LifePoint Hospitals ended its fourth quarter with strong revenue growth from newly acquired hospitals after closing 2014 with higher revenue and net income growth.
The Brentwood, Tenn.-based health system finished the fourth quarter with revenue up 33%, compared with the same quarter a year ago, at $1.26 billion, but net income declined to $26.7 million, compared with $37.6 million in the fourth quarter the prior year.
For 2014, LifePoint saw revenue go up 22% to $4.48 billion and net income increase 2.3% to $134.9 million.
LifePoint CEO William Carpenter said recently acquired hospitals added $308 million to fourth-quarter revenue, and more deals are expected as the company continues to pursue its strategy to build regional health systems, as it is doing in Michigan, Pennsylvania and Wisconsin. “Our acquisitions pipeline remains active,” Carpenter said. “Building and expanding systems is an important part of our overall strategy.”
LifePoint is expected to close on a deal for its first hospital in Wisconsin during the first half of the year. In October, LifePoint announced a joint venture with Watertown (Wis.) Regional Medical Center.
In Michigan's Upper Peninsula, LifePoint acquired a majority stake in one hospital and owns another under its joint venture with Duke University Health System.
Newly insured patients under the Affordable Care Act, through Medicaid expansion and private health-insurance exchanges boosted the company's earnings before interest, taxes, depreciation and amortization by $12.5 million in the fourth quarter and $45 million for the year.
LifePoint saw fewer uninsured patients in its hospitals and emergency departments. Same-facility admissions for self-pay patients dropped 42% and ED visits for self-pay patients fell 24%. Declines in uninsured patients were more pronounced in states that expanded Medicaid, with self-pay admissions declining 71% in the fourth quarter for such states and self-pay ED visits down 63%.
LifePoint recently acquired four hospitals in Pennsylvania, which has expanded its Medicaid program. Carpenter said he anticipates system expansion in Indiana and Utah. LifePoint will continue to push for expansion in Tennessee, where a senate committee rejected proposed Medicaid expansion earlier this month, he said.
“That was, to say the least, disappointing,” he said. “Not just for LifePoint and other hospital operators here, but for our state. Rural hospitals are essential to the health of our communities and keeping hospitals viable and strong is crucial to a state's health and well-being. Hospitals provide much more than life-saving services, they also help support the economic development in their communities.”
LifePoint said it expects to see health reform contribute $52 million to its earnings before interest, taxes, depreciation and amortization in 2015.
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