaged employees, and ability to capitalize on growth opportunities—to adapt to and succeed in a dynamic, highly regulated industry, and we have a proven track record of doing so.

Overview of Executive Compensation Actions in 2024

For 2024, our board of directors (for actions related to our President and Chief Executive Officer) and the Committee (for all other NEOs) considered the total compensation packages, both in whole and by component, of our NEOs to determine appropriateness in light of our executive compensation philosophy and 2024 anticipated challenges. We took the following actions:

| 2024 Executive Compensation Actions Summary |     |                                                                                                                                                                            |     |                                                                                                                                                                                                                                                                                        |
| Compensation                                
 Component                                   |     | Actions Related to Plans                                                                                                                                                   
 from Prior Years                                                                                                                                                           |     | Actions Related to 2024 Plans                                                                                                                                                                                                                                                          |
| Base Salary                                 |     | Not applicable                                                                                                                                                             |     | •Increased base salaries of Mr. Darby and Mr. Price to $625,000 and $345,000, respectively                                                                                                                                                                                             |
| Senior Management Bonus Plan (“SMBP”)       |     | Approved payout of 2023 SMBP awards at 183.6% of target performance                                                                                                        |     | •Modified the Quality/Strategic Objectives Scorecard by increasing the First Year RN Turnover target to 70% of hospitals meeting or exceeding their goal (formerly 60%) and removing Discharge to Skilled Nursing Facility as a metric; weighting of remaining factors were rebalanced |
| Long-Term Incentive Plan (“LTIP”)           |     | Approved 2022 PSU award payouts based on performance compared to targets for 2022-23 performance period; awards equaled a weighted average of 127.2% of target opportunity |     | •Expanded PSU performance period to 3 years (from 2 years)                                                                                                                                                                                                                             
 •Increased Mr. Tarr’s target LTIP to $5,425,000                                                                                                                                                                                                                                        |
| Other                                       |     | Not applicable                                                                                                                                                             |     | •Introduced a limited annual allowance (estimated at approximately $75,000) for Mr. Tarr’s personal use of corporate aircraft                                                                                                                                                          |

#### Response to 2024 Say-on-Pay Vote
The Committee believes the 98.0% affirmative vote on our 2024 “say-on-pay” vote indicates that our stockholders support our current executive compensation program’s alignment with our business strategy in the evolving healthcare industry. The expansion of