☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 27-3865930 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
One Park Plaza Nashville, Tennessee | 37203 | |
(Address of principal executive offices) | (Zip Code) |
☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Voting common stock, $.01 par value | HCA | New York Stock Exchange |
Class of Common Stock | Outstanding at April 30, 2019 | |
Voting common stock, $.01 par value |
Page of Form 10-Q | |||||||
Part I. | Financial Information | ||||||
Item 1. | Financial Statements (Unaudited): | ||||||
2 | |||||||
3 | |||||||
4 | |||||||
5 | |||||||
6 | |||||||
7 | |||||||
Item 2. | 25 | ||||||
Item 3. | 38 | ||||||
Item 4. | 38 | ||||||
Part II. | |||||||
Item 1. | 38 | ||||||
Item 1A. | 39 | ||||||
Item 2. | 39 | ||||||
Item 6. | 40 | ||||||
41 |
2019 |
2018 |
|||||||
Revenues |
$ |
|
$ |
|
||||
Salaries and benefits |
|
|
||||||
Supplies |
|
|
||||||
Other operating expenses |
|
|
||||||
Equity in earnings of affiliates |
( |
) |
( |
) | ||||
Depreciation and amortization |
|
|
||||||
Interest expense |
|
|
||||||
Losses (gains) on sales of facilities |
|
( |
) | |||||
|
|
|||||||
Income before income taxes |
|
|
||||||
Provision for income taxes |
|
|
||||||
Net income |
1,181 |
|
||||||
Net income attributable to noncontrolling interests |
|
|
||||||
Net income attributable to HCA Healthcare, Inc. |
$ |
|
$ |
|
||||
Per share data: |
||||||||
Basic earnings |
$ |
|
$ |
|
||||
Diluted earnings |
$ |
|
$ |
|
||||
Shares used in earnings per share calculations (in millions): |
||||||||
Basic |
|
|
||||||
Diluted |
|
|
2019 |
2018 |
|||||||
Net income |
$ |
|
$ |
|
||||
Other comprehensive income (loss) before taxes: |
||||||||
Foreign currency translation |
|
|
||||||
Unrealized gains (losses) on
available-for-sale securities |
|
( |
) | |||||
Defined benefit plans |
|
— |
||||||
Pension costs included in salaries and benefits |
|
|
||||||
|
|
|||||||
Change in fair value of derivative financial instruments |
( |
) |
|
|||||
Interest benefits included in interest expense |
( |
) |
|
|||||
( |
) |
|
||||||
Other comprehensive income before taxes |
|
|
||||||
Income taxes related to other comprehensive income items |
|
|
||||||
Other comprehensive income |
|
|
||||||
Comprehensive income |
|
|
||||||
Comprehensive income attributable to noncontrolling interests |
|
|
||||||
Comprehensive income attributable to HCA Healthcare, Inc. |
$ |
|
$ |
|
||||
March 31, 2019 | December 31, 2018 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Accounts receivable | ||||||||
Inventories | ||||||||
Other | ||||||||
Property and equipment, at cost | ||||||||
Accumulated depreciation | ( | ) | ( | ) | ||||
21,128 | ||||||||
Investments of insurance subsidiaries | ||||||||
Investments in and advances to affiliates | 246 | |||||||
Goodwill and other intangible assets | ||||||||
Right-of-use operating lease assets | 1,812 | — | ||||||
Other | ||||||||
$ | $ | |||||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | $ | ||||||
Accrued salaries | ||||||||
Other accrued expenses | ||||||||
Long-term debt due within one year | ||||||||
Long-term debt, less net debt issuance costs of $ | 31,019 | |||||||
Professional liability risks | ||||||||
Right-of-use operating lease obligations | — | |||||||
Income taxes and other liabilities | 1,277 | |||||||
Stockholders’ deficit: | ||||||||
Common stock $ | ||||||||
Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
Retained deficit | ( | ) | ( | ) | ||||
Stockholders’ deficit attributable to HCA Healthcare, Inc. | ( | ) | ( | ) | ||||
Noncontrolling interests | ||||||||
( | ) | ( | ) | |||||
$ | $ | |||||||
Equity (Deficit) Attributable to HCA Healthcare, Inc. |
Equity Attributable to Noncontrolling Interests |
Total |
|||||||||||||||||||||||||||
Common Stock |
Capital in Excess of Par Value |
Accumulated Other Comprehensive Loss |
Retained Deficit |
||||||||||||||||||||||||||
Shares (in millions) |
Par Value |
||||||||||||||||||||||||||||
Balances, December 31, 2017 |
|
$ |
|
$ |
— |
$ |
( |
) | $ |
( |
) | $ |
|
$ |
( |
) | |||||||||||||
Comprehensive income |
|
|
|
|
|||||||||||||||||||||||||
Repurchase of common stock |
( |
) |
|
( |
) |
( |
) | ||||||||||||||||||||||
Share-based benefit plans |
|
( |
) |
( |
) | ||||||||||||||||||||||||
Cash dividends declared ($ |
( |
) |
( |
) | |||||||||||||||||||||||||
Distributions |
( |
) |
( |
) | |||||||||||||||||||||||||
Other |
( |
) |
( |
) | |||||||||||||||||||||||||
Balances, March 31, 2018 |
|
|
— |
( |
) |
( |
) |
|
( |
) | |||||||||||||||||||
Comprehensive income |
( |
) |
|
|
|
||||||||||||||||||||||||
Repurchase of common stock |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) | |||||||||||||||||||
Share-based benefit plans |
|
|
|
||||||||||||||||||||||||||
Cash dividends declared ($ |
( |
) |
( |
) | |||||||||||||||||||||||||
Distributions |
( |
) |
( |
) | |||||||||||||||||||||||||
Other |
( |
) |
|
( |
) | ||||||||||||||||||||||||
Balances, June 30, 2018 |
|
|
— |
( |
) |
( |
) |
|
( |
) | |||||||||||||||||||
Comprehensive income |
( |
) |
|
|
|
||||||||||||||||||||||||
Repurchase of common stock |
( |
) |
( |
) |
( |
) |
( |
) | |||||||||||||||||||||
Share-based benefit plans |
|
|
|
||||||||||||||||||||||||||
Cash dividends declared ($ |
( |
) |
( |
) | |||||||||||||||||||||||||
Distributions |
( |
) |
( |
) | |||||||||||||||||||||||||
Other |
|
|
|
||||||||||||||||||||||||||
Balances, September 30, 2018 |
|
|
— |
( |
) |
( |
) |
|
( |
) | |||||||||||||||||||
Comprehensive income |
( |
) |
|
|
|
||||||||||||||||||||||||
Repurchase of common stock |
( |
) |
( |
) |
( |
) |
( |
) | |||||||||||||||||||||
Share-based benefit plans |
|
|
|
||||||||||||||||||||||||||
Cash dividends declared ($ |
( |
) |
( |
) | |||||||||||||||||||||||||
Distributions |
( |
) |
( |
) | |||||||||||||||||||||||||
Reclassification of stranded tax effects |
( |
) |
|
— |
|||||||||||||||||||||||||
Other |
( |
) |
|
|
|||||||||||||||||||||||||
Balances, December 31, 2018 |
|
|
— |
( |
) |
( |
) |
|
( |
) | |||||||||||||||||||
Comprehensive income |
|
|
|
|
|||||||||||||||||||||||||
Repurchase of common stock |
( |
) |
|
( |
) |
( |
) | ||||||||||||||||||||||
Share-based benefit plans |
|
( |
) |
( |
) | ||||||||||||||||||||||||
Cash dividends declared ($ |
( |
) |
( |
) | |||||||||||||||||||||||||
Distributions |
( |
) |
( |
) | |||||||||||||||||||||||||
Other |
( |
) |
|
|
|||||||||||||||||||||||||
Balances, March 31, 2019 |
|
$ |
|
$ |
— |
$ |
( |
) |
$ |
( |
) |
$ |
|
$ |
(2,255 |
) |
|||||||||||||
2019 | 2018 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | $ | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Decrease in cash from operating assets and liabilities: | ||||||||
Accounts receivable | ( | ) | ( | ) | ||||
Inventories and other assets | ( | ) | ( | ) | ||||
Accounts payable and accrued expenses | ( | ) | ( | ) | ||||
Depreciation and amortization | 619 | |||||||
Income taxes | ||||||||
Losses (gains) on sales of facilities | ( | ) | ||||||
Amortization of debt issuance costs | ||||||||
Share-based compensation | ||||||||
Other | 28 | |||||||
Net cash provided by operating activities | ||||||||
Cash flows from investing activities: | ||||||||
Purchase of property and equipment | ( | ) | ( | ) | ||||
Acquisition of hospitals and health care entities | (1,474 | ) | ( | ) | ||||
Disposal of hospitals and health care entities | ||||||||
Change in investments | ||||||||
Other | ( | ) | ||||||
Net cash used in investing activities | ( | ) | ( | ) | ||||
Cash flows from financing activities: | ||||||||
Issuances of long-term debt | — | |||||||
Net change in revolving bank credit facilities | ||||||||
Repayment of long-term debt | ( | ) | ( | ) | ||||
Distributions to noncontrolling interests | (136 | ) | ( | ) | ||||
Payment of debt issuance costs | ( | ) | ( | ) | ||||
Payment of cash dividends | ( | ) | ( | ) | ||||
Repurchases of common stock | ( | ) | ( | ) | ||||
Other | ( | ) | ( | ) | ||||
Net cash provided by (used in) financing activities | ( | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents | ||||||||
Change in cash and cash equivalents | 29 | |||||||
Cash and cash equivalents at beginning of period | ||||||||
Cash and cash equivalents at end of period | $ | $ | ||||||
Interest payments | $ | $ | ||||||
Income tax payments, net | $ | $ |
2019 |
Ratio |
2018 |
Ratio |
|||||||||||||
Medicare |
$ |
|
|
% |
$ |
|
|
% | ||||||||
Managed Medicare |
|
|
|
|
||||||||||||
Medicaid |
|
|
|
|
||||||||||||
Managed Medicaid |
|
|
|
|
||||||||||||
Managed care and insurers |
|
|
|
|
||||||||||||
International (managed care and insurers) |
|
|
|
|
||||||||||||
Other |
|
|
|
|
||||||||||||
Revenues |
$ |
|
|
% |
$ |
|
|
% | ||||||||
2019 |
2018 |
|||||||
Patient care costs (salaries and benefits, supplies, other operating expenses and depreciation and amortization)
|
$ |
|
$ |
|
||||
Cost-to-charges ratio (patient care costs as percentage of gross patient charges)
|
|
% |
|
% | ||||
Total uncompensated care
|
$ |
|
$ |
|
||||
Multiply by the cost-to-charges ratio
|
|
% |
|
% | ||||
Estimated cost of total uncompensated care
|
$ |
|
$ |
|
||||
2019 |
2018 |
|||||||
Net income attributable to HCA Healthcare, Inc. |
$ |
|
$ |
|
||||
Weighted average common shares outstanding |
|
|
||||||
Effect of dilutive incremental shares |
|
|
||||||
Shares used for diluted earnings per share |
|
|
||||||
Earnings per share: |
||||||||
Basic earnings |
$ |
|
$ |
|
||||
Diluted earnings |
$ |
|
$ |
|
March 31, 2019 |
|||||||||||||||||
Amortized Cost |
Unrealized Amounts |
Fair Value |
|||||||||||||||
Gains |
Losses |
||||||||||||||||
Debt securities |
$ |
|
$ |
|
$ |
— |
$ |
|
|||||||||
Money market funds and other |
|
— |
— |
|
|||||||||||||
$ |
|
$ |
|
$ |
— |
|
|||||||||||
Amounts classified as current assets |
( |
) |
|||||||||||||||
Investment carrying value |
$ |
|
|||||||||||||||
December 31, 2018 |
|||||||||||||||||
Amortized Cost |
Unrealized Amounts |
Fair Value |
|||||||||||||||
Gains |
Losses |
||||||||||||||||
Debt securities |
$ |
|
$ |
|
$ |
( |
) | $ |
|
||||||||
Money market funds and other |
|
— |
— |
|
|||||||||||||
$ |
|
$ |
|