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Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Total stock-based compensation expense in the Company’s Consolidated Statements of Income related to the Company’s long- term incentive award plans was as follows (in thousands):


	Years ended December 31,
	2019		2018		2017
Cost of services-compensation	$	8,887	$	7,421	$	7,354
Selling, general and administrative	13,014		14,086		16,789
Total	$	21,901	$	21,507	$	24,143

Stock Option Activity

Presented below is a summary of stock option activity for the year ended December 31, 2019 (in thousands, except for weighted average exercise price and weighted average remaining contractual terms):


	Number of Options	Weighted Average Exercise Price		Weighted Average- Remaining Contractual Terms	Aggregate- Intrinsic Value
Outstanding balance at December 31, 2018	4,402	$	17.07
Granted	640	38.61
Exercised	(2,436)	16.20
Forfeitures	(187)	21.21
Expired	(8)	23.59
Outstanding balance at December 31, 2019	2,411	23.43		7.28	$	20,242

Expected to vest at December 31, 2019	1,070	$	28.20	8.5	$	5,979
Exercisable at December 31, 2019	968	$	17.08	5.6	$	12,121

Fair Value of Stock Option Grants Using a Black-Scholes Option Pricing Model

HMS estimated the fair value of each stock option grant on the date of grant using a Black-Scholes option pricing model. Weighted–average assumptions are set forth in the following table:


	Year ended December 31, 2019
	2019		2018		2017
Expected dividend yield	—	%	—	%	—	%
Risk-free interest rate	2.5	%	2.7	%	1.8	%
Expected volatility	41.1	%	42.4	%	44.2	%
Expected life (years)	6.4		6.0		5.0

Fair Value of Stock Option Grants Using a Monte-Carlo Simulation Model

Assumptions are set forth in the following table:


	Year ended December 31,
	2019		2018		2017
Expected dividend yield	—	%	—	%	—	%
Risk-free interest rate	—	%	—	%	2.2	%
Expected volatility	—	%	—	%	52.5	%
Expected life (years)	0		0		6.5

Summary of Restricted Stock Units Activity

Presented below is a summary of restricted stock units activity for the year ended December 31, 2019 (in thousands, except for weighted average grant date fair value per unit):


	Number of Units	Weighted Average Grant Date Fair Value per Unit
Outstanding balance at December 31, 2018	1,488	$	17.60
Granted	487	34.02
Vesting of restricted stock units, net of units withheld for taxes	(406)	16.65
Units withheld for taxes	(201)	16.65
Forfeitures	(129)	21.32
Outstanding balance at December 31, 2019	1,239	$	21.37