HCA 1Q16 Earnings Call Notes

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HCA Holdings (HCA) R. Milton Johnson on Q1 2016 Results

1.6% same facility admission growth

“We continue to experience solid growth in inpatient and outpatient volumes as well as surgical and emergency room visits. We believe these results speak the quality of our markets, and the execution of our strategic agenda. Same facility admissions increased 1.6% while same facility equivalent admissions increased 3.1%. Our growth drivers include capital improvements, programmatic developments within our service lines, end market access point development and strategic acquisitions.”

William B. Rutherford – Chief Financial Officer & Executive Vice President

Exchange admissions were 2.6% of total admissions

“Let me touch briefly on health reform. Health reform activity continued to grow in the quarter. In the first quarter, we saw approximately 12,500 same facility exchange admissions as compared to the 9,860 we saw in the first quarter of last year, or about a 27% increase. You may recall, we saw about 11,200 same facility exchange admissions in the fourth quarter of 2015, or 11% increase sequentially quarter-to-quarter. We believe this is largely due to the minimum enrollment (13:27)

For perspective, exchange admissions represent about 2.6% of total admissions for the company. We saw approximately 50,000 same facility exchange ER visits in the first quarter compared to the approximate 37,000 visits in the first quarter of 2015 and 38,000 visits in the fourth quarter of 2015. Overall, our exchange and reform activity is in line with our expectations.”

Samuel N. Hazen – Chief Operating Officer

Outpatient surgeries have grown

” our outpatient surgeries have grown very consistently over the same 12 quarters, 13 quarters, with a little bit of acceleration in this first quarter. And I can’t really point to why it accelerated in the first quarter as compared to the trend. But our efforts are broad-based. ”

ER and urgent care are filling a gap left by not enough primary care physicians

“I don’t know that the ER as a venue, if you will, is changing in any significant way. I do believe, though, that urgent care and emergency rooms over the past three years to five years, and I think this will be the case going forward, is still a substitute for the shortages of primary care physicians that exist in a lot of markets. And so you see urgent care, freestanding emergency rooms, and even hospital-based emergency rooms, providing the solution that patients are looking for when they can’t get into a physician clinic because of physician shortages, or because of payer dynamics.”