Longtime HCA executive Richard Bracken is inheriting control of a company that appears unlikely to stray from its present path as it uses healthy revenue to pay down debt from its massive 2006 privatization.
Bracken, 56, who is already president and chief operating officer of the giant Nashville, Tenn., hospital ownership company, will become chief executive officer of the company on Jan. 1, 2009. Current CEO Jack Bovender Jr., 63, is retiring from HCA at the end of the yearhis second retirement from the company, which today is the nations largest for-profit hospital owner with 161 facilities.
Bovender came out of retirement in 1997 to help guide the company out of scandal and back into a patients first philosophy. Bracken will retain his title as president, while Bovender will stay on for another year as executive board chairman at the 40-year-old company, which was co-founded by Thomas Frist Sr.
HCA is arguably the strongest hospital management company in the country, in a very tough industry, said healthcare analyst Jeff Villwock, a managing partner with Genesis Capital. Dr. Frist Sr. had a saying. Youre doing well by doing good. That changed for a while at HCA. It became a more aggressive culture. But theyve brought it back again. Frist Sr. died in 1998, but son and co-founder Thomas Frist Jr. remains one of the companys largest shareholders.
The companys financial statement for the quarter ended June 30 reported net income of $141 million on revenue of $6.98 billiona revenue increase of 3.7% over the second quarter of 2007.
The company still carries about $27 billion in long-term debt on its books as a result of a then-record-setting $33 billion leveraged buyout in November 2006 that took the company private for the third time since its founding.
Jay Grinney, who left as HCA Eastern Group president four years ago to become president and CEO of HealthSouth Corp., said the companys revenue seemed likely to let executives pay down debt amid an economic downturn. It was obvious that (Frist Jr.) was not about to transfer control of the company to anyone not raised in the HCA culture, Grinney said.