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Exploring HCA Holdings’ operating expenses
With solutions such as flexible staffing and optimal group purchasing provided by Parallon, HCA Holdings has better operating margins as compared to its peers.
As a result of high operating performance, despite high debt levels, HCA Holdings stock is expected to perform better than most of its industry peers.
Despite having negative equity, HCA Holdings is backed by strong operational performance and debt-to-EBITDA figures, which are among the lowest in the industry.
HCA Holdings uses advanced staffing solutions such as creating a centralized float pool of nurses instead of directly hiring nurses for different facilities.
The ACA is expected to reduce the bad debt expense of hospitals by approximately $5.7 billion in 2014.
Of the healthcare providers that paid penalties, HCA Holdings (HCA) paid the highest amount in penalties, amounting to about $1.7 billion.
HCA Holdings earns about 50% of revenues from facilities in Florida and Texas, which have high levels of uninsured populations at 22.1% and 20.1%, respectively.
HITECH specifies certain criteria that must be satisfied to qualify as a “meaningful use” of electronic health record technology.
HCA Holdings is capturing market share in the $15 billion urgent care clinic market field by focusing on acquiring or opening standalone urgent care clinics.
With staff trained in emergency medicine and leading-edge technology, the company has been able to reduce its patients’ waiting time.
HCA focused on increasing its footprint in high-margin specialty services such as cardiology, neurology, behavioral health, and oncology.
With managed care forming a substantial portion of total revenues, entering contracts with favorable payment rates becomes an essential HCA business strategy.
CMS worked to reduce cases of inaccurate payments, resulting from upcoding or misreporting the severity of the ailments to obtain higher reimbursements.
As private hospitals treat higher numbers of indigent patients, public hospitals have available funds that were previously devoted to these patients.
HCA Holdings’ growth is mainly attributed to the improved quality of services and the company’s market leader position.
HCA Holdings’ diversified suite of services enables it to retain patients at their facilities, which bolsters revenues per patient.
Passive investments account for more than 56% of HCA Holdings’ total ownership structure.
HCA Holdings went private in 1988 through a leveraged buyout, but it again became a public company in 1992.
The resulting best EV/best EBITDA declined only slightly, indicating that analyst estimates about future company earnings remain strong. Despite this performance, the company’s share price began to drop on November 7, 2014.
The company acquires hospitals to create regional networks, especially in states where more of the population is uninsured. By positioning itself to be the network provider in under-penetrated markets, the company can earn higher revenues.