LifePoint Health, the smallest publicly traded hospital operator in the U.S., didn't see the same strong admissions growth in the second quarter as two of its larger peers.
Disappointed investors sent shares down more than 2% after the Brentwood, Tenn.-based chain reported earnings results Friday.
Yet LifePoint said it is continuing to see benefits from the Affordable Care Act, and has recent and pending acquisitions that will add about $900 million in annual revenue.
Unlike its peers Universal Health Services and HCA, LifePoint saw a 4.2% decline in same-hospital admissions in the second quarter, or a 1.8% increase, when adjusted for outpatient activity.
Emergency department visits increased 4%, but were offset by a 1.3% decline in surgeries, primarily procedures for lower-acuity conditions, said Leif Murphy, the company's chief financial officer, on an earnings call.
UHS and HCA have an urban focus, while LifePoint's hospitals are in rural areas. Shares of Community Health Systems, which also has a rural focus, were trading down about 1% Friday.
But LifePoint CEO Bill Carpenter expressed optimism about a continued boost from healthcare reform now that the Obama administration has prevailed in the closely-watched King v. Burwell Supreme Court case. States like Utah, where LifePoint has two hospitals, are now reconsidering their opposition to expanding Medicaid eligibility, he said.
“We expect states that were waiting on the sidelines to once again evaluate the opportunity,” Carpenter said on the call.
Healthcare reform added another $1.5 million in LifePoint revenue in the second quarter, bringing the total impact on pre-tax earnings to $15.5 million, which includes both previously uninsured patients and new patients, Murphy said.
The chain saw a 13.5% decrease in self-pay admissions compared with the second quarter of last year, and an 8% decrease in self-pay ED visits.
LifePoint plans to close on two hospital deals later today: Clark Memorial Hospital in Jeffersonville, Ind., and Fleming County Hospital in Flemingsburg, Ky. At the end of August, it also will add Watertown (Wisc.) Regional Medical Center to its operations. The three deals combined will add $300 million in annual net revenue.
In addition, LifePoint has deals pending for St. Francis Hospital in Columbus, Ga., and Providence Hospital in Columbia, S.C., which will add a combined $600 million in revenue.
Because of those additional transactions, LifePoint is now forecasting 2015 revenue in the range of $5.15 billion to $5.25 billion, up from previous expectations of $5.05 billion to $5.15 billion.
However, it also narrowed its forecast for earning per share to a range of $3.75 to $4.06, compared to its previous range of $3.75 to $4.14 per share.
LifePoint reported $46.4 million in net income on $1.3 billion in revenue for the second quarter, compared with $39.1 million in net income on $1 billion in revenue for the year-ago period.