Why One CEO Decided to Return $250 Million in Government Relief Funds

What would you do if you found $250 million in your bank account—money you were perfectly entitled to, but felt uncomfortable keeping? That’s roughly the situation that faced Javier Rodriquez, CEO of DaVita, a 65,000-employee chain of kidney treatment centers. His company received nearly $250 million from the Health Care Enhancement Act, a part of the U.S. government relief package enacted in response to the pandemic. Unlike the Payroll Protection Program, to which companies must apply (and which some large companies have been criticized for accessing), the health care program delivers the money to qualifying companies—without an application.

After receiving the funds, Rodriguez and DaVita’s directors were torn. The company’s costs have increased dramatically due to Covid-19 (primarily for purchases of personal protective equipment and employee overtime), and the relief money would help fund them. But like the Payroll Protection Program, the HCEA has a finite pool of funds (it’s $175 billion), and many health care organizations are losing much more money than DaVita due to prohibitions on elective procedures. Rodriguez spoke with HBR about how he and his board grappled with the decision. Edited excerpts:

HBR: Why did you debate whether to keep the funding?

RODRIGUEZ: Our company is qualified for the funding, and we are spending money to treat Covid-positive patients, so it’s within the spirit of the program. But philosophically, we don’t need the money to stay open. That creates conversations around shareholders and society, and whether keeping the money is doing what’s right. In the last year, the Business Roundtable put out its statement on the importance of stakeholders, and in Davos this year there was a big emphasis on ESG, or environmental, social, and governance issues. When it comes to the relief money, is it about qualifying for it, or deserving it, or needing it? That’s a tough discussion.  Our board is a group of experienced, thoughtful executives who were interested in assessing all the different perspectives and outcomes.   A lot of times, ethical discussions focus on hypotheticals, but this was not a dress rehearsal. This is real life, where we had to decide what was right.  In the end, the board was unanimous in its decision to return the dollars.

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