(7) Earnings Per Share Data ("EPS") and Stock Based Compensation

Basic earnings per share are based on the weighted average number of common shares outstanding during the period. Diluted earnings per share are based on the weighted average number of common shares outstanding during the period adjusted to give effect to common stock equivalents.

The following table sets forth the computation of basic and diluted earnings per share for the periods indicated (in thousands, except per share data):


	Three months ended June 30,						Six months ended June 30,
	(amounts in thousands)
	2011			2010			2011			2010

Basic and Diluted:
Net income attributable to UHS	$	103,649		$	65,572		$	217,842		$	137,391
Less: Net income attributable to unvested restricted share grants		(126	)		(278	)		(275	)		(593	)

Net income attributable to UHS – basic and diluted	$	103,523		$	65,294		$	217,567		$	136,798


Weighted average number of common shares - basic		97,563			96,703			97,472			96,621
Net effect of dilutive stock options and grants based on the treasury stock method		1,695			1,351			1,591			1,131

Weighted average number of common shares and equivalents - diluted		99,258			98,054			99,063			97,752


	Three months ended June 30,				Six months ended June 30,
	(amounts in thousands)
	2011		2010		2011		2010

Earnings per basic share attributable to UHS:	$	1.06	$	0.68	$	2.23	$	1.42


Earnings per diluted share attributable to UHS:	$	1.04	$	0.67	$	2.20	$	1.40

The "Net effect of dilutive stock options and grants based on the treasury stock method", for all periods presented above, excludes certain outstanding stock options applicable to each period since the effect would have been anti-dilutive. There were no significant anti-dilutive stock options during the three or six months ended June 30, 2011 and 2010, respectively. All classes of our common stock have the same dividend rights.

Stock-Based Compensation: During the three-month periods ended June 30, 2011 and 2010, compensation cost of $4.2 million ($2.6 million after-tax) and $3.4 million ($2.1 million after-tax), respectively, was recognized related to outstanding stock options. During the six-month periods ended June 30, 2011 and 2010, compensation cost of $7.7 million ($4.7 million after-tax) and $6.8 million ($4.2 million after-tax), respectively, was recognized related to outstanding stock options. In addition, during the three-month periods ended June 30, 2011 and 2010, compensation cost of approximately $455,000 ($281,000 after-tax) and $867,000 ($538,000 after-tax), respectively, was recognized related to restricted stock. During the six-month periods ended June 30, 2011 and 2010, compensation cost of approximately $906,000 ($559,000 after-tax) and $1.6 million ($971,000 after-tax) was recognized related to restricted stock. As of June 30, 2011 there was $36.0 million of unrecognized compensation cost related to unvested options and restricted stock which is expected to be recognized over the remaining weighted average vesting period of 3.0 years. There were 2,800,000 stock options granted (net of cancellations) during the first six months of 2011 with a weighted-average grant date fair value of $11.63 per share. There were 1,500 restricted stock shares granted during the first six months of 2011, with a weighted-average grant date fair value of $54.29 per share.