HCA is telling federal lawmakers and officials a grim story. Unless federal authorities expand coverage of uninsured patients, it expects to see bad-debt expenses keep rising at 18 percent to 20 percent per year. Its bad-debt expenses for the fourth quarter of 2007 was 13.2 percent of revenue, about 21 percent more than the 10.9 percent level it reported for the fourth quarter of 2006. Meanwhile, bad-debt expenses for all of 2007 were 11.7 percent of revenue, up from 10.4 percent in 2006. Taken as a whole, bad-debt was fueled not only by uninsured patients, but also lower collections on patient accounts and annual increases in HCA's gross prices.
All of these debt issues have made an impact on HCA's profitability. Profits for 2007 decreased by 15.9 percent, to $874 million from $1.04 billion in 2006, despite a revenue increase of 5.4 percent to $26.86 billion. The picture might have been worse if HCA hadn't gotten $661 million for the sale of three hospitals in 2007.
To find out more about HCA's situation:
- read this Modern Healthcare piece
Related Articles:
HCA income up, but bad debt still significant. Report
HCA profits fall, smacked down by debt payment. Report
HCA to pay $20 million to settle shareholder suits. Report
Shareholder lawsuits seek to block HCA buyout. Report
HCA settles suit attempting to block the sale of the company. Report