HCA - Earnings call transcript Q3 2017

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Operator

Welcome to the HCA Third Quarter 2017 Earnings Conference Call. Today's call is being recorded. At this time for opening remarks and introductions, I'd like to turn the call over to the Senior Vice President, Mr. Vic Campbell. Please go ahead, sir. Healthcare, HCA - Campbell Inc. Victor All right, John. and you good morning, everyone. Thank

welcome Kimbrough, As to Relations also that our Officer the Mark listening the of to are and today, everyone Investor welcome Chief usual webcast. you to I'd call all like

morning Chief our Chairman with Financial Sam Officer. Milton and Officer; Operating is and President our Chief us and this CEO, Johnson; Here Hazen, Bill Rutherford,

third HCA release. on and EBITDA new Healthcare, retirement statements, undue as to statements, revise HCA filings. Inc. to remind such as earnings forward-looking EBITDA these debt, they're turn cause net future table on attributable Before no materially uncertainties facilities, legal a the the on costs, and any net other undertakes or information any over income Several sales will you obligation determine everyone on measures. the morning's included factors losses reliance to in me are the of that these be might results call update excluding let contain that and the events. to any should those adjusted of to significant today. the inherent from and Healthcare, to expectations. listed I are result forward income actual may today's and current Many non-GAAP SEC adjusted press Milt, factors statements. company's looking in on or On future of A based company's the management's reference uncertainties, is measures The In company differ Numerous of light control information losses, call today's release to should which that claims of expressed company results quarter of this in ability providing risks, we beyond or whether predict. to call, Inc. not may adjusted factors gains supplemental of EBITDA place reconciling statements, various attributable are in forward-looking our financial

is will the and over call turn later heard replay the recorded being today. this a As Milton. available you to morning With that, call I'll be

Milton Johnson

and the Thank morning joining call today. webcast Vic good us to or the on you, everyone

details say into few the hit Houston, Corpus few the me unprecedented words go let which of and of take Irma Las began Harvey, and we Vegas. a the then by moments about with quarter, followed shooting in Florida a Before sequence Hurricane events that to hurricane Christi tragic about

Texas, freestanding Harvey we From where rooms. As a near hurricane you presence it our flooding hospital two and it significant there fall significant know one rooms, centers Corpus land six first for three amounts Houston and have record moved all emergency Christi dumped made have to hospital emergency days. of In markets. campuses, market freestanding we these in market surgery have campuses with XX five cancer freestanding causing center. Houston In where we rain

Several resumed of or San our of evacuated facilities also in either some hospitals. in non and from hospitals All Austin were directly cases indirectly. and patients Antonio our were hospitals these from several evacuated and Certain HA patients. evacuating hospitals Dallas, affected took

recovering we XX,XXX approximately and of have Houston Harvey, Corpus Now, affected on in are them Christi, where facilities work employees by still many personal we from loss.

into horrific Florida employees. Georgia lesser recovering of imaging we more XX biggest throughout and our Then again, the freestanding were north Las path disasters state. across diagnostic from Florida hurricane evacuated extent virtually course days facilities one Carolina. Irma emergency Florida certain is states we a impact with hospital XX XX South the of surgery sending natural a entire these Harvey, south Vegas. and even of came than and South and XX,XXX centers Just as rooms, Once from the destruction of centers, after felt to shooting struck all in campuses, Irma XX to

side, & center Hospital the hour. As trauma to closest one concert Medical HCAs XXX Center a Sunrise victims received in approximately

patients XX and the operated in For more operating gunshots intensive event, immediately the nine In care. activated than All operations were with were XXX rooms throughout days. were following XX performed. entirety of all the

manage center, As critical the a Hills relative and hospitals most had all with sure equipment severely the Mountain trauma those Meanwhile necessary Sunrise supplies many dealt and patients. made less View and Sunrise Southern the of to situation. injured staff, took

announced. for robust a nothing in have of speak that were time in preparedness mass very lay incredible us the professionals we team in [indiscernible] saying plans team completely disaster could throughout and the never organization. I that casualty have we when those entire more place will management While now in this sequence proud prepared for been

colleagues of the best the Our beyond company, but in performed communities can HCA of especially the have level those at we expectations any and demonstrated every culture.

hurricanes moving on Medicare along with third to add the Texas third evaluation the to quarter few the in waiver results. Now the of around the a spend reduction quarter quarter, complexity my moments thoughts

However trends if markets, the the trends comparable normalize a we you are affected destruction with in the with of these trends believe in half moment. XXXX, detail first broad some will look and at many to Bill on Sam hurricane the provide of the

to year. $XX.X down increase Adjusted XXXX EBITDA prior quarter. to revenues prior Third contributed billion the Hospitals $X.XXX to million revenues in during $XXX the the the year. in quarter in million approximately increased totalled $XXX X.X% acquired compared billion

$X.XX of were in markets. share hurricanes release unfavourably by quarter by the revenue increased impacted $X.XX estimate As associated in Medicare Georgia, $XX third or diluted or performance to Florida, $XXX Also per million Texas results third Christi, with settlement waiver our Corpus amounts. in million impacted diluted negatively in an approximately for earnings the quarter share per mentioned our $X.XX Canada South losses our

in in same bases the an We same admissions of had somewhat facility equivalent increased unfavourable growth admissions company. year. estimate basis with prior growth. the points admissions equipments with quarter XXXX points XX admissions consecutive points fourteenth the facility XX consistent the basis represents hurricanes the in impact mission As facility that mentioned This increasing volumes basis XX half points and on first earlier growth the of remained same to of improvement XX

facility XX.X% same while year's same XX.X% of comprised Medicare admissions to our quarter. Our and were XX.X% third overall company's managed admissions total admissions XX.X% facility in and priors compared of admissions exchange care the respectively the

share. X.XX we adjusted of have currently noted XXXX. the Waiver XX As we Settlement 'XX for hurricanes range does XXXX. Texas includes for $X.XXX billion for in in EBITDA billion compared $X.XX estimated operations to quarter billion attributed totalled now amounts. of program Cash flow the is in Medicaid Earnings $X.XX diluted preview, per diluted decline our estimated We to income. October third The third impact XXX updated and $X.XXX quarter declines the estimate net range This primarily in guidance the will million to is from per 'XX.

shares and AR to the at billion. quarter. stock million months ended year at million days of the XX share quarter. repurchase days active end and shares XX $XXX increased slightly have of of Our common XXXX, XX.X cost compared end of the X.X second a We in September at XX in days at million We $X.XXX for remain repurchased we with a cost repurchased XX, the nine

XX, has company's announced the $X As remaining approximately program have billion authorize morning, XXXX the the you this new on approved the the program, November board the and for repurchase company announced share company X.XXX share including this authorization that at billion authorization may XXXX seen newly October has repurchase. and

for divestiture acquisition. in Center on close Also X Texas year hospitals close now time X, October update for million. this of closed two a OU The brings Medical more the activity That is hospitals an estimated closed we in Finally, the M&A M&A believe in we to announced activity, approximately quarter to some previously fourth on December which $XXX Rutherford third total the the we previously quarter. Texas with on during seven acquisition announced XXof of pending year. should XXXX

And so, that turn with Bill. the call over to I'll

William Rutherford

I morning on Good to performance everyone. comments for and the and our results Milton's quarter. add third more provide will detail

admissions over equivalent X.X%. year, As our admissions increased admissions prior the we X.X% year. same-facility the Year-to-date are X.X% in quarter, reported increased prior and third over the equivalent same-facility at

As XX admission basis and same-facility Milton hurricanes the points admissions growth noted, by equivalent impacted points. we negatively estimate growth basis by XX

a the also to compared I'll statistics. of you trends give provide In payer will impacted more Sam less business day 'XX some commentary the by moment and third quarter class. volume of addition, a in

Managed During admissions as the in and hurricanes includes Medicare our year. we a surgeries in self-pay emergency service South compared compared compared year-to-date on X.X%. in the period. from and on basis, the Same-facility the are equivalent period in the admissions X.X% ER same our to prior charity the increasing in have the and the prior-year increased X% Same-facility quarter, to represent emergency X.X% X.X% X.X% X.X% acuity quarter. emergency charity room the total period. the increased equivalent X.X% of Medicaid declined our declined visits and X.X% growth room admissions. the last our in same-facility equivalent admissions, admissions represented Year-to-date to reflecting and hurricane impact day, admissions Medicare a basis, On respectively, Carolina increased the These facilities. impact basis same-facility XX.X% admissions X.X% from the prior-year and third Same-facility stated admissions and and increased were year respectively and declined XX.X% we in Georgia, for a up admissions care approximately compared one year, X.X% visits X.X% case third of X.X%, Medicare on admissions XX.X% same-facility quarter our prior quarter, equivalent Intensity in compared declined admissions the declined and from increased release, year-to-date X.X%. other, ER surgeries or basis to adjusted visits compared Florida, had including visits outpatient last business And X.X% X% a X.X% Texas, Medicare year increased and in with to year. same-facility total less of and South period admissions. up quarter, mix same-facility to Managed and prior of basis third exchange admissions a declined to Medicare both the managed room estimate traditional uninsured prior compared estimate quarter. our inpatient year, on the in in XX compared X.X% This quarter total year. prior Same-facility year. quarter. the outpatient point period. of and impact we last our quarter the the same-facility to the hurricanes surgeries quarter When self-pay Same-facility the represent

equivalent the quarter, the During increased prior revenue year. from same-facility X% third admission per

compared in XXXX X.X% the managed to year in increased some and increased equivalent the on strong impact the same-facility care discounts care, $X.XX basis quarter Same-facility comparison from in to year-to-date X.X% quarter the of prior quarter admission other, in recorded the rate totaled compared impacted third the and The surgery hurricane hospital prior prior year. $XXX increase quarter, Our the growth year. million million a revenue charity due X.X% and to lower per Same-facility was growth exchange the by a in an billion the of to care and volume. $XXX charity uninsured period. QX

billion, totaled increase Our over the $X.XXX $XXX an same-facility million year. prior uninsured of discounts

levels trended revenue in uninsured trends. line with uncompensated Our and have our

year's X.X% There quarter it Now, basis. on that compared expense trends difficult in Same-facility more noise quarter. operating affected last per making expenses expense we to increased quarterly is hurricanes expenses. compare a to from of turn to a equivalent lot our third admission the

as Our for of X.X% of reflecting quarter. last points salaries revenue EBITDA to XXX last as year's costs. hurricane the XX.X% third of quarter basis third XX.X% compared Salaries year. was increased equivalent quarter consolidated to per in a third adjusted Same-facility increased to 'XX, related compared the primarily benefits the admission quarter the percent and compared margin

from labor cost year in turnover on increased are pleased basis This last this prior has XX.X% to a year. quarter. Same-facility third year revenue points. XX.X% same-facility supply per seen improvement XX contract increased aligned and we grown and to reduction the in total that We the have sequential our contract labor a basis X.X% a supply admission X.X% for of percent as quarter year in prior equivalent period in the expense nursing over

two in basis increased of supply from percentage improvement to during revenue continue XX third percent Other sequential hurricane primarily reflecting see operating by discussed of and expenses also a a contract year-over-year our fees related of professional XX.X% XXXX. as points last last that revenues to revenue as metric services costs. increases expense year's was We we quarter This in on calls. impacted

billion was billion. flow Year-to-date less operations Cash distributions were from expenditures to under the totaled XXXX. X.XX we $X.XXX our touch and is billion interests Let me December flows XXst X.XX Debt times non-controlling at had times At facilities. cash revolving quarter, $X.XXX $X.XXX cash on briefly XXXX, free cash from flows $X.XXX cash at and the which capital approximately operations, was to from credit compared adjusted December of billion. operations EBITDA end to flow. available flow, XXst, of

Let quarter, consistent third X.X% XX,XXX sequentially. decline and briefly XX,XXX on We pretty track with activity. to health ER activity second to our our compared last in seeing we year speaking the me saw in third reform we what saw quarter. the of quarter same-facility as same-facility In the XX,XXX visits in third of exchange year-over-year been have speak XX,XXX second decline a results for approximately health the approximately quarter we from compared X.X% exchange reform in the the in the about saw for the of year in see and Roman of quarter declined sequentially are with third and XX.X% XXXX quarter 'XX markets. we XX,XXX These a generally admissions the

So, to for over call Sam concludes my turn and comments. additional the that I'll remarks some

Samuel Hazen

for Freestanding volumes of XX both XX in X.X%. XX% declined of North trends in were recovered the I'm of and no admissions X Florida, America, or indications divisions quarter. West adjusted a in and Bill, to Eight and Thank Growth X% and X.X%. Mid most divisions essentially on Central flat. Atlantic same-facilities hospital volumes Far XX compared growth some third our Florida visits was emergency lines. room admissions Surgical in of year. detail impacted again in good some volume provide Gulf Coast were for Coast by by up divisions Once but our markets of West, we had admissions. were believe cardiovascular respectively. divisions of morning conversely strong room divisions Texas of hospital have Trauma and as were divisions lower quarter service in grew going X% room this East issues. surgeries admissions; down and based had and East right. centers. visits EMS basis were especially permanent to well additional the Capitol acuity last On were Inpatient South orthopedic to total Tennessee, seen through emergency growth X had decline Outpatient visits. volumes emergency were the domestic slightly everyone. the XX storms, freestanding inpatient growth room Gulf ambulatory Surgical and down surgeries growth strong the obviously in slightly quarter quarter. grew our divisions visits. weak. while X% by All All had operations, was in our in with and of and XX%, our Seven based surgeries. Florida, you, both the for other were emergency Admissions down surgery grew

less admissions as and the were In to in volume were in summary, of generally adjusting of for admissions year. our down first admissions X.X% Births the effect. have year quarter compared the flat. neonatal X%. with day X%. the the after Cardiology one half grew health business consistent grew hurricanes, volumes estimated X.X%. Behavioral the heading trends essentially were impact last storms Rehab grew We

we my in year, stated most of in believe across has the our last our believe of softer in I over As volumes. the comments most quarter, markets explains moderated we demand general inpatient growth last which

basis market the points data the ended inpatient HCA available, period. months for compared by XXXX, as previous which XX to increased current the share is most March XX For

EBITDA in in this both the $X division. anticipate decline me currency quarter a the and next deliver over we approximately effectively and sustain marketplace improve call last to enhancements me our our and We and for the local market results down for We this Adjusted let the transition few Now, quarters. operations for these improvements performance for London. was million. overall in enhance less represents than us is and continued more in XX% to were quarter better our let This business. compete Overall and our and will refine efforts to continue to growth ultimately value a believe the to With turn company. dynamic physicians, refinements our back Vic. grow that, allow patients dollars and

Victor Campbell

question, that you Thank let's we you, would limit I us? Don, ask one you for themselves opportunity. each questions. Don? to Don, come if are and back give on can everybody with an pull so questioner

Operator

first And you. Lake Today's with Instructions] Yes. we'll [Operator will from conducted be Research. our take question-and-answer electronically. question Justin Wolfe Thank session

Justin Lake

Good Thanks. morning.

the down I as how get of I wanted the that market market to intermediate think that terms market what mentioned we leveraging you stays across described on reasonable view you Thanks. to think EBITDA typical the should X% the today, to think broader X%. X% rate growth of the et company's is your the growth, growth near X% get company in - term? algorithm plus be you to is Sam, to demand would EBITDA cost a it fixed in a growth cetera, call growth think So, share plus If about to inpatient what do in you to for markets. where

Samuel Hazen

point of Let your me start demand on the question.

expected below factors of demand up think overall markets. in X.X% healthcare we drive that growth our that's HCA's markets, other markets XX is available, growing. let XXXX, about for data as I'll still Justin, the grew bit little level most our on a here In some are components. recent of jump Inpatient the in Bill which of for quarter demands markets the first the our services

probably inpatient X.X% X.X% grew demand a overall bit for proxy use that outpatient a demand for about grew as aspects at normalize and leap to X%; If of you some for than growing XXXX we year, faster it that. with little that general about

prospect markets growth HCA's is still good. confident are we So, still in that for the

have grow We demand somewhere that depending south of factors. around believe we that healthcare HCA's to indicated to continue bit bit X%. in going markets a run in be little of services past on the inpatient in It little more, over a the and long could a is number

driving when boomers. things still Our across growth be around and increases diabetes aging other job markets. to the kind growth, market And conditions we demand. utilization then believe going there's belief in the economies, those are baby and at for cancer and solid population obesity, Chronic you HCA's look of growth

So, is constraints. the putting capacity this outpatient to facilities inside high of really investing around We're We're relieving our company ourselves position in adding belief network and a demand. compete at to a level. we're

so, is growth. approach And our volume built around

think to difficult We to period this be had volume growth We've market volume in with year modest modest growth gains. have have a share I successful.

XX For of objectives, market have points volume so XX us to not is that get want be. some to to a little we're up market-specific. to basis our XX, to short we bit pick of we Again share, where

it objective on Milton Some we've EBITDA the let but competitor-specific, in Bill through haul the that and our we a for point our or carry targets position long forward that think a question. on that to are laid ability follow that achieve I'll out. to of is achieve we starting over is obviously

Milton Johnson

X% still Sam I'll expectations Sam, for not to been X% believe just our just organization. Yeah, to sure - long-term EBITDA I've we add echo the that, what I'm in but

new those XXXX XX% markets, markets. economic know, grew. grow these basis to population I our on adding As The acquisitions. of In in We've our composite Good population all attractive you as our the this we in contributing substantial growth. of in mentioned got, a that markets. aging in markets. not markets. including expect roughly years. because earnings making to share of market those the to believe The were we seven acquisitions We're conditions mentioned, seen year, hospitals contribute some in investments capital out Sam

combined had expectation, X% years we've execution, of that EBITDA of confidence us in over where with meet you to growth challenging if this but of going back years under of their a where gives five expectation X%. look in years, a last those things year execution, has we've not record for year the Obviously our team's CAGR X%. that exceeded all guidance we're to been five-year Our track recent long-term just

our again about all thinking long-term goes for HCA. into So, expectations the growth that

Victor Campbell

All right.

Justin, thank you.

Operator

with our of Bank from take America. We'll next question Kevin Fischbeck

Kevin Fischbeck

target? what today Great. There in you Thanks. backdrop get things, less follow want you the about I volume is volumes? it think would below leap doesn't about exclude are heading expect question. long-term likely this on be that a challenging still that and just XXXX you even is better be year it number year. year if improvement you why up a obvious about Would on next do backdrop is but to would What hurricanes, please and why into lot this Maybe obviously coming it the to those market of year to than what to long-term of areas next makes year? seem So, and it versus your

Samuel Hazen

know that in the is a was of four mean we some don't I know. I if in years, about I is same never years. three back three look see each or it again. don't have over you metric this Sam of and four every the what to or answer the those last XXXX. I market judgment This

So, X.X%. one year may may grow X%. grow One year

a you're our a you as markets. if bit if you past development competition have down. certain to at forecasts that the outpatient elements implications we've I but in slowed that that been in get to that call around in looking outpatient arenas as us, there moderated of some some longer saturation of will issue forward for has that on be proxy level it seen in a I said volume reasonable of growth and can so, the run, certain some have last indicated downstream an average seems has And mean over going we've for

that norm one for where normalize So, I this won't to overheated of moderated. I when from studies done, maybe the But think are from the when just market those these believe has it see you past at that bit some look a and factors, my you just years standpoint we position the in it no and move of reasonable we're of yet, provide to particular year. so finalized in about of We really over XXXX two have of you the our guidance growth the three not that be time. don't we some period all the it think in budgets to a this next over to context is if But going years, number. is consistent reason where think X% trending were we cycle somewhere been with that on

Victor Campbell

Thank you, Kevin.

Operator

Frank go next We'll Capital Markets. to Morgan with RBC

Frank Morgan

fourth would then any recovery you to seeing kind between is recovery and recovery, seasonal Good about morning. you're third in first any see color in general appreciate commentary non-hurricane so normal year. hurricane the on the of what us the far could quarter But quarter affected you you're volumes volume the curious affected the of the seeing to any half there just that the Thanks. I related markets? relative I'm volume give difference and

Samuel Hazen

coming the significance I give hurricane. resolve indications the of the any suggest the said gate in as out market, I volumes not I Well, quarter really say the the that Houston the given does Miami, and coming will this. comments, gate out of a fourth able of aversion Sam. be issues, in would permanent but my to can't on which view company the in the quarter, the in gate fourth the

and is. permanent of related last that year, not estimate either in above why was not it Miami So, those damage, we market And it's market tracking any slightly in slightly markets. to Houston but kind below, did in of we two actually are

William Rutherford

they but hurricane command so Columbus you you Right is the know Alright, don't will practice obviously our question. next thank talk you, third as market, that we where over understand quarter, about stand.

Operator

to Ralph Citi. Giacobbe next go with We'll

Ralph Giacobbe

Thanks, to couple up good I quarter is which impacted still home growth, guess. morning, pressures same you've facility we back been Despite to you've revenue X% the put seen first obviously this the sort of able that hurricane, the add back. going by of questions

can there that year, do line the cost make need side whole you in you so, deliver able will or You so do you think amidst level as line haven't trend, X% in you the think are top on that plus next sustained been the X% could EBITDA, to hold you market? really margins things

Samuel Hazen

X% we the maintenance. the take due by waiver the as we'll shared was I Clearly programs element as quarter trans hurricanes, mentioned this we that's the that margin the cost end I think we one came Yeah, you right that, well contribution all sloppy maintenance. think low cover revenue in historically level, from Miami that play. to the will come acquisitions that that margin know the that also our lower and hurricanes. the are anticipate we on awareness, didn't I our into early, that said margin so But, guidelines, still of impacted margin

on that berg be I initiatives various in some we a initiative, through cost work maintain of it track land the which agenda way, will opportunities think our nursing have over. got supply cost to structure; turn success continuing we've continued got of in the we a lot as additional initiatives on the

I a minus So, level, margin anticipate we still X% believe still that the level.

Ralph Giacobbe

Thank you very much

Operator

from question We'll take with next Sheryl our Mizuho. Skolnick

Sheryl Skolnick

make write thank much gentlemen. though, calls we research, don't We very you do

very - hospital this be understand commitment that XXXX said, to hard to we it who to business cared that. the think I fitting still us. probably run going questions can't that So, done was with compassion need over and to work we remember help aren't and times and all year But forget pace in the let quarter and everyone for the people difficult the the first in tribute else of very during

question forward-looking back a So, maybe the different ask strategy. and company's I'll stay about

market. build grow depth The long first best in in market to a share time time hospital quality committed systems the you most you're are integrated, acquisitions, still a doing strongest

haven't a presumably the You've you've invested done and a value time on these on and big basis data day-to-day add creation I we about calls, to which to forward.

terms it year you can outstanding of, you sounds is the the usual could more another like come to there market. frame of us? store Will sounds that strategy, brilliant like and company from play, the or the like to adding to expect are day-to-day, enlighten But, after adding things are from the it so please are what come we've year So, strategy in what pursuing, you the perspective that HCA execution and to next

William Rutherford

And, to been so this we've where more number we our look that long a Sure, they year, you and are We amount certain that have hospitals growth want had we positive term popular the have going should market of acquire opportunities. we hospitals. share in more not we of know comfortable theatrically opportunities market. see our relative into very new to inquisitive demand have company need and markets,

Savannah, said You Worth, us and we are the Jacksonville. children, existing the end Dallas, about in we new opportunity to hospitals to as a the like market. about year, my that, hospitals go San to are close of are markets more Houston, There into excited gives for supplementary comments, of lot our know Fort Savannah in Antonio I've in hope or

those look maybe as pipeline for XX to today years. continue had in will ramp said, really we I is years best We I We the and opportunities. probably or final are good, for XX positions on calls, mean it's last

invested we getting respect Sceptisis, our know utilization of so, started see data our add bit, clinical making and started, care that treatment are anyways another so, saving I in, going see and it up inside difference we and it we primarily it's quality number our something contributing. look making in you the is to to in to getting on quite strategy opportunities, just improve there And lives are of contribution, marked forward. for to With most areas. hospitals, it already continue importantly of but that more we big number like have the the data, flabby Where blood the we the in a ways, interface a see I we But and was way using start there. right in other provides. of is care a we those are

of So, which for as strategy to be in growth contributes overall. that invest continue of And that patients. positions, our from course area great to course our attracts we that well continued all to benefited

our proprietary and information can that is like opportunities for growth all markets. think strategy in our continue I we opportunities, will how we look using that data So, big to continue part to of and freelance that positions Sheryl, leverage growth position the through use also to our

Samuel Hazen

great to perhaps that. directive, chief That's want you you're anything medical add Jon, to

Jon Foster

our for out to enrolled. to thanks heal, sided by improvement the occasionally, that with channel Sure, the using are continuous daily caretakers already cure, guard officially product question rated

better We seen medicine. million keep patient [indiscernible] we Therefore, and XX or used patient give have privilege of also right their going to getting to in them this is to better for generate slice security opportunities the have emergency is the that insight plan. every into encounters business directly year, encounters forwarding XX of a lot room XX operate, and individual outstand intra the now, work data, precision newly efficiency. us protect cure improve But, patient of of the on power into million they minutes of the matching's

You which know, we have unstructured line all. in we to efficiency also matter in them processing happen data, just

spend their it for, to this time got really going the and XX% on to patients, now that's finding our create automatically operational meet cancer of I XX% us provided that it's up learning still improving. they networks efficiency it used improves number of the in in evaluator; question. now the care in effective time Thanks cancer taking [indiscernible] care and some the which So, been system patients to our patients them materialization increase stated, helps our haven't capacity, still cycle of as or for virtually the provide XXX a we've allows what entitled to spend is and we navigation, navigators need. Previously feeding not why

Operator

Tanquilut next with Brian We'll take question Jefferies. our from

Brian Tanquilut

positions good thinking or sustaining growth Hey guys slowing XXXX how that are that stay it focus seems outlook? the that to outgrow to that capital back think you just level, a pushing to about and we're I organic that or about played out. we XXXX, plug re-shifting program the especially annual the CapEx itself? you Is answers contained to you deployment, in first something what So, expect an question from exact to talked be that on guys, given capital growth morning

Samuel Hazen

top Well acquisitions of we on we low I $X for XXXX, and it our the I would that the base I up investment obviously volume have some program, end there, of at been on want for on, continue have some move capital will add thing year- of will to made markets say it have. CapEx the expect this we and expenditure that at bill. the billion what setting year. approximate our hospitals

may do quarters, go will XXXX, investment, proper we have the the in and flexible So, judged more but months beyond we so, coming of continue look as budget through that as amount in are after far floating make investments. capital to our we in as we as commitments

is demand, wait invest, in our we I know, do I expect largely story population and growth you'll year, us continue capital. and organic growth flexibly on see, to again next are beyond but that more with growth respect story but and we we you mentioned markets banked with great we'll see think to as As so

Operator

go next Sanford Lance We to will Bernstein. Wilkes with

Lance Wilkes

that you managed morning increases outlook to related patients. commercial far and XXXX of of cares your and kind to XXXX seeing strategies just as compared know wanted care taking network as Yeah, for what what managed commercial those are rate to then to was good were neuro risk kind in are you

Samuel Hazen

on think this to about company certain almost is our starting the all because to are. we above differently time about the so And reasons round about to XX% At XXXX, of X% for and where little there book are was and business XXXX say in It with business particular number. XX%. pay a XX% to same the XX% our XXXX we bit pricing term into point XX% is trends commercial identical contracted to

in lot So possibly. as neuro a some for I networks But we with general to need changed. taking, say can relates expect it has I not would adjustments pricing about to and respect risk XXXX XXXX the

been development the model. seeing where that neuro inside outside not have are We of we significant network operating exchanges of

a Ourselves pairs movement not as, based the accountable though of in around on of book of is tends the on organizations deeper advantage areas those side. broad as type to such would there at say in that commercial with some other the cure as portfolio of offerings commercial so equation, of penetration our on in levels I those of competitors. things Medicare there our certain such models those and markets number Clearly evolving fronts we there are be business. the side more different within have models on

not are not that term in the some but any across major the movement the XX company would change significant we markets. suggest again across in near So different a structural though seeing term in intermediate markets possibly

Lance Wilkes

Great thank.

Operator

will Baird. Whit Mayo We with next go Robert to

Whit Mayo

entering something is turnover, just am be the Hi, programs what with nurses on to larger a early think into comment on I around these physicians initiatives I kind resources you a like organization think were offering of your of programs. boarding curios are on the comments you may back neuro nurse maybe something you thanks. any Bill, just so company perhaps maybe XXXX the pretty you strategies focus successful larger, years or couple just I ago for have years the

Samuel Hazen

is So Whit this. the same, me take it let

turnover XX points. improved pleased nursing We with - we have turnover are months in XX around really and as we nursing specifically general are XXX nursing are our with basis our where indicated, around we initiatives in Bill by months, about

the a year-over-year third on not actually nursing quarter, of labor our basis. on labor components in in the day for the Our contract contract the labor was nursing spend quarter company contract on

metric tell just for very second further. we I company. head room you, innovation our a checked initiatives the strategy, still are retention an think whole we number So provided idea that will even We nursing we of have in of that encouraged by Milton will down trend. a off drive that

nurses organizational our the nursing are of more care finding company very that in that further to time creating that called environment had with for our the And the ERs, we the technology is the floors bedside And a nursing and leverage in that - this have a from technology on are by robust with a nursing is to is what point. the ORs core capacity company At Part an and nursing company. HCA maybe. on way forth. our few the our so of our We years patients. provide some We improvement, so ultimately acquired is going standardizing believe our case floors we the communicate spend a within differentiate seeing improve example to that that agenda whatever bed part HCA stand we the effective ways allows more to in patients physicians nursing. more in cardiac weight of us with ago effectively CAT lab, [ph] unique nursing can

company nurse with of tell volume. that at nurses I then last pain all up. one through We connected to you that clearly have really work more managers components way working to Milton residency evolved think think in efficient produce is patient a education ultimately We an will this capable as we our force, as outcomes better thing we force being successful deal and work position be. driving on prevent boarding, nurse the moment greater which force in our clinical point more from generating more believe work ago they And programs is indicated more with ongoing want third to got technology the the and component will and rolling particular them

our and of being initiative So very are inside of we think lot resourced improvements facilities. is in a opportunities comprehensively we for our what our is nursing doing there

Whit Mayo

Well, thank you.

Operator

Thank you.

Our BMO Matthew next with Markets. Capital question from Borsch is

Matthew Borsch

- hoping the the impact how Medicare of reimbursement? I those that of think shift we am pointing your strong trend drivers Yeah, from term shift, can very talk think you long I mix just which demographic the to about about is sorry growth versus maybe to do know lower we clearly offset from a the number positive aging the

Victor Campbell

a anybody at to right, swing take that? All

Samuel Hazen

we but be with different and and mix. utilization, between let we Well, coupled have Mat, that as [indiscernible] of about its changes trend markets got the around me year-over-year of through manage terms trend to change materially to I don't side that gain some to in we seen and to have so care higher trying in have a projecting in and commercial governmental just talked strategies seen commercial demographic well overall as managed were that effort shares. what this think commercial

that commercial affairs. under migration governmental it So offsets to yeah, of pending from kind

Matthew Borsch

on still are factor in pace - other in the all said just positive hand kind of you you when - the 'XX Medicare that asking in the left? I that one of that you hand No, trend terms

Samuel Hazen

more the as of continuing those as through imports. clearly going generate to people We utilization aids grows such

commercial profitable market we with maintain than X.X share compensates a believe some demand patients which believe, but that also if you will the the overall we if for A obviously you grow one it forecast inside that continue obviously and grow a positive. margin that won't you but to commercial in to The Medicare baby point we by grow can markets thing will that so demand, think is dilution important demand, picture to comes not still our few side composite we just number, the - is it when continue for So a share then a will other market as our we overall going the markets, will of is I being components stocked of least I trend, demand less if is can that at demand or at point aging be rates we it see and think commercial and overall it's look somewhere grow equation from is rumours that patient. and

all work. we ultimately how about, we to have commercial market our side that's share them grow or maintain think the make So it to on

Matthew Borsch

you. Thank

Samuel Hazen

you. Thank

Operator

We Ana with Gupte Leerink will take next Partners. our question from

Ana Gupte

morning. thanks good Yeah,

how you urgent mix bed markets into urgent a or angulatory care of you is can is do it X%. tonight trends they think visit is down lower they accelerating utilization XX% in their with stay On XX% in how moves normalize, that the factoring get out or things of to optimum saying AD that possible and slowing and and that care care. the hospital admissions heard X% of the deals growth as about I

Samuel Hazen

pretty you this for of the consistent year. give quarter let me give a - a is couple Let same for you the and to this me metrics

our levels has rooms acuity in emergency lower declined X%. Our

it - the low we Our had upper more we end has obviously seeing in have ends. level declines from grown acuity X.X% so we high visits three upper the then levels actually growth

point are emergency upon in room to stepped stand tends visits. room that that and based up be from pricing growing priced so our we Our emergency higher our

production very, seeing our out heard is declines coming We lower, suggest in very the strong. so it if correctly emergency are room still I on way is areas emergency side To It emergency XX% room at revenue be there not put is care, some to acute no for room can happen. there visits too can activity the occur. that possible, into is much that on urgent the

almost and having market very network for a important developing and overall very they they it care a I and setting think have the than situations we care we of as network complimentary the certain in We of a are services. way to broader the in well the do urgent facility for the access think the centres HCA urgent a networking to in emergency patients and are to centers they and across payers market obviously, platform as they to are emergency an to position the important both and are extension up center in room to our better better urgent our place, as very important are XXX is a important very care but to they care are very very complimentary certain place,

place see and markets. much from in our We just trends room trend won't how has to the stabilized not and there so So I market emergency say, other, there is some that the quarters has are where what that the up done. over would gone few difference differences to one within have last that have

there those big be right trends. could in across company that some are the but how broadly places differences are You are,

Ana Gupte

you. Thank

Operator

with Bank. next Rigg will We to Deutsche Chris go

Chris Rigg

morning. good Hi,

Just the ACA explained insured trying in to like you Are Thanks. a same increases, is what not, that seems the if back at sequentially point? or it that volumes to are declining little that play bit quarter. worsened all this in guys on the wanted facility admissions are come of to of most say and dynamics on by

William Rutherford

Bill. this Yeah, is

digits us year-to-date, a to so be in - but jam materially judge So on we that we single in we before have Texas really in a I of we volumes went we keep uninsured as X.X% little anticipated what bit volume high uninsured could XX% stated that think that's don't the and to if X.X% XXXX I jumped reported it's Florida. we made of in run into to quarter, kind as our

drop correlating that are the in to insurance exchange. the health We

and to of uninsured is number I the impact confines level, cost at growing kind think is we level, I we expect, of of I range historical X.X% X% think that remind are that's that the a within the at think overall that's digit guidance. available mid-single seeing the solve underlying expectations that that and that within a you

Victor Campbell

One you question. Thank, last Chris.

Operator

to We Piper Jaffray. James with will go then Sarah

Sarah James

related Can much now admissions done is of you around outpatient markets? think where currently procedures, your So how the of admissions to thanks putting of or the shifting inpatient for context us Hi, in. HCA philosophy in and some much how give some or me the these in for is low in sets ER ER, revenue current revenue acuity?

Samuel Hazen

and commercial than procedures done there businesses from acuity pay of On I X setting point around levels, are the so done all a acuity low a in procedures is of upper To approving be the outpatients, protocols that balance to mean XX% kinds obviously are ER question, our upper little that from of the about ought at roll the side. that I point inpatients setting. to the XX% bit inpatient see all. stand as suggest a the lower as or don't outpatient well and governmental our side stand that is case more the in that as ER on

phenomenon that's there are there activity. there I outpatients. inpatient think tell will So for from up That's that so, out driving source, movement a I to inpatients been also or a is but is that are inner of not really and always technologies it's trend, new decade

that of seen in other service different have aspects vascular lines. care We

the it's at from in judgment. not so services, disrupt goes any inpatient that's of that least our So out or revenue orthopedic inside to of two substantial of revenue overly on seeing patients the trans in unique out these but but aren't to components inpatient anything business, the going stream we stream there always are our accelerate they that's the

Victor Campbell

questions want being on any Sarah, everyone call. right, you. just Have thank the so further to to Mark for All thank you give a feel call. I free Thank much.

Operator

conclude you participation. your does today's for conference. This Thank

disconnect. now You may

HCA Healthcare (HCA) 31 Oct 172017 Q3 Earnings call transcript