Despite facing significant financial setbacks from extreme weather events, HCA Healthcare managed to surpass Wall Street's revenue expectations for the fourth quarter. However, earnings fell short due to substantial costs and lost revenues. The company reported a total revenue of $18.29 billion, marking a 5.7% year-over-year increase. Net income decreased by 10.5%, but after adjustments, it showed a 5.4% rise. The quarter was marred by a $195 million loss from facility sales and a $200 million hit from hurricanes impacting operations in Florida, North Carolina, and Georgia. Despite these challenges, HCA maintained strong fundamentals, with demand for healthcare services remaining robust. For the full year, total revenue grew by 8.7%, reaching $70.6 billion, while net income increased by 9.9%. Looking ahead, HCA projects revenues between $72.8 billion and $75.8 billion for 2025, along with a focus on expanding outpatient networks and addressing policy uncertainties.

Financial Performance Amid Adverse Conditions

HCA Healthcare faced considerable financial turbulence in the fourth quarter, primarily due to severe weather disruptions. Total revenues climbed to $18.29 billion, reflecting a 5.7% growth compared to the previous year. However, net income dipped by 10.5%, though adjusted figures showed a modest 5.4% increase. Significant losses included a $195 million impact from facility sales and a $200 million setback from hurricane damages. These adverse conditions affected patient volumes, causing a decline of 20 to 40 basis points. Despite these challenges, CEO Sam Hazen emphasized the company's strong business fundamentals, noting positive trends in admissions and emergency room visits. Same-facility admissions rose by 3%, and equivalent admissions increased by 3.1%. Inpatient surgeries saw a 2.8% boost, particularly in rehab, obstetrics, and cardiac procedures, while outpatient surgeries declined slightly by 1.3%. Revenue per equivalent admission also improved by 2.9%, aligning with the company's annual projections.

The company's resilience was further demonstrated by its full-year performance. Total revenue reached $70.6 billion, representing an 8.7% increase over the previous year. Net income attributable to HCA grew by 9.9%, totaling $5.76 billion. CFO Mike Marks highlighted that the core operating performance remained robust despite the $250 million impact from hurricanes and other one-time factors. The company's payer mix also stabilized, with managed care admissions rising by 9.2%. Moving forward, HCA has projected revenues between $72.8 billion and $75.8 billion for 2025, anticipating a 3% to 4% growth in equivalent admissions. The company plans to capitalize on reopening facilities like Largo Hospital in Florida, balancing out the economic recovery in affected regions. Additionally, HCA has authorized up to $10 billion in share repurchases and declared a quarterly dividend of $0.72 per share, bolstering investor confidence.

Policy Uncertainty and Strategic Adaptation

HCA Healthcare's leadership addressed several policy uncertainties during the earnings call, focusing on potential impacts from tariffs, immigration policies, and Medicare reimbursement changes. CEO Sam Hazen acknowledged the ongoing challenges posed by tariff announcements, emphasizing the company's proactive approach through fixed-price contracting and supply chain risk assessments. Hazen noted that HCA's group purchasing organization has secured about 70% of supplies with firm pricing for 2025, mitigating immediate risks. On immigration, Hazen stated that the company does not hire undocumented workers, but the broader labor market dynamics could affect staffing. Regarding Medicare outpatient reimbursement cuts, Hazen reiterated HCA's opposition to such measures, advocating for policies that recognize the unique value of fully equipped hospitals.

In response to questions about site-neutral payment legislation, CFO Mike Marks assured investors that HCA's strategy to expand outpatient networks would remain unchanged. The company believes in extending its reach into new communities to enhance patient convenience and integrate facilities into the larger hospital-centric health system. Concerning enhanced Medicaid subsidies, Hazen expressed optimism about working with the Trump administration to extend support beyond 2025. He highlighted the positive outcomes of increased access to care and improved patient satisfaction as key arguments for continued support. Overall, HCA remains committed to navigating policy uncertainties while maintaining its strategic focus on delivering high-quality healthcare services.