HCA Healthcare on Friday affirmed its earlier warnings about Affordable Care Act (ACA) exchange subsidies fallout, telling analysts that patients who dropped off marketplace plan coverage due to increased premiums have "migrated almost one for one" to uninsurance.
The country's largest for-profit brought in $20.23 billion in second-quarter revenue, up 8.7% year-over-year, net income of $1.69 billion, up 2.8%, and adjusted EBITDA of $4.027 billion, up 4.6%, according to financial results published Friday morning. The company also reported diluted earnings per share increasing 11.6% to $7.62 per share.
In particular, a payer mix shift driven by increased uninsured volumes had an “unfavorable impact” on income of approximately $400 million before income taxes, above its estimates from earlier in the year.
Same-facility admissions increased 2.5% and same-facility equivalent admissions were up 2.7%. However, same-facility inpatient surgeries declined 2.3%, and same-facility outpatient surgeries were down 3.4% during Q2 2026.
HCA is the largest for-profit health system in the U.S., making up 190 hospitals and around 2,500 ambulatory care sites. Last year, it grew revenue 7.1% to $75.6 billion and reported $6.8 billion in net income.
The health system released preliminary Q2 results July 14, which suggested ACA subsidies coverage disruptions would hit harder than expected. CEO Sam Hazen, during Friday's investors' call, said the company's general estimates around how many patients would drop marketplace coverage were generally accurate, with adjusted admissions among these falling by 15% during each of the year's first two quarters.
“We expected some of these patients to shift to other forms of coverage, but this did not happen,” Hazen said. “Instead, these patients migrated almost one for one to uninsured," as opposed to the 80% to 85% the company had expected.
CFO Michael Marks noted the exchanges' one-for-one migration comprises approximately 80% of uninsured volume growth, with the remaining 20% attributed to Medicaid conversion decreases “mostly in Texas.”
But, Hazen noted there was incremental net benefit from Medicaid Supplemental Payment Programs and said despite the payer mix shift, executives are pleased with volume growth.
“Insured volumes, excluding exchanges across many of our services, were solid with improving trends over the course of the first six months,” Hazen said. “Emergency room visits, cardiac procedures, and rehab volumes help drive these improvements.”
Hazen added longer-term assumptions of 2% to 3% demand growth “are supported by market factors and population growth rates.”
“To meet this expected demand, we have continued to add capacity and facilities to our networks this year,” Hazen said. “Additionally, we have approved more than $7 billion in capital expenditures that should come online in the next three years. We believe these investments will increase offerings and quality for our patients, improve our competitive positioning, and help us grow.”
Executives also reiterated the full-year guidance adjustment they shared alongside the preliminary Q2 numbers. That included a narrowed revenue guidance ($77 billion to $79.5 billion) is still within the prior window, but lower ranges for net income (then $6.5 billion to $7 billion, now $6.3 billion to $6.7 billion), adjusted EBITDA (then $15.6 billion to $16.5 billion, now $15.4 billion to $16.1 billion) and earnings per diluted share (then $29.10 to $31.50, now $28.70 to $30.50).
The company's shares were trading about 2.5% higher as of midday Friday.