Hospital chains may have a rough couple of weeks as third-quarter earnings season begins in earnest for the companies, despite some positive numbers from two of them.
Analysts are especially guarded on chains that primarily operate rural facilities—such as Community Health Systems and Health Management Associates.
On Oct. 25, Brentwood, Tenn.-based LifePoint reported an encouraging 69.9% increase in income from continuing operations, or $32.5 million compared with $19.2 million last year. But patient volume was still weak, declining 4.3% for same-facility admissions.
Nashville-based HCA, meanwhile, previewed that it would deliver higher year-over-year patient volume, revenue and net income. But not every company can perform like HCA, which is the largest hospital operator in the U.S. and has diversified into outpatient service lines and aggressively cut costs to counteract the volume declines.
Universal Health Services reports earnings Tuesday and Community's arrive Wednesday. Tenet Healthcare Corp. and HCA follow on Nov. 4 and Nov. 5. HMA had not yet announced a date last week.
Investors will be on the lookout for deal-related updates, including where Community stands in its bid to acquire HMA, as well as for signals on 2014 contracts with health plans sold on the new insurance exchanges.
Follow Beth Kutscher on Twitter: @MHbkutscher
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