HCA Healthcare has bold growth plans to take market share.
The for-profit system is investing billions of dollars to expand its physical footprint across service lines. As of Aug. 31, the company had $5.3 billion in approved capital projects set to be completed in the next two years, ranging from renovations of existing facilities to new hospitals and outpatient locations, Chief Operating Officer Jon Foster said Thursday during HCA's investor day conference.
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HCA spent $1.15 billion on capital projects in the third quarter, bringing the year-to-date total to about $3.6 billion. It plans to spend another $1 billion by year's end. The company spent $4.2 billion in 2022.
A key part of HCA's growth strategy is adding hospitals in existing markets. This year HCA has opened the 54-bed Methodist Hospital Landmark in San Antonio, Texas, and acquired the 86-bed Methodist Hospital Hill Country in Fredericksburg, Texas. Earlier this year, HCA bought land for hospitals in Las Vegas and Salt Lake City. Other big players in those markets include Intermountain Health, CommonSpirit Health and Tenet Healthcare.
"Where you compete is just as important as how you compete," said Samuel Hazen, CEO for HCA. "For us, to be successful, we have to build networks that have local scale, they have to have local scope of services in facilities, and we have to integrate them into a cohesive network."
HCA, which reported roughly $60 billion in 2022 revenue, is already a top provider in large markets such as Austin, Texas, Denver and Nashville, Tennessee, where it is headquartered. The health system holds the No. 1 or No. 2 spot for inpatient market share in about 80% of the markets it serves, Foster said.
Foster said HCA operates 12 outpatient locations for every hospital. He expects that to "easily" grow to 20 outpatient locations in the next few years.
"We're meeting patients where they want to be served. We're making it convenient for them and offering them a broad range of clinical services, so they don't need to seek care outside of our local networks," he said.
HCA also is spending more on emergency services, adding more than 100 freestanding emergency departments in the last decade, said Richard Hammett, president of HCA's Atlantic Group, which oversees 62 hospitals in five states. Another 51 freestanding emergency departments are under development, he said.
In May, HCA announced its plan to acquire 41 urgent care centers in Texas from FastMed.
Executives say technology will be another growth engine for the company.
Dr. Michael Schlosser, senior vice president of care transformation and innovation, called technology use in care delivery an "ocean of opportunity." HCA is transitioning to the Meditech Expanse electronic health record platform, a cloud-based program that will help standardize workflow and data collection, he said. HCA has implemented the platform in four hospitals.
HCA is working with Google Cloud to use generative AI for clinical documentation. The health system also plans to implement AI in the shift hand-off and patient discharge processes.
