HCA Healthcare's earnings report is expected to be hurt by hospital closures caused by hurricanes Harvey and Irma, losses from debt retirement and by revenue reductions resulting from a Texas Medicaid waiver.
Close to flat admissions across the hospital giant's portfolio also didn't help its performance, with Nashville-based HCA shares trading down more than 2% in after-hours trading.
Preliminary results for the third quarter ended Sept. 30 show total revenue rising 4.1% to $10.7 billion from $10.3 billion in the prior-year quarter, but net income and the closely watched number representing earnings before interest, taxes, depreciation and amortization are expected to fall when final numbers are released Oct. 31.
Net income is expected to drop 31.1% to $426 million from $618 million a year earlier, while EBITDA will fall 9.2% to $1.8 billion from close to $2 billion, according to HCA.
Lost revenue from the hurricanes was estimated to be $140 million—not including any insurance payouts—and HCA lost about $50 million from the Texas Medicaid waiver-related reduction. The Texas Medicaid program is in financial trouble and has cut reimbursement. Debt-retirement related losses totaled $39 million.
The hits to revenue were expected to a degree, though this is a telling indication of how bad the quarter was and how other hospital chains affected by the hurricanes might perform in their forthcoming earnings reports.