10 unchanged sentences
measures we are taking to respond to the COVID-19
−Removed: the impact and terms of government and administrative regulation and stimulus (including the Families First Coronavirus Response Act, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act, the Paycheck Protection Program and Health Care Enhancement Act, the Consolidated Appropriations Act, 2021, the American Rescue Plan Act of 2021 and other enacted and potential future legislation);
+Added: the impact and terms of government and administrative regulation and stimulus (including the Families First Coronavirus Response Act, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, the Paycheck Protection Program and Health Care Enhancement Act, the Consolidated Appropriations Act, 2021, the American Rescue Plan Act of 2021 and other enacted and potential future legislation) and whether such programs continue or new similar programs are enacted in the future;
changes in revenues due to declining patient volumes, changes in payer mix and deteriorating macroeconomic conditions (including increases in uninsured and underinsured patients);
potential increased expenses related to labor, supply chain or other expenditures;
−Removed: workforce disruptions;
+Added: workforce disruptions, including the impact of any current or future vaccine mandates;
supply shortages and disruptions;
2 unchanged sentences
pandemic, (4) the effects related to the implementation of sequestration spending reductions required under the Budget Control Act of 2011, related legislation extending these reductions, and those required under the Pay-As-You-Go
−Removed: Act of 2010 (“PAYGO Act”) as a result of the federal budget deficit impact of the American Rescue Plan Act of 2021, and the potential for future deficit reduction legislation that may alter these spending reductions, which include cuts to Medicare payments, or create additional spending reductions, (5) increases in the amount and risk of collectability of uninsured accounts and deductibles and copayment amounts for insured accounts, (6) the ability to achieve operating and financial targets, and attain expected levels of patient volumes and control the costs of providing services, (7) possible changes in Medicare, Medicaid and other state programs, including Medicaid supplemental payment programs or Medicaid waiver programs, that may impact reimbursements to health care providers and insurers and the size of the uninsured or underinsured population, (8) the highly competitive nature of the health care business, (9) changes in service mix, revenue mix and surgical volumes, including potential declines in the population covered under third-party payer agreements, the ability to enter into and renew third-party payer provider agreements on acceptable terms and the impact of consumer-driven health plans and physician utilization trends and practices, (10) the efforts of health insurers, health care providers, large employer groups and others to contain health care costs, (11) the outcome of our continuing efforts to monitor, maintain and comply with appropriate laws, regulations, policies and procedures, (12) increases in wages and the ability to attract and retain qualified management and personnel, including affiliated physicians, nurses and medical and
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
+Added: Act of 2010 (“PAYGO Act”) as a result of the federal budget deficit impact of the American Rescue Plan Act of 2021, and the potential for future deficit reduction legislation that may alter these spending reductions, which include cuts to Medicare payments, or create additional spending reductions, (5) increases in the amount and risk of collectability of uninsured accounts and deductibles and copayment amounts for insured accounts, (6) the ability to achieve operating and financial targets, and attain expected levels of patient volumes and control the costs of providing services, (7) possible changes in Medicare, Medicaid and other state programs, including Medicaid supplemental payment programs or Medicaid waiver programs, that may impact reimbursements to health care providers and insurers and the size of the uninsured or underinsured population, (8) the highly competitive nature of the health care business, (9) changes in service mix, revenue mix and surgical volumes, including potential declines in the population covered under third-party payer agreements, the ability to enter into and renew third-party payer provider agreements on acceptable terms and the impact of consumer-driven health plans and physician utilization trends and practices, (10) the efforts of health insurers, health care providers, large employer groups and others to contain health care costs, (11) the outcome of our continuing efforts to monitor, maintain and comply with appropriate laws, regulations, policies and procedures, (12) increases in wages and the ability to attract and retain qualified management and personnel, including affiliated physicians, nurses and medical
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF (Continued)
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Forward-Looking Statements (continued)
−Removed: technical support personnel, (13) the availability and terms of capital to fund the expansion of our business and improvements to our existing facilities, (14) changes in accounting practices, (15) changes in general economic conditions nationally and regionally in our markets, including economic and business conditions (and the impact thereof on the economy, financial markets and banking industry) resulting from the COVID-19
+Added: and technical support personnel, (13) the availability and terms of capital to fund the expansion of our business and improvements to our existing facilities, (14) changes in accounting practices, (15) changes in general economic conditions nationally and regionally in our markets, including inflation and economic and business conditions (and the impact thereof on the economy, financial markets and banking industry) resulting from the COVID-19
pandemic, (16) the emergence of and effects related to other pandemics, epidemics and infectious diseases, (17) future divestitures which may result in charges and possible impairments of long-lived assets, (18) changes in business strategy or development plans, (19) delays in receiving payments for services provided, (20) the outcome of pending and any future tax audits, disputes and litigation associated with our tax positions, (21) potential adverse impact of known and unknown government investigations, litigation and other claims that may be made against us, (22) the impact of potential cybersecurity incidents or security breaches, (23) our ongoing ability to demonstrate meaningful use of certified electronic health record (“EHR”) technology and the impact of interoperability requirements, (24) the impact of natural disasters, such as hurricanes and floods, or similar events beyond our control, (25) changes in the U.S.
6 unchanged sentences
as a global pandemic.
−Removed: Patient volumes and the related revenues for most of our services were significantly impacted during the latter portion of the first quarter and the first half of the second quarter of 2020 and have continued to be impacted in 2021 as various policies were implemented by federal, state and local governments in response to the COVID-19
+Added: Patient volumes and the related revenues for most of our services were significantly impacted during the latter portion of the first quarter and the first half of the second quarter of 2020 and have continued to be impacted as various policies were implemented by federal, state and local governments in response to the COVID-19
During the second quarter of 2021, our patient volumes experienced a strong rebound as the effects of the pandemic moderated and certain pandemic-related restrictions and policies were eased.
+Added: During the third quarter of 2021, our patient volumes remained strong, with the exception of inpatient surgeries, and included a resurgence of COVID-19
+Added: Inpatient surgery volumes were constrained during the quarter as capacity was used to treat the surge of COVID-19 patients.
We believe the extent of the COVID-19
1 unchanged sentence
Because of these uncertainties, we cannot estimate how long or to what extent the pandemic will impact our operations.
−Removed: Second Quarter 2021 Operations Summary
−Removed: Revenues increased to $14.435 billion in the second quarter of 2021 from $11.068 billion in the second quarter of 2020.
+Added: Third Quarter 2021 Operations Summary
+Added: Revenues increased to $15.276 billion in the third quarter of 2021 from $13.311 billion in the third quarter of 2020.
Net income attributable to HCA Healthcare, Inc.
−Removed: totaled $1.450 billion, or $4.36 per diluted share, for the quarter ended June 30, 2021, compared to $1.079 billion, or $3.16 per diluted share, for the quarter ended June 30, 2020.
−Removed: Revenues for the second quarter of 2021 include $33 million, or $0.07 per diluted share, related to the settlement of Medicare outlier calculations for prior periods.
−Removed: Second quarter results for 2021 and 2020 include gains on sales of facilities of $8 million, or $0.02 per diluted share, and losses on sales of facilities of $27 million, or $0.07 per diluted share, respectively.
−Removed: Second quarter results for 2021 include losses on retirement of debt of $12 million, or $0.03 per diluted share.
−Removed: Second quarter results for 2020 include $822 million ($590 million net of tax), or $1.73 per diluted share, of government stimulus income related to general distribution Provider Relief Funds (“PRFs”) and $60 million, or $0.13 per diluted share, of employee retention payroll tax credits, both as provided for by the CARES Act.
−Removed: During October 2020, we announced we
+Added: totaled $2.269 billion, or $7.00 per diluted share, for the quarter ended September 30, 2021, compared to $668 million, or $1.95 per diluted share, for the quarter ended September 30, 2020.
+Added: Third quarter results for 2021 and 2020 include gains on sales of facilities of $1.047 billion, or $2.43 per diluted share, and $14 million, or $0.03 per diluted share, respectively.
+Added: Third quarter results for 2020 include the reversal of $822 million, or $1.72 per diluted share, of government stimulus income recorded in the second quarter of 2020 related to general distribution Provider Relief Funds (“PRFs”) established by the CARES Act.
+Added: During October 2020, we announced we would return, or repay early, our share of the PRFs of approximately $1.6 billion and approximately $4.4 billion in Medicare accelerated payments (repaid during
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Second Quarter 2021 Operations Summary (continued)
−Removed: would return, or repay early, our share of the PRFs of approximately $1.6 billion and approximately $4.4 billion in Medicare accelerated payments (repaid during the fourth quarter of 2020).
−Removed: In the third quarter of 2020, we reversed the $822 million of government stimulus income that we recognized during the second quarter of 2020.
+Added: Third Quarter 2021 Operations Summary (continued)
+Added: the fourth quarter of 2020).
All “per diluted share” disclosures are based upon amounts net of the applicable income taxes.
−Removed: Shares used for diluted earnings per share were 332.613 million shares for the quarter ended June 30, 2021 and 341.599 million shares for the quarter ended June 30, 2020.
−Removed: During 2020 and the first six months of 2021, we repurchased 3.287 million shares and 19.738 million shares, respectively, of our common stock.
−Removed: Revenues increased 30.4% on a consolidated basis and 30.1% on a same facility basis for the quarter ended June 30, 2021, compared to the quarter ended June 30, 2020.
+Added: Shares used for diluted earnings per share were 324.029 million shares for the quarter ended September 30, 2021 and 343.346 million shares for the quarter ended September 30, 2020.
+Added: During the first nine months of 2021, we repurchased 29.343 million shares of our common stock.
+Added: Revenues increased 14.8% on a consolidated basis and 15.0% on a same facility basis for the quarter ended September 30, 2021, compared to the quarter ended September 30, 2020.
The increase in consolidated revenues can be primarily attributed to the combined impact of a 5.9% increase in revenue per equivalent admission and a 8.4% increase in equivalent admissions.
The same facility revenues increase primarily resulted from the combined impact of a 5.2% increase in same facility revenue per equivalent admission and a 9.3% increase in same facility equivalent admissions.
−Removed: During the quarter ended June 30, 2021, consolidated admissions and same facility admissions both increased 17.5% compared to the quarter ended June 30, 2020.
−Removed: Surgeries increased 37.7% on a consolidated basis and 37.1% on a same facility basis during the quarter ended June 30, 2021, compared to the quarter ended June 30, 2020.
−Removed: Emergency department visits increased 40.4% and 40.5% on a consolidated basis and on a same facility basis, respectively, during the quarter ended June 30, 2021, compared to the quarter ended June 30, 2020.
−Removed: Consolidated and same facility uninsured admissions both increased 6.6% for the quarter ended June 30, 2021, compared to the quarter ended June 30, 2020.
−Removed: During the second quarter of 2021, our patient volumes experienced a strong rebound as the effects of the pandemic moderated and certain pandemic-related restrictions and policies were eased.
−Removed: Cash flows from operating activities declined $6.472 billion, from $8.723 billion for the second quarter of 2020 to $2.251 billion for the second quarter of 2021.
−Removed: The $8.723 billion of cash flows from operating activities in the second quarter of 2020 included the $822 million of government stimulus income and $4.999 billion of contract liabilities-deferred revenues (primarily related to the Medicare accelerated payments), which were reversed during the third and fourth quarters of 2020, respectively.
−Removed: The decline in cash provided by operating activities also included the net impact of negative changes in working capital items of $1.242 billion, primarily related to an increase in accounts receivable, and income taxes of $579 million, offset by an increase in net income, excluding the government stimulus income, of $1.094 billion.
+Added: During the quarter ended September 30, 2021, consolidated admissions increased 5.9% and same facility admissions increased 6.8% compared to the quarter ended September 30, 2020.
+Added: Surgeries increased 2.6% on a consolidated basis and 2.3% on a same facility basis during the quarter ended September 30, 2021, compared to the quarter ended September 30, 2020.
+Added: Emergency department visits increased 28.9% on a consolidated basis and 31.2% on a same facility basis during the quarter ended September 30, 2021, compared to the quarter ended September 30, 2020.
+Added: Consolidated and same facility uninsured admissions increased 0.7% and 1.2%, respectively, for the quarter ended September 30, 2021, compared to the quarter ended September 30, 2020.
+Added: Cash flows from operating activities declined $440 million, from $2.717 billion for the third quarter of 2020 to $2.277 billion for the third quarter of 2021.
+Added: The decline in cash provided by operating activities was primarily related to the net impact of negative changes in working capital items of $797 million, primarily related to an increase in accounts receivable, offset by a $269 million increase in net income, excluding the government stimulus income reversal and gains on sales of facilities.
Results of Operations
5 unchanged sentences
The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, Medicaid, managed care health plans and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payers.
−Removed: The payment arrangements with third-party payers for the services
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Results of Operations (continued)
−Removed: Revenue/Volume Trends (continued)
−Removed: we provide to the related patients typically specify payments at amounts less than our standard charges.
+Added: The payment arrangements with third-party payers for the services we provide to the related patients typically specify payments at amounts less than our standard charges.
Medicare generally pays for inpatient and outpatient services at prospectively determined rates based on clinical, diagnostic and other factors.
2 unchanged sentences
Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in managed care contractual terms resulting from contract renegotiations and renewals.
−Removed: Revenues increased 30.4% from $11.068 billion in the second quarter of 2020 to $14.435 billion in the second quarter of 2021.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF (Continued)
+Added: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Results of Operations (continued)
+Added: Revenue/Volume Trends (continued)
+Added: Revenues increased 14.8% from $13.311 billion in the third quarter of 2020 to $15.276 billion in the third quarter of 2021.
Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers.
6 unchanged sentences
Because we do not pursue collection of amounts determined to qualify as charity care, they are not reported in revenues.
−Removed: Our revenues by primary third-party payer classification and other (including uninsured patients) for the quarters and six months ended June 30, 2021 and 2020 are summarized in the following table (dollars in millions):
+Added: Our revenues by primary third-party payer classification and other (including uninsured patients) for the quarters and nine months ended September 30, 2021 and 2020 are summarized in the following table (dollars in millions):
Managed Medicare
10 unchanged sentences
Revenue/Volume Trends (continued)
−Removed: Consolidated and same facility revenue per equivalent admission increased 2.9% and 2.6%, respectively, in the second quarter of 2021, compared to the second quarter of 2020.
−Removed: Consolidated and same facility equivalent admissions increased 26.7% and 26.8%, respectively, in the second quarter of 2021, compared to the second quarter of 2020.
−Removed: Consolidated and same facility outpatient surgeries increased 53.4% and 52.5%, respectively, in the second quarter of 2021, compared to the second quarter of 2020.
−Removed: Consolidated and same facility inpatient surgeries increased 15.1% and 15.0%, respectively, in the second quarter of 2021, compared to the second quarter of 2020.
−Removed: Consolidated and same facility emergency department visits increased 40.4% and 40.5%, respectively, in the second quarter of 2021, compared to the second quarter of 2020.
−Removed: During the second quarter of 2021, our patient volumes experienced a strong recovery as the effects of the pandemic moderated and certain pandemic-related restrictions and policies were eased.
+Added: Consolidated and same facility revenue per equivalent admission increased 5.9% and 5.2%, respectively, in the third quarter of 2021, compared to the third quarter of 2020.
+Added: Consolidated and same facility equivalent admissions increased 8.4% and 9.3%, respectively, in the third quarter of 2021, compared to the third quarter of 2020.
+Added: Consolidated and same facility outpatient surgeries increased 7.2% and 6.4%, respectively, in the third quarter of 2021, compared to the third quarter of 2020.
+Added: Consolidated and same facility inpatient surgeries declined 5.3% and 4.9%, respectively, in the third quarter of 2021, compared to the third quarter of 2020.
+Added: Consolidated and same facility emergency department visits increased 28.9% and 31.2%, respectively, in the third quarter of 2021, compared to the third quarter of 2020.
To quantify the total impact of the trends related to uninsured patient accounts, we believe it is beneficial to view total uncompensated care, which is comprised of charity care, uninsured discounts and implicit price concessions.
−Removed: A summary of the estimated cost of total uncompensated care for the quarters and six months ended June 30, 2021 and 2020 follows (dollars in millions):
+Added: A summary of the estimated cost of total uncompensated care for the quarters and nine months ended September 30, 2021 and 2020 follows (dollars in millions):
Patient care costs (salaries and benefits, supplies, other operating expenses and depreciation and amortization)
4 unchanged sentences
Estimated cost of total uncompensated care
−Removed: Same facility uninsured admissions increased by 2,596 admissions, or 6.6%, in the second quarter of 2021 compared to the second quarter of 2020.
+Added: Same facility uninsured admissions increased by 463 admissions, or 1.2%, in the third quarter of 2021 compared to the third quarter of 2020.
+Added: Same facility uninsured admissions increased 6.6% in the second quarter of 2021 compared to the second quarter of 2020.
Same facility uninsured admissions declined 15.7% in the first quarter of 2021 compared to the first quarter of 2020.
2 unchanged sentences
and the resulting classification of those patients as an insured admission, as well as general declines in patient volumes resulting from the pandemic’s impact on our operations.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
Revenue/Volume Trends (continued)
−Removed: The approximate percentages of our admissions related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers and the uninsured for the quarters and six months ended June 30, 2021 and 2020 are set forth in the following table.
+Added: The approximate percentages of our admissions related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers and the uninsured for the quarters and nine months ended September 30, 2021 and 2020 are set forth in the following table.
Managed Medicare
1 unchanged sentence
Managed care and insurers
−Removed: The approximate percentages of our inpatient revenues related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers for the quarters and six months ended June 30, 2021 and 2020 are set forth in the following table.
+Added: The approximate percentages of our inpatient revenues related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers for the quarters and nine months ended September 30, 2021 and 2020 are set forth in the following table.
Managed Medicare
1 unchanged sentence
Managed care and insurers
−Removed: At June 30, 2021, we had 92 hospitals in the states of Texas and Florida.
−Removed: During the quarter ended June 30, 2021, 56% of our admissions and 49% of our revenues were generated by these hospitals.
−Removed: Uninsured admissions in Texas and Florida represented 72% of our uninsured admissions during the quarter ended June 30, 2021.
+Added: At September 30, 2021, we had 91 hospitals in the states of Texas and Florida.
+Added: During the quarter ended September 30, 2021, 57% of our admissions and 50% of our revenues were generated by these hospitals.
+Added: Uninsured admissions in Texas and Florida represented 71% of our uninsured admissions during the quarter ended September 30, 2021.
We receive a significant portion of our revenues from government health programs, principally Medicare and Medicaid, which are highly regulated and subject to frequent and substantial changes.
2 unchanged sentences
In December 2017, CMS approved an extension of this waiver through September 30, 2022, but indicated that it will phase out some of the federal funding.
−Removed: Our Texas Medicaid revenues included Medicaid supplemental payments of $148 million and $186 million during the second quarters of 2021 and 2020, respectively, and $286 million and $301 million during the first six months of 2021 and 2020, respectively.
+Added: Our Texas Medicaid revenues included Medicaid supplemental payments of $151 million and $154 million during the third quarters of 2021 and 2020, respectively, and $437 million and $455 million during the first nine months of 2021 and 2020, respectively.
In addition, we receive supplemental payments in several other states.
1 unchanged sentence
It is possible these reviews and requests will
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
7 unchanged sentences
Operating Results Summary
−Removed: The following is a comparative summary of results of operations for the quarters and six months ended June 30, 2021 and 2020 (dollars in millions):
+Added: The following is a comparative summary of results of operations for the quarters and nine months ended September 30, 2021 and 2020 (dollars in millions):
Salaries and benefits
Other operating expenses
−Removed: Government stimulus income
+Added: Government stimulus income reversal
Equity in earnings of affiliates
1 unchanged sentence
Interest expense
−Removed: Losses (gains) on sales of facilities
−Removed: Losses on retirement of debt
+Added: Gains on sales of facilities
Income before income taxes
12 unchanged sentences
Revenue per equivalent admission
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
2 unchanged sentences
Other operating expenses
−Removed: Government stimulus income
Equity in earnings of affiliates
22 unchanged sentences
Same facility information excludes the operations of hospitals and their related facilities which were either acquired or divested during the current and prior period.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
−Removed: Quarters Ended June 30, 2021 and 2020
−Removed: Revenues increased to $14.435 billion in the second quarter of 2021 from $11.068 billion in the second quarter of 2020.
+Added: Quarters Ended September 30, 2021 and 2020
+Added: Revenues increased to $15.276 billion in the third quarter of 2021 from $13.311 billion in the third quarter of 2020.
Net income attributable to HCA Healthcare, Inc.
−Removed: totaled $1.450 billion, or $4.36 per diluted share, for the quarter ended June 30, 2021, compared to $1.079 billion, or $3.16 per diluted share, for the quarter ended June 30, 2020.
−Removed: Revenues for the second quarter of 2021 include $33 million, or $0.07 per diluted share, related to the settlement of Medicare outlier calculations for prior periods.
−Removed: Second quarter results for 2021 and 2020 include gains on sales of facilities of $8 million, or $0.02 per diluted share, and losses on sales of facilities of $27 million, or $0.07 per diluted share, respectively.
−Removed: Second quarter results for 2021 include losses on retirement of debt of $12 million, or $0.03 per diluted share.
−Removed: Second quarter results for 2020 also include $822 million ($590 million net of tax), or $1.73 per diluted share, of government stimulus income related to general distribution PRFs and $60 million, or $0.13 per diluted share, of employee retention payroll tax credits, both as provided for by the CARES Act.
+Added: totaled $2.269 billion, or $7.00 per diluted share, for the quarter ended September 30, 2021, compared to $668 million, or $1.95 per diluted share, for the quarter ended September 30, 2020.
+Added: Third quarter results for 2021 and 2020 include gains on sales of facilities of $1.047 billion, or $2.43 per diluted share, and $14 million, or $0.03 per diluted share, respectively.
+Added: Third quarter results for 2020 include the reversal of $822 million, or $1.72 per diluted share, of government stimulus income recorded in the second quarter of 2020 related to general distribution PRFs established by the CARES Act.
During October 2020, we announced we would return, or repay early, our share of the PRFs of approximately $1.6 billion and approximately $4.4 billion in Medicare accelerated payments (repaid during the fourth quarter of 2020).
−Removed: In the third quarter of 2020, we reversed the $822 million of government stimulus income that we recognized during the second quarter of 2020.
All “per diluted share” disclosures are based upon amounts net of the applicable income taxes.
−Removed: Shares used for diluted earnings per share were 332.613 million shares for the quarter ended June 30, 2021 and 341.599 million shares for the quarter ended June 30, 2020.
−Removed: During 2020 and the first six months of 2021, we repurchased 3.287 million shares and 19.738 million shares, respectively, of our common stock.
−Removed: Revenues increased 30.4% on a consolidated basis and 30.1% on a same facility basis for the quarter ended June 30, 2021, compared to the quarter ended June 30, 2020.
+Added: Shares used for diluted earnings per share were 324.029 million shares for the quarter ended September 30, 2021 and 343.346 million shares for the quarter ended September 30, 2020.
+Added: During the first nine months of 2021, we repurchased 29.343 million shares of our common stock.
+Added: Revenues increased 14.8% on a consolidated basis and 15.0% on a same facility basis for the quarter ended September 30, 2021, compared to the quarter ended September 30, 2020.
The increase in consolidated revenues can be primarily attributed to the combined impact of a 5.9% increase in revenue per equivalent admission and a 8.4% increase in equivalent admissions.
The same facility revenues increase primarily resulted from the combined impact of a 5.2% increase in same facility revenue per equivalent admission and a 9.3% increase in same facility equivalent admissions.
−Removed: Salaries and benefits, as a percentage of revenues, were 44.2% in the second quarter of 2021 and 48.2% in the second quarter of 2020.
−Removed: Salaries and benefits per equivalent admission declined 5.5% in the second quarter of 2021 compared to the second quarter of 2020.
−Removed: Same facility labor rate increases averaged 7.8% for the second quarter of 2021 compared to the second quarter of 2020 primarily due to certain cost reduction initiatives that impacted the second quarter of 2020.
−Removed: Supplies, as a percentage of revenues, were 16.5% in the second quarter of 2021 and 15.8% in the second quarter of 2020.
−Removed: Supply costs per equivalent admission increased 7.4% in the second quarter of 2021 compared to the second quarter of 2020 primarily due to the rebound in our surgical procedures in the second quarter of 2021 compared to the second quarter of 2020.
−Removed: Supply costs per equivalent admission increased 9.9% for medical devices and 10.1% for general medical and surgical items and declined 1.4% for pharmacy supplies in the second quarter of 2021 compared to the second quarter of 2020.
−Removed: Other operating expenses, as a percentage of revenues, were 17.2% in the second quarter of 2021 and 19.3% in the second quarter of 2020.
+Added: Salaries and benefits, as a percentage of revenues, were 46.4% in the third quarter of 2021 and 45.8% in the third quarter of 2020.
+Added: Salaries and benefits per equivalent admission increased 7.4% in the third quarter of 2021 compared to the third quarter of 2020.
+Added: Same facility labor rate increases averaged 8.0% for the third quarter of 2021 compared to the third quarter of 2020 primarily due to certain contract, overtime and other premium rate labor costs being incurred during the third quarter of 2021 to support our clinical staff and address the surge of COVID-19
+Added: Supplies, as a percentage of revenues, were 16.1% in the third quarter of 2021 and 16.0% in the third quarter of 2020.
+Added: Supply costs per equivalent admission increased 6.8% in the third quarter of 2021 compared to the third quarter of 2020.
+Added: Supply costs per equivalent admission increased 24.0% for pharmacy supplies and 9.4% for general medical and surgical items and declined 4.9% for medical devices in the third quarter of 2021 compared to the third quarter of 2020.
+Added: The increase in pharmacy supplies is primarily related to certain COVID-19
+Added: therapies used in the surge of COVID-19
+Added: cases during the third quarter of 2021, and the increase in general medical and surgical items is primarily related to an increased utilization of personal protective equipment (“PPE”).
+Added: Other operating expenses, as a percentage of revenues, were 16.6% in the third quarter of 2021 and 16.9% in the third quarter of 2020.
Other operating expenses is primarily comprised of contract services, professional fees, repairs and maintenance, rents and leases, utilities, insurance (including professional liability insurance) and nonincome taxes.
−Removed: Provisions for losses related to professional liability risks were $135 million and $139 million for the second quarters of 2021 and 2020, respectively.
−Removed: During the second quarter of 2020, we recorded $822 million ($590 million net of tax) of government stimulus income related to general distribution funds received from the PRFs established by the CARES Act.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Provisions for losses related to professional liability risks were $49 million and $26 million for the third quarters of 2021 and 2020, respectively.
+Added: During the third quarters of 2021 and 2020, we recorded reductions of $87 million, or $0.21 per diluted share, and $112 million, or $0.25 per diluted share, respectively, to our provision for professional liability risks related to the receipt of updated actuarial information.
+Added: During the third quarter of 2020, we recorded the reversal of $822 million of government stimulus income previously recorded in the second quarter of 2020 related to general distribution funds received from the PRFs established by the CARES Act.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
−Removed: Quarters Ended June 30, 2021 and 2020 (continued)
−Removed: Equity in earnings of affiliates was $22 million and $1 million in the second quarters of 2021 and 2020, respectively.
−Removed: Depreciation and amortization increased $21 million, from $691 million in the second quarter of 2020 to $712 million in the second quarter of 2021.
+Added: Quarters Ended September 30, 2021 and 2020 (continued)
+Added: Equity in earnings of affiliates was $35 million and $40 million in the third quarters of 2021 and 2020, respectively.
+Added: Depreciation and amortization increased $22 million, from $694 million in the third quarter of 2020 to $716 million in the third quarter of 2021.
The increase in depreciation relates primarily to capital expenditures at our existing facilities.
−Removed: Interest expense was $386 million in the second quarter of 2021 and $388 million in the second quarter of 2020.
−Removed: Our average debt balance was $31.892 billion for the second quarter of 2021 compared to $31.921 billion for the second quarter of 2020.
−Removed: The average effective interest rate for our long-term debt was 4.9% for both of the quarters ended June 30, 2021 and 2020.
−Removed: During the second quarters of 2021 and 2020, we recorded gains on sales of facilities of $8 million and losses on sales of facilities of $27 million, respectively.
−Removed: During June 2021, we issued $2.350 billion aggregate principal amount of senior secured notes comprised of $850 million aggregate principal amount of 2 3/8% notes due 2031 and $1.500 billion aggregate principal amount of 3 1/2% notes due 2051 (the “June 2021 Notes”).
−Removed: We also amended and restated our senior secured revolving credit facility and our senior secured asset-based revolving credit facility, including increasing availability under the asset-based revolving credit facility to $4.500 billion, extending the maturity date on both facilities to June 30, 2026 and entering into a new $1.500 billion term loan A-7 facility and a new $500 million term loan B-14 facility (the “Credit Agreement Transactions”).
−Removed: We used the net proceeds from the June 2021 Notes and the Credit Agreement Transactions to retire the existing $1.071 billion term loan A-6 facility, the existing $1.455 billion term loan B-12 facility and the existing $1.131 billion term loan B-13 facility.
−Removed: The pretax loss on retirement of debt was $12 million.
−Removed: The effective tax rates were 23.8% and 24.2% for the second quarters of 2021 and 2020, respectively.
+Added: Interest expense was $398 million in the third quarter of 2021 and $385 million in the third quarter of 2020.
+Added: Our average debt balance was $32.450 billion for the third quarter of 2021 compared to $30.952 billion for the third quarter of 2020.
+Added: The average effective interest rate for our long-term debt was 4.9% for both of the quarters ended September 30, 2021 and 2020.
+Added: During the third quarters of 2021 and 2020, we recorded gains on sales of facilities of $1.047 billion and $14 million, respectively.
+Added: The gains on sales of facilities for the third quarter of 2021 include a $655 million gain related to the sale of four hospital facilities in Georgia and gains of $392 million related to the sales of other health care entity investments and minor real estate assets.
+Added: The effective tax rates were 23.2% and 23.8% for the third quarters of 2021 and 2020, respectively.
The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships.
−Removed: Net income attributable to noncontrolling interests increased from $137 million for the second quarter of 2020 to $214 million for the second quarter of 2021.
−Removed: The increase in net income attributable to noncontrolling interests related primarily to the operations of two of our Texas markets and our surgery center partnerships.
−Removed: pandemic negatively impacted second quarter 2020 operations, and surgery center operations were some of the most negatively impacted.
−Removed: Six Months Ended June 30, 2021 and 2020
−Removed: Revenues increased to $28.412 billion in the first six months of 2021 from $23.929 billion in the first six months of 2020.
+Added: Net income attributable to noncontrolling interests increased from $111 million for the third quarter of 2020 to $203 million for the third quarter of 2021.
+Added: The increase in net income attributable to noncontrolling interests related primarily to an increase in partnership operating income as well as the impact of the government stimulus income reversal for certain hospital and surgery center partnerships in the third quarter of 2020.
+Added: Nine Months Ended September 30, 2021 and 2020
+Added: Revenues increased to $43.688 billion in the first nine months of 2021 from $37.240 billion in the first nine months of 2020.
Net income attributable to HCA Healthcare, Inc.
−Removed: totaled $2.873 billion, or $8.50 per diluted share, for the first six months ended June 30, 2021, compared to $1.660 billion, or $4.84 per diluted share, for the first six months ended June 30, 2020.
−Removed: Results for the first six months of 2021 included gains on sales of facilities of $10 million, or $0.02 per diluted share, and losses on retirement of debt of $12 million, or $0.03 per diluted share.
−Removed: Results for the first six months of 2020 also included losses on retirement of debt of $295 million, or $0.66 per diluted share, and losses on sales of facilities of $20 million, or $0.06 per diluted share.
−Removed: Revenues for the first six months of 2021 and 2020, respectively, include $33 million, or $0.07 per diluted share, and $55 million, or
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Results of Operations (continued)
−Removed: Six Months Ended June 30, 2021 and 2020 (continued)
−Removed: $0.12 per diluted share, related to the settlement of Medicare outlier calculations for prior periods.
−Removed: Results for the first six months of 2020 included $822 million ($590 million net of tax), or $1.72 per diluted share, of government stimulus income related to general distribution PRFs and $60 million, or $0.13 per diluted share, of employee retention payroll tax credits, both as provided for by the CARES Act.
−Removed: During October 2020, we announced we would return, or repay early, our share of the PRFs of approximately $1.6 billion and approximately $4.4 billion in Medicare accelerated payments (repaid during the fourth quarter of 2020).
−Removed: In the third quarter of 2020, we reversed the $822 million of government stimulus income that we recognized during the second quarter of 2020.
−Removed: Our provision for income taxes for the first six months of 2021 and 2020 included tax benefits of $85 million, or $0.25 per diluted share, and $54 million, or $0.16 per diluted share, respectively, related to employee equity award settlements.
+Added: totaled $5.142 billion, or $15.43 per diluted share, for the first nine months ended September 30, 2021, compared to $2.328 billion, or $6.79 per diluted share, for the first nine months ended September 30, 2020.
+Added: Results for the first nine months of 2021 included gains on sales of facilities of $1.057 billion, or $2.39 per diluted share, and losses on retirement of debt of $12 million, or $0.03 per diluted share.
+Added: Results for the first nine months of 2020 included losses on sales of facilities of $6 million, or $0.03 per diluted share, and losses on retirement of debt of $295 million, or $0.66 per diluted share.
+Added: Revenues for the first nine months of 2021 and 2020, respectively, include $33 million, or $0.07 per diluted share, and $55 million, or $0.12 per diluted share, related to the settlement of Medicare outlier calculations for prior periods.
+Added: Results for the first nine months of 2020 also included $60 million, or $0.13 per diluted share, of employee retention payroll tax credits, established by the CARES Act.
+Added: Our provision for income taxes for the first nine months of 2021 and 2020 included tax benefits of $96 million, or $0.29 per diluted share, and $59 million, or $0.17 per diluted share, respectively, related to employee equity award settlements.
All “per diluted share” disclosures are based upon amounts net of the applicable income taxes.
−Removed: Shares used for diluted earnings per share were 337.940 million shares for the six months ended June 30, 2021 and 342.848 million shares for the six months ended June 30, 2020.
−Removed: During 2020 and the first six months of 2021, we repurchased 3.287 million shares and 19.738 million shares, respectively, of our common stock.
−Removed: Revenues increased 18.7% on a consolidated basis and 18.8% on a same facility basis for the six months ended June 30, 2021, compared to the six months ended June 30, 2020.
−Removed: The increase in both consolidated and same facility revenues can be primarily attributed to the combined impact of 9.5% increases in revenue per equivalent admission and 8.5% increases in equivalent admissions.
−Removed: Salaries and benefits, as a percentage of revenues, were 44.6% in the first six months of 2021 and 47.8% in the first six months of 2020.
−Removed: Salaries and benefits per equivalent admission increased 2.2% in the first six months of 2021 compared to the first six months of 2020.
−Removed: Same facility labor rate increases averaged 6.9% for the first six months of 2021 compared to the first six months of 2020.
−Removed: Supplies, as a percentage of revenues, were 16.2% in both the first six months of 2021 and 2020.
−Removed: Supply costs per equivalent admission increased 9.7% in the first six months of 2021 compared to the first six months of 2020.
−Removed: Supply costs per equivalent admission increased 8.3% for medical devices, 9.5% for pharmacy supplies and 11.2% for general medical and surgical items in the first six months of 2021 compared to the first six months of 2020.
−Removed: Other operating expenses, as a percentage of revenues, were 17.3% in the first six months of 2021 and 19.1% in the first six months of 2020.
+Added: Shares used for diluted earnings per share were 333.248 million shares for the nine months ended September 30, 2021 and 343.014 million shares for the nine months ended September 30, 2020.
+Added: During the first nine months of 2021, we repurchased 29.343 million shares of our common stock.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Results of Operations (continued)
+Added: Nine Months Ended September 30, 2021 and 2020 (continued)
+Added: Revenues increased 17.3% on a consolidated basis and 17.5% on a same facility basis for the nine months ended September 30, 2021, compared to the nine months ended September 30, 2020.
+Added: The increase in consolidated revenues can be primarily attributed to the combined impact of an 8.2% increase in revenue per equivalent admission and an 8.4% increase in equivalent admissions.
+Added: The increase in same facility revenues can be primarily attributed to the combined impact of a 7.9% increase in revenue per equivalent admission and an 8.8% increase in equivalent admissions.
+Added: Salaries and benefits, as a percentage of revenues, were 45.3% in the first nine months of 2021 and 47.1% in the first nine months of 2020.
+Added: Salaries and benefits per equivalent admission increased 4.0% in the first nine months of 2021 compared to the first nine months of 2020.
+Added: Same facility labor rate increases averaged 7.3% for the first nine months of 2021 compared to the first nine months of 2020 primarily due to an increased utilization of contract, overtime and other premium rate labor costs during the 2021 period to support our clinical staff and address the surges of COVID-19 cases during the first and third quarters of 2021.
+Added: Supplies, as a percentage of revenues, were 16.2% in the first nine months of 2021 and 16.1% in the first nine months of 2020.
+Added: Supply costs per equivalent admission increased 8.6% in the first nine months of 2021 compared to the first nine months of 2020.
+Added: Supply costs per equivalent admission increased 3.6% for medical devices, 14.8% for pharmacy supplies and 10.7% for general medical and surgical items in the first nine months of 2021 compared to the first nine months of 2020.
+Added: The increase in pharmacy supplies is primarily related to certain COVID-19
+Added: therapies used in the surges of COVID-19
+Added: cases during the first and third quarters of 2021, and the increase in general medical and surgical items is primarily related to increased utilization of PPE.
+Added: Other operating expenses, as a percentage of revenues, were 17.0% in the first nine months of 2021 and 18.3% in the first nine months of 2020.
Other operating expenses is primarily comprised of contract services, professional fees, repairs and maintenance, rents and leases, utilities, insurance (including professional liability insurance) and nonincome taxes.
−Removed: Provisions for losses related to professional liability risks were $269 million and $279 million for the first six months of 2021 and 2020, respectively.
−Removed: During the first six months of 2020, we recorded $822 million ($590 million net of tax) of government stimulus income related to general distribution funds received from the PRFs established by the CARES Act.
−Removed: Equity in earnings of affiliates was $43 million and $8 million in the first six months of 2021 and 2020, respectively.
−Removed: Depreciation and amortization increased $44 million, from $1.365 billion in the first six months of 2020 to $1.409 billion in the first six months of 2021.
+Added: Provisions for losses related to professional liability risks were $318 million and $305 million for the first nine months of 2021 and 2020, respectively.
+Added: During the first nine months of 2021 and 2020, we recorded reductions of $87 million, or $0.20 per diluted share, and $112 million, or $0.25 per diluted share, respectively, to our provision for professional liability risks related to the receipt of updated actuarial information.
+Added: Equity in earnings of affiliates was $78 million and $48 million in the first nine months of 2021 and 2020, respectively.
+Added: Depreciation and amortization increased $66 million, from $2.059 billion in the first nine months of 2020 to $2.125 billion in the first nine months of 2021.
The increase in depreciation relates primarily to capital expenditures at our existing facilities.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Interest expense was $1.168 billion in the first nine months of 2021 and $1.201 billion in the first nine months of 2020.
+Added: Our average debt balance was $31.780 billion for the first nine months of 2021 compared to $32.223 billion for the first nine months of 2020.
+Added: The average effective interest rate for our long-term debt declined to 4.9% for the nine months ended September 30, 2021 from 5.0% for the nine months ended September 30, 2020.
+Added: During the first nine months of 2021 and 2020, we recorded net gains of $1.057 billion and net losses on sales of facilities of $6 million, respectively.
+Added: The gains on sales of facilities for the first nine months of 2021 are primarily related to the sale of four hospital facilities in Georgia and other health care entity investments.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
−Removed: Six Months Ended June 30, 2021 and 2020 (continued)
−Removed: Interest expense was $770 million in the first six months of 2021 and $816 million in the first six months of 2020.
−Removed: Our average debt balance was $31.510 billion for the first six months of 2021 compared to $32.766 billion for the first six months of 2020.
−Removed: The average effective interest rate for our long-term debt declined to 4.9% for the six months ended June 30, 2021 from 5.0% for the six months ended June 30, 2020.
−Removed: During the first six months of 2021 and 2020, we recorded net gains of $10 million and net losses on sales of facilities of $20 million, respectively.
+Added: Nine Months Ended September 30, 2021 and 2020 (continued)
During June 2021, we issued $2.350 billion aggregate principal amount of senior secured notes comprised of $850 million aggregate principal amount of 2 3/8% notes due 2031 and $1.500 billion aggregate principal amount of 3 1/2% notes due 2051 (the “June 2021 Notes”).
−Removed: We also amended and restated our senior secured revolving credit facility and our senior secured asset-based revolving credit facility, including increasing availability under the asset-based revolving credit facility to $4.500 billion, extending the maturity date on both facilities to June 30, 2026 and entering into a new $1.500 billion term loan A-7 facility and a new $500 million term loan B-14
+Added: We also amended and restated our senior secured revolving credit facility and our senior secured asset-based revolving credit facility, including increasing availability under the asset-based revolving credit facility to $4.500 billion, extending the maturity date on both facilities to June 30, 2026 and entering into a new $1.500 billion term loan A-7
+Added: facility and a new $500 million term loan B-14
facility (the “Credit Agreement Transactions”).
−Removed: We used the net proceeds from the June 2021 Notes and the Credit Agreement Transactions to retire the existing $1.071 billion term loan A-6
−Removed: facility, the existing $1.455 billion term loan B-12
−Removed: facility and the existing $1.131 billion term loan B-13
+Added: We used the net proceeds from the June 2021 Notes and the Credit Agreement Transactions to retire the $1.071 billion term loan A-6
+Added: facility, the $1.455 billion term loan B-12
+Added: facility and the $1.131 billion term loan B-13
The pretax loss on retirement of debt was $12 million.
2 unchanged sentences
The pretax loss on retirement of debt was $295 million.
−Removed: The effective tax rates were 22.7% and 21.6% for the first six months of 2021 and 2020, respectively.
+Added: The effective tax rates were 22.9% and 22.2% for the first nine months of 2021 and 2020, respectively.
The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships.
−Removed: Our provisions for income taxes for the first six months of 2021 and 2020 included tax benefits of $85 million and $54 million, respectively, related to employee equity award settlements.
−Removed: Excluding the effect of these adjustments, the effective tax rate for the first six months of 2021 and 2020 would have been 25.0% and 24.1%, respectively.
−Removed: Net income attributable to noncontrolling interests increased from $254 million for the first six months of 2020 to $371 million for the first six months of 2021.
−Removed: The increase in net income attributable to noncontrolling interests related primarily to the operations of two of our Texas markets and our surgery center partnerships.
+Added: Our provisions for income taxes for the first nine months of 2021 and 2020 included tax benefits of $96 million and $59 million, respectively, related to employee equity award settlements.
+Added: Excluding the effect of these adjustments, the effective tax rate for the first nine months of 2021 and 2020 would have been 24.4% and 24.2%, respectively.
+Added: Net income attributable to noncontrolling interests increased from $365 million for the first nine months of 2020 to $574 million for the first nine months of 2021.
+Added: The increase in net income attributable to noncontrolling interests related primarily to the partnership operations of two of our Texas markets and our surgery center partnerships.
Liquidity and Capital Resources
−Removed: Cash provided by operating activities declined $5.859 billion, from $10.098 billion for the first six months of 2020 to $4.239 billion for the first six months of 2021.
−Removed: The $10.098 billion of cash flows from operating activities in the first six months of 2020 included the $822 million of government stimulus income and $4.999 billion of contract liabilities-deferred revenues (primarily related to the Medicare accelerated payments), which were reversed during the third and fourth quarters of 2020, respectively.
−Removed: The decline in cash provided by operating activities also included the net impact of negative changes in working capital items of $1.553 billion, primarily related to an increase in accounts receivable, and income taxes of $363 million, offset by an increase in net income, excluding the government stimulus income, losses and gains on sales of facilities and losses on retirement of debt, of $1.732 billion.
−Removed: The combination of interest payments and net income tax payments in the
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Liquidity and Capital Resources (continued)
−Removed: first six months of 2021 totaled $1.599 billion, compared to the net combination of interest payments and net income tax refunds in the first six months of 2020 of $838 million.
−Removed: Working capital totaled $3.860 billion at June 30, 2021 and $3.629 billion at December 31, 2020.
−Removed: Cash used in investing activities was $1.569 billion in the first six months of 2021 compared to $1.953 billion in the first six months of 2020.
−Removed: Acquisitions of hospitals and health care entities declined from $346 million in the first six months of 2020 to $98 million in the first six months of 2021.
−Removed: Excluding acquisitions, capital expenditures were $1.496 billion in the first six months of 2021 and $1.598 billion in the first six months of 2020.
+Added: Cash provided by operating activities declined $6.299 billion, from $12.815 billion for the first nine months of 2020 to $6.516 billion for the first nine months of 2021.
+Added: The $12.815 billion of cash flows from operating activities in the first nine months of 2020 included $6.123 billion of government stimulus refund liability related to unapplied accelerated Medicare payments and PRFs established by the CARES Act (approximately $6 billion was returned or repaid early and reversed out of cash flow from operations in the fourth quarter of 2020).
+Added: The decline in cash provided by operating activities also included the net impact of negative changes in working capital items of $2.350 billion, primarily related to an increase in accounts receivable, offset by an increase in net income, excluding losses and gains on sales of facilities and losses on retirement of debt, of $2.001 billion.
+Added: The combination of interest payments and net income tax payments in the first nine months of 2021 and 2020 totaled $2.473 billion and $2.009 billion, respectively.
+Added: Working capital totaled $3.624 billion at September 30, 2021 and $3.629 billion at December 31, 2020.
+Added: Cash used in investing activities was $929 million in the first nine months of 2021 compared to $2.483 billion in the first nine months of 2020.
+Added: Acquisitions of hospitals and health care entities increased from $380 million in the first nine months of 2020 to $488 million in the first nine months of 2021.
+Added: Excluding acquisitions, capital expenditures were $2.385 billion in the first nine months of 2021 and $2.087 billion in the first nine months of 2020.
Planned capital expenditures are expected to approximate $3.7 billion in 2021.
−Removed: At June 30, 2021, there were projects under construction which had estimated additional costs to complete and equip over the next five years of approximately $3.6 billion.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Liquidity and Capital Resources (continued)
+Added: September 30, 2021, there were projects under construction which had estimated additional costs to complete and equip over the next five years of approximately $3.6 billion.
We expect to finance capital expenditures with internally generated and borrowed funds.
−Removed: Cash used in financing activities totaled $3.346 billion in the first six months of 2021 compared to $4.116 billion in the first six months of 2020.
−Removed: During the first six months of 2021, net cash flows used in financing activities included a net increase of $1.406 billion in our indebtedness, payment of dividends of $325 million, repurchase of common stock of $3.814 billion and distributions to noncontrolling interests of $357 million.
−Removed: During the first six months of 2020, net cash flows used in financing activities included a net decline of $3.144 billion in our indebtedness, payment of dividends of $153 million, repurchase of common stock of $441 million and distributions to noncontrolling interests of $199 million.
+Added: Sales of hospitals and health care entities increased $1.912 billion primarily related to the proceeds from our sales of five hospitals in Georgia (the sale of one hospital was effective October 1, 2021) and other health care entity investments.
+Added: Cash used in financing activities totaled $6.349 billion in the first nine months of 2021 compared to $4.361 billion in the first nine months of 2020.
+Added: During the first nine months of 2021, net cash flows used in financing activities included a net increase of $1.050 billion in our indebtedness, payment of dividends of $476 million, repurchase of common stock of $6.143 billion and distributions to noncontrolling interests of $501 million.
+Added: During the first nine months of 2020, net cash flows used in financing activities included a net decline of $3.183 billion in our indebtedness, payment of dividends of $153 million, repurchase of common stock of $441 million and distributions to noncontrolling interests of $393 million.
We are a highly leveraged company with significant debt service requirements.
−Removed: Our debt totaled $32.572 billion at June 30, 2021.
−Removed: Our interest expense was $770 million for the first six months of 2021 and $816 million for the first six months of 2020.
−Removed: In addition to cash flows from operations, available sources of capital include amounts available under our senior secured credit facilities ($5.620 billion and $5.550 billion available as of June 30, 2021 and July 31, 2021, respectively) and anticipated access to public and private debt markets.
−Removed: Investments of our insurance subsidiaries, held to maintain statutory equity levels and to provide liquidity to pay claims, totaled $525 million and $504 million at June 30, 2021 and December 31, 2020, respectively.
−Removed: An insurance subsidiary maintained net reserves for professional liability risks of $154 million and $188 million at June 30, 2021 and December 31, 2020, respectively.
+Added: Our debt totaled $32.299 billion at September 30, 2021.
+Added: Our interest expense was $1.168 billion for the first nine months of 2021 and $1.201 billion for the first nine months of 2020.
+Added: In addition to cash flows from operations, available sources of capital include amounts available under our senior secured credit facilities ($5.920 billion and $5.590 billion available as of September 30, 2021 and October 31, 2021, respectively) and anticipated access to public and private debt markets.
+Added: Investments of our insurance subsidiaries, held to maintain statutory equity levels and to provide liquidity to pay claims, totaled $530 million and $504 million at September 30, 2021 and December 31, 2020, respectively.
+Added: An insurance subsidiary maintained net reserves for professional liability risks of $159 million and $188 million at September 30, 2021 and December 31, 2020, respectively.
Our facilities are insured by a 100% owned insurance subsidiary for losses up to $75 million per occurrence;
1 unchanged sentence
Additionally, the insurance subsidiary has entered into reinsurance contracts providing reimbursement for a certain portion of losses in excess of self-insured retentions.
−Removed: Net reserves for the self-insured professional liability risks retained were $1.850 billion and $1.736 billion at June 30, 2021 and December 31, 2020, respectively.
+Added: Net reserves for the self-insured professional liability risks retained were $1.795 billion and $1.736 billion at September 30, 2021 and December 31, 2020, respectively.
Claims payments, net of reinsurance recoveries, during the next 12 months are expected to approximate $476 million.
1 unchanged sentence
During June 2021, we issued $2.350 billion aggregate principal amount of senior secured notes comprised of $850 million aggregate principal amount of 2 3/8% notes due 2031 and $1.500 billion aggregate principal amount of 3 1/2% notes due 2051 (the “June 2021 Notes”).
−Removed: We also amended and restated our senior secured revolving credit facility and our senior secured asset-based revolving credit facility, including increasing availability under the asset-based revolving credit facility to $4.500 billion, extending the maturity date on both facilities to June 30, 2026 and entering into a new $1.500 billion term loan A-7 facility and a new $500 million
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Liquidity and Capital Resources (continued)
−Removed: term loan B-14 facility (the “Credit Agreement Transactions”).
−Removed: We used the net proceeds from the June 2021 Notes and the Credit Agreement Transactions to retire the existing $1.071 billion term loan A-6 facility, the existing $1.455 billion term loan B-12 facility and the existing $1.131 billion term loan B-13 facility.
+Added: We also amended and restated our senior secured revolving credit facility and our senior secured asset-based revolving credit facility, including increasing availability under the asset-based revolving credit facility to $4.500 billion, extending the maturity date on both facilities to June 30, 2026 and entering into a new $1.500 billion term loan A-7
+Added: facility and a new $500 million term loan B-14
+Added: facility (the “Credit Agreement Transactions”).
+Added: We used the net proceeds from the June 2021 Notes and the Credit Agreement Transactions to retire the $1.071 billion term loan A-6
+Added: facility, the $1.455 billion term loan B-12
+Added: facility and the $1.131 billion term loan B-13
Management believes that cash flows from operations, amounts available under our senior secured credit facilities and our anticipated access to public and private debt markets will be sufficient to meet expected liquidity needs during the next 12 months.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Liquidity and Capital Resources (continued)
Summarized Financial Information
11 unchanged sentences
for the year ended December 31, 2020.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Liquidity and Capital Resources (continued)
−Removed: Summarized Financial Information (continued)
Summarized financial information is presented on a combined basis and transactions between the combining entities have been eliminated.
Financial information for nonguarantor entities has been excluded.
−Removed: The summarized operating results information for the six months ended June 30, 2021 and year ended December 31, 2020 and the summarized balance sheet information at June 30, 2021 and December 31, 2020, for HCA Healthcare, Inc., HCA Inc.
+Added: The summarized operating results information for the nine months ended September 30, 2021 and year ended December 31, 2020 and the summarized balance sheet information at September 30, 2021 and December 31, 2020, for HCA Healthcare, Inc., HCA Inc.
and the subsidiary guarantors (the Parent, Subsidiary Issuer and Subsidiary Guarantors) follow (dollars in millions):
−Removed: Six Months Ended June 30, 2021 and Year Ended December 31, 2020:
−Removed: June 30, 2021
+Added: Nine Months Ended September 30, 2021 and Year Ended December 31, 2020:
+Added: September 30, 2021
December 31, 2020
1 unchanged sentence
Net income attributable to Parent, Subsidiary Issuer and Subsidiary Guarantors
−Removed: At June 30, 2021 and December 31, 2020:
−Removed: June 30, 2021
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Liquidity and Capital Resources (continued)
+Added: Summarized Financial Information (continued)
+Added: At September 30, 2021 and December 31, 2020:
+Added: September 30, 2021
December 31, 2020
16 unchanged sentences
Under the first lien intercreditor agreement, the administrative agent for the lenders under the cash flow credit facility, subject to the occurrence of certain events, has the exclusive right to direct foreclosures and take other actions with respect to these liens, and the trustee for the senior secured notes has no right to take any such actions.
−Removed: In certain circumstances, including upon certain events of default under the senior secured credit
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Liquidity and Capital Resources (continued)
−Removed: Summarized Financial Information (continued)
−Removed: facilities and the senior secured notes, the collateral agent in respect of the cash flow credit facility and the senior secured notes could proceed against the collateral granted to it to secure such indebtedness, including the aforementioned pledged capital stock and pledged indebtedness, and require such collateral to be delivered to the collateral agent to the extent not already in its possession for purposes of perfecting the lien on such assets.
+Added: In certain circumstances, including upon certain events of default under the senior secured credit facilities and the senior secured notes, the collateral agent in respect of the cash flow credit facility and the senior secured notes could proceed against the collateral granted to it to secure such indebtedness, including the aforementioned pledged capital stock and pledged indebtedness, and require such collateral to be delivered to the collateral agent to the extent not already in its possession for purposes of perfecting the lien on such assets.
For further information regarding the collateral, including events or circumstances that may require delivery of the collateral, refer to the applicable indentures, the first lien intercreditor agreement, the cash flow credit agreement and the pledge agreement that are filed as exhibits to our annual report on Form 10-K
4 unchanged sentences
The rule provides that such information is not material if the assets, liabilities and results of operations of the combined affiliates whose securities are pledged as collateral are not materially different than the corresponding amounts presented in the consolidated financial statements of the Registrant.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Liquidity and Capital Resources (continued)
+Added: Summarized Financial Information (continued)
Healthtrust, Inc.
5 unchanged sentences
We are exposed to market risk related to changes in market values of securities.
−Removed: The investment securities held by our insurance subsidiaries were recorded at $525 million at June 30, 2021.
+Added: The investment securities held by our insurance subsidiaries were recorded at $530 million at September 30, 2021.
These investments are carried at fair value, with changes in unrealized gains and losses that are not credit-related being recorded as adjustments to other comprehensive income.
−Removed: At June 30, 2021, we had a net unrealized gain of $23 million on the insurance subsidiaries’ investments.
+Added: At September 30, 2021, we had a net unrealized gain of $20 million on the insurance subsidiaries’ investments.
We are exposed to market risk related to market illiquidity.
2 unchanged sentences
We may be required to recognize credit-related impairments on our investment securities in future periods should issuers default on interest payments or should the fair market valuations of the securities deteriorate due to ratings downgrades or other issue-specific factors.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Liquidity and Capital Resources (continued)
−Removed: Market Risk (continued)
We are also exposed to market risk related to changes in interest rates, and we periodically enter into interest rate swap agreements to manage our exposure to these fluctuations.
5 unchanged sentences
Changes in the fair value of these derivatives, which are designated as cash flow hedges, are included in other comprehensive income.
−Removed: With respect to our interest-bearing liabilities, approximately $300 million of long-term debt at June 30, 2021 was subject to variable rates of interest, while the remaining balance in long-term debt of $32.272 billion at June 30, 2021 was subject to fixed rates of interest.
−Removed: Both the general level of interest rates and, for the senior secured credit facilities, our leverage affect our variable interest rates.
+Added: At September 30, 2021, our variable rate debt was fully covered by our interest rate swap agreements.
Our variable debt is comprised primarily of amounts outstanding under the senior secured credit facilities.
1 unchanged sentence
The applicable margin for borrowings under the senior secured credit facilities may fluctuate according to a leverage ratio.
−Removed: The average effective interest rate for our long-term debt was 4.9% and 5.0% for the six months ended June 30, 2021 and 2020, respectively.
−Removed: The estimated fair value of our total long-term debt was $37.022 billion at June 30, 2021.
+Added: The average effective interest rate for our long-term debt was 4.9% and 5.0% for the nine months ended September 30, 2021 and 2020, respectively.
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Liquidity and Capital Resources (continued)
+Added: Market Risk (continued)
+Added: The estimated fair value of our total long-term debt was $36.567 billion at September 30, 2021.
The estimates of fair value are based upon the quoted market prices for the same or similar issues of long-term debt with the same maturities.
−Removed: Based on a hypothetical 1% increase in variable interest rates, the potential annualized reduction to future pretax earnings would be approximately $3 million.
To mitigate the impact of fluctuations in interest rates, we generally target a portion of our debt portfolio to be maintained at fixed rates.
2 unchanged sentences
Tax Examinations
−Removed: The Internal Revenue Service was conducting an examination of the Company’s 2016, 2017 and 2018 federal income tax returns at June 30, 2021.
+Added: The Internal Revenue Service was conducting an examination of the Company’s 2016, 2017 and 2018 federal income tax returns at September 30, 2021.
We are also subject to examination by state and foreign taxing authorities.
2 unchanged sentences
However, if payments due upon final resolution of any issues exceed our recorded estimates, such resolutions could have a material, adverse effect on our results of operations or financial position.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Operating Data
3 unchanged sentences
Weighted average beds in service(b):
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Operating Data (continued)
Average daily census(c):
1 unchanged sentence
Equivalent admissions(e):
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Operating Data (continued)
Average length of stay (days)(f):
1 unchanged sentence
Outpatient surgeries(h):
+Added: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
+Added: Operating Data (continued)
Inpatient surgeries(i):
4 unchanged sentences
Represents the average number of patients in our hospital beds each day.
−Removed: MANAGEMENT’S DISCUSSION AND ANALYSIS OF
−Removed: FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
−Removed: Operating Data (continued)
Represents the total number of patients admitted to our hospitals and is used by management and certain investors as a general measure of inpatient volume.
14 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.