~~SECURITIES EXCHANGE ACT OF~~Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 ~~(AMENDMENT NO. )~~


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	1.	(1)		Title of each class of securities to which transaction applies:

(2)

Aggregate number of securities to which transaction applies:

(3)

Per unit price or other underlying value of transaction computed pursuant to Exchange ActRule 0-11 ~~(Set~~ (set forth the amount on which the filing fee is calculated and state how it was determined):

(4)

Proposed maximum aggregate value of transaction:

(5)

Total fee paid:

☐

Fee paid previously with preliminary materials.


☐	¨				Check box if any part of the fee is offset as provided by Exchange Act Rule0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its ~~filing.~~filing:

~~Amount Previously Paid:~~


2.	(1)	Amount previously paid:
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	(3)	Filing party:
	(4)	Date Filed:

~~Filing Party:~~

~~Date Filed:~~

UNIVERSAL HEALTH SERVICES, INC.

April ~~7, 2016~~4, 2019

Dear Stockholder:

You are cordially invited to attend the Annual Meeting of Stockholders of Universal Health Services, Inc. (the “Company”) to be held at the offices of the Company, Universal Corporate Center, 367 South Gulph Road, King of Prussia, Pennsylvania, on Wednesday, May ~~18, 2016,~~15, 2019, at 10:00 a.m., for the following purposes:

(1)

the election of one director by the holders of Class A and Class C Common Stock (voting together as a single class) and the election of one director by the holders of Class B and Class D Common ~~Stock;~~Stock (voting together as a single class);

(2)

~~the~~

ratification of the selection of PricewaterhouseCoopers LLP as ~~the Company’s~~our independent registered public accounting firm for the fiscal year ending December 31, ~~2016;~~2019;

(3)

to act on a ~~shareholder~~stockholder proposal regarding proxy access if properly presented at the meeting; and

(4)

the transaction of such other business as may properly come before the meeting or any adjournment thereof.

Detailed information concerning these matters is set forth in the Important Notice Regarding the Availability of Proxy Materials (the “Notice”) you received in the mail and in the attached Notice of Annual Meeting of Stockholders and Proxy Statement. We have elected to provide access to our Proxy Materials over the internet under the Securities and Exchange Commission’s “notice and access” rules. If you want more information, please see the Questions and Answers section of this Proxy Statement.

Your vote is important. Whether or not you plan to attend the meeting, please either vote by telephone or internet or, if you received printed Proxy Materials and wish to vote by mail, by promptly signing and returning your Proxy card in the enclosed envelope. Please review the instructions on each of your voting options described in this Proxy Statement as well as in the Notice you received in the mail. If you then attend and wish to vote your shares in person, you still may do so. In addition to the matters noted above, we will discuss the business of the Company and be available for your comments and discussion relating to the Company.

I look forward to seeing you at the meeting.

Sincerely,

Alan B. Miller

Chairman and

Chief Executive Officer

UNIVERSAL HEALTH SERVICES, INC.

UNIVERSAL CORPORATE CENTER

367 SOUTH GULPH ROAD

KING OF PRUSSIA, PENNSYLVANIA 19406

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

May ~~18, 2016~~15, 2019

Notice is hereby given that the Annual Meeting of Stockholders (the “Annual Meeting”) ~~of Stockholders~~ of Universal Health Services, Inc. (the “Company”) will be held on Wednesday, May ~~18, 2016~~15, 2019 at 10:00 a.m., at the offices of the Company, Universal Corporate Center, 367 South Gulph Road, King of Prussia, Pennsylvania for the following purposes:

(1)

(2)

~~the~~

ratification of the selection of PricewaterhouseCoopers LLP as ~~the Company’s~~our independent registered public accounting firm for the fiscal year ending December 31, ~~2016;~~2019;

(3)to act on a stockholder proposal regarding proxy access if properly presented at the meeting; and

~~(3)~~

(4)

~~to act on a shareholder proposal regarding proxy access if properly presented at the meeting; and~~

~~(4)~~

the transaction of such other business as may properly come before the meeting or any adjournment thereof.

You are entitled to vote at the Annual Meeting only if you were a Company stockholder of record at the close of business on March ~~22, 2016.~~19, 2019.

You are cordially invited to attend the Annual Meeting in person.

WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE VOTE BY TELEPHONE OR INTERNET OR, IF YOU RECEIVED PRINTED PROXY MATERIALS AND WISH TO VOTE BY MAIL, MARK YOUR VOTES, THEN DATE AND SIGN THE ENCLOSED FORM OF PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE. YOU MAY REVOKE YOUR PROXY IF YOU DECIDE TO ATTEND THE ANNUAL MEETING AND WISH TO VOTE YOUR SHARES IN PERSON.

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be held on Wednesday, May ~~18, 2016:~~15, 2019:

The Proxy Statement and Annual Report to Stockholders are available at

http://www.edocumentview.com/uhs.

BY ORDER OF THE BOARD OF DIRECTORS

STEVE G. FILTON,Secretary

King of Prussia, Pennsylvania

April ~~7, 2016~~

4, 2019

UNIVERSAL HEALTH SERVICES, INC.

UNIVERSAL CORPORATE CENTER

367 SOUTH GULPH ROAD

KING OF PRUSSIA, PA 19406

PROXY STATEMENT

QUESTIONS AND ANSWERS

1.	Q: Why am I receiving these materials?

This Proxy Statement and enclosed forms of Proxy (first mailed to the holders of Class A and Class C Common Stock, and to the holders of Class B and Class D Common Stock who requested to receive printed Proxy Materials, on or about April ~~7, 2016)~~4, 2019) are furnished in connection with the solicitation by our Board of Directors of Proxies for use at the Annual Meeting of Stockholders, or at any adjournment thereof. A Notice Regarding the Availability of Proxy Materials was first mailed to all of our other stockholders beginning on or about April ~~7, 2016.~~4, 2019. The Annual Meeting will be held on Wednesday, May ~~18, 2016~~15, 2019 at 10:00 a.m., at our offices located at Universal Corporate Center, 367 South Gulph Road, King of Prussia, Pennsylvania. As a stockholder, you are invited to attend the Annual Meeting and are requested to vote on the items of business described in this Proxy Statement.

2.	Q: What is the purpose of the Annual Meeting?

The Annual Meeting is being held (1) to have the holders of Class A and C Common Stock (voting together as a single class) elect one Class II director and to have the holders of Class B and D Common Stock (voting together as a single class) elect one Class II director, each such director to serve for a term of three years until the annual election of directors in ~~2019 and~~2022 or the election and qualification of his respective successor; (2) to have the holders of Class B and D Common Stock elect one Class II director to serve for a term of three years until the annual election of directors in 2019 and the election and qualification of his successor (3) the ratification of the selection of PricewaterhouseCoopers LLP as ~~the Company’s~~our independent registered public accounting firm for the fiscal year ending December 31, ~~2016; (4)~~2019; (3) to act on a ~~shareholder~~stockholder proposal regarding proxy access if properly presented at the meeting; and ~~(5)~~(4) to transact such other business as may properly be brought before the meeting or any adjournment thereof. We will also discuss our business and be available for your comments and discussion.

3.	Q: Why did holders of Class B and Class D Common Stock receive a notice in the mail regarding the internet availability of Proxy Materials instead of a full set of Proxy Materials?

In accordance with “notice and access” rules adopted by the U.S. Securities and Exchange Commission, or SEC, we may furnish Proxy Materials, including this Proxy Statement and our Annual Report to Stockholders, to our stockholders by providing access to such documents on the internet instead of mailing printed copies. ~~Most holders~~Holders of Class B and Class D Common Stock will not receive

printed copies of the Proxy Materials unless they request them. Instead, the Notice, which was mailed to holders of Class B and Class D Common Stock that did not request printed copies of the Proxy Materials, will instruct you as to how you may access and review all of the Proxy Materials on the internet. Please visit http://www.edocumentview.com/uhs. The Notice also instructs you as to how

you may submit your Proxy on the internet. If you would like to receive a paper or e-mail copy of our Proxy Materials, you should follow the instructions for requesting such materials in the Notice.

4.	Q: Who may attend the Annual Meeting?

Stockholders of record as of the close of business on March ~~22, 2016,~~19, 2019, or their duly appointed Proxies, may attend the meeting. Stockholders whose shares are held through a broker or other nominee will need to bring a copy of a brokerage statement reflecting their ownership of our Common Stock as of the record date.

5.	Q: Who is entitled to vote at the Annual Meeting?

Only stockholders of record as of the close of business on March ~~22, 2016~~19, 2019 are entitled to vote at the Annual Meeting. On that date, ~~6,595,308~~6,577,100 shares of Class A Common Stock, par value $.01 per share, ~~663,940~~661,688 shares of Class C Common Stock, par value $.01 per share, ~~90,014,036~~83,842,101 shares of Class B Common Stock, par value $.01 per share, and ~~23,122~~18,653 shares of Class D Common Stock, par value $.01 per share, were outstanding.

6.	Q: Who is soliciting my vote?

The principal solicitation of Proxies is being made by the Board of Directors by mail. Certain of our officers, directors and employees, none of whom will receive additional compensation therefor, may solicit Proxies by telephone or other personal contact. We will bear the cost of the solicitation of the Proxies, including postage, printing and handling and will reimburse the reasonable expenses of brokerage firms and others for forwarding material to beneficial owners of shares. We have not engaged any third party to assist us in solicitation of proxies at the Annual Meeting, but we may decide to retain the services of a proxy solicitation firm in the future if we believe it is appropriate under the circumstances.

7.	Q: What items of business will be voted on at the Annual Meeting?

The holders of Class A and C Common Stock (voting together as a single class) will elect one Class II director and the holders of Class B and Class D Common Stock (voting together as a single class) will elect one Class II director, each such director to serve for a term of three years until the annual election of directors in ~~2019. The holders~~2022 or the election and qualification of ~~Class B and D Common Stock will elect one Class II director, to serve for a term of three years until the annual election of directors in 2019.~~his respective successor. The holders of Class A, Class C, Class B and Class D Common Stock (voting together as a single class) will vote on the following matters: ratification of the selection of PricewaterhouseCoopers LLP as ~~the Company’s~~our independent registered public accounting firm for the fiscal year ending December 31, ~~2016;~~2019; and a ~~shareholder~~stockholder proposal regarding proxy ~~access if properly presented at the meeting.~~access.

8.	Q: How does the Board of Directors recommend that I vote?

The Board of Directors recommends that holders of Class A and Class C Common Stock and Class B and Class D Common Stock vote shares “FOR” the election of the respective nominees to the Board of Directors (Proposal 1).

The Board of Directors recommends that holders of Class A, Class C, Class B and Class D Common Stock vote shares “FOR” the ratification of the selection of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, ~~2016~~2019 (Proposal 2).

The Board of Directors recommends that holders of Class A, Class C, Class B and Class D Common Stock vote shares “AGAINST” the ~~shareholder~~stockholder proposal regarding proxy access, if properly presented at the meeting; (Proposal 3).

9.	Q: How will voting on any other business be conducted?

Other than the items of business described in this Proxy Statement, we know of no other business to be presented for action at the Annual Meeting. As for any business that may properly come before the Annual Meeting, your signed Proxy gives authority to the persons named therein. Those persons may vote on such matters at their discretion and will use their best judgment with respect thereto.

10.	Q: What is the difference between a “stockholder of record” and a “street name” holder?

These terms describe how your shares are held. If your shares are registered directly in your name with Computershare, our transfer agent, you are a “stockholder of record.” If your shares are held in the name of a brokerage, bank, trust or other nominee as a custodian, you are a “street name” holder.

11.	Q: How do I vote my shares if I am a stockholder of record?

A separate form of Proxy applies to our Class A and Class C Common Stock and a separate form of Proxy applies to our Class B and Class D Common Stock. For specific instructions on how to vote your shares, please refer to the instructions on the Notice Regarding the Availability of Proxy Materials you received in the mail or, if you received printed Proxy Materials, your enclosed Proxy card. If you received printed Proxy Materials, enclosed is a Proxy card for the shares of stock held by you on the record date. If you received printed Proxy Materials, you may vote by signing and dating each Proxy card you receive and returning it in the enclosed prepaid envelope, or you may vote by telephone or internet. Unless otherwise indicated on the Proxy, shares represented by any Proxy will, if the Proxy is properly executed and received by us prior to the Annual Meeting, be voted “FOR” each of the nominees for director; “FOR the ratification of the selection of PricewaterhouseCoopers LLP as ~~the Company’s~~our independent registered public accounting firm for the fiscal year ending December 31, ~~2016;~~2019; and “AGAINST” the ~~shareholder~~stockholder proposal regarding proxy access, if properly presented at the meeting.

12.	Q: How do I vote by telephone or electronically?

Instead of submitting your vote by mail on the enclosed Proxy card (if you received printed Proxy Materials), your vote can be submitted by telephone or electronically, via the internet. Please refer to the specific instructions set forth on the Notice Regarding the Availability of Proxy Materials or, if you received printed Proxy Materials, on the enclosed Proxy card. For security reasons, our electronic voting system has been designed to authenticate your identity as a stockholder.

13.	Q: How do I vote my shares if they are held in street name?

If your shares are held in street name, your broker or other nominee will provide you with a form seeking instruction on how your shares should be voted.

14.	Q: Can I change or revoke my vote?

Yes. Any Proxy executed and returned to us is revocable by delivering a later signed and dated Proxy or other written notice to our Secretary at any time prior to its exercise. Your Proxy is also subject to revocation if you are present at the meeting and choose to vote in person.

15.	~~Q: What is the vote required to approve each proposal?~~

The director nominee receiving the highest number of affirmative votes of the shares of Class A and Class C Common Stock, voting as a class, present in person or represented by Proxy and entitled to vote, a quorum being present, shall be elected as Class II director. The director nominee receiving the highest number of affirmative votes of the shares of Class B and Class D Common Stock, voting as a class, present in person or represented by Proxy and entitled to vote, a quorum being present, shall be elected as Class II director. The affirmative vote of the holders of a majority of the Class A, B, C and D Common Stock votes, present in person or represented by Proxy and entitled to vote on the matter is required to approve each proposal other than the election of directors.

~~16.~~

Q: What constitutes a “quorum”?

The holders of a majority of the common stock votes issued and outstanding and entitled to vote, either in person or represented by Proxy, constitutes a quorum. Proxies received but marked as

abstentions and broker non-votes will be included in the calculation of the number of shares considered to be present at the meeting.

~~17.~~

16.

Q: What are our voting rights with respect to the election of directors?

Our Restated Certificate of Incorporation provides that, with respect to the election of directors, holders of Class A Common Stock vote as a class with the holders of Class C Common Stock, and holders of Class B Common Stock vote as a class with holders of Class D Common Stock, with holders of all classes of Common Stock entitled to one vote per share.

As of March ~~22, 2016,~~19, 2019, the shares of Class A and Class C Common Stock constituted ~~7.5%~~7.9% of the aggregate outstanding shares of our Common Stock, had the right to elect five members of the Board of

Directors and constituted ~~86.4%~~87.2% of our general voting power; and as of that date the shares of Class B and Class D Common Stock (excluding shares issuable upon exercise of options) constituted ~~92.5%~~92.1% of the outstanding shares of our Common Stock, had the right to elect two members of the Board of Directors and constituted ~~13.6%~~12.8% of our general voting power.

~~18.~~

17.

Q: What are our voting rights with respect to matters other than the election of directors?

As to matters other than the election of directors, our Restated Certificate of Incorporation provides that holders of Class A, Class B, Class C and Class D Common Stock all vote together as a single class, except as otherwise provided by law.

Each share of Class A Common Stock entitles the holder thereof to one vote; each share of Class B Common Stock entitles the holder thereof to one-tenth of a vote; each share of Class C Common Stock entitles the holder thereof to 100 votes (provided the holder of Class C Common Stock holds a number of shares of Class A Common Stock equal to ten times the number of shares of Class C Common Stock that holder holds); and each share of Class D Common Stock entitles the holder thereof to ten votes (provided the holder of Class D Common Stock holds a number of shares of Class B Common Stock equal to ten times the number of shares of Class D Common Stock that holder holds).

In the event a holder of Class C or Class D Common Stock holds a number of shares of Class A or Class B Common Stock, respectively, less than ten times the number of shares of Class C or Class D Common Stock that holder holds, then that holder will be entitled to only one vote for every share of Class C Common Stock, or one-tenth of a vote for every share of Class D Common Stock, which that holder holds in excess of one-tenth the number of shares of Class A or Class B Common Stock, respectively, held by that holder. The Board of Directors, in its discretion, may require holders of Class C or Class D Common Stock to provide satisfactory evidence that such owner holds ten times as many shares of Class A or Class B Common Stock as Class C or Class D Common Stock, respectively, if such facts are not apparent from our stock records.

~~19.~~

18.

~~Q: What if I abstain from voting or withhold my vote?~~

Stockholders entitled to vote for the election of directors can abstain from voting or withhold the authority to vote for any nominee. If you attend the meeting or send in your signed Proxy with instructions to withhold authority to vote for one or more nominees, you will be counted for the purposes of determining whether a quorum exists. Abstentions and instructions on the accompanying Proxy card to withhold authority to vote will result in the respective nominees receiving fewer votes. However, the number of votes otherwise received by the nominee will not be reduced by such action.

~~20.~~

Q: Will my shares be voted if I do not sign and return my Proxy card or vote by telephone or internet?

If you are a stockholder of record and you do not sign and return your Proxy card or vote by telephone or internet, your shares will not be voted at the Annual Meeting. If your shares are held in street name and you do not issue instructions to your broker, your broker may vote your shares at its discretion on routine matters, but may not vote your shares on nonroutine matters. Under the New York Stock

Exchange rules, each of the proposals other than the ratification of the selection of the Company’s independent registered public accounting firm is deemed to be a nonroutine matter with respect to which brokers and nominees may not exercise their voting discretion without receiving instructions from the beneficial owner of the shares.

~~21.~~

19.

Q: What is a “broker non-vote”?

“Broker non-votes” are shares held by brokers or nominees which are present in person or represented by Proxy, but which are not voted on a particular matter because instructions have not been received from the beneficial owner. Under the rules of the Financial Industry Regulatory Authority, member brokers generally may not vote shares held by them in street name for customers unless they are permitted to do so under the rules of any national securities exchange of which they are a member. Under the rules of the New York Stock Exchange, New York Stock Exchange-member brokers who hold shares of Common Stock in street name for their customers and have transmitted our Proxy solicitation materials to their customers, but do not receive voting instructions from such customers, are not permitted to vote on nonroutine matters. Under the New York Stock Exchange rules, each of the proposals other than the ratification of the selection of the Company’s independent registered public accounting firm is deemed to be nonroutine matters with respect to which brokers and nominees may not exercise their voting discretion without receiving instructions from the beneficial owner of the shares.

~~22.~~

20.

Q: What is the effect of a broker non-vote?

Broker non-votes will be counted for the purpose of determining the presence or absence of a quorum but ~~they do~~will not ~~affect~~be considered present and entitled to vote on any matter for which a broker, bank or other nominee does not have authority. For the ~~determination~~Annual Meeting, pursuant to the rules of ~~whether~~the New York Stock Exchange, your broker, bank or other nominee will be permitted to vote for you without instruction only with respect to Proposal 2 regarding the ratification of PricewaterhouseCoopers LLP. A broker non-vote will not have any impact on the outcome of any other proposals.

21.	Q: What is the vote required to approve each proposal?



Item of Business	Votes Required for Approval	Abstentions	Signed But Unmarked Proxy Cards	Broker Non-Votes

Proposal 1: Election of Directors	One Class II director will be elected by the highest number of affirmative votes of the shares of Class A and Class C Common Stock, voting together as a ~~matter is approved.~~single class, present in person or represented by Proxy and entitled to vote. One Class II director will be elected by the highest number of affirmative votes of the shares of Class B and Class D Common Stock, voting together as a single class, present in person or represented by Proxy and entitled to vote.	No effect	Count as votes FOR	No effect on voting



Item of Business	Votes Required for Approval	Abstentions	Signed But Unmarked Proxy Cards	Broker Non-Votes
Proposal 2: Ratification of Independent Registered Public Accounting Firm	Majority of the Class A, B, C and D Common Stock votes, present in person or represented by Proxy and entitled to vote.	Count as votes AGAINST	Count as votes FOR	Not applicable
Proposal 3: Stockholder Proposal regarding Proxy Access	Majority of the Class A, B, C and D Common Stock votes, present in person or represented by Proxy and entitled to vote.	Count as votes AGAINST	Count as votes AGAINST	No effect on voting

~~23.~~

22.

Q: Who will count the votes?

The Secretary will count the Class A and Class C votes. Our transfer agent will count the Class B and Class D votes and serve as inspector of elections.

~~24.~~

23.

Q: When are stockholder proposals due in order to be included in our Proxy Statement for the ~~2017~~2020 Annual Meeting?

Any stockholder proposal ~~that you wish~~intended to ~~present~~be included in the proxy materials for ~~consideration at~~ the ~~2017~~2020 Annual Meeting must be received by us no later than December ~~8, 2016. This date provides sufficient time for inclusion~~6, 2019. Such proposals should be sent in writing by courier or certified mail to our Secretary at Universal Health Services, Inc., Universal Corporate Center, 367 South Gulph Road, P.O. Box 61558, King of ~~the proposal in the 2017 Proxy Materials.~~Prussia, Pennsylvania 19406. Any stockholder proposal must also be in proper form and substance, as determined in accordance with the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. ~~Proposals should be addressed to our Secretary at Universal Health Services, Inc., Universal Corporate Center, 367 South Gulph Road, P.O. Box 61558, King of Prussia, Pennsylvania 19406.~~

~~25.~~

24.

Q: Can I receive more than one set of Annual Meeting materials?

If you share an address with another stockholder, each stockholder may not receive a separate copy of our Annual Report and Proxy Statement. We will promptly deliver a separate copy of either document to any stockholder upon written or oral request to our Secretary at Universal Health Services, Inc., Universal Corporate Center, 367 South Gulph Road, P.O. Box 61558, King of Prussia, Pennsylvania 19406, telephone (610) 768-3300. If you share an address with another stockholder and (i) would like to receive multiple copies of the Proxy Statement or Annual Report to Stockholders in the future, or (ii) if you are receiving multiple copies and would like to receive only one copy per household in the future, please contact your bank, broker, or other nominee record holder, or you may contact us at the above address and phone number.

~~26.~~

25.

Q: How can I obtain additional information about the Company?

Copies of our annual, quarterly and current reports we file with the Securities and Exchange Commission, or SEC, and any amendments to those reports, are available free of charge on our website, which is located at http://www.uhsinc.com. Copies of these reports will be sent without charge to any stockholder requesting it in writing to our Secretary at Universal Health Services, Inc., Universal Corporate Center, P.O. Box 61558, 367 South Gulph Road, King of Prussia, Pennsylvania 19406. The information posted on our website is not incorporated into this Proxy Statement.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth as of March ~~22, 2016,~~19, 2019, the number of shares of our equity securities and the percentage of each class beneficially owned, within the meaning of Securities and Exchange Commission Rule 13d-3, and the percentage of our general voting power currently held, by (i) all stockholders known by us to own more than 5% of any class of our equity securities, (ii) all of our directors and nominees who are stockholders, (iii) the executive officers named in the Summary Compensation Table and (iv) all directors and executive officers as a group. Except as otherwise specified, the named beneficial owner has sole voting and investment power. ~~No shares are currently pledged as security by any of our directors or executive officers.~~

Title of Class Percentage
of General
Voting
Power⁽³⁾
Name and Address of
Beneficial Owner⁽¹⁾
Class A
Common
Stock⁽²⁾ Class B
Common
Stock⁽²⁾    Class C
Common
Stock⁽²⁾ Class D
Common
Stock⁽²⁾
John H. Herrell
1021 10th Street, S.W.
Rochester, MN 55902
29,267 ^(5)(12)    ⁽⁵⁾
Robert H. Hotz
Houlihan Lokey
Howard & Zukin
245 Park Avenue, 20th Floor
New York, NY 10167
53,661 ^(5)(12)    ⁽⁵⁾
Alan B. Miller

5,163,885
⁽⁶⁾
^(18)(21)
8,312,380
^(4)(12)
^(13)(19)    661,688    83.1 %
(69.1 %) (6.6 %)    (99.7 %)
Marc D. Miller
1,641,815 ^(7)(16)(18)
2,507,596
^(4)(12)
^(15)(19)(20)    2.5 %
(24.9 %) (2.6 %)
Anthony Pantaleoni
Norton Rose Fulbright US LLP
666 Fifth Avenue
New York, NY 10103
633,138 ^{(5)(14)(17)(21)}
822,436
⁽⁴⁾⁽⁵⁾
^(8)(12)(15)    2,192 ⁽⁵⁾ ⁽⁵⁾
Lawrence S. Gibbs
Cannonball Trading LLC
22 Trafalgar Drive
Livingston, NJ 07039
7,504 ^(5)(12)    ⁽⁵⁾
Eileen C. McDonnell
The Penn Mutual Life Insurance Company
600 Dresher Road
Horsham, PA 19044
9,713 ^(5)(12)    ⁽⁵⁾
Debra K. Osteen
210,940 ^(5)(12)    ⁽⁵⁾
Steve G. Filton
429,188 ^(5)(12)    ⁽⁵⁾

	Title of Class
Name and Address of Beneficial Owner⁽¹⁾	Class A Common Stock⁽²⁾				Class B Common Stock⁽²⁾		Class C Common Stock⁽²⁾				Class D Common Stock⁽²⁾				Percentage of General Voting Power⁽³⁾
	Shares		%		Shares	%	Shares		%		Shares		%
Alan B. Miller	5,163,885^(6)(17)(20)		78.5%		8,851,314^{(4)(11)(12)(18)(21)}	9.7%	661,688		100%			—		—		84.3	%

Marc D. Miller	1,641,815^(7)(15)(17)		25.0%		2,700,150^{(4)(11)(14)(18)(19)}	3.1%		—		—		—		—		2.6	%

Elliot J. Sussman, M.D. The Villages Health 1149 Main Street The Villages, FL 32159		—		—	2,500⁽¹¹⁾	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Robert H. Hotz Houlihan Lokey Howard & Zukin 245 Park Avenue, 20th Floor New York, NY 10167		—		—	86,465⁽¹¹⁾	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Warren J. Nimetz Norton Rose Fulbright US LLP 1301 Avenue of the Americas New York, NY 10019	615,330^(13)(16)(20)			—	789,256^(4)(11)(14)	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Lawrence S. Gibbs Erdos Capital 48 Crescent Road Livingston, NJ 07039		—		—	40,463⁽¹¹⁾	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Eileen C. McDonnell The Penn Mutual Life Insurance Company 600 Dresher Road Horsham, PA 19044		—		—	37,237⁽¹¹⁾	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Steve G. Filton		—		—	470,238^(11)(24)	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Marvin G. Pember		—		—	172,129⁽¹¹⁾	⁽⁵⁾		—		—		—		—	⁽⁵⁾

Wellington Management Company, LLP 280 Congress Street Boston, MA 02210		—		—	7,405,132⁽⁸⁾	8.8%		—		—		—		—		1.1	%

BlackRock, Inc. 55 East 52nd Street New York, NY 10055		—		—	6,473,221⁽⁹⁾	7.7%		—		—		—		—	⁽⁵⁾


The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355	—		—	9,246,684⁽¹⁰⁾		11.0%	—		—	—	—		1.4	%

Vanguard Specialized Funds—Vanguard Health Care Fund 100 Vanguard Blvd. Malvern, PA 19355	—		—	4,593,600⁽²²⁾		5.5%	—		—	—	—	⁽⁵⁾

FMR, LLC 245 Summer Street Boston, MA 02210	—		—	5,178,138⁽²³⁾		6.2%	—		—	—	—	⁽⁵⁾

All directors & executive officers as a group (10 persons)	6,574,600	99.96%			11,731,896	12.6%	661,688	100.0%		—	—		87.6	%

Title of Class Percentage
of General
Voting
Power⁽³⁾
Name and Address of
Beneficial Owner⁽¹⁾
Class A
Common
Stock⁽²⁾    Class B
Common
Stock⁽²⁾    Class C
Common
Stock⁽²⁾ Class D
Common
Stock⁽²⁾
Marvin G. Pember
   112,568 ^(5)(12)    ⁽⁵⁾
Wellington Management Company, LLP
280 Congress Street
Boston, MA 02210


5,707,049
(6.3
⁽⁹⁾
%)

BlackRock, Inc.
40 East 52^nd Street
New York, NY 10022


7,482,201
(8.3
⁽¹⁰⁾
%)

The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355


7,851,381
(8.7
⁽¹¹⁾
%)

All directors & executive officers as a group (10 persons)
(99.9 %)    (12.8 %)⁽⁴⁾    (99.9 %) 86.7 %

(1)	Unless otherwise shown, the address of each beneficial owner is c/o Universal Health Services, Inc., Universal Corporate Center, 367 South Gulph Road, King of Prussia, PA 19406.

(2)	Each share of Class A, Class C and Class D Common Stock is convertible at any time into one share of Class B Common Stock.

(3)

As to matters other than the election of directors, holders of Class A, Class B, Class C and Class D Common Stock vote together as a single class. Each share of Class A Common Stock entitles the holder thereof to one vote; each share of Class B Common Stock entitles the holder thereof to one-tenth of a vote; each share of Class C Common Stock entitles the holder thereof to 100 votes (provided the holder of Class C Common Stock holds a number of shares of Class A Common Stock equal to ten times the number of shares of Class C Common Stock that holder holds); and each share of Class D Common Stock entitles the holder thereof to ten votes (provided the holder of Class D Common Stock holds a number of shares of Class B Common Stock equal to ten times the number of shares of Class D Common Stock that holder holds).

(4)	Includes shares issuable upon the conversion of Classes A, C and/or D Common Stock.

(5)	Less than 1% of the class of stock or general voting power.

(6)	Includes 400,000 shares of Class A Common Stock that are beneficially owned by Mr. Miller and are held by Mr. Miller in trust for the benefit of his spouse.

(7)

Includes 521,821 shares of Class A Common Stock which are held by three trusts (the “2002 Trusts”) for the benefit of certain of Alan B. Miller’s family members of which Marc D. Miller (who is a named executive officer, director and the son of Alan B. Miller) and Mr. ~~Pantaleoni~~Nimetz are trustees; and 532,194 shares held by the A. Miller Family, LLC, whose members are the 2002 Trusts. Marc D. Miller is the sole manager of the A. Miller Family, LLC and during his tenure as such, has voting and dispositive power with respect to the Class A Common Stock held by the A. Miller Family, LLC.

(8)	~~Includes 680 shares of Class B Common Stock that are beneficially owned by Mr. Pantaleoni and are held by Mr. Pantaleoni in trust for the benefit of certain members of his family.~~

~~(9)~~

These securities are held by Wellington Management ~~Company,~~Group, LLP ~~a registered investment adviser.~~and various of its affiliates. Wellington Management ~~Company~~Group LLP or its affiliates has shared power to vote or direct the vote of ~~1,399,608~~2,494,269 shares of our Class B Common Stock and shared power to dispose or to direct the disposition of ~~5,707,049~~7,405,132 shares of our Class B Common Stock. Information is based on Amendment No. 1114 to Schedule 13G dated February ~~11, 2016.~~14, 2019.

~~(10)~~

(9)

These securities are held by ~~BlackRock,~~Blackrock, Inc. Blackrock, Inc. has sole power to vote with respect to 5,753,743 shares of our Class B Common Stock and sole power with respect to 6,473,221 shares to dispose or to direct the disposition of 6,473,221 shares of our Class B Common Stock. Information is based on Amendment No. 710 to Schedule 13G dated ~~January 22, 2016.~~February 6, 2019.

~~(11)~~

(10)

These securities are held by The Vanguard Group. Vanguard Group has sole power to vote with respect to ~~167,719~~98,146 shares and shared power to vote or direct the vote with respect to ~~8,800~~29,588 shares of our Class B Common Stock and shared power to dispose with respect to ~~178,010~~125,627 shares and sole power with respect to ~~7,851,381~~9,121,057 shares to dispose or to direct the disposition of ~~7,673,371~~9,246,684 shares of our Class B Common ~~Stock~~Stock. Information is based on Amendment No. 26 to Schedule 13G dated February ~~10, 2016.~~11, 2019.

~~(12)~~

(11)

Includes ~~2,133,750~~2,132,750 shares issuable pursuant to stock options to purchase Class B Common Stock held by our directors and executive officers and exercisable within 60 days of March ~~22, 2016~~19, 2019 as follows: ~~John H. Herrell (15,000)~~Elliot J. Sussman, M.D. (2,500) Robert H. Hotz ~~(11,250)~~(33,750); Alan B. Miller (1,475,000); Marc D. Miller ~~(202,500); Anthony Pantaleoni (15,000)~~(241,500); Lawrence S. Gibbs ~~(7,500)~~(33,750); Eileen C. McDonnell ~~(7,500); Debra K. Osteen (122,500)~~(30,000); Steve G. Filton (175,000); Warren Nimetz (2,500); and Marvin G. Pember ~~(102,500)~~(138,750).

~~(13)~~

(12)

Includes ~~23,984~~28,061 restricted shares awarded during ~~2014~~2016, 2017 and ~~2015,~~2018, net of vestings, pursuant to our 2010 Employees’ Restricted Stock Purchase Plan for Alan B. Miller. These shares are subject to forfeiture and vesting pursuant to the terms and conditions set forth in the applicable restricted stock agreements.

~~(14)~~

(13)

Does not include (i) 521,821 shares of Class A Common Stock which are held by the 2002 Trusts of which Mr. ~~Pantaleoni~~Nimetz is a trustee, and; (ii) 532,194 shares of Class A Common Stock which are held by A. Miller Family, LLC whose members are the 2002 Trusts. Mr. ~~Pantaleoni~~Nimetz disclaims any beneficial interest in the shares.

~~(15)~~

(14)

Includes 171,426 shares held by the three 2011 Family Trusts for the benefit of Alan B. Miller’s three children. ~~Anthony Pantaleoni~~Warren Nimetz and Marc D. Miller are both Trustees. Marc D. Miller has sole voting power with respect to these shares. Mr. ~~Pantaleoni~~Nimetz disclaims beneficial ownership of all shares and Marc D. Miller disclaims beneficial ownership of Abby Miller King’s shares (55,763) and Marni Spencer’s shares (55,763).

~~(16)~~

(15)

Includes 237,800 shares held by the 2012 Family Trust for the benefit of Abby Miller King and Marni Spencer. ~~Anthony Pantaleoni~~Warren Nimetz and Marc D. Miller are both Trustees. Marc D. Miller has sole voting power with respect to these shares. Mr. ~~Pantaleoni~~Nimetz disclaims beneficial ownership of these ~~shares.~~shares and Marc D. Miller disclaims beneficial ownership of Abby Miller King’s shares (118,900) and Marni Spencer’s shares (118,900).

~~(17)~~

(16)

Includes 356,700 shares held by the 2012 Family Trust for the benefit of Alan B. Miller’s three children. ~~Anthony Pantaleoni~~Warren Nimetz is the Trustee of Marc D. Miller’s shares (118,900) and Mr. ~~Pantaleoni~~Nimetz has sole voting power with respect to Marc D. Miller’s shares. Mr. ~~Pantaleoni~~Nimetz disclaims beneficial ownership of these shares.

~~(18)~~

(17)

Includes 350,000 shares held by three separate limited liability companies 100% of the interests of which are held by the three ~~2014~~2018 Grantor Retained Annuity Trusts, Alan B. Miller, and the three ~~2015 Grantor Retained Annuity~~2002 Trusts for the benefit of Alan B. Miller’s three children. Alan B. Miller has the sole dispositive power and Marc D. Miller has sole voting power with respect to these shares. Marc D. Miller disclaims beneficial ownership of Abby Miller King’s shares (100,000) and Marni Spencer’s shares (100,000).

~~(19)~~

(18)

Includes ~~300,000~~400,000 shares held by the three separate limited liability companies 100% of the interests of which are held by ~~2014~~2018 Grantor Retained Annuity Trusts, Alan B. Miller, and the three ~~2015 Grantor Retained Annuity~~2002 Trusts for the benefit of Alan B. Miller’s three children. Alan B. Miller has the sole dispositive power and Marc D. Miller has sole voting power with respect to these ~~shares.~~shares. Marc D. Miller disclaims beneficial ownership of Abby Miller King’s shares (100,000) and Marni Spencer’s shares (100,000).

~~(20)~~

(19)

Includes ~~130,604~~110,172 shares held by the three 2002 Trusts for the benefit of Alan B. Miller’s three children. ~~Anthony Pantaleoni~~Warren Nimetz is a Trustee and disclaims beneficial ownership of these shares. Marc D. Miller has sole voting power with respect to these ~~shares.~~shares and Marc D. Miller disclaims beneficial ownership interest of Abby Miller King’s shares (22,815) and Marni Spencer’s shares (43,247).

~~(21)~~

(20)

Includes 258,630 shares held by The Alan B. Miller 2002 Trust. ~~Anthony Pantaleoni~~Warren Nimetz is the Trustee of the Trust and has sole voting power with respect to these shares. Mr. ~~Pantaleoni~~Nimetz disclaims any beneficial interest in the shares.

(21)	Excludes 10,810 shares in The Alan and Jill Miller Foundation.

(22)

These securities are held by Vanguard Specialized Funds - Vanguard Health Care Fund. Vanguard Specialized Funds - Vanguard Health Care Fund has sole power to vote with respect to 4,593,600 shares of our Class B Common Stock and holds no dispositive power. Information is based on Amendment No. 2 of Schedule 13G dated February 1, 2019.

(23)

These securities are held by FMR, LLC and its affiliates. FMR, LLC has sole power to vote with respect to 559,345 shares of our Class B Common Stock and sole power with respect to 5,178,138 shares to dispose or to direct the disposition of 5,178,138 shares of our Class B Common Stock. Information is based on the initial filing of Schedule 13G dated February 13, 2019.

(24)	Includes 45,000 shares pledged to Merrill Lynch as collateral in connection with a personal loan extended to Mr. Filton.

Equity Compensation Plan Information

The table below provides information, as of the end of December 31, ~~2015,~~2018, concerning securities authorized for issuance under our equity compensation plans.


Plan Category (1.)	(a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (2.)		(b) Weighted Average Exercise Price of Outstanding Options, Warrants and Rights		(c) Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans (excluding securities reflected in column (a)) (3.)		(a) Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (2.)		(b) Weighted Average Exercise Price of Outstanding Options, Warrants and Rights		(c) Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans (excluding securities reflected in column (a)) (3.)
Equity compensation plans approved by security holders		8,400,183	$	80.50		8,372,888		9,674,791	$	115.39		7,298,643

Total		8,400,183	$	80.50		8,372,888		9,674,791	$	115.39		7,298,643

~~(1)~~

(1.)

Shares of Class B Common ~~Stock~~Stock.

~~(2)~~

(2.)

As of March ~~22, 2016,~~27, 2019, there were ~~7,894,971~~10,385,707 options outstanding with a weighted-average exercise price of ~~$82.45~~$123.55 and ~~a weighted-average~~weighted average remaining term of ~~2.8~~3.22 years. In addition, there were ~~40,984~~292,837 full-value shares outstanding as of March ~~22, 2016.~~27, 2019.

~~(3)~~

(3.)

As of March ~~22, 2016,~~27, 2019, the Company’s Stock Incentive Plan had ~~6,933,041~~3,910,300 shares remaining for future issuance, and the Restricted Stock Purchase Plan had ~~498,975~~197,543 shares remaining for future issuance, for a total of ~~7,432,016~~4,107,843 shares.

PROPOSAL NO. 1

ELECTION OF DIRECTORS

Our Restated Certificate of Incorporation provides for a Board of Directors of not fewer than three members nor more than nine members. The Board of Directors is currently ~~fixed at~~comprised of seven members, and is divided into three classes, with members of each class serving for a three-year term. At each Annual Meeting of Stockholders, directors are chosen to succeed those in the class whose term expires at such Annual Meeting and, in the case of this Annual Meeting, directors will be elected as Class II directors. Under our Restated Certificate of Incorporation, holders of shares of our outstanding Class B and Class D Common Stock (voting together as a single class) are entitled to elect 20% (but not less than one) of the directors, currently two directors, one in Class II and one in Class III, and the holders of Class A and Class C Common Stock (voting together as a single class) are entitled to elect the remaining five directors, three in Class I, one in Class II, and one in Class III.

The persons listed below include our Board of Directors and nominees. The terms of the ~~two~~ current Class II directors, ~~Mr.~~Messrs. Warren J. Nimetz and Robert H. Hotz, ~~and Mr. Anthony Pantaleoni~~ expire at the ~~2016~~2019 Annual Meeting. Mr. ~~Robert H.~~Nimetz has been nominated to be elected by the holders of Class A and C Common Stock and Mr. Hotz has been nominated to be elected by the holders of Class B and ~~Class~~ D ~~Common Stock and Mr. Anthony Pantaleoni has been nominated to be elected by the holders of Class A and C~~ Common Stock. We have no reason to believe that any of the nominees will be unavailable for election; however, if either nominee becomes unavailable for any reason, the shares represented by the Proxy will be voted for the person, if any, who is designated by the Board of Directors to replace the nominee. All nominees have consented to be named and have indicated their intent to serve if elected. The following information is furnished with respect to each of the nominees for election as a director and each member of the Board of Directors whose term of office will continue after the meeting.

Name

Class of
Director

Class of
Stockholders
Entitled to Vote

Age

Business Experience

Director
Since

Class of

Director

Class of

Stockholders

Entitled to Vote

Age

Business Experience

Director

Since

DIRECTOR NOMINEES

Anthony Pantaleoni

A Common

C Common

Of Counsel to the law firm of Norton Rose Fulbright US LLP., New York, New York. We utilized during the year ended December 31, 2015 and currently utilize the services of Norton Rose Fulbright US LLP as outside counsel.

1982

Warren J. Nimetz

A Common

C Common

Mr. Nimetz is a Partner at the law firm of Norton Rose Fulbright and has been an attorney since 1979. We utilized during the year ended December 31, 2018, and currently utilize, the services of Norton Rose Fulbright as outside counsel.

2018

Robert H. Hotz

B Common

D Common

Senior Managing Director, Co-Head of Corporate Finance, Co-Chairman of Houlihan Lokey Howard & Zukin, Member of the Board of Directors and Operating Committee, Houlihan Lokey Howard & Zukin since June 2002.

1991

B Common

D Common

Senior Managing Director, Global Co-Head of Corporate Finance, and Vice Chairman of Houlihan Lokey Howard & Zukin. Member of the Operating Committee, Houlihan Lokey Howard & Zukin since June 2002. Previously a member of the Board of Directors, Houlihan Lokey Howard & Zukin and Senior Vice Chairman, Investment Banking for the Americas of UBS LLC.

1991

Name	Class of Director	Class of Stockholders Entitled to Vote	Age	Business Experience	Director Since
DIRECTORS WHOSE TERMS EXPIRE IN 2020

Alan B. Miller	III	A Common C Common	81	Our Chairman of the Board and Chief Executive Officer since 1978 and previously served as President until May 2009. Prior thereto, President, Chairman of the Board and Chief Executive Officer of American Medicorp, Inc. Chairman of the Board of Trustees, Chief Executive Officer and President of Universal Health Realty Income Trust. Father of Marc D. Miller, a Director and President.	1978

Lawrence S. Gibbs	III	B Common D Common	47	Chief Investment Officer at Erdos Capital since January 2017. Previously served in various portfolio manager and chief investment officer roles including portfolio manager at JP Morgan Chase Bank NA.	2011

Name	Class of Director	Class of Stockholders Entitled to Vote	Age	Business Experience	Director Since
DIRECTORS WHOSE TERMS EXPIRE IN 2021
Elliot J Sussman, M.D.	I	A Common C Common	67	Chairman of the Villages Health. Former President and Chief Executive Officer of Leigh Valley Hospital and Health Network from 1993 to 2010. Currently, a member of the Board of Directors of Yale New Haven Health System since 2011.	2018

Marc D. Miller	I	A Common C Common	48	Appointed as our President in May 2009. Previously served as Senior Vice President and Co-Head of our Acute Care Division during 2007 and served as a Vice President since January 2005. Served as Vice-President of our Acute Care Division since August 2004; Assistant Vice President and Group Director of Acute Care Division, Eastern Region since June 2003, and; served in other management positions at various hospitals from 1999 to 2003. Currently serves as a member of the Board of Trustees of Universal Health Realty Income Trust and as a member of the Board of Directors of Premier, Inc. Son of Alan B. Miller, our Chief Executive Officer and Chairman of the Board.	2006

Name

Class of

Director

Class of

Stockholders

Entitled to Vote

Age

Business Experience

Director

Since

Eileen C. McDonnell

A Common

C Common

Ms. McDonnell currently serves as Chairman and Chief Executive Officer of The Penn Mutual Life Insurance Company since her appointment in February 2011. Ms. McDonnell joined Penn Mutual in 2008 and previously served as President of the company. She was also appointed to The Penn Mutual Board of Trustees in 2010. Ms. McDonnell also serves on the Board of Janney Montgomery Scott LLC, a wholly owned subsidiary of Penn Mutual. Before joining Penn Mutual,

Ms. McDonnell founded ExecMPower, a strategic planning and executive coaching consultancy. Previously, she was president of New England Financial, a wholly-owned subsidiary of MetLife, and senior vice president of the Guardian Life Insurance Company. Ms. McDonnell serves as the Chairman of the Insurance Federation of Pennsylvania. She also serves on the Corporate Council of Children’s Hospital of Philadelphia and is a national advisor to Vision 2020, an initiative of Drexel University College of Medicine Institute for Women’s Health and Leadership.

2013

Name
   Class of
Director    Class of
Stockholders
Entitled to Vote    Age
Business Experience
   Director
Since
DIRECTORS WHOSE
TERMS EXPIRE IN 2017

Alan B. Miller
   III    A Common
C Common
   78       Our Chairman of the Board and Chief Executive Officer since 1978 and previously served as President until May 2009. Prior thereto, President, Chairman of the Board and Chief Executive Officer of American Medicorp, Inc. Chairman of the Board of Trustees, Chief Executive Officer and President of Universal Health Realty Income Trust. Father of Marc D. Miller, a Director and President.    1978
Lawrence S. Gibbs
   III    B Common
D Common
   44       Managing Partner at Cannonball Trading, LLC since July 2014. Previously served as a Macro Portfolio Manager at Ramius LLC from March 2010 until July 2014. Prior thereto, Portfolio Manager at Millennium Partners LLC from February 2009 to March 2010.    2011
DIRECTORS WHOSE
TERMS EXPIRE IN 2018

John H. Herrell
   I    A Common
C Common
   75       Former Chief Administrative Officer of Mayo Foundation from 1993 through 2002; Chief Financial Officer of Mayo Foundation from 1984 until 1993 and various other capacities since 1968.    1993
Marc D. Miller
   I    A Common
C Common
   45       Appointed as our President in May 2009. Previously served as Senior Vice President and Co-Head of our Acute Care Division during 2007 and served as a Vice President since January 2005. Served as Vice-President of our Acute Care Division    2006

Name
   Class of
Director    Class of
Stockholders
Entitled to Vote    Age
Business Experience
   Director
Since
            since August 2004; Assistant Vice President and Group Director of Acute Care Division, Eastern Region since June 2003, and; served in other management positions at various hospitals from 1999 to 2003. Currently serves as a member of the Board of Trustees of Universal Health Realty Income Trust and as a member of the Board of Directors of Premier, Inc. Son of Alan B. Miller, our Chief Executive Officer and Chairman of the Board.
Eileen C. McDonnell
   I    A Common
C Common
   53       Ms. McDonnell was appointed to our Board of Directors in April, 2013 and she currently serves as Chairman and Chief Executive Officer of The Penn Mutual Life Insurance Company since her appointment in February, 2011. Ms. McDonnell joined Penn Mutual in 2008 and previously served as President of the company. She was also appointed to The Penn Mutual Board of Trustees in 2010. Before joining Penn Mutual, Ms. McDonnell founded ExecMPower, a strategic planning and executive coaching consultancy. Previously, she was president of New England Financial, a wholly-owned subsidiary of MetLife, and senior vice president of the Guardian Life Insurance Company.    2013

See the “Corporate Governance” section for additional information about our Board of Directors.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF THESE NOMINEES AS DIRECTORS.

PROPOSAL NO. 2

RATIFICATION OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS

The Audit Committee of the Board has selected, and as a matter of good corporate governance, is requesting ratification by the ~~shareholders~~stockholders of the selection of PricewaterhouseCoopers LLP to serve as our independent registered public accountants for the year ending December 31, ~~2016.~~2019. PricewaterhouseCoopers LLP has served as our independent registered public accountants ~~for the year ended December 31, 2015.~~since 2007. If a favorable vote is not obtained, the Audit Committee may reconsider the selection of PricewaterhouseCoopers LLP. Even if the selection is ratified, the Audit Committee, in its discretion, may select different independent auditors if it subsequently determines that such a change would be in the best interest of the Company and its ~~shareholders.~~stockholders.

PricewaterhouseCoopers LLP representatives will attend the Annual Meeting and respond to questions where appropriate. Such representatives may make a statement at the Annual Meeting should they so desire.

Vote Required

Ratification of the selection of the independent registered public accountants by the ~~shareholders~~stockholders requires that affirmative “FOR” vote of the holders of a majority of the Class A, Class B, Class C and Class D Common Stock votes present in person or represented by proxy and entitled to vote on the matter. Unless marked to the contrary, proxies will be voted FOR the ratification of the selection of PricewaterhouseCoopers LLP as our independent registered public accountants.

THE BOARD RECOMMENDS THAT ~~SHAREHOLDERS~~STOCKHOLDERS VOTE FOR THE RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, ~~2016.~~2019.

PROPOSAL NO. 3

~~SHAREHOLDER~~STOCKHOLDER PROPOSAL REGARDING ~~SHAREHOLDER~~STOCKHOLDER PROXY ACCESS

We have been notified that the Comptroller of the City of New York, Scott M. Stringer, as the custodian and a trustee of the New York City Employees’ Retirement System, the New York City ~~Fire Department Pension Fund, the New York City~~ Teachers’ Retirement System, and the New York City Police Pension Fund, and custodian of the New York City Board of Education Retirement System (the “Systems”) intends to present a non-binding proposal for consideration at the Annual Meeting. The Comptroller of the City of New York represents that each System intends to continue to hold at least $2,000 worth of securities of Universal Health Services, Inc., (“UHS”) through the ~~Systems, collectively, are the beneficial owners~~date of ~~197,080 shares of common stock.~~UHS’ next annual meeting. The stockholders making this proposal have provided the proposal and supporting statement, which is set forth below.

The Board opposes adoption of the proposal and asks stockholders to review the Board’s statement in opposition to the proposal, which follows the stockholders’ proposal and supporting statement below.

~~Shareholder~~Stockholder Proposal Regarding Proxy Access

RESOLVED: Shareholders of the Universal Health Services, Inc. ~~(“UHS”~~(the “Company”) ask the board of directors ~~(“Board”~~(the “Board”) to take the steps necessary to adopt a “proxy access” bylaw. ~~The~~Such a bylaw ~~should~~shall require ~~UHS~~the Company to include in proxy materials prepared for a shareholder meeting at which ~~Class B/D~~ directors are to be elected the name, Disclosure and Statement ~~(defined below)~~(as defined herein) of any person nominated for election ~~as a Class B/D director~~to the board by a ~~Class B/D~~ shareholder or group ~~(“Nominator”~~(the “Nominator”) ~~satisfying~~that meets the criteria established ~~below and~~below. The Company shall allow ~~Class B/D~~ shareholders to vote on such ~~nominee(s)~~nominee on ~~UHS’s~~the Company’s proxy card.

The number of shareholder-nominated candidates ~~nominated pursuant to the bylaw for a given meeting should~~appearing in proxy materials shall not exceed the larger of two or one quarter of the directors then comprising the Board, subject to any limitations on the number of Class B/D directors to be elected by Class B/D shareholders at the meeting. (Currently, holders of Class B and D shares elect two of UHS’s seven directors, and they are in different classes resulting from UHS’s classified board.)serving. This bylaw, which ~~supplements~~shall supplement existing rights under Company bylaws, should provide that a Nominator must:

~~Not be an executive officer or director of UHS;~~

have beneficially owned 3% or more of ~~UHS’s~~the Company’s outstanding ~~Class B or D~~ common stock continuously for at least three ~~years;~~years before submitting the nomination;

give ~~UHS,~~the Company, within the time period identified in its bylaws, written notice of the information required by the bylaws and any ~~SEC~~Securities and Exchange Commission rules about (i) the ~~nominee;~~nominee, including consent to being named in the proxy materials and to serving as director if elected; and (ii) the Nominator, including proof it owns the required shares ~~(information required by this subsection is the~~(the “Disclosure”); and

certify that (i) it will assume liability stemming from any legal or regulatory violation arising out of the Nominator’s communications with ~~UHS~~the Company shareholders, including the Disclosure and Statement; (ii) it will comply with all applicable laws and regulations if it uses soliciting material other than ~~UHS’s~~the Company’s proxy materials; and (iii) to the best of its knowledge, the required shares were acquired in the ordinary course of business and not to change or influence control at ~~UHS.~~the Company..

The Nominator may submit with the Disclosure a statement not exceeding 500 words in support of each nominee (the “Statement”). The Board shall adopt procedures for promptly resolving disputes over whether notice of a nomination was timely, whether the Disclosure and Statement satisfy the bylaw and applicable ~~rules,~~federal regulations, and the priority to be given ~~when~~to multiple nominations exceeding the ~~limit on nominees is exceeded.~~one-quarter limit.

SUPPORTING STATEMENT

We believe proxy access ~~is a fundamental shareholder right that~~ will make directors more accountable and enhance shareholder value. A 2014 study by the CFA Institute ~~study~~ concluded that proxy access ~~would “benefit both the markets and corporate boardrooms, with little cost or disruption and~~ could raise overall US market capitalization by up to $140.3 billion if adopted ~~market-wide.~~

market-wide, “with little cost or disruption.” ((http://www.cfapubs.org/doi/pdf/10.2469/ccb.v2014.n9.1)

The proposed terms are similar to those in vacated SEC Rule 14a-11 (https://www.sec.gov/rules/final/2010/33-9136.pdf). The SEC, following extensive analysis and input from market participants, determined that those terms struck the proper balance of providing shareholders with viable proxy access while containing appropriate safeguards.

The proposed terms enjoy strong investor ~~support. Through November 2015,~~support and company acceptance. We believe a similar proposal received a majority of non-insider votes oncast at the company in 2018. Additionally, more than ~~100 similar proposals have averaged 55% and more than 70~~440 companies have enacted bylaws with similar ~~proxy access bylaws for 3% shareowners.~~terms.

We urge shareholders to vote FOR this proposal.

MANAGEMENT’S STATEMENT IN OPPOSITION TO STOCKHOLDER PROPOSAL

This is the fourth consecutive year that our stockholders have been asked to vote on this proposal or a substantially similar proposal regarding “proxy access.” Each “proxy access” proposal submitted to stockholders at our annual meetings has received the support of less than 10% of the common stock votes represented in person or by proxy at the meeting. Our Board of Directors continues to believe that the implementation of proxy access is not in the best interests of our Company. The Board has carefully considered this specific proposal and recommends a vote AGAINST it.

It is the ~~foregoing proposal for~~Board of Directors’ view that our corporate governance policies already ensure that the ~~following reasons:~~

~~Proxy access~~Board of Directors is ~~a procedure designed~~accountable to facilitate company-financed proxy contests in director elections, pitting the Board’s nominees against one or more proxy access candidates nominated by a stockholder to be included in the Company’s proxy statement. The Board recommendsstockholders, and that ~~you vote against~~ this proposal ~~because it ignores the voice stockholders already have, undercuts~~would undercut the role that the Board of Directors and the ~~independent~~ Nominating and Governance Committee ~~and~~play in evaluating director nominees. This proposal calls for you to approve a process that would ~~introduce an unnecessary and~~enable special interest groups collectively owning as little as 3% of the Company’s outstanding shares to nominate directors that promote their own agendas, potentially ~~expensive and destabilizing dynamic into~~at the expense of the long-term interests of stockholders. With non-management directors constituting 70% of the Board ~~election process.~~of Directors and routinely receiving more than 90% of all votes cast, and our enhanced stockholder engagement program, the Company already has a Board of Directors that is accountable to stockholders, responsive to your input, and committed to promoting your best interests.

This proposal advances a solution for a problem that does not exist at the Company, as ~~the Company’s~~our current corporate governance policies and practices provide stockholders with the ability to effectively express their views and participate meaningfully in director elections, and ensure that the Board of Directors is accountable to ~~stockholders~~.stockholders. For example,

As a “controlled company” for purposes of NYSE Listed Company Manual Section 303A.00, we are not required to have a majority of independent directors and we are exempt from the NYSE’s requirements relating to compensation committees and nominating/corporate governance committees. However, the Company has a majority of independent directors on our Board of Directors and all independent directors serving on our Compensation Committee and Nominating & Governance Committee. We believe that our Board and committee structure provides independence and good corporate governance practices while our multi-tiered voting structure preserves our ability to manage the Company in the best interests of all our ~~shareholders.~~stockholders.

We have an empowered ~~independent~~ Lead Independent Director.

~~Shareholders~~Stockholders are able to:

•

~~Communicate~~o

communicate directly with any director, including our independent directors, as discussed in this Proxy Statement under “~~Stockholder~~“Stockholder Communications”;

propose director nominees to the Nominating and Governance Committee;

directly submit nominations of director candidates at our annual meetings, subject to the conditions set forth in our By-laws; and

submit proposals for consideration at our annual meetings and for inclusion in the Company’s proxy statement.

~~Propose director nominees to the Nominating and Governance Committee; and~~

~~Directly submit nominations of director candidates at our annual meetings, subject to the conditions set forth in our By-laws.~~

We do not have a “poison pill” which would limit the amount of shares any group of stockholders could hold.

Since its founding in 1979 UHS has become one of the largest and most respected hospital management companies in the nation. As a Fortune 500 corporation, with net revenues of approximately ~~$9.0~~$10.8 billion ~~in annual revenue~~generated during the year ended December 31, 2018 that produced net income of ~~more than $680~~approximately $800 million, ~~in 2015,~~ UHS subsidiaries own and operate ~~260~~350 inpatient acute care and behavioral health care facilities in 37 states, the District of Columbia, Puerto Rico, ~~the U.S. Virgin Islands~~ and the United Kingdom, and employ more than ~~74,000~~87,000 people. Our governance structure has enabled us to grow our

business and to succeed despite a rapidly changing landscape and changes in technology, market structure and regulatory regimes. The tenure of our directors enables the Board to provide insight into the rationale and historical context for past decisions and strategies that has allowed us to successfully adapt to our evolving business environment. This continuity increases the full Board’s collective experience, provides new directors the opportunity to learn about our business from the continuing directors and improves the Board’s ability to develop, refine, and execute our long-term strategic plans. All of this is even more important in today’s uncertain environment with increased challenges and opportunities facing companies within the healthcare industry. An abrupt change in the composition of our Board could impair our progress in achieving our strategic goals.

~~The proposal would undermine the important role of the independent Nominating and Governance Committee~~. Allowing stockholders to nominate competing candidates for director in our proxy statement would seriously undercut the role of the independent Nominating and Governance Committee and our Board in one of the most crucial elements of corporate governance, the election of directors. An effective Board of Directors is composed of individuals with a diverse and complementary blend of experiences, skills and perspectives. Our independent Nominating and Governance Committee and our Board of Directors are in the best position to ~~assess the particular qualifications of~~identify potential director nominees with the experience and qualities to serve on the Board of Directors, and to determine whether ~~they~~such candidates will contribute to an effective and well-rounded Board that operates openly and collaboratively and represents the interests of all stockholders, not just those with special interests.

The Nominating and Governance Committee, which is comprised of independent, non-management directors who owe fiduciary duties to act in the best interests of all stockholders, has developed criteria and a process for identifying and recommending director candidates for election by our Class B and D stockholders, which are described in this Proxy Statement under “Committees of the Board of Directors-Nominating and Governance Committee.”

As part of this process, stockholders can recommend prospective director candidates for the Nominating and Governance Committee’s consideration. No stockholders have recommended prospective director candidates through this process to date, which we believe reflects the confidence of our stockholders in the nomination process of the Nominating and Governance Committee outlined above. However, any nominee proposed by stockholders for the Committee’s consideration through this process would be evaluated and considered in the same manner as a nominee recommended by a Board member, management, search firm or other source.

This process is designed to identify and nominate qualified director candidates who possess a combination of skills, professional experience and diversity of backgrounds necessary to oversee our business and who can contribute to the overall effectiveness of our Board. The Nominating and Governance Committee also carefully reviews and considers the independence of potential nominees. ~~Shareholders~~Stockholders already have a voice in this process and the ability to nominate potential directors for consideration by the Committee. Through this process, we believe that our Nominating and Governance Committee and Board achieve the optimal balance of identifying and nominating directors ~~and~~that best serve the Company and all of our stockholders.

This proxy access proposal would potentially enable a holder, or a group of holders, with ownership of as little as 3% of our outstanding shares to completely bypass this process by placing directly into nomination

candidates who may fail to meet the qualifications established by the Board, fail to contribute to the desired mix of perspectives, or fail to represent the interests of stockholders as a whole. ~~In addition,~~For example, the Board of Directors believes that this proposal ifinvites the influence of special interest groups who do not owe fiduciary duties to the Company on decisions that are more appropriately made by the Board of Directors. Were this proposal implemented, ~~would allow~~ a ~~constantly shifting alignment~~small group of stockholders ~~that have held shares~~could nominate directors with a special interest agenda, or a slate of nominees focused on short-term interests rather than creating long-term value for, and promoting the ~~requisite three-year period to aggregate their shares to reach~~best interests of, all stockholders. The Board of Directors does not believe this ~~3% threshold creating a never ending cycle~~is in the best interests of ~~stockholders seeking to disrupt~~ the ~~Company’s governance.~~Company or its stockholders.

~~The proposal could have a number of other significant adverse consequences~~. In addition, ~~to proxy access being unnecessary,~~ the Board believes that the potential for frequent contested elections arising from proxy access would not only be highly distracting to the Board and management, but could also encourage a short-term focus with respect to the management of the business that would not be in the long-term interests of our stockholders. We believe that our Board’s stability has driven, and will continue to drive, long-term value for stockholders who are committed to holding our stock for extended periods. As a testament to this belief, our shares have outperformed leading stock indices by significant margins since our initial public offering in 1981. More recently,

since 2000, our stock performance has outperformed the S&P 500 Index by a margin of 5.7 to 1 during the 19-year period ended December 31, 2018. After various stock splits and reinvested dividends are considered, an investor who purchased $1,000 of our Class B Common Stock on January 1, 2000, would have had an investment valued at $14,040 as ~~proposed in this stockholder proposal could have a number~~ of ~~significant adverse consequences and harm the Company and stockholders by:~~

•

~~Creating an Uneven Playing Field and Increasing Company Costs~~. In the absence of proxy access, the playing field is level, in that a stockholder seeking to elect its own nominee to the Board outside of the process of the Nominating and Governance Committee outlined above would, like the Company, need to undertake the expense of preparing proxy materials and soliciting proxies on its nominee’s behalf. We see little reason why a stockholder owning 3% or more of the outstanding shares of the Company (which as of the record date would constitute over $320 million worth of shares) should not, if the stockholder has a legitimate interest in having representation on the Board, bear the expense of preparing proxy materials and soliciting proxies. Moreover, in a contested election resulting from proxy access, we would likely feel compelled to undertake an additional and potentially expensive campaign in support of Board-nominated candidates and inform stockholders of the reasons why we believe the Board-nominated candidates rather than the stockholder nominee(s) should be elected. In this regard, the United States Court of Appeals for the District of Columbia overturned the SEC’s proxy access rule because it determined that the SEC failed to adequately assess the economic effects of the rule, including the expense and distraction that contested director elections arising out of proxy access would entail.

•

~~Increasing the Influence of Special Interest Groups~~. Proxy access creates the potential for a stockholder with a special interest to use the proxy access process to promote a specific agenda rather than the interests of all stockholders or to extract concessions from the Company related to that stockholder’s special interests, thereby creating the risk of politicizing the Board election process at virtually no cost to the proponent.

•

~~Encouraging Short-Termism~~. With proxy access, contested director elections could become routine. The Board believes that the potential for frequent contested elections arising from proxy access would not only be highly distracting to the Board and management, but could also encourage a short-term focus with respect to the management of the business that would not be in the long-term interests of our stockholders. We believe that our Board’s stability has driven, and will continue to drive, long-term value for stockholders who are committed to holding our stock for extended periods. As a testament to this belief, our shares have outperformed leading stock indices by significant margins since our initial public offering in 1981. More recently, since 2000, our stock performance has outperformed the S&P 500 Index by a margin of more than 7.5 to 1 during the 16-year period ended December 31, 2015. After various stock splits and reinvested dividends are considered, an investor who purchased $1,000 of our Class B Common Stock on January 1, 2000, would have had an investment valued at $14,249 as of

~~December 31, 2015, as compared to $1,891~~December 31, 2018, as compared to $2,466 for a $1,000 investment made in the S&P 500 Index during the same period.

•

~~Disrupting Board Operations~~. Frequent contested director elections arising out of proxy access could also disrupt our Board operations and dynamics in various ways. Abrupt changes in the composition of our Board arising out of proxy access could disrupt continuity on our Board in a manner that could interfere with our ability to develop, refine, monitor and execute our long-term strategic and business plans. In addition, the election of stockholder-nominated directors through proxy access could create factions on the Board, leading to dissension and delay, and thereby potentially preclude the Board’s ability to function effectively and serve the best interests of all our stockholders. Finally, the potential for frequent contested elections arising out of proxy access could hinder collegiality among our Board members by creating the potential for our Board members to be pitted against one another in contested director elections on a regular basis where there would be more nominees up for election than available director positions.

•

~~Discouraging Highly Qualified Director Candidates from Serving~~. Under the current process overseen by the Nominating and Governance Committee, we have a well-functioning team of directors with a diverse range of expertise and experience. However, the prospect of routinely standing for election in a contested situation may deter highly qualified individuals from Board service. Moreover, the prospect of perennial contested elections may cause incumbent directors to become excessively risk adverse, thereby impairing their ability to provide sound and prudent guidance with respect to our operations and interests.

The Board further believes that the current measures the Company employs for the nomination and election of directors, as well as the Company’s stockholder engagement program, have led to a Board that is responsive to stockholder input and promotes a strategy of long-term value creation. While our Board strives to implement corporate governance best practices when appropriate, our Board believes that proxy access would be unnecessary and counterproductive for the Company. Moreover, our Board believes that proxy access could disrupt the functioning of our Board and adversely affect the implementation of our long-term strategy. Finally, while proxy access has been the subject of significant publicity this proxy season, proxy access has only been implemented by a relatively small number of U.S. public companies, which we believe creates the potential for other unforeseen problems in light of the complicated issues associated with the implementation of proxy access.

For the foregoing reasons, while we recognize that proxy access is a topic of growing interest and we will continue to monitor its implementation by and effect on other U.S. public companies, the Board of Directors believes that this proposal is not in the best interests of the Company or its stockholders.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “AGAINST” THE ~~SHAREHOLDER~~STOCKHOLDER PROPOSAL REGARDING STOCKHOLDER PROXY ACCESS DESCRIBED IN PROPOSAL NO. 3.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Our ~~2015~~2018 Performance

The following are highlights of our ~~2015~~2018 financial and operating performance:

During ~~2015,~~2018, our adjusted net income attributable to UHS (see A. below) increased ~~19%~~ to ~~$692.0~~$894.4 million, or ~~$6.87~~$9.53 per diluted share, as compared to ~~$581.8~~$725.5 million, or ~~$5.78~~$7.53 per diluted share, during ~~2014.~~2017.

Our net revenues increased ~~10.2%~~3.5% to ~~$9.04~~$10.77 billion during ~~2015~~2018 as compared to ~~$8.21~~$10.41 billion during ~~2014.~~2017.

Net revenues at our acute care hospitals owned during both years increased ~~8.7%~~4.6% during ~~2015~~2018 as compared to ~~2014.~~2017. During ~~2015~~2018 at these facilities, adjusted admissions (adjusted for outpatient activity) increased ~~5.4%~~2.1% and adjusted patient days increased ~~5.5%~~4.8% as compared to ~~2014.~~2017.

Net revenues at our behavioral health care facilities owned during both years increased ~~5.0%~~2.6% during ~~2015~~2018 as compared to ~~2014.~~2017. During ~~2015~~2018 at these facilities, adjusted admissions increased ~~2.9%~~3.0% and adjusted patient days increased ~~1.2%~~0.5% as compared to ~~2014.~~2017.

In addition to strong financial performance, we continued to focus on delivering quality care to our patients. The following are a few of the ~~2015~~ quality and patient care ~~highlights:~~highlights achieved in 2018:

We invested more than $400 million in our acute care division, and approximately $260 million in our behavioral health care division, to construct, expand, equip and improve our facilities.

Acute Care Services:

Our acute care hospital delivered nearly $1.9 billion in uncompensated care.

The ~~Joint Commission released its list~~Patient Safety Index 90 (“PSI-90”) is a composite of ~~Top Performers on Key Quality Measures (based on 2014 performance results)~~indicators created by the Agency for Healthcare, Research and 46Quality. The PSI-90 provides an overview of ~~our facilities were included on~~hospital level quality as it relates to a set of potentially preventable hospital related events associated with harmful outcomes for patients. For 2018, the ~~list including 8~~UHS PSI 90 score of 0.411 was better than the national average of 1.00.

Risk-adjusted observed to expected mortality (“O:E Ratio”) is another commonly used method to assess acute care quality (an O:E Ratio of 1.0 represents the average mortality rate; less than 1.0 represents a better-than-expected mortality rate). The Company’s acute care 2018 O:E Ratio of 0.7969 compared favorably to the expected.

Eleven of our acute care hospitals were awarded an ‘A’ from The Leapfrog Group’s Fall 2018 Hospital Safety Grade. The designation recognizes our hospitals’ efforts in protecting patients from harm and ~~38 behavioral health care facilities.~~

~~Our behavioral health care facilities that achieved this recognition comprised approximately 35% of all freestanding psychiatric facilities~~meeting the highest safety standards in the ~~nation recognized by The Joint Commission.~~United States.

Behavioral Health Care Services:

~~Our inpatient behavioral health care facilities exceeded national averages for quality reporting measures reported to the federal~~The Centers for Medicare and Medicaid ~~Services, in some cases by more than 25%.~~

~~More than 318,000 of~~Services’ inpatient psychiatric facility quality reporting measures compare our behavioral health care ~~patients participated~~facilities to approximately 1,500 providers in the ~~division’s Patient Satisfaction Survey, scoring~~U.S. Our behavioral health results exceed the average of the group in 12 out of 15 indicators.

The Joint Commission’s Core Measures for hospital-based inpatient psychiatric services quality compares our behavioral health care facilities to over 700 providers in the U.S. The results indicate that, on a comparative basis, our behavioral health care facilities outperform the group in all four measures.

In 2018, patients in our behavioral health care facilities rated their overall care, on average, as 4.5 out of 5 ~~on each question asked, with 92% indicating that~~in our patient satisfaction surveys. More than 91% indicated they felt better ~~after~~following care at one of our facilities and almost 90% would refer a friend or family member in need of care.

~~The adjusted~~

Adjusted net income and adjusted net income per diluted share for ~~2015~~2018 and ~~2014~~2017 were publicly disclosed and reconciled to our reported results for each year on the Schedule of Non-GAAP Supplemental Consolidated Statements of Income Information, included with our earnings for the years ended December 31, ~~2015~~2018 and ~~2014,~~2017, as filed on Form 8-K on February ~~25, 2016.~~27, 2019.

Compensation Philosophy and Objectives

Our compensation ~~practices are aligned~~philosophy of aligning pay strongly with ~~our philosophy by~~performance is grounded in best practices that are regulatory compliant, financially sound and provide long-term value to ~~shareholders and generally include the following:~~stockholders. Specifically, we:

Review peer group market data on an annual basis;

~~Performance discussion is included on~~Discuss financial and operational performance rigorously in determining any base salary and incentive ~~decisions~~decisions;

Enforce maximums on incentive payments to limit undue ~~risk~~risk;

~~Practices evaluated annually~~Evaluate our compensation practices on an annual basis;

~~The Compensation Committee seeks guidance from~~Retain an independent, outside ~~consultant~~consultant;

Do not provide plans generally outside of current market practices, and;

Do not offer excessive perquisites to our ~~executives~~executives.

In designing our compensation programs for our named executive officers, we follow our belief that compensation should reflect the value created for stockholders while supporting our strategic business goals. In doing so, our compensation programs reflect the following objectives:

Compensation should encourage increases in stockholder value;

Compensation programs should support our short-term and long-term strategic business goals and objectives;

Compensation programs should reflect and promote our core values set forth in our mission statement, which includes commitment to excellence, high ethical standards, teamwork and innovation;

Compensation should reward individuals for outstanding performance and contributions toward business goals, and;

Compensation programs should enable us to attract, retain and motivate highly qualified professionals.

These objectives govern the decisions that the Compensation Committee of the Board of Directors (the “Compensation Committee”) and management of the Company make with respect to the amount and type of compensation payable to our named executive officers. The Compensation Committee believes that linking executive compensation to corporate performance results in a strong alignment of compensation with corporate business goals and stockholder value. This belief has been adhered to through the use of incentive pay programs that provide competitive compensation ~~and~~ for achieving superior ~~performance. Our compensation programs are designed to reward our employees for outstanding~~ performance and ~~contributions that increase our stock price thereby increasing stockholder value. Both short-term and long-term incentive compensation are based on our performance and the~~creating value ~~received by~~for stockholders. Executives are rewarded commensurately for the achievement of specified business goals and performance objectives, which may increase the value of our stock. ~~The majority of our~~Our compensation programs are reviewed annually to ensure that these objectives continue to be met.

Compensation Setting Process

The Compensation Committee has traditionally taken into account the input and recommendations of our Chairman and Chief Executive Officer, Mr. Alan Miller, with respect to our compensation programs, including the compensation arrangements with our named executive officers other than himself. The Compensation Committee believes that Mr. Alan Miller, due to his role within the Company, his years of healthcare experience and other factors, as mentioned below, ~~provides~~is a valuable resource to the Compensation Committee. Mr. Alan Miller attends certain Compensation Committee meetings by invitation, however, he does not have the right to vote on

matters addressed by the Compensation Committee and he does not participate in the discussions with respect to his own compensation. Mr. Alan Miller conducts formal performance evaluations on an annual basis of the named executives who have direct reporting responsibility to him.

Unlike our other named executive officers, Mr. Alan Miller’s base salary, ~~minimum~~target annual bonus and certain perquisites are determined under his employment agreement. Please also refer to the discussion of Mr. Alan Miller’s employment agreement in theChief Executive Officer Employment Agreement section of this Proxy Statement. In addition, the compensation setting process for Mr. Alan Miller varies from that of our other named executive officers because it is determined by the Compensation Committee without Mr. Alan Miller’s participation. The Compensation Committee, in determining Mr. Alan Miller’s compensation, takes into account his position as Chief Executive Officer, his role as a founder of our Company in 1978, his years of dedicated service and his expertise and reputation in the hospital management industry. The Compensation Committee also considers Mr. Alan Miller’s responsibilities in overseeing all of our Company’s businesses, operations, development and overall strategy and his role as the public face of our Company, which shapes our corporate image and identity. These factors differentiate Mr. Alan Miller from the other named executive officers.

In addition, for Mr. Alan Miller and the Company’s other named executive officers, the Compensation Committee reviewed data prepared in early ~~2015~~2018 by Pay Governance LLC that compared the Company’s executive compensation levels to data for comparable positions from two reference points: a primary reference of other similar companies within the healthcare industry; and a secondary reference of size-adjusted (by revenues) data from the broader general industry. Data for the primary reference were drawn from publicly filed proxies of peer healthcare companies, and data for the secondary reference were drawn from published compensation surveys covering a range of companies and industries. Data were compiled for all elements of compensation including base salary, annual incentive opportunity, and equity/long-term incentive awards. These data, as well as Company-specific factors including the prior year performance of our executives and the Company’s operating and shareholder return performance relative to our competitors, were considered by the Committee in determining ~~2015~~2018 compensation ~~rates~~ for Mr. Alan Miller and our other named officers. In light of the above factors, the Compensation Committee approved the base salary, annual cash incentive opportunity, and long-term compensation award to each of the named executive officers in ~~2015~~2018 and believes that the forms and amounts of compensation for each year adequately reflect our compensation goals and policies.

Elements of Compensation

Our executive compensation is based on six primary components, each of which is intended to serve the overall compensation objectives. These components include:

annual base salary;

annual cash incentive;

long-term incentive ~~awards;~~awards, and;

deferred ~~compensation;~~

compensation, retirement ~~benefits;~~benefits and

other benefits, including perquisites.

Annual Base Salary

Our annual base salary levels are intended to be consistent with competitive pay practices and level of responsibility, with salary increases reflecting competitive trends, our overall financial performance, the performance of each individual executive and general economic conditions.

In establishing the base salary for our named executive officers, various criteria are reviewed including the following:

the executive officer’s achievements, performance in his or her position with us, taking into account the tenure of service, the complexity of the position and current job responsibilities;

Mr. Alan Miller’s recommendations as to the proposed base salary, other than his own;

company financial performance, and;

salaries of similar positions in our healthcare competitor ~~companies.~~companies and general industry comparisons.

For our named executive officers, an analysis was conducted in ~~2015~~2018 utilizing the most currently available proxy statements and financial results, as filed with the Securities and Exchange Commission, from ~~six~~seven companies that we believe are our most direct competitors. We believe these companies, which are indicated below, are comparable peer companies based upon the median revenues of this peer group, which were approximately ~~$12.8~~$6.4 billion as compared to our ~~2015~~2018 revenues of ~~$9.0~~$10.8 billion.

The companies are:

Acadia Healthcare Company, Inc.

Community Health Systems Inc.

HCA Inc.

~~Iasis Healthcare~~

Kindred Healthcare, Inc.

LifePoint Hospitals, Inc.

Tenet Healthcare Corporation

~~In addition, Pay Governance LLC provided assistance in the development of our new equity plan and provided additional market data on competitive levels of incentive plan participation.~~Brookdale Senior Living Inc.

For Mr. Alan Miller, his ~~2015~~2018 base salary exceeded the ~~75th~~90th percentile of the peer ~~group,~~and general industry groups, due to his long tenure in the position, his value as the Company’s founder, his status within the healthcare industry and his performance. The median years of same company/role experience of other executives in ~~this~~the peer group was 109.3 years compared to Mr. Alan Miller’s 3740 years.

For ~~2015,~~2018, the actual base salary rates for our named executives (excluding Mr. Alan B. Miller) were within approximately 15% of their respective median base salary market rates (as assessed relative to our peer and general industry groups). For 2018, for our other named executive officers (excluding Mr. Alan Miller), we targeted the median ~~(fiftieth~~(50^th percentile) base salary paid by the ~~comparable~~peer companies (listed above), along with the median of broader general industry data, to establish our base market rate. We generally consider our base salaries to be competitive if they are approximately within a 15% range of the median market rate. However, actual base salaries are not dictated solely by the median market rate. We also take into account an individual’s expertise, tenure in the position, responsibilities and achievements. For 2015, the actual base salary rates for Messrs. Marc Miller, Filton, Pember and Ms. Osteen were within approximately 15% of their respective median base salary market rates (as assessed relative to our peer group).

Annual Cash Incentives

Cash incentives for our named executive officers are awarded under the Executive Incentive Plan, which was adopted by our stockholders at our 2010 Annual Meeting and re-approved by our stockholders at our 2015 Annual Meeting. The Executive Incentive Plan is intended to support our efforts to attract, retain and motivate highly qualified senior management and other executive officers of the Company and its affiliates through the payment of performance-based incentive compensation. Annual incentive compensation may be awarded under the Executive Incentive Plan to our named executive officers and others as selected by the Compensation

Committee for any calendar year. The Compensation Committee believes that the payment of cash incentives to our named executive officers under the Executive Incentive Plan is consistent with the objectives for our compensation programs by rewarding such officers for the achievement of specified business goals and performance objectives and that may increase the value of our stock.

The amount of an employee’s cash incentive award for a calendar year is based upon the employee’s target cash incentive and the extent to which the performance goal(s) applicable to the employee are achieved. For each calendar year, an employee’s target cash incentive will be equal to a fixed percentage of the employee’s base salary earned during the year.

The Compensation Committee establishes performance goals for the named executive officers using such business criteria and other measures of performance discussed ~~herein; provided that, in the case of incentive~~

~~awards intended to qualify as “performance-based compensation” under Section 162(m) of the Code,~~herein and the Compensation Committee will establish objective performance goals based upon one or more of the following business criteria:

attainment of certain target levels of, or a specified increase in, after-tax or pre-tax profits;

attainment of certain target levels of, or a specified increase in, earnings per diluted share or adjusted earnings per diluted share, and;

attainment of certain target levels of, or a specified increase in, return on capital or return on invested capital.

In the case of an award intended to qualify as “performance-based compensation” ~~under Section 162(m) of the Code, except as otherwise permitted under Section 162(m) of the Code,~~, the applicable target cash incentive, performance goals and performance factors with respect to any calendar year will be established in writing by the Compensation Committee no later than 90 days after the commencement of that year. Promptly after the date on which the necessary financial or other information for a particular year becomes available, the Compensation Committee will determine the amount, if any, of the cash incentive compensation payable to each participant for that calendar year and will certify in writing prior to payment that the performance goals for the year were in fact satisfied. The maximum incentive award which any participant may earn under the Executive Incentive Plan for any calendar year shall not exceed $5 million. The Executive Incentive Plan provides the Compensation Committee with the discretion to establish higher or lower performance factors for levels of performance that are more or less than the target levels. Performance goals may be adjusted for changes in accounting methods, corporate transactions and other similar types of ~~events, provided that, such adjustment is permitted under~~events.

On December 22, 2017, the President of the United States signed into law comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act of 2017 (the “TCJA-17”). TCJA-17 modifies Section 162(m) under the Code removing the exception for performance-based compensation applicable to years beginning after December 31, 2017. This change does not apply to compensation stemming from contracts entered into on or before November 2, 2017, unless such contracts were materially modified on or after that date. Compensation agreements entered into and share-based payment awards granted after this date will be subject to the revised terms of ~~the Code.~~Section 162(m).

~~2016 and 2015~~2018 Annual Cash Incentive Formula and Performance Goals: The Compensation Committee approved the specific formula for the determination of the target annual cash incentive compensation for our executive officers pursuant to the Executive Incentive Plan with respect to the years ending December 31, ~~2016 and 2015.~~2018. Under the formulae approved by the Compensation Committee, each of the Company’s executive officers was assigned a percentage of such executive officer’s base salary as a target bonus to be paid based ~~upon corporate~~on pre-specified performance criteria. The ~~corporate performance criteria~~ target bonus award indicated below for Mr. Alan B. Miller is stipulated in his employment agreement dated July 24, ~~2013.~~2013, as amended on November 5, 2018.

The following table shows each named executive officer’s ~~corporate performance criteria~~ target bonus as a percentage of his or her base salary for ~~2016 and 2015.~~2018. With respect to Messrs. Alan B. Miller, Marc D. Miller and Steve G. Filton, 100% of their annual incentive bonus for ~~2016 and 2015 will be/~~2018 was determined using the corporate performance criteria, as described below. With respect to ~~Ms. Osteen and~~ Mr. Pember, ~~their 2016 and 2015~~25% of his annual incentive bonus ~~will be/~~was ~~determined utilizing: (i) 25% of their annual salary~~ based upon the achievement of the corporate performance criteria ~~and; (ii)~~and 75% of ~~their~~his annual ~~salary~~incentive bonus was based upon the achievement of the divisional income targets, as described below. Ms. Osteen resigned from the Company effective December 13, 2018 and therefore was not eligible for a 2018 annual incentive bonus.

Name

Title
   Target Award
as a % of salary
        2016     2015
Alan B. Miller
   Chief Executive Officer and
Chairman of the Board    100 % 100 %
Marc D. Miller
   President    65 % 65 %
Steve G. Filton
   Senior Vice President and
Chief Financial Officer    50 % 50 %
Debra K. Osteen
   Senior Vice President and
President, Behavioral
Health Division    50 % 50 %
Marvin G. Pember
   Senior Vice President and
President, Acute Care
Division    50 % 50 %

Name	Title	Target Incentive Bonus Award as a % of salary
Alan B. Miller	Chief Executive Officer and Chairman of the Board		100	%
Marc D. Miller	President		65	%
Steve G. Filton	Executive Vice President and Chief Financial Officer		50	%
Marvin G. Pember	Executive Vice President and President-Acute Care Division		50	%
Debra K. Osteen (Resigned in December, 2018)	Former Executive Vice President and President-Behavioral Health Division		50	%

As part of our peer company compensation review for executive officers as discussed above inAnnual Base Salary, we also target the median ~~(fiftieth~~(50^th percentile) market rate from our healthcare peers and the broader general industry data when determining each officer’s target annual incentive. For ~~2015,~~2018, our target annual incentive opportunities were assessed as being ~~at or~~ below the market 25^th percentile. Actual cash incentive awards, however, appropriately vary from this targeted level based upon performance, consistent with our pay for performance philosophy, and are detailed in the Summary Compensation Table in this Proxy Statement. The Compensation Committee believes that the annual ~~and long-term~~ incentive opportunities offered to our named executive officers are appropriate to facilitate our ability to attract, retain, motivate and reward our named executive officers, and that actual incentive payouts appropriately reflect the Company’s performance.

Pursuant to the Plan and the formulae approved by the Compensation Committee, each executive officer is entitled to receive between 0% and 250% of that executive officer’s target bonus based, either entirely or in part, on the Company’s achievement of a combination of: (i) a specified range of target levels of adjusted net income per diluted share attributable to UHS, and; (ii) a specified range of target levels of return on capital (adjusted net income attributable to UHS divided by quarterly average net capital) for the ~~years~~year ending December 31, ~~2016 and 2015.~~2018. The adjusted net income per diluted share attributable to UHS generally excludes among other things, the impact of the incentive income and incremental expenses incurred in connection with the implementation of electronic health records applications at our acute care hospitals as well as other amounts that may be nonrecurring or non-operational in nature or amounts that may be reflected in the current year financial statements that relate to prior years. As disclosed on the Schedule of Non-GAAP Supplemental Information for the year ended December 31, 2018 (“Supplemental Schedule”) included with our 2018 financial results as filed on Form 8-K on February 27, 2019, our 2018 adjusted net income per diluted share excluded the impact of the increase in the reserve established in connection with the civil aspects of the government’s investigation of certain of our behavioral health care facilities, the impact on our provision for income taxes resulting from our adoption of ASU 2016-09 which amended the accounting for employee share-based payment transactions and the impact of the provision for

intangible asset impairment to reduce the carrying value of a tradename intangible asset previously recorded in connection with our 2015 acquisition of Foundations Recovery Network, L.L.C.

On March 21, 2018, the Compensation Committee approved specific bonus formulae for the determination of annual incentive compensation for our named executive officers pursuant to the Executive Incentive Plan for the year ending December 31, 2018. Pursuant to the terms of the Executive Incentive Plan for 2018, our named executive officers were eligible to receive the applicable portion of their annual cash incentive (which were based on the corporate performance criteria) at various increments ranging from 0% of their bonus target award (based upon the achievement of a Target of adjusted net income per diluted share attributable to UHS of $8.69 or less, and Return on Capital of 8.8% or less) up to 250% of their annual cash incentive target award (based upon the achievement of a Target of adjusted net income per diluted share attributable to UHS of $10.44 or greater and Return on Capital of 10.7% or greater). Although the cash incentive formula for 2018 was unchanged from 2017’s cash incentive formula, the Targets have been adjusted, as necessary, to correlate to the range of our estimated 2018 adjusted net income per diluted share attributable to UHS, as publicly disclosed.

On February 28, 2018, we publicly disclosed our 2018 estimated range of adjusted net income per diluted share attributable to UHS of $9.25 to $9.90. The 2018 Target of adjusted net income per diluted share attributable to UHS, which represented the approximate midpoint within the publicly disclosed range of our projected consolidated earnings per diluted share estimate for the year, was $9.57 per diluted share. The 2018 Return on Capital Target was 9.8%. In October of 2018, based upon our actual operating results experienced during the first nine months of 2018, we publicly disclosed a decrease to the upper end of our previously disclosed estimated range of adjusted net income per diluted share attributable to UHS for 2018 (reduced the upper end of the range to $9.60 per diluted share from $9.90 per diluted share while the lower end of the range of $9.25 per diluted share remained unchanged); however, our annual incentive performance targets were not impacted by these publicly disclosed revisions.

The divisional income targets consist of the projected aggregate pre-tax income for our Acute Care and Behavioral Health Services segments, net of deductions for the allocation of corporate overhead expenses and a charge for the estimated cost of capital. The actual divisional income and the targets generally exclude, among other things, amounts that may be nonrecurring or non-operational in nature or amounts that may be reflected in the current year financial statements that relate to prior years. The divisional income targets may be adjusted to include the impact of acquisitions or divestitures made during the year, if material.

ToFor 2018, to the extent that the actual divisional results exceeded the ~~targets, Ms. Osteen and~~target, Mr. Pember ~~are~~was entitled to 75% of the following (as applied to ~~their~~his annual base salary) as the portion of ~~their~~his annual bonus that is based upon his divisional income ~~targets:~~target: (i) 25% if actual results meet the divisional income ~~targets;~~target; (ii) 50% if actual results exceed the divisional income ~~targets~~target by the greater of 5%; or $10 million; (iii) 75% if actual results exceed the divisional income ~~targets~~target by the greater of 10%, or $20 million, and; (iv) 100% if actual results exceed the divisional income ~~targets~~target by ~~15%.~~

~~The 2015 Target~~the greater of adjusted net income per diluted share attributable to UHS, which represented a specified point within the publicly disclosed range of our projected consolidated earnings per diluted share estimate for the year, was $6.35 per diluted share. The 2015 Return on Capital Target was 9.1%. On February 26, 2015, we publicly disclosed our 2015 estimated range of adjusted net income per diluted share attributable to UHS of $6.15 to $6.55.

In July of 2015, based upon our actual operating results experienced during the first six months of 2015, we publicly disclosed an increase to our 2015 estimated range of adjusted net income attributable to UHS to $6.75 to $7.15 per diluted share. In October of 2015, based upon our actual operating results experienced during the first nine months of 2015, we publicly disclosed a slight reduction to the upper end of the revised range to $7.05 per diluted share from $7.15 per diluted share. For annual cash incentive computation purposes, the above-mentioned 2015 Target of adjusted net income per diluted share attributable to UHS, and the 2015 Return on Capital Target, were not impacted by these publicly disclosed revisions to our annual 2015 estimated range of adjusted net income per diluted share attributable to UHS.

Pursuant to the terms of the Executive Incentive Plan and the formula approved by our Compensation Committee, our named executive officers were eligible to receive the applicable portion of their annual cash incentive (which were based on the corporate performance criteria) at various increments ranging from 0% of their bonus target award (based upon the achievement of a Target of adjusted net income per diluted share attributable to UHS of $5.7615% or less, and Return on Capital of 8.2% or less) up to 250% of their annual cash incentive target award (based upon the achievement of a Target of adjusted net income per diluted share attributable to UHS of $6.93 or greater and Return on Capital of 10.0% or greater). Although the cash incentive formula in fiscal year 2015 was unchanged from 2014’s cash incentive formula, the Targets have been adjusted, as necessary, to correlate to the range of our estimated 2015 adjusted net income per diluted share attributable to UHS, as publicly disclosed on February 26, 2015.$30 million.

In determining the corporate and divisional performance criteria, various factors are considered, including the projected revenue and earnings growth over the prior year. Since the value received by stockholders is measured, in large part, by an increase in stock price, which is in turn typically influenced by increases in

revenues and earnings, our performance criteria are established at reasonably aggressive levels to encourage the attainment of our financial objectives which, if accomplished, may result in an increase to our stock price and increased value to stockholders. As mentioned above, the corporate performance criteria are established annually and the Target of adjusted net income per diluted share attributable to UHS directly correlates to our annual earnings guidance that is typically publicly disclosed by us during the first quarter of each year. The divisional

performance criteria are also established annually and represent each division’s respective portion of the corporate performance criteria.

The actual cash incentives awarded for ~~2015~~2018 (which were based upon corporate performance criteria) were based upon the achievement of ~~219%~~92% of the target, as determined by the Compensation Committee inon March ~~2016,~~20, 2019, based upon our ~~2015~~2018 actual operating results. During ~~2015,~~2018, our adjusted net income per diluted share attributable to UHS was ~~$6.87.~~$9.53, as compared to a target of $9.57 per diluted share. This adjusted net income per diluted share attributable to UHS for ~~2015~~2018 was publicly disclosed and reconciled to our reported ~~2015~~2018 net income per diluted share attributable to UHS of ~~$6.76,~~8.31, on the Supplemental Schedule ~~of Non-GAAP Supplemental Consolidated Statements of Income Information,~~(as discussed above) included with our ~~earnings~~financial results for the year ended December 31, ~~2015,~~2018, as filed on Form 8-K on February ~~25, 2016.~~27, 2019. The Return on Capital was ~~9.6%~~9.7% for ~~2015,~~2018, as compared to a target of ~~9.1%~~9.8%. The Return on Capital is calculated by dividing our annual adjusted net income attributable to UHS by the consolidated average net capital.

For ~~2015, Ms. Osteen’s~~2018, Mr. Pember’s divisional income target was ~~$301~~$100.5 million. The divisional income target consists of the projected aggregate pre-tax income for our Behavioral Health Services segment, net of deductions for the allocation of corporate overhead expenses and a charge for the estimated cost of capital. The divisional income target was adjusted to include the impact of acquisitions or divestitures made during the year as well as other amounts that may be nonrecurring or non-operational in nature or amounts that may be reflected in the current year financial statements that relate to prior years. The 2015 actual divisional income, as calculated, was $334 million. Since the actual divisional income exceeded the target by more than 10% (the $301 million target was exceeded by $33 million, or 11%), Ms. Osteen was entitled to 75% of the portion of her bonus (75%) that was based upon the achievement of the divisional income target.

~~For 2015, Mr. Pember’s divisional income/loss target was a loss of $138 million. The divisional income/loss~~ target consists of the projected aggregate pre-tax income for our Acute Care Services segment, net of deductions for the allocation of corporate overhead expenses and a charge for the estimated cost of capital. The actual divisional ~~income/loss~~income as calculated, was $103.7 million. If applicable, the divisional income target or actual divisional income was adjusted for certain amounts that may be nonrecurring or non-operational in nature or amounts that may be reflected in the current year financial statements that relate to prior years. ~~The 2015 actual divisional income/loss, as calculated, was a loss of $116 million.~~ Since the actual divisional ~~income/loss~~income compared favorably to the target ($103.7 million actual divisional income exceeded the $100.5 million divisional income target by ~~more than 15% (the $138 million target loss was favorably reduced by $22~~$3.2 million or ~~16%~~3%), Mr. Pember was entitled to ~~100%~~25% of the portion of his bonus (75%) that was based upon the achievement of the divisional income target.

As indicated above, Ms. Osteen resigned from the Company effective December 13, 2018 and therefore was not eligible for a 2018 annual incentive bonus.

The performance goals related to the Executive Incentive Plan, as outlined above, are generally based upon the achievement of our business plan financial objectives. Performance goals are established at reasonably aggressive levels to encourage and motivate executive performance and attainment of our financial objectives. At the time the Compensation Committee approved the Executive Incentive Plan for fiscal ~~years 2016 and 2015~~year 2018, we

believed that the performance goals were attainable, but not certain. ~~Based upon~~Since the achievement of the corporate performance criteria ~~219% during 2015, 250% during 2014 and 154% during 2013~~ of 92% of target for 2018 contrasts with the 44% of target ~~awards were~~ earned ~~showing~~for 2017, we believe that our system demonstrates the variability and performance-oriented nature of payouts over time.

For a further description of the cash incentives and other elements of compensation granted to our named executive officer for ~~2015, 2014~~2018, 2017 and ~~2013,~~2016, please refer to the Summary Compensation Table in this Proxy Statement.

Long-Term Incentives

The Compensation Committee believes that the grant of equity-based, long-term compensation, primarily in the form of stock options and restricted shares, to our named executive officers is appropriate to attract ~~motivate~~ and retain such individuals and to motivate them to enhance stockholder ~~value through the use of equity incentive compensation opportunities.~~value.

Further, long-term incentive awards reward individuals for their performance and achievement of business goals. The Compensation Committee believes that our best interests will be advanced by enabling our named executive officers, ~~that~~who are responsible for our management, growth and success, to receive compensation in the form of long-term incentive awards ~~which~~that may increase in value in conjunction with an increase in the value of our common ~~stock and which will provide our named executive officers~~stock.

As is the case with ~~an incentive~~respect to ~~remain in their positions with us.~~

~~Like~~ base salaries, ~~with respect to~~a number of factors are taken into account in calibrating grants of long-term incentive awards, including an individual’s performance ~~is reviewed~~ in light of his or her position, responsibilities and contribution to our financial performance. In addition, the Compensation Committee takes into account an individual’s potential contribution to our growth and productivity. ~~There~~In determining appropriate long-term incentive grants, there is no other predetermined formula, factors or specified list of criteria that is followed.

For a description of the long-term incentive awards granted to our named executive officers for ~~2015,~~2018, please read the Summary Compensation Table and the Grants of Plan-Based Awards Table included in this Proxy Statement.

Stock options. Our Third Amended and Restated 2005 Stock Incentive Plan (the “Stock Incentive Plan”), as amended in 2008, 2011, 2015 and ~~2011 and 2015,~~2017, provides for the issuance of options to purchase shares of our Class B Common Stock at an exercise price equal to the fair market value on the date of grant. The Stock Incentive Plan is intended to provide a flexible vehicle through which we may offer equity based compensation incentives to our named executive officers and other eligible personnel in support of our compensation objectives.

Awards under the Stock Incentive Plan may be in the form of options to purchase shares of Class B Common Stock (including options intended to qualify as “incentive stock options” within the meaning of Section 422 of the Code and options which do not qualify as “incentive stock options”) and stock appreciation rights (“SARs”). Awards may be granted to our present or future employees, our affiliates and our directors and consultants who are not employees. To date, no SARs have been granted.

Typically, option awards are granted by the Compensation Committee on specific dates that are scheduled in advance, which generally coincide with regularly scheduled meetings of the Compensation Committee and the Board of Directors. There is no separate policy with respect to the timing of option awards to our named executive officers. Typically, option awards are granted to our named executive officers at the same time as option awards are granted to our other employees. In certain circumstances, such as new hires or promotions, option awards are granted separately by the Compensation Committee or our Chief Executive Officer and Chief Financial Officer who are duly authorized by the Compensation Committee.

Subject to the provisions of the Stock Incentive Plan, the Compensation Committee has the responsibility and full power and authority to select the persons to whom awards will be made, to prescribe the terms and conditions of each award and make amendments thereto, to construe, interpret and apply the provisions of the Stock Incentive Plan and of any agreement or other instrument evidencing an award and to make any and all determinations and take any and all other actions as it deems necessary or desirable in order to carry out the terms of the Stock Incentive Plan. ~~The grant of stock options is based primarily on an employee’s level in the organization and their contribution to our growth and profitability.~~

Stock options have such vesting and other terms and conditions as the Compensation Committee, acting in its discretion, may determine. Generally, grants of stock options vest in equal amounts over four years, are scheduled to expire on the fifth anniversary of the date of grant and, unless otherwise determined, employees must be employed by us for such options to vest. We do not have any plan to select option grant dates for our named executive officers in coordination with the release of material non-public information. The exercise price per share of Class B Common Stock covered by an option may not be less than 100% of the fair market value of the underlying Class B Common Stock on the date of grant. For purposes of the Stock Incentive Plan, unless otherwise determined by the Compensation Committee, the fair market value of a share of Class B Common Stock as of any given date is the closing sale price per share reported on a consolidated basis for securities listed on the

principal stock exchange or market on which the Class B Common Stock is traded on the date as of which such value is being determined or, if there is no sale on that day, then on the next day on which a sale was reported.

In ~~March~~April of ~~2015,~~2018, Mr. Alan Miller made recommendations to our Compensation Committee with respect to stock option awards to our named executive officers (except for himself) and other eligible employees. The number of stock options awarded to each of our named executive officers during ~~2015 was~~2018 were as follows: Alan B. Miller (590,000); Marc D. Miller ~~(90,000)~~(100,000); Steve G. Filton (70,000); Marvin G. Pember (70,000); and; Debra K. Osteen (70,000)~~; and; Marvin G. Pember (50,000)~~. The 70,000 stock options granted to Ms. Osteen in April, 2018 were subsequently cancelled on December 13, 2018 since no portion had vested prior to her resignation from the Company on December 13, 2018. In determining the number of options to award to our named executive officers, the Compensation Committee considered Mr. Alan Miller’s recommendations and took into account individual performance in light of a named executive officer’s position, responsibilities and contribution to our financial performance as well as his or her potential contribution to our growth and productivity. In addition, the Compensation Committee also reviewed and considered the compensation data and competitive performance data prepared by Pay Governance LLC in January, 2015, including stock-based compensation, and reviewed historical company practices with respect to stock option and long-term incentive awards. The grant date value of the above-mentioned 2015 stock option awards for Mr. Alan Miller, Mr. Pember and Ms. Osteen exceeded the median and the grants for Mr. Marc Miller and Mr. Filton approximated the median. For a description of the long-term incentive awards granted to our named executive officers in 2015, please see the Summary Compensation Table and the Grants of Plan-Based Awards Table included in this Proxy Statement.

Additionally, in March of 2016, Mr. Alan Miller made recommendations to our Compensation Committee with respect to stock option awards to our named executive officers (except for himself) and other eligible employees. The number of stock options awarded to each of our named executive officers during 2016 were as follows: Alan B. Miller (590,000); Marc D. Miller (100,000); Steve G. Filton (70,000); Debra K. Osteen (70,000); and; Marvin G. Pember (55,000). In determining the number of options to award to our named executive officers, the Compensation Committee considered Mr. Alan Miller’s recommendations and took into account individual performance in light of a named executive officer’s position, responsibilities and contribution to our financial performance as well as his or her potential contribution to our growth and productivity. In addition, the Compensation Committee also reviewed and considered the compensation data and competitive performance data prepared by Pay Governance LLC in January, 2016,early 2018, including stock-based compensation, and reviewed historical company practices with respect to stock option and long-term incentive awards.

Restricted Stock Awards. The Amended and Restated 2010 Employees’ Restricted Stock Purchase Plan (the “Restricted Stock Plan”), which is administered by the Compensation Committee, provides for the grant of shares of our Class B Common Stock to eligible personnel for a purchase price equal to par value. Shares of our Class B Common Stock may be granted under the Restricted Stock Plan to any of our employees or consultants. Historically, our restricted grants have had a scheduled vesting period ranging from one to five years.

Vesting conditions on shares issued under the Restricted Stock Plan may consist of continuing employment for a specified period of time following the purchase date. Alternatively, or in addition, vesting may be tied to the satisfaction of specific performance objectives established by the Compensation Committee based upon any one or more of the business criteria used in determining the bonuses for our named executive officers, as mentioned above. We have the right to repurchase the shares for the same purchase price (par value) if specified vesting conditions are not met.

The Compensation Committee believes restricted stock awards, at times, can be effective in achieving our compensation objectives because it provides employees with a strong retention incentive and aligns the value of the award with our stock price performance. Additionally, cash dividends are paid on all outstanding awards of restricted stock as an additional element of compensation and to provide employees incentives to sustain or increase our performance. We do not have any plan to select restricted stock award grant dates for our named executive officers in coordination with the release of material non-public information. Mr. Alan Miller iswas entitled to an annual grant of restricted stock having a minimum value of $1.5 million ~~of restricted stock~~during 2018 pursuant to his ~~Employment Agreement~~employment agreement with the ~~Company~~Company.

Deferred Compensation

Our Deferred Compensation Plan, which is subject to the applicable provisions of Internal Revenue Code Section 409A, provides that eligible employees may elect to defer a portion of their base salary and bonus award into deferred compensation accounts that accrue earnings based upon the selection of available investment options. ~~An “eligible employee” under~~Under the Deferred Compensation Plan, ~~is: (i)~~ an employee ~~whose~~is deemed eligible if their base compensation for ~~2015 is expected to be~~2018 was $120,000 or higher and ~~has been approved by our Chief Executive Officer, or; (ii) any other employee who has been approved by our Chief Executive Officer.~~they are performing duties in a qualified position. The base compensation threshold is adjusted ~~annually~~from time-to-time for cost-of-living increases. Pursuant to the terms of the Deferred

Compensation Plan, the minimum annual amount that can be deferred is $2,000. Prior to January 1, 2016, no more than 25% of an employee’s base salary or 50% of an employee’s annual bonus may be deferred under the Deferred Compensation Plan in any calendar year. Effective January 1, 2016, noNo more than 50% of an

employee’s base salary or 95% of an employee’s annual bonus may be deferred under the Deferred Compensation Plan in any calendar year. Employees may allocate a portion of their deferred compensation to be distributed in a lump sum or installments to begin at retirement or a scheduled distribution date. The available investment options consist of certain mutual funds which include: (i) conservative (e.g. money markets or bonds); (ii) moderately conservative (e.g. balanced funds), and; (iii) aggressive (e.g. domestic and international equity).

Our obligation to make payments of amounts credited to participants’ deferred compensation accounts is a general unsecured obligation. In addition, under the Deferred Compensation Plan, we may make discretionary contributions on behalf of an eligible employee. Since inception of the Deferred Compensation Plan, we have not made any discretionary contributions on behalf of employees. ~~Two~~Three of our named executive officers deferred a portion of their base salary and/or bonus paid during ~~2015~~2018 to the Deferred Compensation Plan. The Compensation Committee believes that, by offering an alternative savings ~~alternative~~vehicle for our named executive officers, the Deferred Compensation Plan supports our objectives to attract, retain and motivate talented personnel.

For a further description of the Deferred Compensation Plan, please refer tothe Nonqualified Deferred Compensationtable and the narrative discussion included in this Proxy Statement.

Retirement Benefits

Our retirement benefits consist of our Executive Retirement Income Plan, Supplemental Executive Retirement Income Plan and a 401(k) plan. These plans are designed in combination to provide an appropriate level of replacement income upon retirement. The Compensation Committee believes that these retirement benefits provide a balanced and competitive retirement program and support our objectives to attract, retain and motivate talented personnel.

Supplemental Executive Retirement Income Plan (“SERIP”). In July 2018, the Board of Directors adopted the SERIP. Pursuant to the terms of this plan, a select group of management or other highly compensated employees may be designated as plan participants. Our SERIP, which is subject to the applicable provisions of Internal Revenue Code Section 409A, provides eligible employees with annual employer contributions which are entirely at the Company’s discretion. Generally, each annual contribution vests on the earlier of: (i) the 5^th anniversary of the date of funding to the participant’s account, or; (ii) the participant attaining the qualified age of retirement (either age 62 or 65, as stipulated in the SERIP). The SERIP also provides for discretionary alternative vesting schedules for certain supplemental discretionary contributions made on an individual basis. Upon attaining the plan’s qualified age of retirement, distributions are paid in 10 annual installments to the participant. Distributions due to events other than retirement are paid in a lump sum. Our obligation to fund payments to participants’ accounts pursuant to the SERIP is a general unsecured obligation. Three of our named executive officers are participants in the SERIP.

In 2018, upon commencement of the SERIP, certain participants of the ERIP, who had not yet approached their qualified age of retirement, were given the option to remain in the ERIP or convert their participation into the SERIP. ERIP participants that elected to convert to the SERIP have been provided with an unfunded, lump sum conversion balance that was credited to the participant’s SERIP account. The unfunded ERIP conversion balances transferred to the SERIP, which were computed based upon the participant’s 2017 salary and will remain permanently unchanged after conversion, are payable over 60 monthly installments, if the participant attains their qualified age of retirement, as previously stipulated in the ERIP. If the participant does not attain their qualified age of retirement, the ERIP conversion balance is forfeited unless the Board of Directors, in its full discretion, determined otherwise. For ERIP participants who elected to convert to the SERIP, their participation in the ERIP was terminated upon conversion and no future benefits will be earned pursuant to the ERIP. SERIP participants who converted from the ERIP are entitled to future benefits pursuant to the terms of the SERIP.

Executive Retirement Income Plan (“ERIP”). In October 1993, the Board of Directors adopted the ~~Executive Retirement Income Plan,~~ERIP, which was subsequently closed to new participants effective January 1, 2015. Pursuant to the terms of ~~this plan,~~the ERIP, certain management or other highly compensated employees, who had been previously designated as plan participants by our Board of Directors prior to December 31, 2014, and who had completed at least 10 years of active employment with us, may receive retirement income benefits. ~~The~~

Subject to certain conditions, the monthly benefit is payable to a participant who retires after he or she reaches age 62 (applicable to participants added to the ~~plan~~ERIP before 2008) or age 65 (applicable to participants added to the ~~plan~~ERIP after January 1, 2008). The benefit is equal to 3% of the employee’s average monthly base salary over the three years preceding retirement multiplied by the number of qualified years (not to exceed 10) of the participant’s employment with us. Payment of the benefit will be made in 60 monthly installments following the participant’s retirement date. If ~~an employee ceases~~a participant’s employment with us is terminated prior to ~~the applicable~~their qualified age of retirement, ~~age, or an employee has not completed at least 10 years of active employment with us,~~ no ~~retirement income~~ERIP benefits will be payable ~~to the employee~~ unless the Board of Directors,

in its full discretion, determines otherwise. In 2018, certain participants were transferred to the SERIP and were provided with an unfunded, lump sum conversion balance pursuant to the SERIP, as discussed above. One of our named executive officers remains a participant in the ERIP.

For a further description of the ~~Executive Retirement Income Plan,~~SERIP and ERIP, please refer to the Pension Benefits ~~Table~~ included in this Proxy ~~Statement.~~Statement

401(k) Plan. We maintain a 401(k) plan for all employees, including our named executive officers, as an additional source of retirement income. Pursuant to the 401(k) plan, in ~~2015,~~2018, we made matching contributions (subject to highly compensated employee limits set by the Internal Revenue Code) to the 401(k) plan of approximately ~~$41~~$57 million. All of the named executive officers participated in the 401(k) plan in ~~2015.~~2018. Accordingly, we made matching contributions equal to ~~$7,950~~$8,250 to the 401(k) plan for each of the participating named executives.

Benefits

Our named executive officers are eligible to participate in the benefit plans generally available to all of our employees, which include health, dental, life insurance, vision and disability plans, all of which the Compensation Committee believes are commensurate with plans of other similarly situated public companies in the hospital management industry.

Company Aircraft. We have a partial ownership interest in a fixed wing aircraft that is available for business purpose use by members of our management team, including our named executive officers, and for personal use by Mr. Alan Miller, as stipulated in his employment agreement. When the aircraft is utilized for personal purposes by Mr. Alan Miller and/or his family members, the incremental costs incurred, including the regular hourly charges, variable fuel charges and associated fees and taxes, are directly reimbursed to us by Mr. Alan Miller and therefore no imputed amounts are included in theSummary Compensation Table.

Automobile.~~Automobile.~~ Mr. Alan Miller utilizes his automobiles for both business and personal purposes. As partial reimbursement for his business-related usage, we paid 70% of the cost of a vehicle purchased in 2006 and Mr. Alan Miller paid the remainder. Included in theSummary Compensation Table in “All other compensation” for ~~2015,~~2018, is ~~$1,536~~$1,724 related maintenance and fuel costs paid by the Company deemed to be related to his personal vehicle use.

Reimbursement of Relocation Expenses. In the normal course of business, in an effort to satisfy our staffing needs with high-quality personnel and/or support the career development of an employee by enabling

them to assume a position of broader scope and complexity, we may need to place an executive in a position in a geographic location which differs from that in which the individual resides. The relocation benefits for our executives are patterned on standard industry practices and are competitive in design. The provisions for relocation benefits are the same for several of the top layers of management and consistently administered. Included in the relocation benefits are reimbursements or direct payment to vendors for expenses that include items like a short duration house hunting trip, movement of household goods and personal items, short duration of interim living expenses and certain closing costs for the sale and purchase of a house. Relocation reimbursement that is taxable to the individual is typically grossed-up to cover the resulting incremental income tax expense. During ~~2015,~~2018, we did not pay any relocation expenses on behalf of our named executive officers.

Other Perquisites. From time to time, we make tickets to cultural and sporting events available to our employees, including our named executive officers, for business purposes. If not utilized for business purposes, the tickets are made available to our employees, including our named executive officers, for personal use.

Split-Dollar Life Insurance Agreements. In October 1998, we entered into split dollar life insurance agreements, with a combined face value of $16 million, in connection with second to die insurance policies issued on the lives of our chief executive officer, Alan B. Miller and his wife and owned by the Alan B. Miller 1998 Dual Life Insurance Trust (the “1998 Trust”). In January, 2002, we entered into two additional split dollar life insurance agreements, with a combined face value of $30 million, in connection with life insurance policies issued on the life of Alan B. Miller and owned by the Alan B. Miller 2002 Trust (the “2002 Trust”). Anthony Pantaleoni, a director of the Company, is Trustee of the 1998 Trusts and the 2002 Trusts.

In December 2010, ~~with assistance from its advisors, the Compensation Committee of the Board of Directors recommended, and the~~our Board of Directors approved the Company’s entering into supplemental life insurance plans and agreements ~~with~~on the ~~1998 Trust~~lives of our chief executive officer (“CEO”) and the 2002 Trust (collectively, the “Trusts”) previously established by Mr. Miller and which previously owned the policies. The supplemental life agreements replaced the existing arrangements. The supplemental life agreements are intended to constitute a “non-equity endorsement split-dollar arrangement” as defined by Internal Revenue Code and Regulations. In order to effectuate the supplemental life agreements, the Trusts transferred the life insurance policies to the Company in exchange for cancellation of the previously existing split-dollar agreement obligation to repay the Company’s premium advances. This transfer terminated the previously existing split-dollar arrangements.his wife. As a result of these transfers, the Company owns the policies and agreed to endorse a portion of the death benefit to the Trusts. The Company (and the Trusts) agreed to resume making premium payments on the policies, which had been suspended since 2002, with the consent of Mr. Miller, due to uncertainties regarding the legality of the fundings of the previously existing split-dollar arrangements pursuant to the Sarbanes-Oxley Act of 2002. Premium payments will be shared by the Company and the Trusts, with the Trusts’ portion determined under the principles established by applicable U.S. Treasury Department pronouncements, notices, rulings and regulationsagreements, as amended in ~~effect for determining such costs for insurance (the same premium division contemplated in the original arrangement).~~

~~As a result of these Agreements,~~October 2016, based on actuarial tables and other assumptions, during the life expectancies of the insureds, ~~and including amounts paid through 2015, the Company~~we would pay approximately ~~$25.3~~$28 million in premiums, and ~~the Trusts~~certain trusts owned by our CEO, would pay approximately ~~$8.2~~$9 million in premiums. Based on the projected premiums mentioned above, and assuming the policies remain in effect until the death of the insureds, ~~the Company~~we will be entitled to receive death benefit proceeds of no less than ~~$33.5~~approximately $37 million representing the ~~$25.3~~$28 million of aggregate premiums paid by us as well as the $9 million of aggregate premiums paid by the ~~Company as well as the $8.2~~trusts. In connection with these policies, we paid approximately $1.1 million ~~of aggregate premiums paid by the Trusts. The Trusts will receive the remaining death benefit proceeds under the policies.~~and $1.2 million in premium payments during 2018 and 2017, respectively.

Based on these projections, which are subject to the achievement of certain investment income and life expectancy assumptions, the total economic pre-tax cost to the Company (which includes the projected cost of capital net of the income resulting from the Company’s expected future receipt of the ~~$8.2~~$9 million of premiums paid by the Trusts) would be ~~$11.3~~approximately $10 million over the life expectancies of the insureds. ~~During each~~We estimate that our share of ~~2015 and 2014,~~ the ~~Company paid approximately $1.3~~premium payments due on these policies will approximate $1.1 million in ~~premium payments. The Company expects~~2019 and decrease annually to ~~expend between $1.3 million and $500,000 during each~~approximately $200,000 over the life expectancies of the ~~next ten years and lesser amounts thereafter. All of~~

~~the Company’s~~insureds. Our aggregate premium payments (as well as the ~~Trusts’)~~Trust’s) are expected to be repaid to ~~the Company~~us utilizing the death benefit proceeds. The Company recorded net after-tax income of $232,000 during 2015, $156,000 during 2014 and $86,000 during 2013, in connection with the present value computations related to the Company’s projected premium funding commitment over the terms of the policies and the projected death benefit proceeds due to the Company in the future, as discussed above.

The Compensation Committee has determined to offer the above-described fringe benefits and perquisites in order to attract and retain our named executive officers by offering compensation opportunities that are competitive. In determining the total compensation payable to our named executive officers, for a given fiscal year, the Compensation Committee considers such fringe benefits and perquisites. However, with the exception of the above-mentioned split dollar life insurance agreements related to Mr. Alan B. Miller, given the fact that such other fringe benefits and perquisites, which are available to our named executive officers, represent a relatively insignificant portion of their total compensation, they do not materially influence the decisions made by the Compensation Committee with respect to other elements of each individual’s total compensation. For a further description of the fringe benefits and perquisites received by our named executive officers during ~~2015,~~2018, please refer to theAll Other Compensation table included in this Proxy Statement.

Rewards/Compensation Risk Analysis: As part of its oversight of the Company’s executive compensation program, the Compensation Committee considers the impact of the Company’s executive compensation program, and the incentives created by the compensation awards that it administers, on the Company’s risk profile. In addition, the Company reviews all of its compensation policies and procedures, including the incentives that they create and factors that may reduce the likelihood of excessive risk taking, to determine whether they present a significant risk to the Company. The review found that there were no excessive risks encouraged by the Company’s reward programs and the rewards programs do not produce payments that have a material impact on

the financial performance of the organization. Approximately ~~465~~800 employees (including the named executive officers) of our ~~52,400~~approximate 62,000 full-time employees in the U.S. and U.K. (comprising ~~0.8%~~approximately 1% of our full-time employees) have incentive plans that entitle those individuals to larger bonus awards if profitability increases. However, although the plans are based on profitability, the bonus awards for these employees are capped at specific award levels (typically at 125% or less of base salary). Therefore, should our profitability increase, even by significant amounts, we do not believe the additional aggregate bonus awards would have a material unfavorable impact on our future results of operations.

Tax Considerations

Our chief executive officer, our chief financial officer and the next three most highly compensated officers are referred to herein as the named executive officers. For years beginning prior to January 1, 2018, Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) ~~places~~placed a limit of $1 million on the amount of compensation we may deduct for federal income tax purposes in any one year with respect to our named executive officers with the exception of our chief financial officer. However, performance-based compensation that ~~meets~~met certain requirements is excluded from this $1 million limitation.

On December 22, 2017, the President of the United States signed into law comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act of 2017 (the “TCJA-17”). TCJA-17 modifies Section 162(m) by (1) expanding which employees are considered covered employees by including the chief financial officer applicable to years beginning after December 31, 2017, (2) providing that if an individual is a covered employee for a year beginning after December 31, 2016, the individual remains a covered employee for all future years, and (3) removing the exceptions for performance-based compensation applicable to years beginning after December 31, 2017. These changes do not apply to compensation stemming from contracts entered into on or before November 2, 2017, unless such contracts were materially modified on or after that date. Compensation agreements entered into and share-based payment awards granted after this date will be subject to the revised terms of Section 162(m).

In reviewing the effectiveness of the executive compensation program, the Compensation Committee considers the anticipated tax treatment to us and to the named executive officers of various payments and

benefits. However, the deductibility of certain compensation payments depends upon the timing of an executive’s vesting or exercise of previously granted awards, as well as interpretations and changes in the tax laws and other factors beyond the Compensation Committee’s control. For these and other reasons, including to maintain flexibility in compensating the named executive officers in a manner designed to promote varying corporate goals, the Compensation Committee ~~will~~did not necessarily, or in all circumstances, limit executive compensation to that which is deductible under Section 162(m) of the Code and ~~has~~had not adopted a policy requiring all compensation to be deductible.

The Compensation Committee will consider various alternatives to preserving the deductibility of compensation payments and benefits to the extent reasonably practicable and to the extent consistent with its other compensation objectives. The portion of Mr. Alan Miller’s 2015 base salary exceeding $1 million will not be deductible by virtue of Section 162(m) of the Code.

Summary

The foregoing discussion describes the compensation objectives and policies that were utilized with respect to our named executive officers during ~~2015 and 2016.~~2018. In the future, as the Compensation Committee continues to review each element of the executive compensation program with respect to our named executive officers, the objectives of our executive compensation program, as well as the methods that the Compensation Committee utilizes to determine both the types and amounts of compensation to award to our named executive officers, may change.

Compensation Committee Report

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management; and based on the review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement.

COMPENSATION COMMITTEE

Robert H. Hotz

Lawrence S. Gibbs

~~John H. Herrell~~Elliot J. Sussman, M.D.

Compensation Committee Interlocks and Insider Participation

The Compensation Committee of the Board of Directors is composed of Robert H. Hotz, Lawrence S. Gibbs and ~~John H. Herrell.~~Elliot J. Sussman. All the members of the Compensation Committee are independent directors and no member has ever been one of our officers or employees or had a relationship with us that required disclosure.

SUMMARY COMPENSATION TABLE

The following table sets forth certain compensation information for our Chief Executive Officer, our Chief Financial Officer and the other most highly compensated executive officers for services rendered to UHS and its subsidiaries during the past three fiscal years. We refer to these officers collectively as our named executive officers:

Name and principal
position
Year Salary ($) Bonus
($) Grant
Date Fair
Value
Stock
Awards
($) Grant
Date Fair
Value
Option
Awards
(2.) ($) Non-Equity
Incentive Plan
Compensation
(3.) ($) Change in
Pension
Value and
Nonqualified
Deferred
Compen-
sation
Earnings (4.)
($) All
other
compen-
sation
(6.) ($) Total ($)
Alan B. Miller,
Chairman of the
Board and Chief
Executive
Officer
2015    $ 1,568,310    $ 0    1,500,022 (1). $ 12,553,430    $ 3,434,599    $ 49,722    $ 1,370,948    $ 20,477,031
2014    1,537,560    0    1,500,004 (1). 10,098,440    3,843,900    48,748    1,396,923    18,425,575
2013    1,500,058    0    0    7,846,233    2,310,089    79,913    1,414,824    13,151,117
Marc D. Miller,
President and
Director
2015    $ 695,027    $ 0    $ 0    $ 1,914,930    $ 989,371    $ 46,133    $ 13,877    $ 3,659,338
2014    666,692    0    0    1,540,440    1,083,375    98,957    14,189    3,403,653
2013    644,692    0    0    1,196,883    645,337    30,960    421    2,518,293
Steve G. Filton,
Senior Vice
President, Chief
Financial Officer
and Secretary
2015    $ 566,022    $ 0    $ 0    $ 1,489,390    $ 619,794    $ 29,305    $ 17,443    $ 2,721,954
2014    546,321    0    0    1,198,120    682,901    32,993    17,293    2,477,628
2013    525,320    0    0    930,909    404,496    25,358    8,542    1,894,625
Debra K. Osteen,
Senior Vice
President and
President,
Behavioral Health
Division
2015    $ 620,024    $ 0    $ 0    $ 1,489,390    $ 518,495    $ 28,315    $ 17,115    $ 2,673,339
2014    601,023    0    0    1,198,120    413,203    26,616    16,965    2,255,927
2013    583,517    0    0    930,909    331,146    21,337    8,510    1,875,419
Marvin G. Pember,
Senior Vice
President and
President, Acute
Care Division
2015    $ 599,210    $ 0    $ 0    $ 1,063,850    $ 613,441    $ 0    $ 17,697    $ 2,294,198
2014    581,823    0    0    855,800    618,187    0    17,547    2,073,357
2013    575,022    1,000,000 (5.) 0    664,935    110,692    0    8,971    2,359,620

Name and principal position	Year	Salary ($)		Bonus ($)		Grant Date Fair Value Stock Awards (1.) ($)		Grant Date Fair Value Option Awards (2.) ($)		Non-Equity Incentive Plan Compensation (3.) ($)		Change in Pension Value and Nonqualified Deferred Compen- sation Earnings (4.) ($)		All other compen- sation (5.) ($)		Total ($)
Alan B. Miller, Chairman of the Board and Chief Executive Officer	2018	$	1,665,064	$	1,000,000	$	1,500,062	$	16,616,760	$	1,531,859	$	43,044	$	1,232,094	$	23,588,883
	2017		1,635,063		0		2,000,060		15,978,734		719,428		43,407		1,254,169		21,630,861
	2016		1,600,061		0		1,500,069		14,024,359		1,360,053		44,599		1,338,607		19,867,748
Marc D. Miller, President and Director	2018	$	786,068	$	0	$	0	$	2,816,400	$	470,069	$	333,951	$	16,511	$	4,422,999
	2017		752,216		0		0		2,789,508		215,134		43,152		15,285		3,815,295
	2016		720,861		0		0		2,377,010		398,276		30,819		14,107		3,541,073
Steve G. Filton, Executive Vice President, Chief Financial Officer and Secretary	2018	$	635,903	$	0	$	0	$	1,971,480	$	292,515	$	185,536	$	17,743	$	3,103,177
	2017		608,518		0		0		1,895,782		133,874		30,290		17,593		2,686,057
	2016		584,606		0		0		1,663,907		248,458		18,688		17,443		2,533,102
Marvin G. Pember, Executive Vice President and President, Acute Care Division	2018	$	669,706	$	0	$	0	$	1,971,480	$	202,586	$	178,885	$	18,247	$	3,040,904
	2017		643,451		0		0		1,624,956		156,037		0		17,847		2,442,291
	2016		618,502		0		0		1,307,356		529,592		0		17,926		2,473,376
Debra K. Osteen, Former Executive Vice President and President, Behavioral Health Division	2018	$	650,490	$	0	$	0	$	1,971,480	$	-	$	0	$	17,382	$	2,639,352
	2017		662,788		0		0		1,895,782		36,453		39,420		17,637		2,652,080
	2016		638,025		0		0		1,663,907		67,790		28,200		17,114		2,415,036

(1.)

Represents the grant date fair value of award made during ~~2015~~2018, 2017 and ~~2014~~2016 under the 2010 Amended and Restated Employees’ Restricted Stock Purchase Plan (the “2010 Plan”). The ~~2015~~2018, 2017 and ~~2014~~2016 awards are scheduled to vest ratably over a four-year period. Dividends declared by the Company are paid with respect to outstanding shares of restricted stock.

(2.)

Represents grant date fair value of $28.16 in 2018, $27.08 in 2017 and $23.77 in 2016 for awards made pursuant to our Amended and Restated 2005 Stock Incentive Plan. For the assumptions used for the fair value valuations, please refer to Note 5—Common Stock, to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the years ended December 31, ~~2015, 2014~~2018, 2017 and ~~2013.~~2016.

(3.)

Reflects the dollar value of annual bonuses earned during each of the last three years pursuant to the terms of our Executive Incentive Plan as approved by our Compensation Committee on March ~~23, 2016~~20, 2019 (for ~~2015)~~2018), March ~~18, 2015~~27, 2018 (for ~~2014)~~2017) and on March ~~26, 2014~~29, 2017 (for ~~2013)~~2016). As a percentage of each individual’s annual base salary, the bonus amounts earned were as follows: Alan B. Miller ~~219%~~92% in ~~2015, 250%~~2018, 44% in ~~2014~~2017 and, ~~154%~~85% in ~~2013;~~2016; Marc D. Miller ~~142%~~60% in ~~2015, 163%~~2018, 29% in ~~2014~~2017 and ~~100%~~55% in ~~2013;~~2016; Steve G. Filton ~~110%~~46% in ~~2015, 125%~~2018, 22% in ~~2014~~2017 and ~~77%~~43% in ~~2013;~~2016, and;

Marvin G. Pember 30% in 2018, 24% in 2017, and 86% in 2016. Debra K. Osteen, ~~84%~~who resigned from the Company in ~~2015, 69%~~December, 2018, earned annual bonuses of 0% in ~~2014~~2018, 6% in 2017 and ~~57%~~11% in ~~2013, and; Marvin G. Pember 102% in 2015, 106% in 2014 and 19% in 2013.~~2016.

(4.)

These amounts represent the aggregate change in ~~the present~~pension value ~~that accrued~~ for each named executive in ~~2015, 2014~~2018, 2017 and ~~2013 under~~2016 pursuant to the ~~UHS~~ Executive Retirement ~~Plan.~~Income Plan or the Supplemental Executive Retirement Income Plan, as disclosed herein. The amounts in this column do not reflect compensation deferrals pursuant to our Nonqualified Deferred Compensation Plan since there are no contributions or benefits provide by us in connection with the plan.

(5.)

The $1 million supplemental cash compensation payment for Mr. Marvin Pember was paid in August, 2013, the second anniversary date of his employment. This supplemental compensation payment was intended to compensate Mr. Pember for a deferred compensation arrangement with his previous employer that he forfeited upon resignation.

~~(6.)~~

Components of All Other Compensation are as follows:

ALL OTHER COMPENSATION TABLE


Name	Year		Perquisites and Other Personal Benefits ($) (1.)		Tax Reimbur- sements ($) (2.)		Insurance Premiums ($) (3.)		Company Contributions to Retirement and 401(k) Plans ($)		Dividends Paid on Unvested Stock		Total ($)		Year	Perquisites and Other Personal Benefits ($) (1.)		Tax Reimbur- sements ($) (2.)		Insurance Premiums ($) (3.)		Company Contributions to Retirement and 401(k) Plans ($)		Dividends Paid on Unvested Stock		Total ($)
Alan B. Miller		2015	$	46,391	$	0	$	1,306,534	$	7,950	$	10,073	$	1,370,948	2018	$	49,250	$	0	$	1,159,281	$	8,250	$	15,313	$	1,232,094
		2014		45,004		0		1,334,303		7,800		9,816		1,396,923
		2013		47,846		0		1,351,442		7,650		7,886		1,414,824	2017		46,605		0		1,185,260		8,100		14,204		1,254,169
															2016		46,986		0		1,271,403		7,950		12,268		1,338,607
Marc D. Miller		2015	$	230	$	0	$	5,697	$	7,950	$	0	$	13,877	2018	$	2,564	$	0	$	5,697	$	8,250	$	0	$	16,511
		2014		692		0		5,697		7,800		0		14,189	2017		1,488		0		5,697		8,100		0		15,285
		2013		421		0		0		0		0		421	2016		460		0		5,697		7,950		0		14,107

Steve G. Filton		2015	$	0	$	0	$	9,493	$	7,950	$	0	$	17,443	2018	$	0	$	0	$	9,493	$	8,250	$	0	$	17,743
		2014		0		0		9,493		7,800		0		17,293	2017		0		0		9,493		8,100		0		17,593
															2016		0		0		9,493		7,950		0		17,443
Marvin G. Pember															2018	$	1,150	$	0	$	8,847	$	8,250	$	0	$	18,247
		2013		0		0		892		7,650		0		8,542	2017		900		0		8,847		8,100		0		17,847
															2016		1,130		0		8,847		7,950		0		17,927
Debra K. Osteen		2015	$	0	$	0	$	9,165	$	7,950	$	0	$	17,115	2018	$	0	$	0	$	9,132	$	8,250	$	0	$	17,382
		2014		0		0		9,165		7,800		0		16,965	2017		372		0		9,165		8,100		0		17,637
		2013		421		0		439		7,650		0		8,510	2016		0		0		9,165		7,950		0		17,115

Marvin G. Pember		2015	$	900	$	0	$	8,847	$	7,950	$	0	$	17,697
		2014		900		0		8,847		7,800		0		17,547
		2013		1,321		0		0		7,650		0		8,971

(1.)	~~2015:~~2018:

Amounts for Mr. Miller consist of the following: (i) $25,000 for professional tax services; (ii) $15,788 for payment of country club dues; (iii) $3,632 for accounting services; (iv) $2,806 for maintenance on personal residence; (v) $1,724 for fuel and maintenance charges incurred in connection with his automobile, and; (vi) $300 wireless stipend.

Amount for Mr. Marc D. Miller consists of $2,564 for sporting event tickets paid for by us.

Amount for Mr. Marvin G. Pember consist of $900 for cell phone stipend and $250 for sporting event tickets paid for by us.

2017:

Amounts for Mr. Miller consist of the following: (i) $25,000 for professional tax services; (ii) $15,713 for payment of country club dues; (iii) $1,306 for accounting services; (iv) $2,806 for maintenance on personal residence; (v) $980 for fuel and maintenance charges incurred in connection with his automobile; (vi) $300 wireless stipend, and; (vii) $500 for sporting event tickets paid for by us.

Amount for Mr. Marc D. Miller consists of $1,488 for sporting event tickets paid for by us.

Amount for Mr. Marvin G. Pember consist of $900 for cell phone stipend.

Amount for Ms. Debra K. Osteen consists of $372 for sporting event tickets paid for by us.

2016:

Amount for Mr. Alan Miller consists of the following: (i) $25,000 for professional tax services; (ii) ~~$13,846~~$14,990 for payment of country club dues; (iii) ~~$2,548~~$2,642 for accounting services; (iv) ~~$2,707~~$2,740 for maintenance on personal residence; (v) ~~$1,530~~$854 for fuel and maintenance charges incurred in connection with his automobile; (vi) $300 wireless stipend, and; (vii) $460 for sporting event tickets paid for by us.

Amount for Mr. Marc D. Miller consists of ~~$230 for sporting event tickets paid for by us.~~

~~Amount for Mr. Marvin G. Pember consist of a $900 cell phone stipend.~~

~~2014:~~

Amount for Mr. Alan Miller consists of the following: (i) $25,000 for professional tax services; (ii) $14,075 for payment of country club dues; (iii) $2,686 for accounting services; (iv) $2,545 for maintenance on personal residence; (v) $167 for fuel and maintenance charges incurred in connection with his automobile; (vi) $300 wireless stipend, and; (vii) $231 for sporting event tickets paid for by us.

~~Amount for Mr. Marc D. Miller consists of $692 for sporting event tickets paid for by us.~~

~~Amount for Mr. Marvin G. Pember consist of a $900 cell phone stipend.~~

~~2013:~~

Amount for Mr. Alan Miller consists of the following: (i) $25,000 for professional tax services; (ii) $12,025 for payment of country club dues; (iii) $2,866 for accounting services; (iv) $3,948 for maintenance on personal residence; (v) $3,286 for fuel and maintenance charges incurred in connection with his automobile; (vi) $300 wireless stipend, and; (vii) $421 for sporting event tickets paid for by us.

~~Amount for Mr. Marc D. Miller and Ms. Debra K. Osteen consists of $421 each~~$460 for sporting event tickets paid for by us.

Amount for Mr. Marvin G. Pember consist of: (i) ~~$421~~$900 cell phone stipend, and; (ii) $230 for sporting event tickets paid for by ~~us, and; (ii) $900 cell phone stipend.~~us.

(2.)	There were no reimbursements for taxes during ~~2015, 2014~~2018, 2017 or ~~2013.~~2016.

(3.)	Amounts for Messrs. Marc. D. Miller, Steve G. Filton and Marvin G. Pember and Ms. Osteen consist of premiums paid in connection with long term disability coverage.

Amounts for Mr. Alan B. Miller consist of: (i) ~~$1,294,709~~$1,147,456 in ~~2015, $1,322,392~~2018, $1,173,435 in ~~2014~~2017 and ~~$1,344,683~~$1,259,578 in ~~2013,~~2016, of premium payments made in connection with split-dollar-life insurance agreements, as discussed inSplit Dollar Life Insurance Agreement, included herein, and; (ii) $11,825 in ~~2015, $11,911 in 2014~~each of 2018, 2017 and ~~$6,759 in 2013~~2016 of premiums paid in connection with long term disability coverage.

GRANTS OF PLAN-BASED AWARDS

The following table provides information regarding plan-based awards granted during fiscal year ~~2015~~2018 to our named executive officers.

																																									All Other Stock
Name	Approval / Grant Date				Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1.)									Estimated Future Payouts Under Equity Incentive Plan Awards			All Other Stock Awards: Number of Shares of Stock or Units (3.) (#)			All Other Option Awards: Number of Securities Underlying Options (4.) (#)		Exercise or Base Price of Option Awards ($ /Sh)			Grant Date Fair Value of Stock and Option Awards (5.) ($)		Closing Price on Grant Date ($ / Sh)
Name																						Exercise or Base Price of Option Awards ($ /Sh)			Grant Date Fair Value of Stock and Option Awards (5.) ($)		Closing Price on Grant Date ($ / Sh)												Awards:		All Other			Exercise		Grant
																																									Number			Option		or		Date
																															Estimated Future							Estimated Future			of			Awards:		Base		Fair		Closing
																															Payouts Under							Payouts Under			Shares			Number of		Price		Value of		Price
																															Non-Equity Incentive Plan							Equity Incentive Plan			of			Securities		of		Stock		on
																														Approval/	Awards (1.)							Awards			Stock or			Underlying		Option		and Option		Grant
																														Grant	Threshold			Target		Maximum		Threshold	Target	Maximum	Units			Options		Awards		Awards (5.)		Date
Name	Approval / Grant Date			Approval / Grant Date			Threshold ($) (2.)			Target ($) (2.)			Maximum ($) (2.)		Threshold ($)	Target ($)			Maximum ($)	All Other Stock Awards: Number of Shares of Stock or Units (3.) (#)		All Other Option Awards: Number of Securities Underlying Options (4.) (#)			Exercise or Base Price of Option Awards ($ /Sh)		Grant Date Fair Value of Stock and Option Awards (5.) ($)			Closing Price on Grant Date ($ / Sh)			Date	($) (2.)		($) (2.)		($) (2.)		($)	($)		($)	(3.) (#)		(4.) (#)		($ /Sh)		($)		($ / Sh)
Name		$	78,416	Approval / Grant Date				$	1,568,310		$	3,920,775												4/13/2018	Exercise or Base Price of Option Awards ($ /Sh)		Grant Date Fair Value of Stock and Option Awards (5.) ($)		$	Closing Price on Grant Date ($ / Sh)		83,253		$	1,665,064	$	4,162,660
		3/18/2015																12,789							$	1,500,022	$	117.29		1/17/2018												12,926						$	1,500,062	$	116.05
		3/18/2015																—			590,000	$	117.29		$	12,553,430	$	117.29		4/13/2018												—			590,000	$	119.64	$	16,616,760	$	119.64

Marc D. Miller		3/18/2015			$	22,588		$	451,768		$	1,129,419																		4/13/2018	$	25,547		$	510,944	$	1,277,361
		3/18/2015																—			90,000	$	117.29		$	1,914,930	$	117.29
																														4/13/2018												—			100,000	$	119.64	$	2,816,400	$	119.64
Steve G. Filton		3/18/2015			$	14,151		$	283,011		$	707,528																		4/13/2018	$	15,898		$	317,952	$	794,879
		3/18/2015																—			70,000	$	117.29		$	1,489,390	$	117.29		4/13/2018												—			70,000	$	119.64	$	1,971,480	$	119.64
Marvin G. Pember																														4/13/2018	$	4,186		$	209,286	$	711,563
																														4/13/2018												—			70,000	$	119.64	$	1,971,480	$	119.64
Debra K. Osteen		3/18/2015			$	3,875		$	193,758		$	658,776																		4/13/2018	$	-		$	-	$	-
		3/18/2015																—			70,000	$	117.29		$	1,489,390	$	117.29		4/13/2018												—			70,000	$	119.64	$	1,971,480	$	119.64

Marvin G. Pember		3/18/2015			$	3,745		$	187,253		$	636,661
		3/18/2015																—			50,000	$	117.29		$	1,063,850	$	117.29

(1.)

Pursuant to the Executive Incentive Plan and the formula approved by the Compensation Committee, each named executive officer is entitled to receive between 0% and 250% of that executive officer’s target bonus based, either entirely or in part, on our achievement of certain corporate and divisional performance criteria. As discussed in theCompensation Discussion and Analysis,with respect to Messrs. Alan B. Miller, Marc D. Miller and Steve G. Filton, 100% of their ~~2015~~2018 annual incentive bonus was determined using certain corporate performance criteria, and with respect to ~~Ms. Osteen and~~ Mr. Pember, ~~their 2015~~his 2018 annual incentive bonus was determined utilizing: (i) 25% of ~~their~~his annual salary based upon the achievement of certain corporate performance criteria, and; (ii) 75% of ~~their~~his annual salary based upon the achievement of certain divisional income targets. Ms. Debra K. Osteen forfeited her bonus for 2018 upon her separation from the Company in December, 2018.

(2.)	Estimates calculated based upon ~~2015~~2018 salaries.

(3.)	Restricted shares of Class B Common Stock issued under the Company’s Amended and Restated 2010 Employees’ Restricted Stock Purchase Plan.

(4.)	Stock option awards issued on ~~March 18, 2015~~April 13, 2018 were issued under our Third Amended and Restated 2005 Stock Incentive Plan. Ms. Debra K. Osteen forfeited her option award issued in 2018 upon her separation from the Company in December, 2018.

(5.)	Represents the full grant date fair value for the stock awards and option awards, calculated in accordance with ASC 718 as described in our Form 10-K for the year ended December 31, ~~2015.~~2018.

Chief Executive Officer Employment Agreement

As discussed in theCompensation Discussion and Analysis, unlike our other named executive officers, Mr. Alan Miller’s compensation is determined in large part by the terms of his employment agreement. Mr. Miller’s base salary, minimum annual bonus and certain perquisites are determined under his employment agreement. On July 24, 2013, we entered into an employment agreement with Alan B. Miller ~~(effective July 1, 2013)~~(“Employment Agreement”) that ~~provides~~stipulated that Mr. Miller will ~~continue to~~ serve as ~~Chief Executive Officer and~~the Chairman of our Board of Directors and Chief Executive Officer (“CEO”) through December 31, 2017, and ~~subject further to~~provides for automatic annual ~~renewal for one additional year~~renewals unless either party elects otherwise. During 2018, Mr. Miller’s Employment Agreement was automatically renewed for one year through December 31, 2020.

In November 2018, we entered into an amendment to the Employment Agreement with Alan B. Miller, in order to adjust certain terms of the minimum annual awards that Mr. Miller will be eligible to receive during the period of his services as CEO. For each year of the CEO employment commencing on January 1, 2019, the annual award under our long-term incentive plan(s) (“LTIP”), as in effect from time to time, will have a minimum value of $2,000,000, with 50% of such annual LTIP award being in the form of restricted stock and 50% of such annual LTIP award being in the form of cash. LTIP awards received by Mr. Miller shall vest in equal amounts over two years and otherwise shall be subject to conditions as are consistent with terms and conditions applicable to LTIP awards made to our other senior executives. In addition, Mr. Miller received a special cash award in 2018 in the amount of $1,000,000 in connection with entering into the amendment. Except as described above, all other terms of the Employment Agreement remain in full force and effect and are unchanged.

Mr. Alan Miller participates in benefit plans and programs that are made available to other employees and he receives certain executive perquisites, including, but not limited to, split dollar life insurance benefits, payment of certain automobile costs, payment of country club dues, tax and accounting services, use of a private plane for personal purposes for up to 60 hours per year, subject to reimbursement by Mr. Alan Miller of the incremental costs incurred at market rates, and such other fringe benefits as the Compensation Committee of our Board of Directors may determine (as discussed in theCompensation Discussion and Analysis).

Mr. Alan Miller’s salary as our Chief Executive Officer will be ~~$1,600,000~~$1,700,000 for ~~2016~~2019 which is a ~~2.0%~~2.1% increase over his ~~2015~~2018 salary. Mr. Miller is also entitled to an annual bonus opportunity target equal to 100% of his salary. The amount of the annual bonus for any year may be more or less than the target amount and will be determined by the Board of Directors in accordance with pre-established performance measures.

In addition to the stock options and/or restricted stock granted to Mr. Alan Miller during the years discussed above in theCompensation Discussion and Analysis-Restricted Stock Awards and Stock Options, he was also eligible to receive awards under our long-term incentive plan(s), including shares of restricted stock.

For a further description of the employment agreement, please refer to thePotential Payments Upon Termination or Change-in-Control section below. For a further description of the compensation setting process with respect to Mr. Miller, please refer to theCompensation Discussion and Analysis section above.

Chief Executive Officer Restricted Stock Grants in ~~2016, 2015~~2018, 2017 and ~~2014~~2016

Pursuant to Mr. Alan Miller’s ~~employment agreement,~~Employment Agreement, in January of 2018, March of ~~2016, 2015~~2017 and ~~2014,~~March of 2016, as indicated below, the Compensation Committee approved the issuance of restricted shares of our Class B Common Stock to Mr. Alan Miller pursuant to the Amended and Restated 2010 Employees’ Restricted Stock Purchase Plan. ~~These~~The restricted shares ~~each~~issued in January, 2018 had a market value of ~~which~~$1.5 million, the restricted shares issued in March, 2017 had a market value of $2.0 million and the shares issued in March, 2016 had a market value of $1.5 million on the date of ~~grant,~~grant. Each of these restricted stock grants have a vesting schedule of

25% on each of the first, second, third and fourth anniversaries of the grant date. The forfeiture of these shares prior to the vesting dates are determined pursuant to the terms set forth in the Restricted Stock Purchase Agreement. Dividends declared by the Company are paid with respect to outstanding shares of restricted stock.

12,926 restricted shares of our Class B Common Stock issued on January 17, 2018 (grant date market value of $116.05 per share).

16,057 restricted shares of our Class B Common Stock issued on March 29, 2017 (grant date market value of $124.56 per share).

12,646 restricted shares of our Class B Common Stock issued on March 23, 2016 (grant date market value of $118.62 per share).

~~12,789 restricted shares of our Class B Common Stock issued on March 18, 2015 ((grant date market value of $117.29 per share).~~

~~19,189 restricted shares of our Class B Common Stock issued on March 26, 2014 ((grant date market value of $78.17 per share).~~

OUTSTANDING EQUITY AWARDS AT DECEMBER 31, ~~2015~~2018

The following table provides information about the number of outstanding equity awards held by our named executive officers at December 31, ~~2015.~~2018.

Name
Option Awards (1.) Stock Awards (2.)

Number of
Securities
Underlying
Unexercised
Options (#)

Number of
Securities
Underlying
Unexercised
Options (#)
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#) Option
Exercise
Price
($) Option
Expiration
Date Number
of
Shares
or Units
of Stock
That
Have
Not
Vested
(#) Market
Value of
Shares
or Units
of Stock
That
Have Not
Vested
($) (3.) Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#) Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
($)
Exercisable Unexercisable
Alan B. Miller

27,181    $ 3,247,858    0    0
442,500    147,500    0    $ 36.95    01/17/2017    0    0    0    0
295,000    295,000    0    $ 53.38    01/15/2018    0    0    0    0
147,500    442,500    0    $ 78.17    03/25/2019    0    0    0    0
0    590,000    0    $ 117.29    03/17/2020    0    0    0    0
Marc D. Miller
45,000    22,500    0    $ 36.95    01/17/2017    0    0    0    0
45,000    45,000    0    $ 53.38    01/15/2018    0    0    0    0
22,500    67,500    0    $ 78.17    03/25/2019    0    0    0    0
0    90,000    0    $ 117.29    03/17/2020    0    0    0    0
Steve G. Filton
52,500    17,500    0    $ 36.95    01/17/2017    0    0    0    0
35,000    35,000    0    $ 53.38    01/15/2018    0    0    0    0
17,500    52,500    0    $ 78.17    03/25/2019    0    0    0    0
0    70,000    0    $ 117.29    03/17/2020    0    0    0    0
Debra K. Osteen

0    17,500    0    $ 36.95    01/17/2017    0    0    0    0
35,000    35,000    0    $ 53.38    01/15/2018    0    0    0    0
17,500    52,500    0    $ 78.17    03/25/2019    0    0    0    0
0    70,000    0    $ 117.29    03/17/2020    0    0    0    0
Marvin G. Pember
15,000    0    0    $ 38.12    08/10/2016    0    0    0    0
12,500    12,500    0    $ 36.95    01/17/2017    0    0    0    0
12,500    25,000    0    $ 53.38    01/15/2018    0    0    0    0
12,500    37,500    0    $ 78.17    03/25/2019    0    0    0    0
0    50,000    0    $ 117.29    03/17/2020    0    0    0    0

	Option Awards (1.)									Stock Awards (2.)
														Equity
														Incentive		Equity
														Plan		Incentive
														Awards:		Plan
					Equity									Number		Awards:
					Incentive					Number				of		Market or
					Plan					of		Market		Unearned		Payout
					Awards:					Shares		Value of		Shares,		Value of
					Number of					or Units		Shares		Units or		Unearned
	Number of		Number of		Securities					of Stock		or Units		Other		Shares,
	Securities		Securities		Underlying					That		of Stock		Rights		Units or
	Underlying		Underlying		Unexercised		Option			Have		That		That		Other Rights
	Unexercised		Unexercised		Unearned		Exercise		Option	Not		Have Not		Have Not		That Have
	Options (#)		Options (#)		Options		Price		Expiration	Vested		Vested		Vested		Not Vested
Name	Exercisable		Unexercisable		(#)		($)		Date	(#)		($) (4.)		(#)		($)
Alan B. Miller											34,490	$	4,020,154		0		0
		590,000		0		0	$	78.17	03/25/2019		0		0		0		0
		442,500		147,500		0	$	117.29	03/17/2020		0		0		0		0
		295,000		295,000		0	$	118.62	03/22/2021		0		0		0		0
		147,500		442,500		0	$	124.56	03/28/2022		0		0		0		0
		0		590,000		0	$	119.64	4/12/2023		0		0		0		0

Marc D. Miller		90,000		0		0	$	78.17	03/25/2019		0		0		0		0
		67,500		22,500		0	$	117.29	03/17/2020		0		0		0		0
		50,000		50,000		0	$	118.62	03/22/2021		0		0		0		0
		25,750		77,250		0	$	124.56	03/28/2022		0		0		0		0
		0		100,000		0	$	119.64	4/12/2023		0		0		0		0

Steve G. Filton		70,000		-		0	$	78.17	03/25/2019		0		0		0		0
		52,500		17,500		0	$	117.29	03/17/2020		0		0		0		0
		35,000		35,000		0	$	118.62	03/22/2021		0		0		0		0
		17,500		52,500		0	$	124.56	03/28/2022		0		0		0		0
		0		70,000		0	$	119.64	4/12/2023		0		0		0		0

Marvin G. Pember		50,000		-		0	$	78.17	03/25/2019		0		0		0		0
		37,500		12,500		0	$	117.29	03/17/2020		0		0		0		0
		27,500		27,500		0	$	118.62	03/22/2021		0		0		0		0
		15,000		45,000		0	$	124.56	03/28/2022		0		0		0		0
		0		70,000		0	$	119.64	4/12/2023		0		0		0		0

Debra K. Osteen (3.)		70,000		-		0	$	78.17	03/25/2019		0		0		0		0
		52,500		-		0	$	117.29	03/17/2020		0		0		0		0
		35,000		-		0	$	118.62	03/22/2021		0		0		0		0
		17,500		-		0	$	124.56	03/28/2022		0		0		0		0

1.	Stock option awards. All of the stock options are scheduled to vest ratably on the first, second, third and fourth anniversary dates from the date of grant. The applicable grant dates for the options indicated above are set forth below:

~~On August 11, 2011, stock options were granted with an exercise price of $38.12.~~

~~On January 18, 2012, stock options were granted with an exercise price of $36.95.~~

~~On January 16, 2013, stock options were granted with an exercise price of $53.38.~~

On March 26, 2014, stock options were granted with an exercise price of $78.17.

On March 18, 2015, stock options were granted with an exercise price of $117.29

On March 23, 2016, stock options were granted with an exercise price of $118.62.

On March 29, 2017, stock options were granted with an exercise price of $124.56.

On April 13, 2018, stock options were granted with an exercise price of $119.64.

2.	Restricted Stock Awards. The outstanding restricted stock awards for Mr. Alan B. Miller are scheduled to vest as follows:

3,197 shares on March 18, 2016; 4,797 shares on March 26, 2016; 3,197 shares on March 18, 2017; 4,797 shares on March 26, 2017; 3,197 on March 18, 2018; 4,798 shares on March 26, 2018, and; 3,198 on March 18, 2019.


Date	2019		2020		2021		2022		TOTAL
January 17,		3,231		3,232		3,231		3,232		12,926
March 18,		3,198		-		-		-		3,198
March 23,		3,161		3,162		-		-		6,323
March 29,		4,014		4,014		4,015		-		12,043
TOTAL		13,604		10,408		7,246		3,232		34,490

Ms. Osteen resigned from the Company effective December 13, 2018 and all unvested stock options were cancelled at that time. Ms. Osteen was entitled to the stock options that were fully vested at the time of her resignation, as reflected on the table above, all of which were exercised in early March, 2019.

4.	Based on the closing sale price of the Class B Common Stock on the New York Stock Exchange on December 31, ~~2015~~2018 of ~~$119.49~~$116.56 per share.

OPTION EXERCISES AND STOCK VESTED

The following table provides information about stock option exercises by, and the vesting of stock for, our named executive officers during fiscal year ~~2015:~~2018:

   Option Awards    Stock Awards
Name
   Number of Shares
Acquired on Exercise
(#)    Value Realized
on Exercise
($)    Number of Shares
Acquired on Vesting
(#) (1.)    Value Realized
on Vesting
($)
Alan B. Miller
   590,000       $ 45,357,600       13,532       $ 1,464,433
         4,797       $ 565,950
Marc D. Miller
   45,000       $ 3,447,450
Steve G. Filton
   70,000       $ 5,362,700
Debra K. Osteen
   35,000       $ 2,873,150
   17,500       $ 1,658,475
Marvin Pember
   0       $ 0

	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise (#)		Value Realized on Exercise ($)		Number of Shares Acquired on Vesting (#) (1.)		Value Realized on Vesting ($)
Alan B. Miller		-	$	-		4,798	$	581,374
						3,197	$	394,861
						3,162	$	389,021
						4,014	$	487,219
Marc D. Miller		-	$	-
Steve G. Filton		-	$	-
Marvin G. Pember		-	$	-
Debra K. Osteen		-	$	-

(1.)	Restricted stock for Alan B. Miller vested as follows:

On ~~January~~March 18, ~~2015, 13,532~~2018, 3,197 shares ~~of restricted stock vested for Mr. Alan B Miller.~~at $123.51 per share.

On March 23, 2018, 3,162 shares at $123.03 per share.

On March 26, ~~2015, 4,797~~2018, 4,798 shares ~~of restricted stock vested for Mr. Alan B Miller.~~at $121.17 per share.

On March 29, 2018, 4,014 shares at $121.38 per share.

PENSION BENEFITS

~~The following table provides information about pension benefits pursuant to our~~ Executive Retirement Income Plan ~~for our named executive officers.~~(“ERIP”)

Name
   Number of Years
Credited Service
(#)    Present Value of
Accumulated Benefit
($) (1.)    Payments During
Last Fiscal Year
($)
Alan B. Miller
   37       $ 2,050,398       0
Marc D. Miller
   21       $ 773,974       0
Steve G. Filton
   30       $ 721,600       0
Debra K. Osteen
   31       $ 787,502       0
Marvin G. Pember
   N/A       $ 0       0

~~(1.)~~

~~4% discount rate applied.~~

In October 1993, the Board of Directors adopted the ~~Executive Retirement Income Plan,~~ERIP, which was subsequently closed to new participants effective January 1, 2015. Pursuant to the terms of ~~this plan,~~the ERIP, certain management or other highly compensated employees, who had been previously designated as plan participants by our Board of Directors prior to December 31, 2014, and who had completed at least 10 years of active employment with us, may receive retirement income benefits. ~~The~~

Subject to certain conditions, the monthly benefit is payable to a participant who retires after he or she reaches age 62 (applicable to participants added to the plan before 2008) or age 65 (applicable to participants added to the plan after January 1, 2008). The benefit is equal to 3% of the employee’s average monthly base salary over the three years preceding retirement multiplied by the number of qualified years (not to exceed 10) of the participant’s employment with us.

~~Payment~~Upon attaining the qualified age of retirement as stipulated in the ~~benefit will be~~plan, subject to certain conditions, payment of ERIP benefits are made to participants in 60 monthly installments following ~~the participant’s~~their retirement date. ~~Under~~In certain circumstances, the participant may ~~be entitled to~~ elect to receive the present value of the payments in one lump sum or receive payments over a period of 10 years. If ~~an employee ceases~~a participant’s employment with us is terminated prior to ~~the applicable~~their qualified age of retirement, ~~age, or an employee has not completed at least 10 years of active employment with us,~~ no ~~retirement income~~ERIP benefits will be payable ~~to the employee~~ unless the Board of Directors, in its full discretion, determines otherwise.

~~For~~ In 2018, upon commencement of the Supplemental Executive Retirement Income Plan (“SERIP”), as discussed below, certain participants of the ERIP, who had not yet approached their qualified age of retirement, were given the option to remain in the ERIP or convert their participation into the SERIP. Please see Supplemental Executive Retirement Income Plan below for additional disclosure related to participants who elected to convert from the ERIP to the SERIP.

Mr. Alan B. Miller remains a participant in the ERIP. Mr. Alan B. Miller’s aggregate benefit payable under the ERIP (for the 60 months in which the participant receives benefits), assuming retirement as of December 31, ~~2015~~2018, amounted to approximately ~~$2.3~~$2.5 million. As ~~of December 31, 2015, the projected aggregate benefit payable for each of~~discussed below, Marc D. Miller and Steve G. Filton ~~and~~converted their ERIP participation into the SERIP. Ms. Debra K. ~~Osteen were approximately $1.7 million, $925,000, $930,000, respectively, based~~Osteen’s accrued ERIP benefit was forfeited pursuant to the terms and conditions of the plan upon her resignation from the ~~following assumptions: (i) each participant will retire at the age of 62, and; (ii) annual salary increases of 3% are provided until the age of 62 is attained.~~

~~NONQUALIFIED DEFERRED COMPENSATION~~Company in December, 2018.

The following ~~table provides~~tables provide information about pension benefits pursuant to our ~~Deferred Compensation Plan~~ERIP for our named executive ~~officers.~~officer, as described below.

Name
Executive Contributions
in Last Fiscal Year ($)
(1.) Registrant
Contributions in Last
Fiscal Year ($) (2.) Aggregate Earnings
in Last Fiscal Year
($) (2.) Aggregate
Withdrawals /
Distributions
($) Aggregate Balance at
Last Fiscal Year-
End
($)
Alan B. Miller
$ 25,000    $ 0    $ 15,276    $ 0    $ 1,437,752
Marc D. Miller
$ 0    $ 0    $ 217    $ 0    $ 46,679
Steve G. Filton
$ 0    $ 0    $ 0    $ 0    $ 0
Debra K. Osteen
$ 0    $ 0    $ 0    $ 0    $ 0
Marvin G. Pember
$ 148,000    $ 0    $ 11,935    $ 0    $ 487,188

Name

Number

of Years

Credited

Service

(#)

Value of

Accumulated

Benefit

($) (1.)

Payments

During

Last Fiscal

Year ($)

Alan B. Miller

2,181,448

(1.)	~~Amounts included in “salary” in~~ 4% discount rate applied over the ~~Summary Compensation Table.~~projected post-retirement 5-year payout period.

Supplemental Executive Retirement Income Plan (“SERIP”)

In July, 2018, the Board of Directors adopted the SERIP. Pursuant to the terms of the SERIP, a select group of management or other highly compensated employees may be designated as plan participants. Our SERIP, which is subject to the applicable provisions of Internal Revenue Code Section 409A, provides eligible employees with annual employer contributions which are entirely at the Company’s discretion. Generally, each annual contribution vests on the earlier of: (i) the 5^th anniversary of the date of funding to the participant’s account, or; (ii) the participant attaining the qualified age of retirement (either age 62 or age 65, as stipulated in the SERIP). The SERIP also provides for discretionary alternative vesting schedules for certain supplemental discretionary contributions made on an individual basis. Upon attaining the SERIP’s qualified age of retirement, distributions are paid in 10 annual installments to the participant. Distributions due to events other than retirement are paid in a lump sum. Our obligation to make payments of amounts credited to participants’ accounts is a general unsecured obligation.

As discussed above, a select group of employees who were previously participants in the ERIP and elected to convert to the SERIP, have been provided with an unfunded, lump sum conversion balance that was credited to the participant’s SERIP account. The unfunded ERIP conversion balances transferred to the SERIP, which were computed based upon the participant’s 2017 salary and will remain permanently unchanged after conversion, are payable over 60 monthly installments, if the participant attains their qualified age of retirement, as previously stipulated in the ERIP. If the participant does not attain their qualified age of retirement, the ERIP conversion balance is forfeited unless the Board of Directors, in its full discretion, determined otherwise. For ERIP participants who elected to convert to the SERIP, their participation in the ERIP was terminated upon conversion and no future benefits will be earned pursuant to the ERIP. SERIP participants who converted from the ERIP are entitled to future benefits pursuant to the terms of the SERIP.

Marc D. Miller and Steve G. Filton elected to convert their ERIP participation into the SERIP. As a result of their elections, their unfunded ERIP conversion balances, which are reflected below and were computed based upon their 2017 salaries, will remain permanently unchanged. Marvin G. Pember, who was not previously an ERIP participant, also participates in the SERIP.

The following tables provide information about pension benefits pursuant to our SERIP for our named executive officers as described below.

~~(2.)~~

~~Amounts shown are not reported as compensation in the Summary Compensation Table.~~

Name	SERIP Beginning Balance 1/1/2018 ($)		Registrant SERIP Contributions in Last Fiscal Year ($)		SERIP Losses in Last Fiscal Year ($)			SERIP Distributions ($)		SERIP Balance at Last Fiscal Year-End ($)				ERIP Conversion Balance to SERIP		Aggregate Balance at Last Fiscal Year-End ($)
										Vested		Unvested
Marc D. Miller	$	-	$	45,458	$	(6,639	)	$	-	$	-	$	38,819	$	1,136,438	$	1,175,257
Steve G. Filton	$	-	$	36,774	$	(3,904	)	$	-	$	-	$	32,870	$	919,340	$	952,210
Marvin G. Pember	$	-	$	178,885	$	(14,974	)	$	-	$	163,911	$	-	$	-	$	163,911

During 2018, for Marc D. Miller, and Steve G. Filton, the Company made discretionary contributions to their respective SERIP accounts of $45,458 and $36,774, respectively. For Marvin G. Pember, the Company made a discretionary contribution during 2018 of $38,885 plus an additional supplemental discretionary contribution of $140,000.

Deferred Compensation

Our Deferred Compensation Plan, which is subject to the applicable provisions of Internal Revenue Code Section 409A provides that eligible employees may elect to ~~convert and~~ defer a portion of their base salary and bonus award into investment options in lieu of receiving cash. ~~An “eligible employee” under~~Under the Deferred Compensation Plan, ~~is: (i)~~ an employee ~~whose~~is deemed eligible if their base compensation ~~is expected to be above the IRS threshold~~ for ~~highly compensated employees (currently~~2018 was $120,000 or ~~higher)~~higher and ~~who is employed~~they are performing duties in ~~an internally deemed eligible position, or; (ii) any other employee who has been internally deemed eligible.~~a qualified position. The base compensation threshold is adjusted annually for cost-of-living increases.

Pursuant to the terms of the Deferred Compensation Plan, the minimum annual amount that can be deferred is $2,000. Prior to January 1, 2016, no more than 25% of an employee’s base salary or 50% of an employee’s annual bonus may be deferred under the Deferred Compensation Plan in any calendar year. Effective January 1, 2016, noNo more than 50% of an employee’s base salary or 95% of an employee’s annual bonus may be deferred under the Deferred Compensation Plan in any calendar year. Employees may allocate a portion of their deferred compensation to be distributed in a lump sum or installments to begin at retirement or a scheduled distribution date. The available investment options consist of certain mutual funds which include: (i) conservative (e.g. money markets or bonds); (ii) moderately conservative (e.g. balanced funds), and; (iii) aggressive (e.g. domestic and international equity). Our obligation to make payments of amounts credited to participants’ deferred compensation accounts is a general unsecured obligation. In addition, under the Deferred Compensation Plan, we may make discretionary contributions on behalf of an eligible employee. Since inception of the Deferred Compensation Plan, we have not made any discretionary contributions on behalf of employees.

Our obligations under the Deferred Compensation Plan in connection with an employee’s retirement account are payable, beginning at retirement at age 55 and 10 years of service for deferrals made prior to January 1, 2016, and age 55 and 5 years of service for deferrals made on or after January 1, 2016, in equal

installments over a ten year period; except that an employee may make a distribution election to receive the balance of the participant’s retirement account in either a single ~~one~~ lump sum or equal annual or less frequent installments over a period not to exceed ten years. For deferrals made on or after January 1, 2016, an employee may elect to defer the retirement distribution to begin one year following retirement. An employee or designated beneficiary will receive a lump sum ~~distribution~~ as a result of death, disability, or termination, ~~of employment for~~ other than ~~retirement, death or disability.~~for retirement. An employee may change his distribution elections by making new distribution elections at least 12 months prior to the date on which such payment was otherwise scheduled to be made and must be delayed until a date that is at least five years after the date the distribution was previously scheduled to begin.

Our obligations under the Deferred Compensation Plan in connection with an employee’s scheduled distribution are payable in a lump sum or installments of two to ten years, commencing on the date indicated by the employee. If the employee’s employment is terminated prior to the distribution of obligations in accordance with a scheduled distribution then the amounts credited to such accounts will be transferred to the employee’s retirement account and distributed in accordance with the employee’s distribution election for that account.

If an employee experiences a financial hardship that is the result of an “unforeseeable emergency,” as defined under the Deferred Compensation Plan, he or she may apply to the administrator of the Deferred Compensation Plan for an emergency withdrawal against his or her accounts. Such an emergency withdrawal may be allowed at the discretion of the administrator, in which case the employee’s account will be reduced accordingly.

~~Executive Retirement Income Plan~~

~~For a description of the Executive Retirement Income~~NONQUALIFIED DEFERRED COMPENSATION

The following table provides information about our Deferred Compensation Plan ~~and potential payments thereunder, please refer to the Pension Benefits Table and the related narrative discussion included in this Proxy Statement.~~for our named executive officers.

Name

Executive Contributions
in Last Fiscal Year ($)
(1.)

Registrant
Contributions in Last
Fiscal Year ($)

Aggregate Earnings
in Last Fiscal
Year ($)

Aggregate
Withdrawals /
Distributions
($)

Aggregate Balance
at Last Fiscal
Year-End ($)

Alan B. Miller

$
100,000

$
0

$
(96,710
)

$
0

$
1,887,553

Marc D. Miller

$
50,000

$
0

$
(9,923
)

$
0

$
154,373

Steve G. Filton

$
0

$
0

$
0

$
0

$
-

Marvin G. Pember

$
417,028

$
0

$
(122,320
)

$
(40,758
)

$
1,905,782

Debra K. Osteen

$
0

$
0

$
0

$
0

$
-

(1.)	Amounts included in “salary” in the Summary Compensation Table.

Split-Dollar Life Insurance Agreements:

See ~~See~~Split-Dollar Life Insurance Agreements as included above in this Proxy Statement.

Potential Payments Upon Termination or Change-in-Control

~~Mr. Alan Miller’s employment agreement dated~~On July 24, 2013, ~~provides~~we entered into an employment agreement, as amended on November 5, 2018, with Alan B. Miller (“Employment Agreement”) that stipulates that Mr. ~~Alan~~ Miller will ~~continue to~~ serve as ~~Chief Executive Officer and~~the Chairman of our Board of Directors and Chief Executive Officer (“CEO”) through December 31, 2017, ~~subject to~~and provides for automatic annual ~~renewal for one additional year~~renewals unless either party elects otherwise. During 2018, Mr. Miller’s Employment Agreement was automatically renewed for one year through December 31, 2020. The agreement also contemplates that Mr. Alan Miller will remain as Executive Chairman of our Board of Directors during the term of his CEO employment. The ~~employment agreement~~Employment Agreement also contains customary non-disparagement, non-solicitation and non-competition provisions.

In general, Mr. Alan Miller’s long-term stock-based incentive awards granted pursuant to his ~~employment agreement~~Employment Agreement will become fully vested upon termination of his employment other than by us for “cause” or voluntarily by Mr. Alan Miller before the end of the applicable term (under circumstances not involving a breach of the ~~employment agreement~~Employment Agreement by us).

If Mr. Alan Miller’s employment is terminated for “cause”, as defined in the ~~employment agreement,~~Employment Agreement, he will be entitled to any benefits payable to or earned by Mr. Miller with respect to any period of his employment or other service prior to the date of such discharge.

If Mr. Alan Miller’s employment as Chief Executive Officer is terminated due to his disability, Mr. Alan Miller shall be paid a pro rata portion of the annual bonus which would otherwise have been payable for the year in which his employment terminates, plus an amount equal to one-half of Mr. Alan Miller’s base salary, payable in twelve equal monthly installments. If Mr. Alan Miller’s employment or service terminates due to his death, Mr. Alan Miller’s beneficiary shall receive a pro rata portion of the annual bonus which would otherwise have been payable to Mr. Alan Miller for the year of his death.

If Mr. Miller terminates his employment or other service under the ~~employment agreement~~Employment Agreement because of a material change in the duties of his office or any other breach by us of our obligations, or in the event of the termination of Mr. Alan Miller’s employment by us without cause or otherwise in breach of the ~~employment agreement,~~Employment Agreement, Mr. Alan Miller will generally continue to receive all of the cash compensation, benefits and minimum long term incentive compensation set forth in the ~~employment agreement~~Employment Agreement as if his employment or service had not terminated, and the vesting of his long-term incentive plan awards will accelerate.

The following table provides quantitative disclosure of the estimated payments that would be made to Mr. Alan Miller under his ~~employment agreement~~Employment Agreement as of December 31, ~~2015,~~2018, the last business day of our fiscal ~~2015,~~2018, assuming that the ~~employment agreement~~Employment Agreement would have been in effect at that time:

Cash Severance
Payment ($) Perquisites/
Benefits ($) Vesting Acceleration
of Previously
Granted Stock
Based
Awards ($) (e.) Continuation of
Restricted Stock
Awards ($) Total Termination
Benefits ($)
Alan B. Miller

Termination by Us for “Cause”
$ 0    $ 0    $ 0    $ 0    $ 0
Termination Due to Mr. Alan Miller’s Disability
$ 1,600,000 (a.) $ 0    $ 28,256,518    $ 0    $ 29,856,518
Termination Due to Mr. Alan Miller’s Death
$ 0    $ 0    $ 28,256,518    $ 0    $ 28,256,518
Termination by Mr. Alan Miller for “Breach by the Company” or Termination by the Company Without Cause
$ 6,464,000 (b.) $ 2,721,693 (c.) $ 28,256,518    $ 3,000,000 (d.) $ 40,442,211

	Cash Severance Payment ($)			Perquisites/ Benefits ($)			Vesting Acceleration of Previously Granted Stock Based Awards ($) (e.)		Long Term Incentive Plan Awards ($)			Total Termination Benefits ($)
Alan B. Miller
Termination by Us for “Cause”	$	0		$	0		$	0	$	0		$	0
Termination Due to Mr. Alan Miller’s Disability	$	1,700,000	(a.)	$	0		$	42,876,584	$	0		$	44,576,584
Termination Due to Mr. Alan Miller’s Death	$	0		$	0		$	42,876,584	$	0		$	42,876,584
Termination by Mr. Alan Miller for “Breach by the Company” or Termination by the Company Without Cause	$	6,868,000	(b.)	$	2,387,797	(c.)	$	42,876,584	$	4,000,000	(d.)	$	56,132,381

(a.)	Based upon 50% of the targeted ~~2016~~2019 non-equity incentive plan bonus award and 50% (6 months) of Mr. Alan Miller’s ~~2016~~2019 base salary.

(b.)

Assumes (i) continuation of all cash compensation through ~~2017;~~2020 (automatic annual renewal termination date); (ii) annual base salary increase of 2.0% through ~~2017,~~2020, and; (iii) an annual bonus award equal to 100% of his estimated base salary through ~~2017,~~2020, which assumes the achievement of the bonus opportunity target set forth under Mr. Alan Miller’s employment agreement.

(c.)

Assumes (i) continuation of all entitled perquisites through ~~2017;~~2020; (ii) continuation of insurance premiums in connection with long-term disability, our 401(k) match and charges all of which were based upon the actual ~~2015~~2018 amounts. Additionally, assumes premiums due in connection with split-dollar life insurance agreements through ~~2017.~~2020. Please see theSummary Compensation and the All Other Compensation table included herein.

(d.)	~~Assumes~~ Pursuant to the terms of the amendment to the Employment Agreement dated November 5, 2018, assumes continuation of minimum long-term incentive compensation through ~~2017.~~2020 with 50% being in the form of restricted stock and 50% in the form of cash.

(e.)	Represents grant date fair value of unvested awards as of December 31, ~~2015.~~2018. The full grant date fair values of these awards were also included in the Summary Compensation Table in the year of original grant.

~~2015~~CEO Pay Ratio

As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), and Item 402(u) of Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Alan B. Miller, the Chairman of our Board of Directors and Chief Executive Officer.

As is permitted under the SEC rules, we reasonably determined our median employee by using the greater of total annual W-2 wages of employees both in the U.S. and the U.K. who were employed as of December 31, 2018 (excluding Mr. Miller), or calculated annualized pay for those who commenced work during 2018 or were on a leave of absence. The employee population consisted of our full-time, part-time and temporary employees. The inclusion of part-time and temporary employees reduces the median of the annual total compensation for the overall group of our employees. Due to the amount of turnover and job status changes that exist in the healthcare industry, we recalculated the median employee in 2018 and determined that person’s total compensation was $40,826. The ratio of CEO pay to median worker pay is 578:1.

The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.

2018 DIRECTOR COMPENSATION

The following table provides information concerning the compensation of our ~~Non-Employee~~non-employee Directors for ~~2015.~~2018.


Name	Fees Earned or Paid in Cash ($)		Grant Date Fair Value Stock Awards (1.) ($)		Grant Date Fair Value Option Awards (2.) ($)		Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)		Total ($)		Fees Earned or Paid in Cash ($)		Grant Date Fair Value Stock Awards (1.) ($)		Grant Date Fair Value Option Awards (2.) ($)		Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)		Total ($)
Lawrence S. Gibbs	$	56,500	$	0	$	319,155	$	0	$	0	$	375,655	$	84,500	$	0	$	281,640	$	0	$	0	$	366,140
John H. Herrell	$	64,000	$	0	$	319,155	$	0	$	0	$	383,155
John H. Herrell (3.)													$	35,740	$	0	$	0	$	0	$	0	$	35,740
Robert H. Hotz	$	65,500	$	0	$	319,155	$	0	$	0	$	384,655	$	93,500	$	0	$	281,640	$	0	$	0	$	375,140
Eileen C. McDonnell	$	55,500	$	0	$	319,155	$	0	$	0	$	374,655	$	85,226	$	0	$	281,640	$	0	$	0	$	366,866
Anthony Pantaleoni	$	41,000	$	0	$	319,155	$	0	$	0	$	360,155
Warren J. Nimetz													$	61,973	$	0	$	281,640	$	0	$	0	$	343,613
Elliot J. Sussman, M.D.													$	64,890	$	0	$	281,640	$	0	$	0	$	346,530

(1.)	There were no restricted stock awards made to our non-employee directors during ~~2015.~~2018.

(2.)	Each non-employee director received ~~15,000~~10,000 stock options on ~~March 18, 2015,~~April 13, 2018, which had a grant date fair value of ~~$319,155. In addition,~~$281,640 or $28.164 per share.

(3.)	Mr. John H. Herrell retired from our Board of Directors on ~~March 23, 2016, each of the members of the board of directors reflected above received 15,000~~May 16, 2018. All unvested stock ~~options.~~options were cancelled on May 16, 2018.

As of December 31, ~~2015~~2018 the following stock options were outstanding for each director:


Lawrence S. Gibbs		~~37,500~~
~~John H. Herrell~~	61,250	~~37,500~~
Robert H. Hotz		~~48,750~~ 65,000
Eileen C. McDonnell		~~30,000~~ 53,750
~~Anthony Pantaleoni~~Warren J. Nimetz		~~37,500~~ 10,000
Elliot J. Sussman, M.D.		10,000

2018 Cash Compensation. During ~~2015,~~2018, all ~~active~~ non-employee directors received ana pro rata annual retainer of ~~$40,000~~$65,000 for service on the Board of Directors. Additionally, during ~~2015,~~2018, John H. Herrell, Chairperson of the Audit Committee received ana pro rata annual retainer of $10,000 for his services in that capacity ~~and~~through his retirement on May 16, 2018 ($3,699 on pro rata basis). Eileen C. McDonnell, Chairperson of the Audit Committee effective May 16, 2018, received a pro rata annual retainer of $10,000 for her services in that capacity ($6,301 on pro rata basis), as well as a pro rata annual retainer of $2,500 for her services as a member of the Audit Committee through May 16, 2018 ($925 on pro rata basis). Lawrence S. Gibbs, ~~and~~ Robert H. Hotz and Elliott J. Sussman, members of the Audit Committee, each received an annual retainer of ~~$2,500.~~$2,500 for services in that capacity. Also during ~~2015,~~2018, Robert H. Hotz, received $5,000 for his services as Chairperson of the Compensation Committee and an additional $5,000 for his services as Chairperson of the Nominating & Governance Committee. Each non-employee director also was paid a $1,000 meeting fee for participation in each committee meeting in excess of 30 minutes. ~~Meeting~~Committee meeting fees paid during ~~2015~~2018 were as follows: Robert H. Hotz was paid ~~$13,000,~~$16,000, Eileen C. McDonnell was paid $13,000, John H. Herrell was paid ~~$14,000,~~$8,000, Lawrence S. Gibbs was paid ~~$14,000~~$17,000 and ~~Anthony Pantaleoni~~Elliot J. Sussman, M.D. was paid ~~$1,000.~~$12,000. Warren J. Nimetz was not paid any committee meeting fees during 2018.

~~During 2016, we anticipate that each active~~2018 Stock Option Awards. On April 13, 2018, all non-employee ~~director will receive an annual retainer of $40,000 for service~~directors (with the exception on ~~the Board of Directors. Additionally, during 2016,~~ John H. Herrell, Chairperson of the Audit Committee, will receive an annual retainer of $10,000 for his service in that capacity and members of the Audit Committee will receive an annual retainer of $2,500 each. Also during 2016, Robert H. Hotz, Chairperson of the Compensation Committee and Chairperson of the Nominating & Governance Committee, will receive annual retainers of $5,000 each for his services in the respective capacities. Each non-employee director will be paid a meeting fee of $1,000 for participation in each committee meeting in excess of 30 minutes. All retainers and meeting fees will be paid in cash.

~~Stock Option Awards~~~~. On March 18, 2015, all non-employee directors~~who retired on May 16, 2018) received ~~an option~~options to purchase ~~15,000~~10,000 shares of our Class B Common Stock at an exercise price of ~~$117.29~~$119.64 per share. These options ~~have~~had a grant date fair value of $21.28 per share. These stock options were granted under our Second Amended and Restated 2005 Stock Incentive Plan, vest ratably over four years and expire on the fifth anniversary of the grant date. Additionally, on March 23, 2016, all non-employee directors received an option to purchase 15,000 shares of our Class B Common Stock at an exercise price of $118.62$28.164 per share. These stock options were granted under our Third Amended and Restated 2005 Stock Incentive Plan, vest ratably over four years and expire on the fifth anniversary of the grant date.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and executive officers, and persons who own more than ten percent of a registered class of our equity securities, to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of our Common Stock and other equity securities.

Based upon a review of the copies of such reports furnished to us during fiscal year ~~2015~~2018 and written representations from our executive officers and directors, we believe that during the ~~2015~~2018 fiscal year, the officers, directors and holders of more than 10% of our Common Stock complied with all Section 16(a) filing requirements.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Alan B. Miller isserves as the Chairman of our Board of Directors and ~~our~~ Chief Executive ~~Officer.~~Officer (“CEO”). Alan B. Miller also serves as the Chairman of the Board of Trustees, ~~Chief Executive Officer~~CEO and President of Universal Health Realty Income Trust (“UHT”), a publicly traded real estate investment trust which commenced operations in 1986. The Company acts as advisor to UHT pursuant to the terms of an annually renewable advisory agreement and also leases the real property of certain of its facilities from UHT.

Marc D. Miller isserves as our President and a member of our Board of ~~Directors and President of the Company.~~Directors. Marc D. Miller is the son of Alan B. ~~Miller, the Chairman of our Board of Directors and our Chief Executive Officer.~~Miller. Marc D. Miller is a named executive officer and therefore the salary and other compensation arrangements between us and Marc D. Miller are disclosed and described throughout this Proxy Statement. Additionally, Marc D. Miller serves as a member of the Board of Trustees of UHT, and also serves as a member of the Board of Directors of Premier, Inc., a healthcare performance improvement alliance which contracts with the Company pursuant to a group purchasing agreement. ~~All fees earned by Marc D. Miller in his capacity as a Board member of Premier, Inc. are paid to the Company.~~

~~Anthony Pantaleoni,~~Warren J. Nimetz, a member of our Board of Directors and a member of the Executive Committee and the Finance Committee, is ~~Of Counsel to~~a Partner in Norton Rose Fulbright US LLP, the law firm we use as outside corporate counsel. We paid approximately $461,000 in legal fees to this law firm in 2018. This law firm also provides personal legal services to Alan B. Miller, our ~~Chief Executive Officer.~~CEO. Mr. ~~Pantaleoni~~Nimetz is ~~also~~ the trustee of certain trusts for the benefit of Alan B. Miller and his family.

Pursuant to our Code of Business Conduct and Corporate Standards, all employees, officers and directors of the Company and its subsidiaries are prohibited from engaging in any relationship or financial interest which is a conflict of interest with, or which interferes or has the potential to interfere with, the interests of the Company or any of its subsidiaries or facilities. In addition, all employees, officers and directors of the Company and its subsidiaries are required to disclose to our chief compliance officer any financial interest or ownership interest or any other relationship that he or she (or a member of his or her immediate family) has with customers, vendors,

or competitors of the Company or any of its subsidiaries or facilities. ~~James Caponi is currently our Chief Compliance Officer.~~

All employees, officers and directors of the Company and its subsidiaries are prohibited from entering into a related party transaction with the Company without the prior approval of Ms. Mia Meloni, our ~~chief compliance officer.~~Chief Compliance Officer. Any request for the Company to enter into a transaction with an employee, officer or director or any of such persons’ immediate family members must first be presented to our ~~chief compliance officer~~Chief Compliance Officer for review, consideration and approval. In approving or rejecting the proposed agreement, our ~~chief compliance officer~~Chief Compliance Officer will consider the relevant facts and circumstances available and deemed relevant, including but not limited to, the risks, costs, and benefits to the Company, the terms of the transactions, the availability of other sources for

comparable services or products, and, if applicable, the impact on director independence. Our ~~chief compliance officer~~Chief Compliance Officer shall only approve those agreements that, in light of known circumstances, are in or are not inconsistent with, the Company’s best interests, as determined in good faith by our ~~chief compliance officer.~~Chief Compliance Officer.

Except as otherwise disclosed in this Proxy Statement, since the beginning of the Company’s last fiscal year, we have not been a party to, and we have no plans to be a party to, any transaction or series of similar transactions in which the amount involved exceeded or will exceed $120,000 and in which any employee, executive officer or director, holder of more than 5% of our voting securities, or any member of the immediate family of any of the foregoing, had or will have a direct or indirect material interest.

Please see “Corporate Governance—Director Independence” for additional information on the independence of our ~~directors~~directors.

CORPORATE GOVERNANCE

Director Independence

Our Board of Directors has affirmatively determined that four of its seven current members ~~(John H. Herrell, Robert~~(Robert H. Hotz, Lawrence S. Gibbs, ~~and~~ Eileen C. ~~McDonnell)~~McDonnell and Elliot J. Sussman, M.D.) are independent directors under the applicable rules and regulations of the SEC and the New York Stock Exchange listing standards.

In determining independence, the Board of Directors affirmatively determines each year whether directors have any material relationship with us. When assessing the materiality of a director’s relationship with us, the Board of Directors considers all relevant facts and circumstances, not merely from the director’s standpoint, but also from the standpoint of the persons or organizations with which the director has an affiliation. Material relationships can include commercial, banking, industrial, consulting, legal, accounting, charitable and familial relationships. The Board of Directors has concluded that no material relationship exists between us and any of our independent directors, other than each such person’s position as one of our directors.

We are eligible to be treated as a controlled company under New York Stock Exchange Rule 303A due to the fact that the family of Alan B. Miller holds more than 95% of the shares of Class A and Class C Common

Stock, which is entitled to elect 80% of the entire Board of Directors and constitutes more than 50% of our aggregate voting power. New York Stock Exchange Rule 303A states that a controlled company need not have a majority of independent directors on its board or have nominating/corporate governance and compensation committees composed entirely of independent directors. We have elected to avail ourselves of a limited aspect of the Rule 303A exemption, determining that the Nominating & Governance Committee is not responsible for identifying and recommending qualified candidates for Board positions that, in accordance with our Restated Certificate of Incorporation, are to be elected by the holders of Class A and Class C Common Stock of the Company. We currently intend to have a majority of independent directors on our Board of Directors and all independent directors on our Audit Committee, Compensation Committee and Nominating & Governance Committee.

Meetings of the Board of Directors

Regular meetings of the Board of Directors are generally held every other month, while special meetings are called when necessary. Before each Board of Directors or committee meeting, directors are furnished with an agenda and background materials relating to matters to be discussed. During ~~2015,~~2018, there were six ~~Board of Directors meetings and all active directors participated in 100% of the aggregate of the total number of~~regular meetings of the Board of Directors and one special meeting. All directors participated in each of the ~~total number of~~ meetings ~~held by all committees~~ of the Board of Directors and all or substantially all of meetings held by the respective committees on which they ~~served.~~served, if

applicable. Directors are expected to attend the Annual Meeting of Stockholders. All of our directors attended the ~~2015~~2018 Annual Meeting of Stockholders.

Our Corporate Governance Guidelines provide that the Board of Directors shall hold, in accordance with a schedule determined by the Nominating & Governance Committee of the Board of Directors, executive sessions where non-management directors (i.e., directors who are not our officers, but who do not otherwise have to qualify as “independent directors”) meet without management participation (except as otherwise specifically requested by the non-management directors). ~~John H. Herrell presides over the executive sessions of the non-management directors.~~ Interested parties may communicate directly and confidentially with the presiding director or with the non-management directors of the Board of Directors as a group by writing to that person or group at Universal Health Services, Inc., c/o Secretary, Universal Corporate Center, 367 South Gulph Road, P.O. Box 61558, King of Prussia, PA 19406.

Board Leadership Structure and Board of Directors

Mr. Alan B. Miller serves as both the Company’s Chairman of the Board and ~~Chief Executive Officer. John~~CEO. Robert H. ~~Herrell is~~Hotz serves as the ~~presiding director who~~Lead Independent Director and presides over the executive sessions of the non-management directors. The Company believes this structure allows all of the non-management directors to participate in the full range of the Board’s responsibilities with respect to its oversight of the Company’s management. The Board has determined that this leadership structure is appropriate given the size and complexity of the Company, the number of directors overseeing the Company and the Board’s oversight responsibilities.

The specific experience, qualifications, attributes or skills that led to the conclusion that each Director should serve as a Director of the Company, in light of the Company’s business and structure, are as follows:

Alan B. Miller has been a Director of the Company since 1978. Mr. Alan Miller has been the Company’s Chairman of the Board of Directors and ~~Chief Executive Officer~~CEO since 1978, when he founded the Company. Prior thereto, he was President, Chairman of the Board and Chief Executive Officer of American Medicorp, Inc. Mr. Alan Miller currently serves as Chairman of the Board of Trustees, ~~Chief Executive Officer~~CEO and President of Universal Health Realty Income Trust. ~~He was formerly a Director of Penn Mutual Life Insurance Company from 1994 until February 2013.~~ Mr. Alan Miller oversees all of the Company’s businesses, its operations, development and overall strategy. As a result of his many years of service, Mr. Alan B. Miller provides expertise on the hospital management industry.

Marc D. Miller has been a Director of the Company since 2006 and was appointed President of the Company in May 2009. Previously he has served in various management positions including: Senior Vice President and Co-Head of our Acute Care Division (2007-2009); Vice President, Acute Care Division (2004-2007), and; Assistant Vice President and Group Director of the Acute Care Division, Eastern Region (2003-2004). He has also served in other management positions at various acute care hospitals from 1999 to 2003. Additionally, Mr. Marc D. Miller serves as a member of the Board of Trustees of Universal Health Realty Income Trust and as a member of the Board of Directors of Premier, Inc. Mr. Marc D. Miller provides expertise on the hospital management industry.

Anthony Pantaleoni has been a Director of the Company since 1982. He is Of Counsel to the law firm of Norton Rose Fulbright US LLP and he was a partner from 1970 to 2000. His corporate representation has involved a variety of complex transactions, including mergers, acquisitions, joint ventures, leveraged buyouts, exchange offers and corporate restructurings. Additionally, he has had substantial experience in public offerings and private placements of securities, having represented both issuers and investment banking firms in these transactions. Clients represented by Mr. Pantaleoni have included a wide variety of companies, such as a supplier of products that analyze medical health costs. Mr. Pantaleoni provides expertise on legal matters.

Robert H. Hotz has been a Director of the Company since 1991. He is Senior Managing Director, Global Co-Head of Corporate Finance and ~~Co-Chairman~~Vice Chairman of Houlihan Lokey Howard & Zukin. He ~~has also been~~previously served as a member of the Board of Directors ~~and~~of Houlihan Lokey Howard & Zukin from 2002-2015. He has also been a member of the Operating Committee of Houlihan Lokey Howard & Zukin since June 2002. Mr. Hotz ~~previously served as Chairman of the Board of Directors of Pep Boys–Manny, Moe & Jack, and~~ was ~~former~~formerly Senior Vice Chairman, Investment Banking for the Americas, of UBS LLC. Mr. Hotz provides expertise on financial and strategic advisory matters.

John H. Herrell has been a Director of the Company since 1993. He was the former Chief Administrative Officer of the Mayo Foundation from 1993 through 2002. Mr. Herrell was the Chief Financial Officer of the Mayo Foundation from 1984 until 1993 and held various other capacities since 1968. Mr. Herrell provides expertise on health care companies and financial matters.

Lawrence S.S Gibbs has been a Director of the Company since 2011. HeSince January, 2017, he has ~~been a~~served as the Chief Investment Officer at Erdos Capital. Prior thereto, he was Managing Partner at Cannonball Trading,

LLC ~~since July 2014. Previously Mr. Gibbs was~~from 2010 to 2017, a ~~Macro~~ Portfolio Manager at ~~Ramius LLC~~

JP Morgan Chase Bank NA from ~~March 2010~~2006 to ~~July 2014. Prior thereto, he was~~2009 and a Portfolio Manager at Millennium Partners, LLC from ~~February 2009~~2005 to ~~March 2010.~~2006. Mr. Gibbs provides expertise on corporate finance and investment matters.

Eileen C. McDonnell ~~was appointed~~has been a Director of the Company ~~in April,~~since 2013. Ms. McDonnell currently serves as Chairman and Chief Executive Officer of The Penn Mutual Life Insurance Company. She joined Penn Mutual in 2008 and previously served as President of the company. Ms. McDonnell was also appointed to The Penn Mutual Board of Trustees in 2010. Before joining Penn Mutual, Ms. McDonnell founded ExecMPower, a strategic planning and executive coaching consultancy. Previously, she was president of New England Financial, a wholly owned subsidiary of MetLife, and senior vice president of the Guardian Life Insurance Company. Ms. McDonnell also serves on the Board of ~~Managers of~~ Janney Montgomery Scott LLC, a wholly owned subsidiary of Penn Mutual. ~~In 2012,~~ Ms. McDonnell ~~was named~~serves as the Chairman of the Insurance Federation of ~~Pennsylvania and to~~Pennsylvania. She also serves on the ~~Board of the American~~Corporate Council of ~~Life Insurers. She~~Children’s Hospital of Philadelphia and is ~~also~~ a national advisor to Vision 2020, an initiative of Drexel University College of Medicine Institute for Women’s Health and Leadership. Ms. McDonnell provides expertise on the insurance industry and financial matters.

Warren J. Nimetz was elected to our Board of Directors in January, 2018. Mr. Nimetz has been a Partner at the law firm of Norton Rose Fulbright US LLP since 1987, and he is Administrative Partner of the New York office. Mr. Nimetz focuses his practice on general corporate and securities law, with special emphasis on mergers and acquisitions of public and private companies and related corporate governance issues. Mr. Nimetz advises public and private companies’ boards of directors and their committees on all aspects of corporate governance and has special expertise in structuring and negotiating transactions involving the acquisition, financing and disposition of hospital and other health care and life science companies and properties. Mr. Nimetz provides expertise on legal matters.

Elliot J. Sussman, M.D. was elected to our Board of Directors in March, 2018. Dr. Sussman is Chairman of The Villages Health. He previously served as President and Chief Executive Officer of Lehigh Valley Hospital and Health Network from 1993 through 2010. He has been a member of the Board of Directors of Yale New Haven Health System since 2011. Dr. Sussman provides expertise on the management of hospitals and health systems.

The Board holds six regular meetings each year to consider and address matters involving the Company. The Board also may hold special meetings to address matters arising between regular meetings. These meetings may take place in person or by telephone. The independent directors also regularly meet in executive sessions outside the presence of management. The Board has access to legal counsel for consultation concerning any issues that may occur during or between regularly scheduled Board meetings. As discussed below, the Board has established a Compensation Committee, an Audit Committee, ~~and~~ a Nominating & Governance Committee, an Executive Committee and a Finance Committee to assist the Board in performing its oversight responsibilities.

The Nominating & Governance Committee annually oversees a self-evaluation of the current Board members and those committees as the Board shall specify from time to time and reports to the Board with respect to whether the Board and its committees are functioning effectively. The full Board discusses each evaluation report to determine what, if any, actions should be taken to improve the effectiveness of the Board or any committee thereof.

The Board’s Role in Risk Oversight

Consistent with its responsibility for oversight of the Company, the Board, among other things, oversees risk management of the Company’s business affairs directly and through the committee structure that it has

established. The principal risks associated with the Company are risks related to concentration of the locations of our facilities, dependence on payments from the government and other third party payors, the inability to collect payments from patients, a worsening of the economic and employment conditions in the United States, uncertainties regarding health care reform, competition for patients from other hospitals and health care providers, our ability to recruit and retain quality physicians, our ability to attract and retain qualified nurses and medical support staff, compliance with extensive laws and government regulations, liabilities from claims brought against our facilities, governmental investigations, regulatory actions, whistleblower lawsuits and ~~whistleblower~~purported shareholder class action lawsuits, accreditation of our facilities, acquisition and integration of hospitals, state efforts to regulate the construction or

expansion of health care facilities, fluctuations in our operating results, quarter to quarter earnings and other factors, significant corporate regulation as a public company, and dependence on key management personnel.

The Board’s role in the Company’s risk oversight process includes regular reports from senior management on areas of material risk to the Company, including operational, financial, legal and regulatory, and strategic and reputational risks. The full Board (or the appropriate committee) receives these reports from management to identify and discuss such risks.

The Board periodically reviews with management its strategies, techniques, policies and procedures designed to manage these risks. Under the overall supervision of the Board, management has implemented a variety of processes, procedures and controls to address these risks.

The Board requires management to report to the full Board on a variety of matters at regular meetings of the Board and on an as-needed basis, including the performance and operations of the Company and other matters relating to risk management. The Audit Committee also receives regular reports from the Company’s independent registered public accounting firm on internal control and financial reporting matters. These reviews are conducted in conjunction with the Board’s risk oversight function and enable the Board to review and assess any material risks facing the Company. ~~John~~Robert H. ~~Herrell,~~Hotz, the Lead Independent Director, periodically meets with management and the Company’s independent registered public accounting firm to review and discuss the activities of the Company and to provide direction with respect thereto.

Stockholder Communications

Stockholders who wish to send communications to the Board of Directors or an individual director should address such communications to Universal Health Services, Inc., c/o Secretary, Universal Corporate Center, 367 South Gulph Road, P.O. Box 61558, King of Prussia, PA 19406. The Secretary will forward such communications to the Board of Directors or the specified individual director to whom the communication is directed unless such communication is unduly hostile, threatening, illegal or similarly inappropriate, in which case the Secretary has the authority to discard the communication or take appropriate legal action regarding such communication.

Committees of the Board of Directors

The Compensation Committee, the Audit Committee, the Nominating & Governance Committee, the Executive Committee and the Finance Committee are the standing committees of the Board of Directors. A current copy of ~~the~~ our Corporate Governance Guidelines, Code of Business Conduct and Corporate Standards, Code of Ethics for Senior Financial Officers, Compensation Committee Charter, Nominating & Governance Committee Charter and Audit Committee Charter are available free of charge on our website at www.uhsinc.com. Copies of these documents also are available in print free of charge to any stockholder who requests them. We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K relating to amendments to or waivers of any provision of our Code of Ethics for Senior Financial Officers by promptly posting the information on our website.

Compensation Committee. The current members of the Compensation Committee are Robert H. Hotz (Chairman), Lawrence S. Gibbs and ~~John H. Herrell.~~Elliot J. Sussman, M.D., The Compensation Committee met ~~two~~eight times during ~~2015.~~2018. The Board of Directors has determined, in its business judgment, that each member of the Compensation Committee qualifies as an “independent” director under the regulations adopted by the SEC and the New York Stock Exchange.

The Compensation Committee reviews and approves our goals and objectives relevant to the compensation of our Chief Executive Officer and other executive officers, evaluates their performance, determines and approves their compensation level, reviews and determines the form and amount of compensation of the non-management members of the Board of Directors, administers incentive-compensation plans and equity-based plans and approves compensation awards, among other duties and responsibilities.

The amount and mix of the compensation paid to our named executive officers and directors are evaluated on an annual basis. See the section titled “Compensation Setting Process,” in the Compensation Discussion & Analysis for an additional discussion.

The Compensation Committee has the authority to establish one or more subcommittees that shall have the responsibilities and consist of those members of the Compensation Committee as the Compensation Committee may determine from time to time. The Compensation Committee also has the sole authority to retain and terminate compensation consultants to assist it in evaluating our compensation plans, particularly those pertaining to our directors, our Chief Executive Officer and our other executive officers, and to approve the fees and other terms relating to the provision of those services. As discussed in theCompensation Discussion and Analysis, unlike our other named executive officers, Mr. Alan Miller’s compensation is determined in large part by the terms of his employment agreement.

Audit Committee. Current members of the Audit Committee are ~~John H. Herrell,~~Eileen C. McDonnell (Chairperson), Robert H. Hotz, Lawrence S. Gibbs and ~~Eileen C. McDonnell.~~Elliot J. Sussman, M.D. No member serves on the audit committee of more than three public companies. The Audit Committee met ~~twelve~~thirteen times during ~~2015.~~2018.

The Board of Directors has determined, in its business judgment, that each member of the Audit Committee qualifies as an “independent” director under the regulations adopted by the SEC and the New York Stock Exchange and is financially literate and that ~~John H. Herrell~~Eileen C. McDonnell qualifies as an “audit committee financial expert” under SEC regulations and has accounting or related financial management expertise.

The Audit Committee provides assistance to the Board of Directors in fulfilling its oversight responsibility to the stockholders, potential stockholders, the investment community and others relating to: the integrity of our financial statements, the financial reporting process, the systems of internal accounting and financial controls, the performance of our internal audit function and independent auditors, the independent auditors’ qualifications and independence and our compliance with legal and regulatory requirements. This Committee has the authority, duties and responsibilities set forth in its Audit Committee Charter, as amended.

Nominating & Governance Committee. The current members of the Nominating & Governance Committee are Robert H. Hotz (Chairman), Lawrence S. Gibbs and ~~John H. Herrell.~~Elliot J. Sussman, M.D. This Committee met ~~once~~three times during ~~2015.~~

2018. The Board of Directors has determined, in its business judgment, that each member of the Nominating & Governance Committee qualifies as an “independent” director under the regulations adopted by the SEC and the New York Stock Exchange.

The Nominating & Governance Committee was established, with respect to those directors who are to be elected by the holders of Class B and Class D Common Stock of the Company in accordance with the our

Restated Certificate of Incorporation, for the purpose of: (i) assisting the Board of Directors by identifying individuals who are qualified to become directors, consistent with the criteria approved by the Board of Directors; (ii) recommending to the Board of Directors Class B and D director nominees for the next annual meeting of stockholders at which a Class B and D director is to be elected; (iii) developing and recommending to the Board of Directors a set of corporate governance principals in the form of our corporate governance guidelines; (iv) leading and overseeing the Board of Directors in its annual review of the performance of the Board of Directors and our management, and; (v) recommending to the Board of Directors director nominees for each committee of the Board of Directors. The Nominating & Governance Committee provides such assistance in identifying and recommending Class A and Class C Common Stock director nominees as may be requested by the entire Board of Directors. The Nominating & Governance Committee adopted our Corporate Governance Guidelines.

In light of the concentration of over 95% of the voting power of our Class A and Class C Common Stock in a single individual and related entities, and in accordance with the “Controlled Companies” exemption set forth in Section 303A of the New York Stock Exchange Listed Company Manual, the Nominating & Governance Committee is not responsible for identifying and recommending qualified candidates for directors that, in accordance with our Restated Certificate of Incorporation, are to be elected by the holders of Class A and Class C Common Stock. The Nominating & Governance Committee shall, however, provide such assistance in identifying and recommending Class A and C Director nominees as may be requested by the entire Board of Directors.

The Nominating & Governance Committee will consider Class B and D director nominees recommended by stockholders. Under our Restated Certificate of Incorporation, the number of directors to be elected by the Class B and D Common stockholders is limited to 20% of the entire Board of Directors, or a maximum of two directors. Stockholders who wish to recommend a nominee for the Nominating & Governance Committee’s consideration may do so by submitting the individual’s name and qualifications to the Nominating & Governance Committee c/o Secretary, Universal Corporate Center, 367 South Gulph Road, P.O. Box 61558, King of Prussia, PA 19406. Recommendations must be received by the Nominating & Governance Committee no later than the date by which stockholder proposals for presentation at the next Annual Meeting must be received. Recommended nominees will only be considered if there is a vacancy or if the Board of Directors decides to increase the number of directors.

The Nominating & Governance Committee identifies and evaluates committee-recommended Class B and D director nominees considering, among other factors, the following minimum qualifications: the individual’s integrity, experience, education, expertise, independence and any other factors that the Board of Directors and the Nominating & Governance Committee deem would enhance the effectiveness of the Board of Directors and our

governance. The Nominating & Governance Committee seeks persons who have achieved prominence in their fields and who possess significant experience in areas of importance to the Company. Additionally, strong analytical skills, independence, energy, forthrightness and integrity are desired characteristics that the Nominating & Governance Committee seeks in potential candidates. We do not have a formal policy with regard to the consideration of diversity in identifying director nominees. However, the Board of Directors believes that it is essential that its members represent diverse viewpoints, with a broad array of experiences, professions, skills, geographic representation and backgrounds, including diversity of gender and race that, when considered as a group, provide a sufficient mix of perspectives to allow the Board of Directors to best fulfill its responsibilities to the long-term interests of our stockholders. The Nominating & Governance Committee will evaluate a nominee on the same basis if the individual is recommended by a stockholder. The Nominating & Governance Committee does not currently pay a fee to a third party to identify or evaluate nominees, but may consider from time to time engaging a search firm to identify Class B and D director candidates.

Executive Committee. The Executive Committee has the responsibility, between meetings of the Board of Directors, to advise and aid our officers in all matters concerning the management of the business and, while the

Board of Directors is not in session, has the power and authority of the Board of Directors to the fullest extent permitted under law. The Executive Committee ~~met once~~did not meet in ~~2015.~~2018. Members of the Committee are Alan B. Miller (Chairman), Robert H. Hotz, ~~Anthony Pantaleoni and~~ Marc D. ~~Miller.~~Miller and Warren J. Nimetz.

Finance Committee. The Finance Committee is responsible for reviewing our overall long-term financial planning. The Finance Committee ~~met once~~did not meet during ~~2015.~~2018. Members of this Committee are Alan B. Miller (Chariman), Robert H. Hotz, ~~Anthony Pantaleoni and~~ Marc D. ~~Miller.~~Miller and Warren J. Nimetz.

AUDIT COMMITTEE REPORT

The Board of Directors is committed to the accuracy and integrity of the Company’s financial reporting. The Audit Committee takes an involved and active role in delivering on this commitment.

The Audit Committee provides independent, objective oversight of our accounting functions and internal controls.

The Audit Committee reviews and evaluates, and discusses and consults with our management, internal audit personnel and the independent auditors about the following:

the plan for, and the independent auditors’ report on, each audit of the Company’s consolidated financial statements and internal controls;

changes in our accounting practices, principles, controls or methodologies, or in the Company’s financial statements;

significant developments in accounting rules;

the adequacy of our internal accounting controls, and accounting, financial and auditing personnel; and

the establishment and maintenance of a work environment that promotes ethical behavior.

The Audit Committee acts under a written charter that was originally adopted by the Board of Directors in 2004 and is reviewed and approved on an annual basis. The Audit Committee reviews, acts on and reports to the Board of Directors with respect to various auditing, accounting, financial reporting, internal control and regulatory compliance matters. In discharging its oversight role, the Audit Committee may engage independent counsel and other advisers as it determines necessary. In accordance with the Sarbanes-Oxley Act of 2002, the Audit Committee also has the direct responsibility to select, evaluate, determine the compensation of, oversee, and where appropriate, replace our independent auditors, and has the authority to resolve disagreements between management and our auditors. The Audit Committee may establish procedures for the receipt, retention and treatment of complaints received by us regarding accounting and auditing matters, as well as confidential, anonymous submission by employees. The Board of Directors has determined that each of the members of the audit committee is “independent” within the meaning of the rules of the New York Stock Exchange and the Securities Exchange Act of 1934, as amended by the Sarbanes-Oxley Act of 2002.

The Audit Committee recommended to the Board of Directors that the consolidated financial statements be included in the Annual Report on Form 10-K. The Audit Committee took a number of steps in making this recommendation for ~~2015:~~2018:

First, the Audit Committee discussed with our independent auditors the overall scope and plans for their audits.

Second, the Audit Committee met with the independent auditors, to discuss the results of their audits, their evaluations of our internal controls and the overall quality of our financial reporting.

Third, the Audit Committee reviewed and discussed the audited consolidated financial statements in the Annual Report on Form 10-K with management, including a discussion of the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosures in the consolidated financial statements.

Fourth, the Audit Committee reviewed with the independent auditors their judgments as to the quality, not just the acceptability, of our accounting principles and such other matters as are required to be ~~discussed with the Audit Committee under the standards of the Public Company Accounting Oversight Board (United States).~~

discussed with the Audit Committee under the standards of the Public Company Accounting Oversight Board (United States).

Fifth, the Audit Committee discussed with the independent auditors the auditors’ independence from management and the Company, including the matters in the written disclosures required by the Independence Standards Board, and considered the compatibility of non-audit services with the auditors’ independence.

Finally, the Audit Committee obtained and reviewed a report from the independent auditor describing: (i) the independent auditor’s internal quality-control procedures; (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the independent auditor, or by any inquiry or investigation by governmental or professional authorities within the preceding five years inspecting one or more independent audits carried out by the independent auditor, and any steps taken to deal with any such issues; and (iii) all relationships between the independent auditor and the Company.

The Audit Committee reviewed and discussed our consolidated financial statements with the Board of Directors and discussed them with PricewaterhouseCoopers LLP during the ~~2015~~2018 fiscal year, along with the matters required to be discussed by Statement on Auditing Standards No. 61, as amended (AICPA Professional Standards, Vol. 1 AU Section 380) as adopted by the Public Company Accounting Oversight Board in Rule 3200T. The Audit Committee received from PricewaterhouseCoopers LLP the written disclosures, including the letter, required by PCAOB 3524 and 3526 and discussed with PricewaterhouseCoopers LLP its independence. The Audit Committee discussed with the independent accountants matters required to be discussed by Statement of Auditing Standard No. 16, Communications with Audit Committees, as amended, and as adopted by the Public Company Accounting Oversight Board. The Audit Committee received from PricewaterhouseCoopers LLP the written disclosures, including the letter, required by PCAOB 3524 and 3526 and discussed with PricewaterhouseCoopers LLP its independence.

Based on the discussions with PricewaterhouseCoopers LLP and management, the consolidated financial statement review, and such other matters deemed relevant and appropriate by the Audit Committee, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included in our ~~2015~~2018 Annual Report on Form ~~10-K.~~10-K, as filed on February 27, 2019.

Audit Committee

~~John H. Herrell~~Eileen C. McDonnell

Robert H. Hotz

Lawrence S. Gibbs

~~Eileen C. McDonnell~~

Elliot J. Sussman, M.D.

RELATIONSHIP WITH INDEPENDENT AUDITORS

PricewaterhouseCoopers LLP (“PwC”) served as our independent auditors during ~~2015~~2018 and ~~2014.~~2017. Representatives from PwC will be present at the Annual Meeting and will have an opportunity to make a statement, if they desire to do so, and to respond to any appropriate inquiries of the stockholders or their representatives.

PwC’s audit report on our consolidated financial statements as of and for the years ended December 31, ~~2015~~2018 and ~~2014~~2017 did not contain an adverse opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principles.

Set forth below are the fees paid or accrued for the services of PwC during ~~2015~~2018 and ~~2014:~~2017:


	2015		2014		2018		2017
Audit fees	$	3,048,000	$	2,937,846	$	3,141,000	$	3,018,000
Audit-related fees		—		—		25,000		—
Tax fees		265,154		384,350		71,400		72,894
All other fees		96,900		207,550		120,000		559,384

Total	$	3,410,054	$	3,529,746	$	3,357,400	$	3,650,278

Audit fees consisted of professional services rendered to us or certain of our subsidiaries. Such audit services include audits of financial statements, audit of our annual management assessment of the effectiveness of internal control over financial reporting in ~~2015~~2018 and ~~2014~~2017 (as required by Section 404 of the Sarbanes-Oxley Act of 2002), reviews of our quarterly financial statements and audit services provided in connection with regulatory filings, acquisitions and other matters. ~~Audit fees in 2014 also included fees related to a bond offering.~~

Fees for tax services in ~~2015~~2018 and ~~2014~~2017 consisted primarily of consultation on various tax matters related to us and our subsidiaries, including preparation of federal and state income tax returns for certain of our subsidiaries.

The other fees ~~in 2015 and 2014 represent fees~~ to PwC ~~for~~consist of:

2018: consulting services related to an enhanced reimbursement project.

2017: (i) consulting services related to U.K. acquisitions ($459,784); (ii) consulting services related to an enhanced reimbursement project ($45,000), and; (iii) Independent Review Organization services ~~in connection with our South Texas Health System affiliates (2014) and Sierra Vista Hospital (2014 and 2015) and certain revenue cycle benchmarking.~~($54,600).

The Audit Committee has considered and determined that the provision of non-audit services by our principal auditor is compatible with maintaining auditor independence.

All audit and permissible non-audit services provided to us by the independent auditors are pre-approved by the Audit Committee, which considers whether the proposed services would impair the independence of the independent auditors. The Chairperson of the Audit Committee may pre-approve audit and permissible non-audit

services during the time between Audit Committee meetings if the fees for the proposed services are less than $25,000.

YOU ARE URGED TO VOTE, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE OR VOTE YOUR PROXY BY TELEPHONE OR INTERNET AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU CURRENTLY PLAN TO ATTEND THE ANNUAL MEETING IN PERSON.

BY ORDER OF THE BOARD OF DIRECTORS

STEVE G. FILTON, Secretary

King of Prussia, Pennsylvania

April ~~7, 2016~~

4, 2019

~~PROXY~~

~~CLASS A~~

~~COMMON STOCK~~

~~CLASS C~~

~~COMMON STOCK~~

PROXY CLASS A COMMON STOCK CLASS C COMMON STOCK UNIVERSAL HEALTH SERVICES, INC.

This Proxy Solicited By The Board Of

Directors For The Annual Meeting Of

Stockholders To Be Held On May ~~18, 2016~~

15, 2019 Alan B. Miller and Steve Filton and each of them, as the true and lawful attorneys, agents and proxies of the undersigned, with full power of substitution, are hereby authorized to represent and to vote, as designated below, all shares of Class A Common Stock and Class C Common Stock of Universal Health Services, Inc. (the “Company”) held of record by the undersigned on March ~~22, 2016~~19, 2019 at the Annual Meeting of Stockholders to be held at 10:00 a.m. on Wednesday, May ~~18, 2016~~15, 2019 at the offices of the Company, Universal Corporate Center, 367 South Gulph Road, King of Prussia, Pennsylvania and at any adjournment thereof. Any and all proxies heretofore given are hereby revoked.

Important Notice Regarding Availability of Proxy Materials for the Stockholder Meeting to be held on Wednesday, May ~~18, 2016.~~15, 2019. The Proxy Statement and Annual Report to Stockholders are available atwww.edocumentview.com/uhs

THIS PROXY IS CONTINUED ON THE REVERSE SIDE.

PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY

PLEASE MARK YOUR CHOICE LIKE THIS IN BLUE OR BLACK INK

‘ ACCOUNT NUMBER

CLASS A COMMON

CLASS C COMMON

~~The Board of Directors recommends a voteFOR~~ ~~Proposals 1 and 2 andAGAINST~~ ~~Proposal 3:~~

~~1. The Election of Anthony Pantaleoni~~

¨ ~~For~~ ¨ ~~Withhold Authority~~

~~2. To ratify the selection of PricewaterhouseCoopers LLP, as the company’s independent registered public accounting firm for the fiscal year ending December 31, 2016~~

¨ ~~For~~ ¨ ~~Against~~ ¨ ~~Abstain~~

~~3. To act on a shareholder proposal regarding proxy access if properly presented at the meeting~~

¨ ~~For~~ ¨ ~~Against~~ ¨ ~~Abstain~~

~~Discretionary authority is hereby granted with respect to such other matters as may properly come before the meeting.~~

~~DATED:~~

~~SIGNATURE:~~

~~IMPORTANT: Please sign exactly as name appears at the left. Each joint owner shall sign. Executors, administrators, trustees, etc. should give full title.~~

~~The above-signed acknowledges receipt of the Notice of Annual Meeting of Stockholders.~~

The Board of Directors recommends a vote FOR Proposals 1 and 2, and AGAINST Proposal 3: Discretionary authority is hereby granted with respect to such other matters as may properly come before the meeting. 1. The Election of Warren J. Nimetz DATED: ‘ For ‘ Withhold Authority SIGNATURE: 2. To ratify the selection of PricewaterhouseCoopers LLP, as the company’s independent registered SIGNATURE: public accounting firm for the fiscal year ending December 31, 2019. IMPORTANT: Please sign exactly as name appears at the left. ‘ For ‘ Against ‘ Abstain Each joint owner shall sign. Executors, administrators, trustees, etc. should give full title. 3. Stockholder proposal regarding proxy access if properly presented at the meeting. The above-signed acknowledges receipt of the Notice of ‘ For ‘ Against ‘ Abstain Annual Meeting of Stockholders. WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DESIGNATED. IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTEDFOR THE ELECTION OF ~~ANTHONY PANTALEONI~~WARREN J. NIMETZ AS DIRECTOR,FOR THE RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP, AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, ~~2016,~~2019, AND AGAINST THE ~~ACTION ON A SHAREHOLDER~~STOCKHOLDER PROPOSAL REGARDING PROXY ACCESS IF PROPERLY PRESENTED AT THE ~~MEETING.~~MEETING


~~UNIVERSAL HEALTH SERVICES, INC.~~		~~Electronic Voting Instructions~~ ~~Available 24 hours a day, 7 days a week!~~ ~~Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.~~ ~~VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.~~ ~~Proxies submitted by the Internet or telephone must be received by 11:59 p.m., Eastern Time, on May 17, 2016.~~
			~~Vote by Internet~~ ~~• Go to~~~~www.envisionreports.com/UHS~~ ~~• Or scan the QR code with your smartphone~~ ~~• Follow the steps outlined on the secure website~~
		~~Vote by telephone~~ ~~• Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone~~ ~~• Follow the instructions provided by the recorded message~~
~~Using a~~~~black ink~~~~pen, mark your votes with an~~X~~as shown in this example. Please do not write outside the designated areas.~~	x

Universal Health Services, Inc. Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. Your vote matters – here’s how to vote! You may vote online or by phone instead of mailing this card. Votes submitted electronically must be received by 11:59 p.m., Eastern Time, on May 14, 2019. Online Go to www.envisionreports.com/UHS or scan the QR code — login details are located in the shaded bar below. Phone Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada Save paper, time and money! Sign up for electronic delivery at www.envisionreports.com/UHS Annual Meeting Proxy Card • IF ~~YOU HAVE NOT VOTED VIA THE INTERNET~~OR ~~TELEPHONE, FOLD ALONG THE PERFORATION,~~VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q• Proposals — The Board of Directors recommends a vote FOR the nominee listed in Proposal 1, FOR Proposal 2, and AGAINST Proposal 3. A 1. Nominee: + 01. Election of Director: For Withhold 01 - Robert H. Hotz For Against Abstain For Against Abstain 2. Proposal to ratify the selection of PricewaterhouseCoopers LLP 3. Stockholder proposal regarding proxy access if properly as the Company’s independent registered public accounting presented at the meeting. firm for the fiscal year ending December 31, 2019. WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DESIGNATED. IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED FOR THE NOMINEE LISTED IN PROPOSAL 1, FOR PROPOSAL 2, AND AGAINST STOCKHOLDER PROPOSAL 3. Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below B Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. 1UPX + 02ZZJB

~~Proposals — The Board of Directors recommends a voteFOR~~ ~~Proposals 1 and 2 andAGAINST~~ ~~Proposal 3.~~

~~Nominee:~~

~~For~~

~~Withhold~~

~~01 - Robert H. Hotz~~

~~For~~

~~Against~~

~~Abstain~~

~~For~~

~~Against~~

~~Abstain~~

~~2. Proposal to ratify the selection of PricewaterhouseCoopers LLP, as the company’s independent registered public accounting firm for the fiscal year ending December 31, 2016.~~

~~3. To act on a shareholder proposal regarding proxy access if properly presented at the meeting.~~

~~WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DESIGNATED. IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2 ANDAGAINST~~ ~~STOCKHOLDER PROPOSAL 3.~~


		B		~~Non-Voting Items~~

~~Change of Address~~ ~~— Please print your new address below.~~

~~Comments~~ ~~— Please print your comments below.~~

~~Meeting Attendance~~

~~Mark the box to the right if you plan to attend the Annual Meeting.~~


	C	~~Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below~~
Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.

~~Date (mm/dd/yyyy) — Please print date below.~~

~~Signature 1 — Please keep signature within the box.~~

~~Signature 2 — Please keep signature within the box.~~

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be held on Wednesday, May 15, 2019: The Proxy Statement and Annual Report to Stockholders are available at http://www.envisionreports.com/UHS Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.envisionreports.com/UHS • IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. • Proxy — UNIVERSAL HEALTH SERVICES, INC. + UNIVERSAL HEALTH SERVICES, INC. This Proxy Solicited By The Board Of Directors For The Annual Meeting Of Stockholders To Be Held On May 15, 2019 Alan B. Miller and Steve Filton and each of

them, as the true and lawful attorneys, agents and proxies of the undersigned, with full power of substitution, are hereby authorized to represent and to vote, as designated below, all shares of Class B Common Stock and Class D Common Stock of Universal Health Services, Inc. held of record by the undersigned on March 19, 2019 at the Annual Meeting of Stockholders

to be held at 10:00 a.m. on Wednesday, May ~~18, 2016~~

~~10:00 a.m.~~

15, 2019, at the offices of the Company, Universal Corporate Center,

367 South Gulph Road,

King of Prussia, PA

~~Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be~~

~~held on Wednesday, May 18, 2016: The Proxy Statement and Annual Report to Stockholders are~~

~~available at http://www.envisionreports.com/UHS~~

Pennsylvania and at any adjournment thereof. Please call 1-800-814-5819 to obtain directions to the Annual Meeting to vote in person. Any and all proxies heretofore given are hereby revoked. THIS PROXY IS CONTINUED ON THE REVERSE SIDE. PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY. Non-Voting Items C Change of Address — Please print new address below. Comments — Please print your comments below. Meeting Attendance Mark box to the right if you plan to attend the Annual Meeting. +


		q ~~IF YOU HAVE NOT VOTED VIA THE INTERNET~~OR ~~TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.~~ q



		~~Proxy — UNIVERSAL HEALTH SERVICES, INC.~~


		~~UNIVERSAL HEALTH SERVICES, INC.~~ ~~This Proxy Solicited By The Board Of Directors For~~ ~~The Annual Meeting Of Stockholders To Be Held On May 18, 2016~~ Alan B. Miller and Steve Filton and each of them, as the true and lawful attorneys, agents and proxies of the undersigned, with full power of substitution, are hereby authorized to represent and to vote, as designated below, all shares of Class B Common Stock and Class D Common Stock of Universal Health Services, Inc. held of record by the undersigned on March 22, 2016 at the Annual Meeting of Stockholders to be held at 10:00 a.m. on Wednesday, May 18, 2016, at the offices of the Company, Universal Corporate Center, 367 South Gulph Road, King of Prussia, Pennsylvania and at any adjournment thereof. Please call 1-800-814-5819 to obtain directions to the Annual Meeting to vote in person. Any and all proxies heretofore given are hereby revoked. ~~THIS PROXY IS CONTINUED ON THE REVERSE SIDE.~~ ~~PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY.~~


¨ ☐		Soliciting Material ~~Pursuant to§240.14a-12~~Under Rule 14a-12


¨ ☐		Definitive Additional Materials