HCA Healthcare

Shares of HCA Healthcare (Ticker: HCA) were up 15 percent Tuesday afternoon after leaders of the health care giant lifted their 2021 guidance to incorporate higher margins. The company's facilities reported volumes slightly higher than pre-pandemic levels in the second quarter.  

Leaders at the Nashville-based company saw volumes rebound across the board from the same time last year, when elective surgery bans and lock-downs reduced same-facility admissions 12.8 percent and emergency room visits and outpatient surgeries 33 percent. 

In this year's Q2, HCA saw outpatient surgeries soar 59 percent, ER visits pop 43 percent and same-facility admissions rise 17.5 percent — ending June with three percent higher inpatient admissions than in 2019.

In a call with investors Tuesday morning, HCA CFO Bill Rutherford said the hospital chain is also bringing in more revenue from higher-acuity patients (up 5 percent from 2019) and a payer mix that includes more (higher-paying) commercial insurers — factors that also contributed to HCA more than doubling its profits in the first quarter.

HCA leaders believe these conditions will persist and have updated their end-of-year guidance to project higher margins — to the tune of 200 basis points — than originally expected.

“The margins are being driven by volumes returning to 2019 levels, the favorable acuity as well as the favorable payer mix, and then we continue to have a number of cost initiatives that we are managing,” Rutherford said Tuesday. “As we think about where we stand today in the balance of the year, the margins reflect more like our average that we have experienced over the past four quarters.”

Between April and June, HCA reported revenues totaling $14.4 billion — still 13 percent lower than in Q2 2019 — and adjusted EBITDA of $3.2 billion. The company now expects to end the year with revenues ranging from $57 billion to $58 billion and adjusted EBITDA from $12.1 billion to $12.5 billion. 

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