HCA Healthcare has aggressive plans to add hospitals in rapidly growing population centers, determining that adding to existing facilities is not always the best option.
The Nashville, Tennessee-based for-profit system has two hospitals under construction in San Antonio, Texas, and owns land for new facilities in Austin, Dallas and several markets in Florida, CEO Sam Hazen said Friday during HCA’s first-quarter earnings call. He said HCA purchased land for new hospitals in Las Vegas and Salt Lake City this quarter. The system also continues to add to its outpatient network, which has grown to about 2,500 of them.
HCA estimates capital expenditure will reach $4.6 billion by 2023, excluding acquisitions. Last year, it was $4.2 billion.
“We believe that over time, as our community continues to grow—and we believe it is one of HCA’s distinguishing attributes that we are in great markets with great potential. “We think it is better to open new hospitals than to keep adding more hospitals in all situations,” said Hazen. [some communities].”
Aggressive plans come into play as HCA achieves a quarter beyond expectations. It reported $1.36 billion, or $4.85 per share, in net income for the first quarter, up from $1.27 billion, or $4.14 per share, a last year.
Revenue rose 4.3% year-over-year to $15.59 billion, including $145 million collected after a dispute with commercial payers was resolved. An HCA spokesperson declined to provide further details on the dispute.
Demand for the service continued to recover, with inpatient and outpatient surgeries at the same facility increasing by 3.6% and 5.1%, respectively. Hospitalizations increased by 4.4% and emergency room visits by more than 10%.
Expenses rose 4.1% to $13.67 billion, including a 2.1% increase in wages and salaries and a 4.4% increase in supplies. HCA said it continued to improve staffing during the quarter, with contract labor costs down about 20% year over year.
Chief financial officer Bill Rutherford said contract workers make up just over 7% of HCA’s wages, salaries and benefits, compared with 9.5% a year ago. Rutherford said the system wants that percentage down to between 6.5% and 7% by the end of the year.
Hazen said nursing revenue is approaching pre-COVID levels, averaging 17% over the past six months.
HCA raised its guidance for 2023, expecting annual net income to fall between $4.75 billion and $5.16 billion, compared with $4.525 billion and $4.895 billion expected at the start of the year. now.
The stock market reacts favorably to the news. Shares of HCA are up more than 6% from Thursday’s close at $287.18 a share on Friday morning.
