Adjusted diluted earnings per share: increased 25% to $4.90, including an estimated $0.15 per share impact from the hurricane.
Increase in inpatient admissions: 4.5% increase on a same-facility basis compared to the previous year.
Adjusted enrollment growth: 4.5% increase on a like-for-like basis.
Number of emergency department visits: 4.6% increase.
Inpatient surgery: 1.6% increase.
Ambulatory Surgery Revenues: Increased 5% while procedure volume decreased 2%.
Same-property revenue growth rate: 7.1%.
Total number of clinical facilities: Expected to exceed 2,600 by year-end, with approximately 600 inpatient beds and 100 new outpatient facilities added.
Revenue growth: 7.9% year over year.
Adjusted EBITDA margin improvement: 90 basis points improvement compared to last year.
Labor costs as a percentage of revenue: improved by 160 basis points from last year.
Contract labor costs: improved by 18% year over year, representing 4.6% of total labor costs.
Operating cash flow: $3.5 billion for the quarter.
Capital expenditures: $1.19 billion in the quarter. It is estimated that by 2024 it will be around $5 billion.
Share repurchases: $1.79 billion during the quarter.
Dividends paid: $169 million.
Release date: October 25, 2024
For a complete record of financial statements, see Complete Record of Financial Statements.
HCA Healthcare, Inc. (NYSE:HCA) reported strong financial results in the third quarter, with diluted earnings per share increasing 25% to $4.90 despite the impact of the hurricane.
The company posted strong revenue growth of 7.9% year over year, driven by strong volume growth across most service lines.
Hospital admissions and emergency department admissions increased by 4.5% and 4.6%, respectively, indicating strong demand for health services.
HCA Healthcare, Inc. (NYSE:HCA) continues to invest in network development and plans to add approximately 600 inpatient beds and 100 new outpatient facilities by the end of the year.
The company maintains a strong balance sheet with operating cash flow of $3.5 billion in the quarter and a low debt-to-adjusted EBITDA leverage ratio.
HCA Healthcare, Inc. (NYSE:HCA) faces significant challenges from two major hurricanes, resulting in an expected impact of $0.15 per share in the third quarter and additional costs and expenses in the fourth quarter. Revenue losses were expected to be between $200 million and $300 million.
The company expects hurricane-related impacts to continue into 2025, particularly impacting hospitals in North Carolina and Florida.
Although outpatient surgery volume decreased 2%, this service segment’s revenue increased due to higher precision and payer mix.
Medicaid admissions decreased 8.5% on a same-facility basis, reflecting the challenges in this payer category.
The company expects its 2024 results to be in the lower half of its guidance range due to the impact of the hurricane.
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Q: Can you clarify the outlook for 2025 and the impact of the hurricane recovery on financial projections? A: Chief Financial Officer Michael Marks said that the continued impact of the hurricane in 2025 will be , which primarily affects North Carolina and is expected to be manageable. The Tampa facility is expected to be operational by the end of 2024. Our 2025 outlook assumes volume growth of 3% to 4% and revenue growth near or slightly above the high end of our long-term target range.
Q: What are the current trends in claim denial activity, particularly with regard to the 2am rule? A: Michael Marks noted that denial mitigation strategies are limiting the growth in denial charge-offs. . The 2 a.m. rule slightly reduced the propensity for pre-approval declines for accounts that were open at 2 a.m. or later. However, some large Medicare Advantage payers remain notable outliers that cause denials.
Q: How is HCA addressing the operational and financial impact of hurricanes? A: CEO Sam Hazen said the company’s strong disaster response capabilities, which were effectively utilized during recent hurricanes, I emphasized. Two hospitals, HCA Mission Hospital and HCA Florida Largo Hospital, have been significantly impacted and are expected to experience ongoing repair costs and lost revenue. The company expects recovery results similar to past hurricanes.
Q: What are the prospects for payer mix and volume growth in 2025? A: Michael Marks says exchange enrollment growth will be between 8% and 10% in 2025, compared to more than 30% in 2024. % is expected to moderate. Medicaid volumes are expected to stabilize as the redetermination process concludes. Overall, the payer mix is expected to stabilize in 2025.
Q: How is HCA leveraging its AI and technology investments to improve its operations? A: CEO Sam Hazen sees the role of AI in enhancing administrative functions, operations management, and clinical outcomes. We highlighted the company’s digital agenda. Early efforts in schedule management and revenue cycle management are showing promising results, and we plan to expand these efforts in the coming years.
For a complete record of financial statements, see Complete Record of Financial Statements.
This article first appeared on GuruFocus.
