(11) Supplemental Condensed Consolidating Financial Information

Certain of our senior notes are guaranteed by a group of subsidiaries (the “Guarantors”). The Guarantors, each of which is a 100% directly owned subsidiary of Universal Health Services, Inc., fully and unconditionally guarantee the senior notes on a joint and several basis, subject to certain customary release provisions.

The following financial statements present condensed consolidating financial data for (i) Universal Health Services, Inc. (on a parent company only basis), (ii) the combined Guarantors, (iii) the combined non guarantor subsidiaries (all other subsidiaries), (iv) an elimination column for adjustments to arrive at the information for the parent company, Guarantors, and non guarantors on a consolidated basis, and (v) the parent company and our subsidiaries on a consolidated basis.

Investments in subsidiaries are accounted for by the parent company and the Guarantors using the equity method for this presentation. Results of operations of subsidiaries are therefore classified in the parent company’s and Guarantors’ investment in subsidiaries accounts. The elimination entries set forth in the following condensed consolidating financial statements eliminate distributed and undistributed income of subsidiaries, investments in subsidiaries, and intercompany balances and transactions between the parent, Guarantors, and non guarantors.

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2016
(amounts in thousands)


	Parent			Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Net revenues before provision for doubtful accounts	$	0		$	1,812,098		$	815,838		$	(8,343	)	$	2,619,593
Less: Provision for doubtful accounts		0			107,680			62,115			0			169,795
Net revenues		0			1,704,418			753,723			(8,343	)		2,449,798
Operating charges:
Salaries, wages and benefits		0			824,295			323,844			0			1,148,139
Other operating expenses		0			387,677			181,980			(8,073	)		561,584
Supplies expense		0			153,387			101,863			0			255,250
Depreciation and amortization		0			72,253			31,796			0			104,049
Lease and rental expense		0			15,294			9,428			(270	)		24,452
		0			1,452,906			648,911			(8,343	)		2,093,474
Income from operations		0			251,512			104,812			0			356,324
Interest expense		28,300			1,136			164			0			29,600
Interest (income) expense, affiliate		0			23,054			(23,054	)		0			0
Equity in net income of consolidated affiliates		(208,227	)		(70,175	)		0			278,402			0
Income before income taxes		179,927			297,497			127,702			(278,402	)		326,724
Provision for income taxes		(10,832	)		97,979			23,858			0			111,005
Net income		190,759			199,518			103,844			(278,402	)		215,719
Less: Income attributable to noncontrolling interests		0			0			24,960			0			24,960
Net income attributable to UHS	$	190,759		$	199,518		$	78,884		$	(278,402	)	$	190,759

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2015
(amounts in thousands)


	Parent			Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Net revenues before provision for doubtful accounts	$	0		$	1,661,612		$	726,080		$	(7,591	)	$	2,380,101
Less: Provision for doubtful accounts		0			106,304			48,444			0			154,748
Net revenues		0			1,555,308			677,636			(7,591	)		2,225,353
Operating charges:
Salaries, wages and benefits		0			740,554			291,149			0			1,031,703
Other operating expenses		0			351,580			161,686			(7,300	)		505,966
Supplies expense		0			141,361			97,380			0			238,741
Depreciation and amortization		0			69,645			29,353			0			98,998
Lease and rental expense		0			13,755			9,427			(291	)		22,891
		0			1,316,895			588,995			(7,591	)		1,898,299
Income from operations		0			238,413			88,641			0			327,054
Interest expense		28,512			1,227			298			0			30,037
Interest (income) expense, affiliate		0			23,054			(23,054	)		0			0
Equity in net income of consolidated affiliates		(191,898	)		(59,515	)		0			251,413			0
Income before income taxes		163,386			273,647			111,397			(251,413	)		297,017
Provision for income taxes		(10,913	)		92,130			21,477			0			102,694
Net income		174,299			181,517			89,920			(251,413	)		194,323
Less: Income attributable to noncontrolling interests		0			0			20,024			0			20,024
Net income attributable to UHS	$	174,299		$	181,517		$	69,896		$	(251,413	)	$	174,299

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2016
(amounts in thousands)


	Parent			Guarantors		Non Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Net income	$	190,759		$	199,518	$	103,844	$	(278,402	)	$	215,719
Other comprehensive income (loss):
Unrealized derivative gains on cash flow hedges		(14,299	)		0		0		0			(14,299	)
Amortization of terminated hedge		(84	)		0		0		0			(84	)
Foreign currency translation adjustment		5,986			5,986		0		(5,986	)		5,986
Other comprehensive income before tax		(8,397	)		5,986		0		(5,986	)		(8,397	)
Income tax expense related to items of other comprehensive income		(5,360	)		0		0		0			(5,360	)
Total other comprehensive income, net of tax		(3,037	)		5,986		0		(5,986	)		(3,037	)
Comprehensive income		187,722			205,504		103,844		(284,388	)		212,682
Less: Comprehensive income attributable to noncontrolling interests		0			0		24,960		0			24,960
Comprehensive income attributable to UHS	$	187,722		$	205,504	$	78,884	$	(284,388	)	$	187,722

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2015
(amounts in thousands)


	Parent			Guarantors			Non Guarantors		Consolidating Adjustments			Total Consolidated Amounts
Net income	$	174,299		$	181,517		$	89,920	$	(251,413	)	$	194,323
Other comprehensive income (loss):
Unrealized derivative gains on cash flow hedges		4,132			0			0		0			4,132
Amortization of terminated hedge		(84	)		0			0		0			(84	)
Currency translation adjustment		(418	)		(418	)		0		418			(418	)
Other comprehensive income before tax		3,630			(418	)		0		418			3,630
Income tax expense related to items of other comprehensive income		1,497			0			0		0			1,497
Total other comprehensive income, net of tax		2,133			(418	)		0		418			2,133
Comprehensive income		176,432			181,099			89,920		(250,995	)		196,456
Less: Comprehensive income attributable to noncontrolling interests		0			0			20,024		0			20,024
Comprehensive income attributable to UHS	$	176,432		$	181,099		$	69,896	$	(250,995	)	$	176,432

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF MARCH 31, 2016
(amounts in thousands)


	Parent		Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Assets
Current assets:
Cash and cash equivalents	$	0	$	40,381		$	14,209		$	0		$	54,590
Accounts receivable, net		0		957,504			417,233			0			1,374,737
Supplies		0		72,559			44,166			0			116,725
Other current assets		0		67,954			21,432			0			89,386
Total current assets		0		1,138,398			497,040			0			1,635,438

Investments in subsidiaries		7,974,369		1,946,590			0			(9,920,959	)		0

Intercompany receivable		0		0			801,649			(801,649	)		0
Intercompany note receivable		0		0			1,242,937			(1,242,937	)		0

Property and equipment		0		4,782,483			1,872,809			0			6,655,292
Less: accumulated depreciation		0		(1,897,760	)		(876,980	)		0			(2,774,740	)
		0		2,884,723			995,829			0			3,880,552
Other assets:
Goodwill		0		3,065,409			529,492			0			3,594,901
Deferred charges		6,708		5,586			3,941			0			16,235
Other		8,180		390,548			39,155			0			437,883
	$	7,989,257	$	9,431,254		$	4,110,043		$	(11,965,545	)	$	9,565,009
Liabilities and Stockholders’ Equity
Current liabilities:
Current maturities of long-term debt	$	485,862	$	1,241		$	1,159		$	0		$	488,262
Accounts payable and accrued liabilities		20,343		821,832			305,209			0			1,147,384
Federal and state taxes		49,794		0			0			0			49,794
Total current liabilities		555,999		823,073			306,368			0			1,685,440

Intercompany payable		186,164		615,485			0			(801,649	)		0
Intercompany note payable		0		1,242,937			0			(1,242,937	)		0

Other noncurrent liabilities		11,324		213,818			70,542			0			295,684
Long-term debt		2,767,605		16,468			8,071			0			2,792,144
Deferred income taxes		178,947		0			0			0			178,947

Redeemable noncontrolling interests		0		0			261,492			0			261,492
Equity:
UHS common stockholders’ equity		4,289,218		6,519,473			3,401,486			(9,920,959	)		4,289,218
Noncontrolling interest		0		0			62,084			0			62,084
Total equity		4,289,218		6,519,473			3,463,570			(9,920,959	)		4,351,302
	$	7,989,257	$	9,431,254		$	4,110,043		$	(11,965,545	)	$	9,565,009

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 2015
(amounts in thousands)


	Parent		Guarantors			Non Guarantors			Consolidating Adjustments			Total Consolidated Amounts
Assets
Current assets:
Cash and cash equivalents	$	0	$	47,192		$	14,036		$	0		$	61,228
Accounts receivable, net		0		918,699			383,730			0			1,302,429
Supplies		0		72,499			43,538			0			116,037
Deferred income taxes		132,975		2,145			0						135,120
Other current assets		0		89,973			13,517			0			103,490
Total current assets		132,975		1,130,508			454,821			0			1,718,304

Investments in subsidiaries		7,760,156		1,876,415			0			(9,636,571	)		0

Intercompany receivable		80,764		0			747,709			(828,473	)		0
Intercompany note receivable		0		0			1,242,937			(1,242,937	)		0

Property and equipment		0		4,722,050			1,808,519			0			6,530,569
Less: accumulated depreciation		0		(1,845,746	)		(848,845	)		0			(2,694,591	)
		0		2,876,304			959,674			0			3,835,978
Other assets:
Goodwill		0		3,070,061			526,053			0			3,596,114
Deferred charges		7,208		5,530			3,950			0			16,688
Other		14,251		394,998			39,111			0			448,360
	$	7,995,354	$	9,353,816		$	3,974,255		$	(11,707,981	)	$	9,615,444
Liabilities and Stockholders’ Equity
Current liabilities:
Current maturities of long-term debt	$	60,368	$	1,223		$	1,131		$	0		$	62,722
Accounts payable and accrued liabilities		19,996		744,137			269,564			0			1,033,697
Federal and state taxes		3,987		0			0			0			3,987
Total current liabilities		84,351		745,360			270,695			0			1,100,406

Intercompany payable		0		828,473			0			(828,473	)		0
Intercompany note payable		0		1,242,937			0			(1,242,937	)		0

Other noncurrent liabilities		1,982		206,287			70,565			0			278,834
Long-term debt		3,343,474		16,790			8,370			0			3,368,634
Deferred income taxes		315,900		0			0			0			315,900

Redeemable noncontrolling interests		0		0			242,509			0			242,509
Equity:
UHS common stockholders’ equity		4,249,647		6,313,969			3,322,602			(9,636,571	)		4,249,647
Noncontrolling interest		0		0			59,514			0			59,514
Total equity		4,249,647		6,313,969			3,382,116			(9,636,571	)		4,309,161
	$	7,995,354	$	9,353,816		$	3,974,255		$	(11,707,981	)	$	9,615,444

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2016
(amounts in thousands)


	Parent			Guarantors			Non Guarantors			Consolidating Adjustments		Total Consolidated Amounts
Net cash (used in) provided by operating activities	$	52,278		$	279,625		$	132,324		$	0	$	464,227

Cash Flows from Investing Activities:
Property and equipment additions, net of disposals		0			(61,718	)		(65,496	)		0		(127,214	)
Acquisition of property and businesses		0			(10,506	)		(9,037	)		0		(19,543	)
Net cash used in investing activities		0			(72,224	)		(74,533	)		0		(146,757	)

Cash Flows from Financing Activities:
Reduction of long-term debt		(166,096	)		(304	)		(271	)		0		(166,671	)
Additional borrowings		14,400			0			0			0		14,400
Financing costs		(44	)		0			0			0		(44	)
Repurchase of common shares		(171,042	)		0			0			0		(171,042	)
Dividends paid		(9,757	)		0			0			0		(9,757	)
Issuance of common stock		2,331			0			0			0		2,331
Excess income tax benefits related to stock-based compensation		11,002			0			0			0		11,002
Profit distributions to noncontrolling interests		0			0			(3,407	)		0		(3,407	)
Changes in intercompany balances with affiliates, net		266,928			(212,988	)		(53,940	)		0		0
Net cash provided by (used in) financing activities		(52,278	)		(213,292	)		(57,618	)		0		(323,188	)

Effect of exchange rate changes on cash and cash equivalents		0			(920	)		0			0		(920	)

(Decrease) increase in cash and cash equivalents		0			(6,811	)		173			0		(6,638	)
Cash and cash equivalents, beginning of period		0			47,192			14,036			0		61,228
Cash and cash equivalents, end of period	$	0		$	40,381		$	14,209		$	0	$	54,590

UNIVERSAL HEALTH SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2015
(amounts in thousands)


	Parent			Guarantors			Non Guarantors			Consolidating Adjustments		Total Consolidated Amounts
Net cash provided by operating activities	$	62,343		$	124,046		$	84,886		$	0	$	271,275

Cash Flows from Investing Activities:
Property and equipment additions, net of disposals		0			(59,217	)		(30,059	)		0		(89,276	)
Acquisition of property and businesses		0			(22,513	)		(11,987	)		0		(34,500	)
Net cash used in investing activities		0			(81,730	)		(42,046	)		0		(123,776	)

Cash Flows from Financing Activities:
Reduction of long-term debt		(156,097	)		(2,561	)		(213	)		0		(158,871	)
Additional borrowings		20,800			0			0			0		20,800
Repurchase of common shares		(28,767	)		0			0			0		(28,767	)
Dividends paid		(9,899	)		0			0			0		(9,899	)
Issuance of common stock		1,768			0			0			0		1,768
Excess income tax benefits related to stock-based compensation		20,807			0			0			0		20,807
Profit distributions to noncontrolling interests		0			0			(2,413	)		0		(2,413	)
Proceeds received from sale/leaseback of real property		0			0			12,551					12,551
Changes in intercompany balances with affiliates, net		89,045			(45,555	)		(43,490	)		0		0
Net cash (used in) provided by financing activities		(62,343	)		(48,116	)		(33,565	)		0		(144,024	)

Effect of exchange rate changes on cash and cash equivalents		0			(466	)		0			0		(466	)

Increase in cash and cash equivalents		0			(6,266	)		9,275			0		3,009
Cash and cash equivalents, beginning of period		0			21,784			10,285			0		32,069
Cash and cash equivalents, end of period	$	0		$	15,518		$	19,560		$	0	$	35,078