Bad debt hits Health Management Assoc. earnings

Struggling with uncollectible debt, hospital operator Health Management Associates took a financial hit this quarter. The company, which operates 59 hospitals in 15 states, saw second-quarter 2007 net income of $11.9 million, or 5 cents a share, compared with $77.3 million, or 32 cents a share, during the same period in 2006. This comes despite the fact the chain's revenue for the quarter was $1.1 billion, up from $996.9 million for the same period last year.

Why the performance dip? In part, it's because the Naples, Fl.-based chain has found accounts receivable generated by uninsured patients has become harder to collect. These patients generated about $39 million in bad debt, or 10 cents a share. The overall volume of uninsured patients continues to rise as well, something which should affect future earnings.

To find out more about HMA's prospects:
- read this Tampa Bay Business Journal piece

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