UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2017
Or
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 1-11239
HCA Healthcare, Inc.
(Exact name of registrant as specified in its charter)
Delaware | 27-3865930 | |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
One Park Plaza Nashville, Tennessee |
37203 | |
(Address of principal executive offices) | (Zip Code) |
(615) 344-9551
(Registrants telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
☒ |
Accelerated filer |
☐ | |||
Non-accelerated filer |
☐ (Do not check if a smaller reporting company) |
Smaller reporting company |
☐ | |||
Emerging growth company |
☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
Indicate the number of shares outstanding of each of the issuers classes of common stock as of the latest practicable date.
Class of Common Stock |
Outstanding at October 31, 2017 | |
Voting common stock, $.01 par value |
354,052,500 shares |
Form 10-Q
September 30, 2017
Page of Form 10-Q |
||||||
Part I. |
Financial Information | |||||
Item 1. |
Financial Statements (Unaudited): | |||||
2 | ||||||
3 | ||||||
Condensed Consolidated Balance Sheets September 30, 2017 and December 31, 2016 |
4 | |||||
5 | ||||||
6 | ||||||
Item 2. |
Managements Discussion and Analysis of Financial Condition and Results of Operations |
26 | ||||
Item 3. |
44 | |||||
Item 4. |
44 | |||||
Part II. |
Other Information | |||||
Item 1. |
44 | |||||
Item 1A. |
44 | |||||
Item 2. |
45 | |||||
Item 6. |
46 | |||||
47 |
1
CONDENSED CONSOLIDATED INCOME STATEMENTS
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016
Unaudited
(Dollars in millions, except per share amounts)
Quarter | Nine months | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Revenues before provision for doubtful accounts |
$ | 11,967 | $ | 11,110 | $ | 35,156 | $ | 33,241 | ||||||||
Provision for doubtful accounts |
1,271 | 840 | 3,104 | 2,392 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues |
10,696 | 10,270 | 32,052 | 30,849 | ||||||||||||
Salaries and benefits |
5,081 | 4,740 | 14,878 | 14,133 | ||||||||||||
Supplies |
1,777 | 1,699 | 5,369 | 5,131 | ||||||||||||
Other operating expenses |
2,075 | 1,896 | 5,970 | 5,617 | ||||||||||||
Equity in earnings of affiliates |
(13 | ) | (22 | ) | (36 | ) | (44 | ) | ||||||||
Depreciation and amortization |
539 | 495 | 1,581 | 1,463 | ||||||||||||
Interest expense |
427 | 432 | 1,257 | 1,275 | ||||||||||||
Gains on sales of facilities |
(7 | ) | (3 | ) | (10 | ) | (8 | ) | ||||||||
Losses on retirement of debt |
39 | 4 | 39 | 4 | ||||||||||||
Legal claim costs |
| 11 | | 33 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
9,918 | 9,252 | 29,048 | 27,604 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income before income taxes |
778 | 1,018 | 3,004 | 3,245 | ||||||||||||
Provision for income taxes |
248 | 273 | 902 | 898 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income |
530 | 745 | 2,102 | 2,347 | ||||||||||||
Net income attributable to noncontrolling interests |
104 | 127 | 360 | 377 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income attributable to HCA Healthcare, Inc. |
$ | 426 | $ | 618 | $ | 1,742 | $ | 1,970 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Per share data: |
||||||||||||||||
Basic earnings per share |
$ | 1.18 | $ | 1.63 | $ | 4.77 | $ | 5.09 | ||||||||
Diluted earnings per share |
$ | 1.15 | $ | 1.59 | $ | 4.64 | $ | 4.93 | ||||||||
Shares used in earnings per share calculations (in millions): |
||||||||||||||||
Basic |
360.170 | 378.199 | 365.398 | 386.968 | ||||||||||||
Diluted |
369.834 | 389.592 | 375.013 | 399.577 |
See accompanying notes.
2
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME STATEMENTS
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016
Unaudited
(Dollars in millions)
Quarter | Nine months | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Net income |
$ | 530 | $ | 745 | $ | 2,102 | $ | 2,347 | ||||||||
Other comprehensive income (loss) before taxes: |
||||||||||||||||
Foreign currency translation |
32 | (40 | ) | 87 | (169 | ) | ||||||||||
Unrealized gains (losses) on available-for-sale securities |
| (2 | ) | 5 | 3 | |||||||||||
Defined benefit plans |
| | | | ||||||||||||
Pension costs included in salaries and benefits |
5 | 4 | 14 | 13 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
5 | 4 | 14 | 13 | |||||||||||||
Change in fair value of derivative financial instruments |
(1 | ) | 13 | (9 | ) | (57 | ) | |||||||||
Interest costs included in interest expense |
4 | 28 | 17 | 84 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
3 | 41 | 8 | 27 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income (loss) before taxes |
40 | 3 | 114 | (126 | ) | |||||||||||
Income taxes (benefits) related to other comprehensive income items |
15 | | 44 | (50 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income (loss) |
25 | 3 | 70 | (76 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income |
555 | 748 | 2,172 | 2,271 | ||||||||||||
Comprehensive income attributable to noncontrolling interests |
104 | 127 | 360 | 377 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income attributable to HCA Healthcare, Inc. |
$ | 451 | $ | 621 | $ | 1,812 | $ | 1,894 | ||||||||
|
|
|
|
|
|
|
|
See accompanying notes.
3
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited
(Dollars in millions)
September 30, 2017 |
December 31, 2016 |
|||||||
ASSETS | ||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 718 | $ | 646 | ||||
Accounts receivable, less allowance for doubtful accounts of $5,416 and $4,988 |
5,980 | 5,826 | ||||||
Inventories |
1,546 | 1,503 | ||||||
Other |
1,204 | 1,111 | ||||||
|
|
|
|
|||||
9,448 | 9,086 | |||||||
Property and equipment, at cost |
39,262 | 37,055 | ||||||
Accumulated depreciation |
(21,933 | ) | (20,703 | ) | ||||
|
|
|
|
|||||
17,329 | 16,352 | |||||||
Investments of insurance subsidiaries |
368 | 336 | ||||||
Investments in and advances to affiliates |
201 | 206 | ||||||
Goodwill and other intangible assets |
7,357 | 6,704 | ||||||
Other |
1,028 | 1,074 | ||||||
|
|
|
|
|||||
$ | 35,731 | $ | 33,758 | |||||
|
|
|
|
|||||
LIABILITIES AND STOCKHOLDERS DEFICIT | ||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 2,314 | $ | 2,318 | ||||
Accrued salaries |
1,312 | 1,265 | ||||||
Other accrued expenses |
1,783 | 2,035 | ||||||
Long-term debt due within one year |
202 | 216 | ||||||
|
|
|
|
|||||
5,611 | 5,834 | |||||||
Long-term debt, less net debt issuance costs of $171 and $170 |
32,751 | 31,160 | ||||||
Professional liability risks |
1,179 | 1,148 | ||||||
Income taxes and other liabilities |
1,256 | 1,249 | ||||||
Stockholders deficit: |
||||||||
Common stock $0.01 par; authorized 1,800,000,000 shares; outstanding 356,979,800 shares in 2017 and 370,535,900 shares in 2016 |
4 | 4 | ||||||
Accumulated other comprehensive loss |
(268 | ) | (338 | ) | ||||
Retained deficit |
(6,516 | ) | (6,968 | ) | ||||
|
|
|
|
|||||
Stockholders deficit attributable to HCA Healthcare, Inc. |
(6,780 | ) | (7,302 | ) | ||||
Noncontrolling interests |
1,714 | 1,669 | ||||||
|
|
|
|
|||||
(5,066 | ) | (5,633 | ) | |||||
|
|
|
|
|||||
$ | 35,731 | $ | 33,758 | |||||
|
|
|
|
See accompanying notes.
4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016
Unaudited
(Dollars in millions)
2017 | 2016 | |||||||
Cash flows from operating activities: |
||||||||
Net income |
$ | 2,102 | $ | 2,347 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Increase (decrease) in cash from operating assets and liabilities: |
||||||||
Accounts receivable |
(3,174 | ) | (2,044 | ) | ||||
Provision for doubtful accounts |
3,104 | 2,392 | ||||||
|
|
|
|
|||||
Accounts receivable, net |
(70 | ) | 348 | |||||
Inventories and other assets |
(50 | ) | (161 | ) | ||||
Accounts payable and accrued expenses |
(169 | ) | (341 | ) | ||||
Depreciation and amortization |
1,581 | 1,463 | ||||||
Income taxes |
(9 | ) | 8 | |||||
Gains on sales of facilities |
(10 | ) | (8 | ) | ||||
Losses on retirement of debt |
39 | 4 | ||||||
Legal claim costs |
| 33 | ||||||
Amortization of debt issuance costs |
23 | 26 | ||||||
Share-based compensation |
195 | 196 | ||||||
Other |
60 | 39 | ||||||
|
|
|
|
|||||
Net cash provided by operating activities |
3,692 | 3,954 | ||||||
|
|
|
|
|||||
Cash flows from investing activities: |
||||||||
Purchase of property and equipment |
(2,033 | ) | (1,884 | ) | ||||
Acquisition of hospitals and health care entities |
(1,142 | ) | (468 | ) | ||||
Disposal of hospitals and health care entities |
24 | 23 | ||||||
Change in investments |
(15 | ) | 78 | |||||
Other |
(6 | ) | 17 | |||||
|
|
|
|
|||||
Net cash used in investing activities |
(3,172 | ) | (2,234 | ) | ||||
|
|
|
|
|||||
Cash flows from financing activities: |
||||||||
Issuances of long-term debt |
1,502 | 5,400 | ||||||
Net change in revolving bank credit facilities |
650 | (70 | ) | |||||
Repayment of long-term debt |
(700 | ) | (4,424 | ) | ||||
Distributions to noncontrolling interests |
(363 | ) | (342 | ) | ||||
Payment of debt issuance costs |
(25 | ) | (40 | ) | ||||
Repurchases of common stock |
(1,475 | ) | (2,213 | ) | ||||
Other |
(37 | ) | (95 | ) | ||||
|
|
|
|
|||||
Net cash used in financing activities |
(448 | ) | (1,784 | ) | ||||
|
|
|
|
|||||
Change in cash and cash equivalents |
72 | (64 | ) | |||||
Cash and cash equivalents at beginning of period |
646 | 741 | ||||||
|
|
|
|
|||||
Cash and cash equivalents at end of period |
$ | 718 | $ | 677 | ||||
|
|
|
|
|||||
Interest payments |
$ | 1,383 | $ | 1,339 | ||||
Income tax payments, net |
$ | 911 | $ | 890 |
See accompanying notes.
5
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
Reporting Entity
HCA Healthcare, Inc. is a holding company whose affiliates own and operate hospitals and related health care entities. The term affiliates includes direct and indirect subsidiaries of HCA Healthcare, Inc. and partnerships and joint ventures in which such subsidiaries are partners. At September 30, 2017, these affiliates owned and operated 177 hospitals, 119 freestanding surgery centers and provided extensive outpatient and ancillary services. HCA Healthcare, Inc.s facilities are located in 20 states and England. The terms Company, HCA, we, our or us, as used herein and unless otherwise stated or indicated by context, refer to HCA Healthcare, Inc. and its affiliates. The terms facilities or hospitals refer to entities owned and operated by affiliates of HCA and the term employees refers to employees of affiliates of HCA.
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal and recurring nature.
The majority of our expenses are costs of revenues items. Costs that could be classified as general and administrative would include our corporate office costs, which were $91 million and $94 million for the quarters ended September 30, 2017 and 2016, respectively, and $273 million and $272 million for the nine months ended September 30, 2017 and 2016, respectively. Operating results for the quarter and nine months ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. For further information, refer to the consolidated financial statements and footnotes thereto included in our annual report on Form 10-K for the year ended December 31, 2016.
6
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 1 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued)
Revenues
Revenues are recorded during the period the health care services are provided, based upon the estimated amounts due from the patients and third-party payers. Third-party payers include federal and state agencies (under the Medicare and Medicaid programs), managed care health plans and commercial insurance companies (including plans offered through the health insurance exchanges), and employers. Estimates of contractual allowances under managed care health plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured discounts and contractual discounts). We also record a provision for doubtful accounts (based primarily on historical collection experience) related to uninsured accounts to record net self-pay revenues at the estimated amounts we expect to collect. Our revenues from third-party payers, the uninsured and other for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
Quarter | ||||||||||||||||
2017 | Ratio | 2016 | Ratio | |||||||||||||
Medicare |
$ | 2,354 | 22.0 | % | $ | 2,158 | 21.0 | % | ||||||||
Managed Medicare |
1,156 | 10.8 | 1,068 | 10.4 | ||||||||||||
Medicaid |
362 | 3.4 | 405 | 3.9 | ||||||||||||
Managed Medicaid |
582 | 5.4 | 611 | 6.0 | ||||||||||||
Managed care and other insurers |
6,039 | 56.4 | 5,863 | 57.1 | ||||||||||||
International (managed care and other insurers) |
276 | 2.6 | 285 | 2.8 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
10,769 | 100.6 | 10,390 | 101.2 | |||||||||||||
Uninsured |
849 | 7.9 | 336 | 3.3 | ||||||||||||
Other |
349 | 3.3 | 384 | 3.7 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues before provision for doubtful accounts |
11,967 | 111.8 | 11,110 | 108.2 | ||||||||||||
Provision for doubtful accounts |
(1,271 | ) | (11.8 | ) | (840 | ) | (8.2 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues |
$ | 10,696 | 100.0 | % | $ | 10,270 | 100.0 | % | ||||||||
|
|
|
|
|
|
|
|
Nine Months | ||||||||||||||||
2017 | Ratio | 2016 | Ratio | |||||||||||||
Medicare |
$ | 7,080 | 22.1 | % | $ | 6,641 | 21.5 | % | ||||||||
Managed Medicare |
3,546 | 11.1 | 3,250 | 10.5 | ||||||||||||
Medicaid |
1,188 | 3.7 | 1,248 | 4.0 | ||||||||||||
Managed Medicaid |
1,798 | 5.6 | 1,816 | 5.9 | ||||||||||||
Managed care and other insurers |
18,071 | 56.4 | 17,324 | 56.2 | ||||||||||||
International (managed care and other insurers) |
814 | 2.5 | 926 | 3.0 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
32,497 | 101.4 | 31,205 | 101.1 | |||||||||||||
Uninsured |
1,593 | 5.0 | 750 | 2.4 | ||||||||||||
Other |
1,066 | 3.3 | 1,286 | 4.2 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues before provision for doubtful accounts |
35,156 | 109.7 | 33,241 | 107.7 | ||||||||||||
Provision for doubtful accounts |
(3,104 | ) | (9.7 | ) | (2,392 | ) | (7.7 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues |
$ | 32,052 | 100.0 | % | $ | 30,849 | 100.0 | % | ||||||||
|
|
|
|
|
|
|
|
7
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 1 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued)
Recent Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board issued a final, converged, principles-based standard on revenue recognition. Companies across all industries will use a five-step model to recognize revenue from customer contracts. The new standard, which replaces nearly all existing revenue recognition guidance, will require significant management judgments and change the way many companies recognize revenue in their financial statements. In July 2015, the FASB decided to defer the effective date of the new revenue standard by one year to annual and interim periods beginning after December 15, 2017 for public entities and permit entities to adopt one year earlier if they choose. The FASB decided, based on its outreach to various stakeholders and continuing amendments to the new revenue standard, that a deferral was necessary to provide adequate time to effectively implement the new standard. We are continuing to evaluate the effects the adoption of this standard will have on our financial statements and financial disclosures. We believe the most significant impact will be to the presentation of our income statement where the provision for doubtful accounts will be recorded as a direct reduction to revenues and will not be presented as a separate line item. We expect to adopt the new standard using the full retrospective application, and we do not currently believe the adoption will have a significant impact on our recognition of net revenues or related disclosures for any period.
In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (ASU 2016-02), which requires lessees to recognize assets and liabilities for most leases. ASU 2016-02 is effective for public business entities for annual and interim periods beginning after December 15, 2018. Early adoption is permitted. ASU 2016-02s transition provisions will be applied using a modified retrospective approach at the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the provisions of ASU 2016-02 to determine how our financial statements will be affected, and we believe the primary effect of adopting the new standard will be to record right-of-use assets and obligations for our leases currently classified as operating leases.
Reclassifications
Certain prior year amounts have been reclassified to conform to the current year presentation.
NOTE 2 ACQUISITIONS AND DISPOSITIONS
During the nine months ended September 30, 2017, we paid $1.000 billion to acquire seven hospital facilities (one of the acquired hospital facilities has an effective acquisition date of October 1, 2017) and $142 million to acquire other nonhospital health care entities. During the nine months ended September 30, 2016, we paid $343 million to acquire three hospital facilities and $125 million to acquire other nonhospital health care entities.
During the nine months ended September 30, 2017, we received proceeds of $24 million and recognized a net pretax gain of $10 million related to sales of real estate and other investments. During the nine months ended September 30, 2016, we received proceeds of $23 million and recognized a net pretax gain of $8 million related to sales of real estate and other investments.
8
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 3 INCOME TAXES
Our liability for unrecognized tax benefits was $429 million, including accrued interest of $40 million, as of September 30, 2017 ($418 million and $45 million, respectively, as of December 31, 2016). Unrecognized tax benefits of $136 million ($137 million as of December 31, 2016) would affect the effective rate, if recognized.
Our provision for income taxes for the quarters ended September 30, 2017 and 2016, included tax benefits of $4 million and $11 million, respectively, and for the nine months ended September 30, 2017 and 2016, included tax benefits of $80 million and $129 million, respectively, related to the settlement of employee equity awards. Our provision for income taxes for the quarter and nine months ended September 30, 2017 also included $4 million and $16 million, respectively, of reductions in interest expense (net of tax). We also reduced our provision for income taxes for the quarter and nine months ended September 30, 2016 by $51 million, including interest of $17 million (net of tax) primarily related to the completion of IRS examinations which resolved all outstanding federal tax issues for our 2011 and 2012 tax years.
We are subject to examination by federal, state and foreign taxing authorities. Depending on the resolution of any federal, state and foreign tax disputes, the completion of examinations by federal, state or foreign taxing authorities, or the expiration of statutes of limitation for specific taxing jurisdictions, we believe it is reasonably possible that our liability for unrecognized tax benefits may significantly increase or decrease within the next 12 months. However, we are currently unable to estimate the range of any possible change.
NOTE 4 EARNINGS PER SHARE
We compute basic earnings per share using the weighted average number of common shares outstanding. We compute diluted earnings per share using the weighted average number of common shares outstanding, plus the dilutive effect of outstanding equity awards and potential shares, computed using the treasury stock method.
The following table sets forth the computation of basic and diluted earnings per share for the quarters and nine months ended September 30, 2017 and 2016 (dollars and shares in millions, except per share amounts):
Quarter | Nine months | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Net income attributable to HCA Healthcare, Inc. |
$ | 426 | $ | 618 | $ | 1,742 | $ | 1,970 | ||||||||
Weighted average common shares outstanding |
360.170 | 378.199 | 365.398 | 386.968 | ||||||||||||
Effect of dilutive incremental shares |
9.664 | 11.393 | 9.615 | 12.609 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Shares used for diluted earnings per share |
369.834 | 389.592 | 375.013 | 399.577 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Earnings per share: |
||||||||||||||||
Basic earnings per share |
$ | 1.18 | $ | 1.63 | $ | 4.77 | $ | 5.09 | ||||||||
Diluted earnings per share |
$ | 1.15 | $ | 1.59 | $ | 4.64 | $ | 4.93 |
9
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 5 INVESTMENTS OF INSURANCE SUBSIDIARIES
A summary of our insurance subsidiaries investments at September 30, 2017 and December 31, 2016 follows (dollars in millions):
September 30, 2017 | ||||||||||||||||
Amortized Cost |
Unrealized Amounts |
Fair Value |
||||||||||||||
Gains | Losses | |||||||||||||||
Debt securities: |
||||||||||||||||
States and municipalities |
$ | 352 | $14 | $ | $ | 366 | ||||||||||
Money market funds |
52 | | | 52 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
404 | 14 | | 418 | |||||||||||||
Equity securities |
1 | 2 | | 3 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 405 | $16 | $ | 421 | ||||||||||||
|
|
|
|
|
|
|||||||||||
Amounts classified as current assets |
(53 | ) | ||||||||||||||
|
|
|||||||||||||||
Investment carrying value |
$ | 368 | ||||||||||||||
|
|
December 31, 2016 | ||||||||||||||||
Amortized Cost |
Unrealized Amounts |
Fair Value |
||||||||||||||
Gains | Losses | |||||||||||||||
Debt securities: |
||||||||||||||||
States and municipalities |
$ | 345 | $9 | $(1) | $ | 353 | ||||||||||
Money market funds |
28 | | | 28 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
373 | 9 | (1) | 381 | |||||||||||||
Equity securities |
1 | 3 | | 4 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 374 | $12 | $(1) | 385 | ||||||||||||
|
|
|
|
|
|
|||||||||||
Amounts classified as current assets |
(49 | ) | ||||||||||||||
|
|
|||||||||||||||
Investment carrying value |
$ | 336 | ||||||||||||||
|
|
At September 30, 2017 and December 31, 2016, the investments of our insurance subsidiaries were classified as available-for-sale. Changes in temporary unrealized gains and losses are recorded as adjustments to other comprehensive income (loss).
Scheduled maturities of investments in debt securities at September 30, 2017 were as follows (dollars in millions):
Amortized Cost |
Fair Value |
|||||||
Due in one year or less |
$ | 100 | $ | 100 | ||||
Due after one year through five years |
76 | 80 | ||||||
Due after five years through ten years |
178 | 187 | ||||||
Due after ten years |
50 | 51 | ||||||
|
|
|
|
|||||
$ | 404 | $ | 418 | |||||
|
|
|
|
10
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 5 INVESTMENTS OF INSURANCE SUBSIDIARIES (Continued)
The average expected maturity of the investments in debt securities at September 30, 2017 was 4.0 years, compared to the average scheduled maturity of 5.5 years. Expected and scheduled maturities may differ because the issuers of certain securities have the right to call, prepay or otherwise redeem such obligations prior to their scheduled maturity date.
NOTE 6 FINANCIAL INSTRUMENTS
Interest Rate Swap Agreements
We have entered into interest rate swap agreements to manage our exposure to fluctuations in interest rates. These swap agreements involve the exchange of fixed and variable rate interest payments between two parties based on common notional principal amounts and maturity dates. Pay-fixed interest rate swaps effectively convert LIBOR indexed variable rate obligations to fixed interest rate obligations. The interest payments under these agreements are settled on a net basis. The net interest payments, based on the notional amounts in these agreements, generally match the timing of the related liabilities for the interest rate swap agreements which have been designated as cash flow hedges. The notional amounts of the swap agreements represent amounts used to calculate the exchange of cash flows and are not our assets or liabilities. Our credit risk related to these agreements is considered low because the swap agreements are with creditworthy financial institutions.
The following table sets forth our interest rate swap agreements, which have been designated as cash flow hedges, at September 30, 2017 (dollars in millions):
Notional Amount |
Maturity Date | Fair Value |
||||||||||
Pay-fixed interest rate swaps |
$ | 1,000 | December 2017 | $ | (3 | ) | ||||||
Pay-fixed interest rate swaps |
2,000 | December 2021 | 30 |
During the next 12 months, we estimate $3 million will be reclassified from other comprehensive income (OCI) to interest expense.
Derivatives Results of Operations
The following table presents the effect of our interest rate swaps on our results of operations for the nine months ended September 30, 2017 (dollars in millions):
Derivatives in Cash Flow Hedging Relationships |
Amount of Loss Recognized in OCI on Derivatives, Net of Tax |
Location of Loss Reclassified from Accumulated OCI into Operations |
Amount of Loss Reclassified from Accumulated OCI into Operations |
|||||||||
Interest rate swaps |
$ | 6 | Interest expense | $ | 17 |
11
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 7 ASSETS AND LIABILITIES MEASURED AT FAIR VALUE
Accounting Standards Codification 820, Fair Value Measurements and Disclosures (ASC 820) emphasizes fair value is a market-based measurement, and fair value measurements should be determined based on the assumptions market participants would use in pricing assets or liabilities. ASC 820 utilizes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs classified within Levels 1 and 2 of the hierarchy) and the reporting entitys own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).
Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entitys own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment.
Cash Traded Investments
Our cash traded investments are generally classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Certain types of cash traded instruments are classified within Level 3 of the fair value hierarchy because they trade infrequently and therefore have little or no price transparency. The valuation of these securities involves the consideration of market factors and managements judgment.
Derivative Financial Instruments
We have entered into interest rate swap agreements to manage our exposure to fluctuations in interest rates. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. We incorporate credit valuation adjustments to reflect both our own nonperformance risk and the respective counterpartys nonperformance risk in the fair value measurements of these instruments.
Although we determined the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. We assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions, and at September 30, 2017 and December 31, 2016, we determined the credit valuation adjustments were not significant to the overall valuation of our derivatives.
12
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 7 ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Continued)
The following tables summarize our assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016, aggregated by the level in the fair value hierarchy within which those measurements fall (dollars in millions):
September 30, 2017 | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Fair Value | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) |
Significant Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (Level 3) |
|||||||||||||
Assets: |
||||||||||||||||
Investments of insurance subsidiaries: |
||||||||||||||||
Debt securities: |
||||||||||||||||
States and municipalities |
$ | 366 | $ | | $ | 366 | $ | | ||||||||
Money market funds |
52 | 52 | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
418 | 52 | 366 | | |||||||||||||
Equity securities |
3 | 3 | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Investments of insurance subsidiaries |
421 | 55 | 366 | | ||||||||||||
Less amounts classified as current assets |
(53 | ) | (52 | ) | (1 | ) | | |||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 368 | $ | 3 | $ | 365 | $ | | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Interest rate swaps (Other) |
$ | 30 | $ | | $ | 30 | $ | | ||||||||
Liabilities: |
||||||||||||||||
Interest rate swaps (Income taxes and other liabilities) |
$ | 3 | $ | | $ | 3 | $ | | ||||||||
December 31, 2016 | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Fair Value | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) |
Significant Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (Level 3) |
|||||||||||||
Assets: |
||||||||||||||||
Investments of insurance subsidiaries: |
||||||||||||||||
Debt securities: |
||||||||||||||||
States and municipalities |
$ | 353 | $ | | $ | 347 | $ | 6 | ||||||||
Money market funds |
28 | 28 | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
381 | 28 | 347 | 6 | |||||||||||||
Equity securities |
4 | 4 | | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Investments of insurance subsidiaries |
385 | 32 | 347 | 6 | ||||||||||||
Less amounts classified as current assets |
(49 | ) | (28 | ) | (21 | ) | | |||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 336 | $ | 4 | $ | 326 | $ | 6 | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Interest rate swaps (Other) |
$ | 31 | $ | | $ | 31 | $ | | ||||||||
Liabilities: |
||||||||||||||||
Interest rate swaps (Income taxes and other liabilities) |
$ | 12 | $ | | $ | 12 | $ | |
13
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 7 ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Continued)
The $6 million reduction in the Level 3 investments of our insurance subsidiaries resulted from settlements. The estimated fair value of our long-term debt was $34.998 billion and $32.833 billion at September 30, 2017 and December 31, 2016, respectively, compared to carrying amounts, excluding net debt issuance costs, aggregating $33.124 billion and $31.546 billion, respectively. The estimates of fair value are generally based upon the quoted market prices or quoted market prices for similar issues of long-term debt with the same maturities.
NOTE 8 LONG-TERM DEBT
A summary of long-term debt at September 30, 2017 and December 31, 2016, including related interest rates at September 30, 2017, follows (dollars in millions):
September 30, 2017 |
December 31, 2016 |
|||||||
Senior secured asset-based revolving credit facility (effective interest rate of 2.7%) |
$ | 3,570 | $ | 2,920 | ||||
Senior secured revolving credit facility |
| | ||||||
Senior secured term loan facilities (effective interest rate of 3.6%) |
3,915 | 3,981 | ||||||
Senior secured notes (effective interest rate of 5.4%) |
15,300 | 13,800 | ||||||
Other senior secured debt (effective interest rate of 5.8%) |
587 | 593 | ||||||
|
|
|
|
|||||
Senior secured debt |
23,372 | 21,294 | ||||||
Senior unsecured notes (effective interest rate of 6.4%) |
9,752 | 10,252 | ||||||
Net debt issuance costs |
(171 | ) | (170 | ) | ||||
|
|
|
|
|||||
Total debt (average life of 7.1 years, rates averaging 5.2%) |
32,953 | 31,376 | ||||||
Less amounts due within one year |
202 | 216 | ||||||
|
|
|
|
|||||
$ | 32,751 | $ | 31,160 | |||||
|
|
|
|
2017 Activity
During June 2017, we issued $1.500 billion aggregate principal amount of 5.500% senior secured notes due 2047. We used the net proceeds for general corporate purposes, including funding the purchase of certain hospital acquisitions, and the redemption, during July 2017, of all $500 million aggregate principal amount of our existing 8.000% senior notes maturing in October 2018. The pretax loss on retirement of debt was $39 million.
During June 2017, we amended our senior secured revolving credit facilities by (i) increasing the commitments under the senior secured asset-based revolving credit facility to $3.750 billion, (ii) extending the maturity date of the revolving credit commitments to June 28, 2022, (iii) amending the incremental facility provisions to permit the incurrence of additional incremental credit facilities in an aggregate principal amount of $1.5 billion and (iv) providing that the commitment fee for unutilized commitments under the senior secured asset-based revolving credit facility shall be 0.250% per annum.
14
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 9 CONTINGENCIES
We operate in a highly regulated and litigious industry. As a result, various lawsuits, claims and legal and regulatory proceedings have been and can be expected to be instituted or asserted against us. We are also subject to claims and suits arising in the ordinary course of business, including claims for personal injuries or wrongful restriction of, or interference with, physicians staff privileges. In certain of these actions the claimants may seek punitive damages against us which may not be covered by insurance. We are also subject to claims by various taxing authorities for additional taxes and related interest and penalties. The resolution of any such lawsuits, claims or legal and regulatory proceedings could have a material, adverse effect on our results of operations, financial position or liquidity.
Health care companies are subject to numerous investigations by various governmental agencies. Under the federal False Claims Act, private parties have the right to bring qui tam, or whistleblower, suits against companies that submit false claims for payments to, or improperly retain overpayments from, the government. Some states have adopted similar state whistleblower and false claims provisions. Certain of our individual facilities have received, and from time to time, other facilities may receive, government inquiries from, and may be subject to investigation by, federal and state agencies. Depending on whether the underlying conduct in these or future inquiries or investigations could be considered systemic, their resolution could have a material, adverse effect on our results of operations, financial position or liquidity.
NOTE 10 CAPITAL STRUCTURE
The changes in stockholders deficit, including changes in stockholders deficit attributable to HCA Healthcare, Inc. and changes in equity attributable to noncontrolling interests, are as follows (dollars and shares in millions):
Equity (Deficit) Attributable to HCA Healthcare, Inc. | Equity Attributable to Noncontrolling Interests |
Total | ||||||||||||||||||||||||||
Common Stock | Capital in Excess of Par Value |
Accumulated Other Comprehensive Loss |
Retained Deficit |
|||||||||||||||||||||||||
Shares | Par Value | |||||||||||||||||||||||||||
Balances at December 31, 2016 |
370.536 | $ | 4 | $ | | $ | (338 | ) | $ | (6,968 | ) | $ | 1,669 | $ | (5,633 | ) | ||||||||||||
Comprehensive income |
| | | 70 | 1,742 | 360 | 2,172 | |||||||||||||||||||||
Repurchase of common stock |
(17.847 | ) | | (185 | ) | | (1,290 | ) | | (1,475 | ) | |||||||||||||||||
Distributions |
| | | | | (363 | ) | (363 | ) | |||||||||||||||||||
Share-based benefit plans |
4.291 | | 188 | | | | 188 | |||||||||||||||||||||
Other |
| | (3 | ) | | | 48 | 45 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balances at September 30, 2017 |
356.980 | $ | 4 | $ | | $ | (268 | ) | $ | (6,516 | ) | $ | 1,714 | $ | (5,066 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During the nine months ended September 30, 2017, we repurchased 17.847 million shares of our common stock at an average price of $82.62 per share through market purchases pursuant to the $2.0 billion share repurchase program authorized during November 2016. At September 30, 2017, we had $379 million of repurchase authorization available under the November 2016 authorization. During October 2017, our board of directors authorized a share repurchase program for up to $2 billion of our outstanding common stock.
15
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 10 CAPITAL STRUCTURE (Continued)
The components of accumulated other comprehensive loss are as follows (dollars in millions):
Unrealized Gains on Available- for-Sale Securities |
Foreign Currency Translation Adjustments |
Defined Benefit Plans |
Change in Fair Value of Derivative Instruments |
Total | ||||||||||||||||
Balances at December 31, 2016 |
$ | 7 | $ | (211 | ) | $ | (146 | ) | $ | 12 | $ | (338 | ) | |||||||
Unrealized gains on available-for-sale securities, net of $2 of income taxes |
3 | | | | 3 | |||||||||||||||
Foreign currency translation adjustments, net of $34 of income taxes |
| 53 | | | 53 | |||||||||||||||
Change in fair value of derivative instruments, net of $3 income tax benefits |
| | | (6 | ) | (6 | ) | |||||||||||||
Expense reclassified into operations from other comprehensive income, net of $5 and $6, respectively, income tax benefits |
| | 9 | 11 | 20 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances at September 30, 2017 |
$ | 10 | $ | (158 | ) | $ | (137 | ) | $ | 17 | $ | (268 | ) | |||||||
|
|
|
|
|
|
|
|
|
|
NOTE 11 SEGMENT AND GEOGRAPHIC INFORMATION
We operate in one line of business, which is operating hospitals and related health care entities. We operate in two geographically organized groups: the National and American Groups. The National Group includes 86 hospitals located in Alaska, California, Florida, southern Georgia, Idaho, Indiana, northern Kentucky, Nevada, New Hampshire, South Carolina, Utah and Virginia, and the American Group includes 85 hospitals located in Colorado, northern Georgia, Kansas, southern Kentucky, Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas. We also operate six hospitals in England, and these facilities are included in the Corporate and other group.
Adjusted segment EBITDA is defined as income before depreciation and amortization, interest expense, gains on sales of facilities, losses on retirement of debt, legal claim costs, income taxes and net income attributable to noncontrolling interests. We use adjusted segment EBITDA as an analytical indicator for purposes of allocating resources to geographic areas and assessing their performance. Adjusted segment EBITDA is commonly used as an analytical indicator within the health care industry, and also serves as a measure of leverage capacity and debt service ability. Adjusted segment EBITDA should not be considered as a measure of financial performance under generally accepted accounting principles, and the items excluded from adjusted segment EBITDA are significant components in understanding and assessing financial performance. Because adjusted segment EBITDA is not a measurement determined in accordance with generally accepted accounting principles and is thus susceptible to varying calculations, adjusted segment EBITDA, as presented, may not be comparable to other similarly titled measures of other companies. The geographic distributions of our revenues,
16
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 11 SEGMENT AND GEOGRAPHIC INFORMATION (Continued)
equity in earnings of affiliates, adjusted segment EBITDA and depreciation and amortization for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
Quarter | Nine months | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Revenues: |
||||||||||||||||
National Group |
$ | 5,036 | $ | 4,882 | $ | 15,344 | $ | 14,780 | ||||||||
American Group |
5,180 | 4,908 | 15,268 | 14,554 | ||||||||||||
Corporate and other |
480 | 480 | 1,440 | 1,515 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 10,696 | $ | 10,270 | $ | 32,052 | $ | 30,849 | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Equity in earnings of affiliates: |
||||||||||||||||
National Group |
$ | (8 | ) | $ | (13 | ) | $ | (17 | ) | $ | (17 | ) | ||||
American Group |
(9 | ) | (9 | ) | (27 | ) | (26 | ) | ||||||||
Corporate and other |
4 | | 8 | (1 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | (13 | ) | $ | (22 | ) | $ | (36 | ) | $ | (44 | ) | |||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted segment EBITDA: |
||||||||||||||||
National Group |
$ | 975 | $ | 1,073 | $ | 3,268 | $ | 3,342 | ||||||||
American Group |
930 | 1,016 | 2,977 | 3,002 | ||||||||||||
Corporate and other |
(129 | ) | (132 | ) | (374 | ) | (332 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 1,776 | $ | 1,957 | $ | 5,871 | $ | 6,012 | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Depreciation and amortization: |
||||||||||||||||
National Group |
$ | 219 | $ | 204 | $ | 650 | $ | 602 | ||||||||
American Group |
251 | 231 | 727 | 675 | ||||||||||||
Corporate and other |
69 | 60 | 204 | 186 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 539 | $ | 495 | $ | 1,581 | $ | 1,463 | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted segment EBITDA |
$ | 1,776 | $ | 1,957 | $ | 5,871 | $ | 6,012 | ||||||||
Depreciation and amortization |
539 | 495 | 1,581 | 1,463 | ||||||||||||
Interest expense |
427 | 432 | 1,257 | 1,275 | ||||||||||||
Gains on sales of facilities |
(7 | ) | (3 | ) | (10 | ) | (8 | ) | ||||||||
Losses on retirement of debt |
39 | 4 | 39 | 4 | ||||||||||||
Legal claim costs |
| 11 | | 33 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income before income taxes |
$ | 778 | $ | 1,018 | $ | 3,004 | $ | 3,245 | ||||||||
|
|
|
|
|
|
|
|
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION
During December 2012, HCA Healthcare, Inc. issued $1.000 billion aggregate principal amount of 6.250% senior unsecured notes due 2021. These notes are senior unsecured obligations and are not guaranteed by any of our subsidiaries.
HCA Inc., a direct wholly-owned subsidiary of HCA Healthcare, Inc., is the obligor under a significant portion of our other indebtedness, including our senior secured credit facilities, senior secured notes and senior unsecured notes (other than the senior unsecured notes issued by HCA Healthcare, Inc.). The senior secured notes and senior unsecured notes issued by HCA Inc. are fully and unconditionally guaranteed
17
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
by HCA Healthcare, Inc. The senior secured credit facilities and senior secured notes are fully and unconditionally guaranteed by substantially all existing and future, direct and indirect, 100% owned material domestic subsidiaries that are Unrestricted Subsidiaries under our Indenture dated December 16, 1993 (except for certain special purpose subsidiaries that only guarantee and pledge their assets under our senior secured asset-based revolving credit facility).
Our summarized condensed consolidating comprehensive income statements for the quarters and nine months ended September 30, 2017 and 2016, condensed consolidating balance sheets at September 30, 2017 and December 31, 2016 and condensed consolidating statements of cash flows for the nine months ended September 30, 2017 and 2016, segregating HCA Healthcare, Inc. issuer, HCA Inc. issuer, the subsidiary guarantors, the subsidiary non-guarantors and eliminations, follow:
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT
FOR THE QUARTER ENDED SEPTEMBER 30, 2017
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
Revenues before provision for doubtful accounts |
$ | | $ | | $ | 5,897 | $ | 6,070 | $ | | $ | 11,967 | ||||||||||||
Provision for doubtful accounts |
| | 636 | 635 | | 1,271 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenues |
| | 5,261 | 5,435 | | 10,696 | ||||||||||||||||||
Salaries and benefits |
| | 2,427 | 2,654 | | 5,081 | ||||||||||||||||||
Supplies |
| | 889 | 888 | | 1,777 | ||||||||||||||||||
Other operating expenses |
| | 963 | 1,112 | | 2,075 | ||||||||||||||||||
Equity in earnings of affiliates |
(436 | ) | | (1 | ) | (12 | ) | 436 | (13 | ) | ||||||||||||||
Depreciation and amortization |
| | 249 | 290 | | 539 | ||||||||||||||||||
Interest expense |
16 | 792 | (318 | ) | (63 | ) | | 427 | ||||||||||||||||
Gains on sales of facilities |
| | (4 | ) | (3 | ) | | (7 | ) | |||||||||||||||
Losses on retirement of debt |
| 39 | | | | 39 | ||||||||||||||||||
Management fees |
| | (215 | ) | 215 | | | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(420 | ) | 831 | 3,990 | 5,081 | 436 | 9,918 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income (loss) before income taxes |
420 | (831 | ) | 1,271 | 354 | (436 | ) | 778 | ||||||||||||||||
Provision (benefit) for income taxes |
(6 | ) | (307 | ) | 460 | 101 | | 248 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) |
426 | (524 | ) | 811 | 253 | (436 | ) | 530 | ||||||||||||||||
Net income attributable to noncontrolling interests |
| | 24 | 80 | | 104 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) attributable to HCA Healthcare, Inc. |
$ | 426 | $ | (524 | ) | $ | 787 | $ | 173 | $ | (436 | ) | $ | 426 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Comprehensive income (loss) attributable to HCA Healthcare, Inc. |
$ | 451 | $ | (522 | ) | $ | 790 | $ | 193 | $ | (461 | ) | $ | 451 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
18
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT
FOR THE QUARTER ENDED SEPTEMBER 30, 2016
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
Revenues before provision for doubtful accounts |
$ | | $ | | $ | 5,591 | $ | 5,519 | $ | | $ | 11,110 | ||||||||||||
Provision for doubtful accounts |
| | 391 | 449 | | 840 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenues |
| | 5,200 | 5,070 | | 10,270 | ||||||||||||||||||
Salaries and benefits |
| | 2,373 | 2,367 | | 4,740 | ||||||||||||||||||
Supplies |
| | 888 | 811 | | 1,699 | ||||||||||||||||||
Other operating expenses |
1 | | 904 | 991 | | 1,896 | ||||||||||||||||||
Equity in earnings of affiliates |
(573 | ) | | (1 | ) | (21 | ) | 573 | (22 | ) | ||||||||||||||
Depreciation and amortization |
| | 242 | 253 | | 495 | ||||||||||||||||||
Interest expense |
16 | 711 | (235 | ) | (60 | ) | | 432 | ||||||||||||||||
Gains on sales of facilities |
| | | (3 | ) | | (3 | ) | ||||||||||||||||
Losses on retirement of debt |
| 4 | | | | 4 | ||||||||||||||||||
Legal claim costs |
| 11 | | | | 11 | ||||||||||||||||||
Management fees |
| | (206 | ) | 206 | | | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(556 | ) | 726 | 3,965 | 4,544 | 573 | 9,252 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income (loss) before income taxes |
556 | (726 | ) | 1,235 | 526 | (573 | ) | 1,018 | ||||||||||||||||
Provision (benefit) for income taxes |
(62 | ) | (268 | ) | 447 | 156 | | 273 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) |
618 | (458 | ) | 788 | 370 | (573 | ) | 745 | ||||||||||||||||
Net income attributable to noncontrolling interests |
| | 24 | 103 | | 127 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) attributable to HCA Healthcare, Inc. |
$ | 618 | $ | (458 | ) | $ | 764 | $ | 267 | $ | (573 | ) | $ | 618 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Comprehensive income (loss) attributable to HCA Healthcare, Inc. |
$ | 621 | $ | (432 | ) | $ | 766 | $ | 242 | $ | (576 | ) | $ | 621 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
19
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
Revenues before provision for doubtful accounts |
$ | | $ | | $ | 17,799 | 17,357 | $ | | $ | 35,156 | |||||||||||||
Provision for doubtful accounts |
| | 1,648 | 1,456 | | 3,104 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenues |
| | 16,151 | 15,901 | | 32,052 | ||||||||||||||||||
Salaries and benefits |
| | 7,330 | 7,548 | | 14,878 | ||||||||||||||||||
Supplies |
| | 2,771 | 2,598 | | 5,369 | ||||||||||||||||||
Other operating expenses |
5 | | 2,841 | 3,124 | | 5,970 | ||||||||||||||||||
Equity in earnings of affiliates |
(1,702 | ) | | (3 | ) | (33 | ) | 1,702 | (36 | ) | ||||||||||||||
Depreciation and amortization |
| | 748 | 833 | | 1,581 | ||||||||||||||||||
Interest expense |
48 | 2,280 | (878 | ) | (193 | ) | | 1,257 | ||||||||||||||||
Gains on sales of facilities |
| | (5 | ) | (5 | ) | | (10 | ) | |||||||||||||||
Losses on retirement of debt |
| 39 | | | | 39 | ||||||||||||||||||
Management fees |
| | (637 | ) | 637 | | | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(1,649 | ) | 2,319 | 12,167 | 14,509 | 1,702 | 29,048 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income (loss) before income taxes |
1,649 | (2,319 | ) | 3,984 | 1,392 | (1,702 | ) | 3,004 | ||||||||||||||||
Provision (benefit) for income taxes |
(93 | ) | (856 | ) | 1,443 | 408 | | 902 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) |
1,742 | (1,463 | ) | 2,541 | 984 | (1,702 | ) | 2,102 | ||||||||||||||||
Net income attributable to noncontrolling interests |
| | 74 | 286 | | 360 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) attributable to HCA Healthcare, Inc. |
$ | 1,742 | $ | (1,463 | ) | $ | 2,467 | $ | 698 | $ | (1,702 | ) | $ | 1,742 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Comprehensive income (loss) attributable to HCA Healthcare, Inc. |
$ | 1,812 | $ | (1,458 | ) | $ | 2,476 | $ | 754 | $ | (1,772 | ) | $ | 1,812 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
20
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
Revenues before provision for doubtful accounts |
$ | | $ | | $ | 16,957 | $ | 16,284 | $ | | $ | 33,241 | ||||||||||||
Provision for doubtful accounts |
| | 1,383 | 1,009 | | 2,392 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenues |
| | 15,574 | 15,275 | | 30,849 | ||||||||||||||||||
Salaries and benefits |
| | 7,074 | 7,059 | | 14,133 | ||||||||||||||||||
Supplies |
| | 2,672 | 2,459 | | 5,131 | ||||||||||||||||||
Other operating expenses |
5 | | 2,654 | 2,958 | | 5,617 | ||||||||||||||||||
Equity in earnings of affiliates |
(1,843 | ) | | (4 | ) | (40 | ) | 1,843 | (44 | ) | ||||||||||||||
Depreciation and amortization |
| | 707 | 756 | | 1,463 | ||||||||||||||||||
Interest expense |
48 | 2,031 | (646 | ) | (158 | ) | | 1,275 | ||||||||||||||||
Gains on sales of facilities |
| | | (8 | ) | | (8 | ) | ||||||||||||||||
Losses on retirement of debt |
| 4 | | | | 4 | ||||||||||||||||||
Legal claim costs |
| 33 | | | | 33 | ||||||||||||||||||
Management fees |
| | (601 | ) | 601 | | | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(1,790 | ) | 2,068 | 11,856 | 13,627 | 1,843 | 27,604 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income (loss) before income taxes |
1,790 | (2,068 | ) | 3,718 | 1,648 | (1,843 | ) | 3,245 | ||||||||||||||||
Provision (benefit) for income taxes |
(180 | ) | (763 | ) | 1,347 | 494 | | 898 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) |
1,970 | (1,305 | ) | 2,371 | 1,154 | (1,843 | ) | 2,347 | ||||||||||||||||
Net income attributable to noncontrolling interests |
| | 67 | 310 | | 377 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) attributable to HCA Healthcare, Inc. |
$ | 1,970 | $ | (1,305 | ) | $ | 2,304 | $ | 844 | $ | (1,843 | ) | $ | 1,970 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Comprehensive income (loss) attributable to HCA Healthcare, Inc. |
$ | 1,894 | $ | (1,288 | ) | $ | 2,312 | $ | 743 | $ | (1,767 | ) | $ | 1,894 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
21
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING BALANCE SHEET
SEPTEMBER 30, 2017
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Current assets: |
||||||||||||||||||||||||
Cash and cash equivalents |
$ | 1 | $ | | $ | 117 | $ | 600 | $ | | $ | 718 | ||||||||||||
Accounts receivable, net |
| | 3,003 | 2,977 | | 5,980 | ||||||||||||||||||
Inventories |
| | 899 | 647 | | 1,546 | ||||||||||||||||||
Other |
33 | | 438 | 733 | | 1,204 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
34 | | 4,457 | 4,957 | | 9,448 | |||||||||||||||||||
Property and equipment, net |
| | 8,670 | 8,659 | | 17,329 | ||||||||||||||||||
Investments of insurance subsidiaries |
| | | 368 | | 368 | ||||||||||||||||||
Investments in and advances to affiliates |
28,817 | | 15 | 186 | (28,817 | ) | 201 | |||||||||||||||||
Goodwill and other intangible assets |
| | 1,728 | 5,629 | | 7,357 | ||||||||||||||||||
Other |
783 | 29 | 35 | 181 | | 1,028 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
$ | 29,634 | $ | 29 | $ | 14,905 | $ | 19,980 | $ | (28,817 | ) | $ | 35,731 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
LIABILITIES AND STOCKHOLDERS (DEFICIT) EQUITY |
||||||||||||||||||||||||
Current liabilities: |
||||||||||||||||||||||||
Accounts payable |
$ | | $ | | $ | 1,288 | $ | 1,026 | $ | | $ | 2,314 | ||||||||||||
Accrued salaries |
| | 704 | 608 | | 1,312 | ||||||||||||||||||
Other accrued expenses |
8 | 279 | 475 | 1,021 | | 1,783 | ||||||||||||||||||
Long-term debt due within one year |
| 97 | 54 | 51 | | 202 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
8 | 376 | 2,521 | 2,706 | | 5,611 | |||||||||||||||||||
Long-term debt, net |
994 | 31,275 | 192 | 290 | | 32,751 | ||||||||||||||||||
Intercompany balances |
34,983 | (10,069 | ) | (28,514 | ) | 3,600 | | | ||||||||||||||||
Professional liability risks |
| | | 1,179 | | 1,179 | ||||||||||||||||||
Income taxes and other liabilities |
429 | 2 | 353 | 472 | | 1,256 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
36,414 | 21,584 | (25,448) | 8,247 | | 40,797 | |||||||||||||||||||
Stockholders (deficit) equity attributable to HCA Healthcare, Inc. |
(6,780 | ) | (21,555 | ) | 40,228 | 10,144 | (28,817 | ) | (6,780 | ) | ||||||||||||||
Noncontrolling interests |
| | 125 | 1,589 | | 1,714 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(6,780 | ) | (21,555 | ) | 40,353 | 11,733 | (28,817 | ) | (5,066 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
$ | 29,634 | $ | 29 | $ | 14,905 | $ | 19,980 | $ | (28,817 | ) | $ | 35,731 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
22
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING BALANCE SHEET
DECEMBER 31, 2016
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Current assets: |
||||||||||||||||||||||||
Cash and cash equivalents |
$ | | $ | | $ | 110 | $ | 536 | $ | | $ | 646 | ||||||||||||
Accounts receivable, net |
| | 3,028 | 2,798 | | 5,826 | ||||||||||||||||||
Inventories |
| | 890 | 613 | | 1,503 | ||||||||||||||||||
Other |
| | 445 | 666 | | 1,111 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| | 4,473 | 4,613 | | 9,086 | |||||||||||||||||||
Property and equipment, net |
| | 8,463 | 7,889 | | 16,352 | ||||||||||||||||||
Investments of insurance subsidiaries |
| | | 336 | | 336 | ||||||||||||||||||
Investments in and advances to affiliates |
27,045 | | 16 | 190 | (27,045 | ) | 206 | |||||||||||||||||
Goodwill and other intangible assets |
| | 1,728 | 4,976 | | 6,704 | ||||||||||||||||||
Other |
877 | | 34 | 163 | | 1,074 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
$ | 27,922 | $ | | $ | 14,714 | $ | 18,167 | $ | (27,045 | ) | $ | 33,758 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
LIABILITIES AND STOCKHOLDERS (DEFICIT) EQUITY |
||||||||||||||||||||||||
Current liabilities: |
||||||||||||||||||||||||
Accounts payable |
$ | | $ | | $ | 1,439 | $ | 879 | $ | | $ | 2,318 | ||||||||||||
Accrued salaries |
| | 704 | 561 | | 1,265 | ||||||||||||||||||
Other accrued expenses |
29 | 572 | 464 | 970 | | 2,035 | ||||||||||||||||||
Long-term debt due within one year |
| 97 | 60 | 59 | | 216 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
29 | 669 | 2,667 | 2,469 | | 5,834 | |||||||||||||||||||
Long-term debt, net |
993 | 29,693 | 199 | 275 | | 31,160 | ||||||||||||||||||
Intercompany balances |
33,784 | (10,277 | ) | (26,447 | ) | 2,940 | | | ||||||||||||||||
Professional liability risks |
| | | 1,148 | | 1,148 | ||||||||||||||||||
Income taxes and other liabilities |
418 | 12 | 387 | 432 | | 1,249 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
35,224 | 20,097 | (23,194 | ) | 7,264 | | 39,391 | ||||||||||||||||||
Stockholders (deficit) equity attributable to HCA Healthcare, Inc. |
(7,302 | ) | (20,097 | ) | 37,752 | 9,390 | (27,045 | ) | (7,302 | ) | ||||||||||||||
Noncontrolling interests |
| | 156 | 1,513 | | 1,669 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
(7,302 | ) | (20,097 | ) | 37,908 | 10,903 | (27,045 | ) | (5,633 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
$ | 27,922 | $ | | $ | 14,714 | $ | 18,167 | $ | (27,045 | ) | $ | 33,758 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
23
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
Cash flows from operating activities: |
||||||||||||||||||||||||
Net income (loss) |
$ | 1,742 | $ | (1,463 | ) | $ | 2,541 | $ | 984 | $ | (1,702 | ) | $ | 2,102 | ||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
||||||||||||||||||||||||
Changes in operating assets and liabilities |
(15 | ) | (293 | ) | (1,785 | ) | (1,300 | ) | | (3,393 | ) | |||||||||||||
Provision for doubtful accounts |
| | 1,648 | 1,456 | | 3,104 | ||||||||||||||||||
Depreciation and amortization |
| | 748 | 833 | | 1,581 | ||||||||||||||||||
Income taxes |
(9 | ) | | | | | (9 | ) | ||||||||||||||||
Gains on sales of facilities |
| | (5 | ) | (5 | ) | | (10 | ) | |||||||||||||||
Losses on retirement of debt |
| 39 | | | | 39 | ||||||||||||||||||
Amortization of debt issuance costs |
| 23 | | | | 23 | ||||||||||||||||||
Share-based compensation |
| | 195 | | | 195 | ||||||||||||||||||
Equity in earnings of affiliates |
(1,702 | ) | | | | 1,702 | | |||||||||||||||||
Other |
58 | | | 2 | | 60 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash provided by (used in) operating activities |
74 | (1,694 | ) | 3,342 | 1,970 | | 3,692 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash flows from investing activities: |
||||||||||||||||||||||||
Purchase of property and equipment |
| | (912 | ) | (1,121 | ) | | (2,033 | ) | |||||||||||||||
Acquisition of hospitals and health care entities |
| | (9 | ) | (1,133 | ) | | (1,142 | ) | |||||||||||||||
Disposition of hospitals and health care entities |
| | 12 | 12 | | 24 | ||||||||||||||||||
Change in investments |
| | | (15 | ) | | (15 | ) | ||||||||||||||||
Other |
| | (2 | ) | (4 | ) | | (6 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash used in investing activities |
| | (911 | ) | (2,261 | ) | | (3,172 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash flows from financing activities: |
||||||||||||||||||||||||
Issuance of long-term debt |
| 1,500 | | 2 | | 1,502 | ||||||||||||||||||
Net change in revolving credit facilities |
| 650 | | | | 650 | ||||||||||||||||||
Repayment of long-term debt |
| (604 | ) | (52 | ) | (44 | ) | | (700 | ) | ||||||||||||||
Distributions to noncontrolling interests |
| | (105 | ) | (258 | ) | | (363 | ) | |||||||||||||||
Payment of debt issuance costs |
| (25 | ) | | | | (25 | ) | ||||||||||||||||
Repurchases of common stock |
(1,475 | ) | | | | | (1,475 | ) | ||||||||||||||||
Changes in intercompany balances with affiliates, net |
1,468 | 173 | (2,267 | ) | 626 | | | |||||||||||||||||
Other |
(66 | ) | | | 29 | | (37 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash (used in) provided by financing activities |
(73 | ) | 1,694 | (2,424 | ) | 355 | | (448 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Change in cash and cash equivalents |
1 | | 7 | 64 | | 72 | ||||||||||||||||||
Cash and cash equivalents at beginning of period |
| | 110 | 536 | | 646 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents at end of period |
$ | 1 | $ | | $ | 117 | $ | 600 | $ | | $ | 718 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
24
HCA HEALTHCARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 12 SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Continued)
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016
(Dollars in millions)
HCA Healthcare, Inc. Issuer |
HCA Inc. Issuer |
Subsidiary Guarantors |
Subsidiary Non- Guarantors |
Eliminations | Condensed Consolidated |
|||||||||||||||||||
Cash flows from operating activities: |
||||||||||||||||||||||||
Net income (loss) |
$ | 1,970 | $ | (1,305 | ) | $ | 2,371 | $ | 1,154 | $ | (1,843 | ) | $ | 2,347 | ||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
||||||||||||||||||||||||
Changes in operating assets and liabilities |
(40 | ) | (49 | ) | (1,628 | ) | (829 | ) | | (2,546 | ) | |||||||||||||
Provision for doubtful accounts |
| | 1,383 | 1,009 | | 2,392 | ||||||||||||||||||
Depreciation and amortization |
| | 707 | 756 | | 1,463 | ||||||||||||||||||
Income taxes |
8 | | | | | 8 | ||||||||||||||||||
Gains on sales of facilities |
| | | (8 | ) | | (8 | ) | ||||||||||||||||
Losses on retirement of debt |
| 4 | | | | 4 | ||||||||||||||||||
Legal claim costs |
| 33 | | | | 33 | ||||||||||||||||||
Amortization of debt issuance costs |
| 26 | | | | 26 | ||||||||||||||||||
Share-based compensation |
| | 196 | | | 196 | ||||||||||||||||||
Equity in earnings of affiliates |
(1,843 | ) | | | | 1,843 | | |||||||||||||||||
Other |
53 | | (3 | ) | (11 | ) | | 39 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash provided by (used in) operating activities |
148 | (1,291 | ) | 3,026 | 2,071 | | 3,954 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash flows from investing activities: |
||||||||||||||||||||||||
Purchase of property and equipment |
| | (892 | ) | (992 | ) | | (1,884 | ) | |||||||||||||||
Acquisition of hospitals and health care entities |
| | (164 | ) | (304 | ) | | (468 | ) | |||||||||||||||
Disposition of hospitals and health care entities |
| | 10 | 13 | | 23 | ||||||||||||||||||
Change in investments |
| | (2 | ) | 80 | | 78 | |||||||||||||||||
Other |
| | | 17 | | 17 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash used in investing activities |
| | (1,048 | ) | (1,186 | ) | | (2,234 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash flows from financing activities: |
||||||||||||||||||||||||
Issuance of long-term debt |
| 5,400 | | | | 5,400 | ||||||||||||||||||
Net change in revolving credit facilities |
| (70 | ) | | | | (70 | ) | ||||||||||||||||
Repayment of long-term debt |
| (4,334 | ) | (54 | ) | (36 | ) | | (4,424 | ) | ||||||||||||||
Distributions to noncontrolling interests |
| | (46 | ) | (296 | ) | | (342 | ) | |||||||||||||||
Payment of debt issuance costs |
| (40 | ) | | | | (40 | ) | ||||||||||||||||
Repurchases of common stock |
(2,213 | ) | | | | | (2,213 | ) | ||||||||||||||||
Changes in intercompany balances with affiliates, net |
2,171 | 335 | (1,895 | ) | (611 | ) | | | ||||||||||||||||
Other |
(105 | ) | | | 10 | | (95 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net cash (used in) provided by financing activities |
(147 | ) | 1,291 | (1,995 | ) | (933 | ) | | (1,784 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Change in cash and cash equivalents |
1 | | (17 | ) | (48 | ) | | (64 | ) | |||||||||||||||
Cash and cash equivalents at beginning of period |
| | 155 | 586 | | 741 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents at end of period |
$ | 1 | $ | | $ | 138 | $ | 538 | $ | | $ | 677 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
25
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward-Looking Statements
This quarterly report on Form 10-Q includes certain disclosures which contain forward-looking statements. Forward-looking statements include statements regarding expected share-based compensation expense, expected capital expenditures and expected net claim payments and all other statements that do not relate solely to historical or current facts, and can be identified by the use of words like may, believe, will, expect, project, estimate, anticipate, plan, initiative or continue. These forward-looking statements are based on our current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond our control, which could significantly affect current plans and expectations and our future financial position and results of operations. These factors include, but are not limited to, (1) the impact of our substantial indebtedness and the ability to refinance such indebtedness on acceptable terms, (2) the impact of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (collectively, the Health Reform Law), including the effects of any repeal of, or changes to, the Health Reform Law or changes to its implementation, the possible enactment of additional federal or state health care reforms and possible changes to other federal, state or local laws or regulations affecting the health care industry, (3) the effects related to the continued implementation of the sequestration spending reductions required under the Budget Control Act of 2011, and related legislation extending these reductions, 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, (4) increases in the amount and risk of collectability of uninsured accounts and deductibles and copayment amounts for insured accounts, (5) the ability to achieve operating and financial targets, and attain expected levels of patient volumes and control the costs of providing services, (6) possible changes in Medicare, Medicaid and other state programs, including Medicaid upper payment limit programs or Waiver Programs, that may impact reimbursements to health care providers and insurers, (7) the highly competitive nature of the health care business, (8) changes in service mix, revenue mix and surgical volumes, including potential declines in the population covered under managed care agreements, the ability to enter into and renew managed care provider agreements on acceptable terms and the impact of consumer-driven health plans and physician utilization trends and practices, (9) the efforts of insurers, health care providers and others to contain health care costs, (10) the outcome of our continuing efforts to monitor, maintain and comply with appropriate laws, regulations, policies and procedures, (11) increases in wages and the ability to attract and retain qualified management and personnel, including affiliated physicians, nurses and medical and technical support personnel, (12) the availability and terms of capital to fund the expansion of our business and improvements to our existing facilities, (13) changes in accounting practices, (14) changes in general economic conditions nationally and regionally in our markets, (15) the emergence and effects related to infectious diseases, (16) future divestitures which may result in charges and possible impairments of long-lived assets, (17) changes in business strategy or development plans, (18) delays in receiving payments for services provided, (19) the outcome of pending and any future tax audits, disputes and litigation associated with our tax positions, (20) potential adverse impact of known and unknown government investigations, litigation and other claims that may be made against us, (21) the impact of potential cybersecurity incidents or security breaches, (22) our ongoing ability to demonstrate meaningful use of certified electronic health record (EHR) technology, and (23) other risk factors described in our annual report on Form 10-K for the year ended December 31, 2016 and our other filings with the Securities and Exchange Commission. As a consequence, current plans, anticipated actions and future financial position and results of operations may differ from those expressed in any forward-looking statements made by or on behalf of HCA. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented in this report, which forward-looking statements reflect managements views only as of the date of this report. We undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise.
26
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Third Quarter 2017 Operations Summary
Revenues increased to $10.696 billion in the third quarter of 2017 from $10.270 billion in the third quarter of 2016. Net income attributable to HCA Healthcare, Inc. totaled $426 million, or $1.15 per diluted share, for the quarter ended September 30, 2017, compared to $618 million, or $1.59 per diluted share, for the quarter ended September 30, 2016. Third quarter 2017 results include additional expenses and losses of revenues estimated at approximately $140 million, or $0.24 per diluted share, associated with the impact of hurricanes Harvey and Irma on our Texas, Florida, Georgia and South Carolina facilities, and a negative impact to operating results related to the Texas Medicaid Waiver program of approximately $50 million, or $0.08 per diluted share, related to final settlement amounts for the program year ended September 30, 2017. The amount associated with the hurricanes is prior to any insurance recoveries which we may receive. Third quarter 2017 results also include net gains on sales of facilities of $7 million, or $0.01 per diluted share, and losses on retirement of debt of $39 million, or $0.07 per diluted share. Third quarter 2016 results include legal claim costs of $11 million, or $0.02 per diluted share, losses on retirement of debt of $4 million, or $0.01 per diluted share, and net gains on sales of facilities of $3 million, or $0.01 per diluted share. Our provisions for income taxes for the third quarters of 2017 and 2016 included tax benefits of $4 million, or $0.01 per diluted share, and $11 million, or $0.03 per diluted share, respectively, related to excess tax benefits from employee equity award settlements. Our provision for income taxes for the third quarter of 2016 also included tax benefits of $51 million, or $0.13 per diluted share, primarily related to the resolution of federal income tax issues for our 2011 and 2012 tax years. All per diluted share disclosures are based upon amounts net of the applicable income taxes. Shares used for diluted earnings per share were 369.834 million shares for the quarter ended September 30, 2017 and 389.592 million shares for the quarter ended September 30, 2016. During 2016 and the first nine months of 2017, we repurchased 36.325 million shares and 17.847 million shares of our common stock, respectively.
Revenues increased 4.2% on a consolidated basis and increased 2.3% on a same facility basis for the quarter ended September 30, 2017, compared to the quarter ended September 30, 2016. The increase in consolidated revenues can be attributed to the combined impact of a 1.6% increase in revenue per equivalent admission and a 2.5% increase in equivalent admissions. The same facility revenues increase resulted from the combined impact of a 2.0% increase in same facility revenue per equivalent admission and a 0.3% increase in same facility equivalent admissions.
During the quarters ended September 30, 2017 and 2016, consolidated admissions and same facility admissions increased 2.7% and 0.6%, respectively. Surgeries declined 0.7% on a consolidated basis and declined 2.9% on a same facility basis during the quarter ended September 30, 2017, compared to the quarter ended September 30, 2016. Emergency department visits increased 2.5% on a consolidated basis and increased 0.3% on a same facility basis during the quarter ended September 30, 2017, compared to the quarter ended September 30, 2016.
For the quarter ended September 30, 2017, the provision for doubtful accounts increased $431 million, compared to the quarter ended September 30, 2016. The self-pay revenue deductions for charity care and uninsured discounts increased $189 million and $256 million, respectively, during the third quarter of 2017, compared to the third quarter of 2016. The sum of the provision for doubtful accounts, uninsured discounts and charity care, as a percentage of the sum of revenues, provision for doubtful accounts, uninsured discounts and charity care, was 36.3% for the third quarter of 2017, compared to 33.7% for the third quarter of 2016. Same facility uninsured admissions increased 6.4% for the quarter ended September 30, 2017, compared to the quarter ended September 30, 2016.
Cash flows from operating activities declined $198 million from $1.206 billion for the third quarter of 2016 to $1.008 billion for the third quarter of 2017. The decline relates primarily to the decline in net income of $215 million.
27
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations
Revenue/Volume Trends
Our revenues depend upon inpatient occupancy levels, the ancillary services and therapy programs ordered by physicians and provided to patients, the volume of outpatient procedures and the charge and negotiated payment rates for such services. Gross charges typically do not reflect what our facilities are actually paid. Our facilities have entered into agreements with third-party payers, including government programs and managed care health plans, under which the facilities are paid based upon the cost of providing services, predetermined rates per diagnosis, fixed per diem rates or discounts from gross charges. We do not pursue collection of amounts related to patients who meet our guidelines to qualify for charity care; therefore, they are not reported in revenues. We provide discounts to uninsured patients who do not qualify for Medicaid or charity care. After the discounts are applied, we are still unable to collect a significant portion of uninsured patients accounts, and we record provisions for doubtful accounts (based upon our historical collection experience) related to uninsured patients in the period the services are provided to record the net self-pay revenues at the estimated amounts we expect to collect.
Revenues increased 4.2% from $10.270 billion in the third quarter of 2016 to $10.696 billion in the third quarter of 2017. Revenues are recorded during the period the health care services are provided, based upon the estimated amounts due from the patients and third-party payers. Third-party payers include federal and state agencies (under the Medicare and Medicaid programs), managed care health plans and commercial insurance companies (including plans offered through the health insurance exchanges), and employers. Estimates of contractual allowances under managed care health plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured discounts and contractual discounts). Our revenues from our third-party payers, the uninsured and other payers for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
Quarter | ||||||||||||||||
2017 | Ratio | 2016 | Ratio | |||||||||||||
Medicare |
$ | 2,354 | 22.0 | % | $ | 2,158 | 21.0 | % | ||||||||
Managed Medicare |
1,156 | 10.8 | 1,068 | 10.4 | ||||||||||||
Medicaid |
362 | 3.4 | 405 | 3.9 | ||||||||||||
Managed Medicaid |
582 | 5.4 | 611 | 6.0 | ||||||||||||
Managed care and other insurers |
6,039 | 56.4 | 5,863 | 57.1 | ||||||||||||
International (managed care and other insurers) |
276 | 2.6 | 285 | 2.8 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
10,769 | 100.6 | 10,390 | 101.2 | |||||||||||||
Uninsured |
849 | 7.9 | 336 | 3.3 | ||||||||||||
Other |
349 | 3.3 | 384 | 3.7 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues before provision for doubtful accounts |
11,967 | 111.8 | 11,110 | 108.2 | ||||||||||||
Provision for doubtful accounts |
(1,271 | ) | (11.8 | ) | (840 | ) | (8.2 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues |
$ | 10,696 | 100.0 | % | $ | 10,270 | 100.0 | % | ||||||||
|
|
|
|
|
|
|
|
28
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
Revenue/Volume Trends (Continued)
Nine Months | ||||||||||||||||
2017 | Ratio | 2016 | Ratio | |||||||||||||
Medicare |
$ | 7,080 | 22.1 | % | $ | 6,641 | 21.5 | % | ||||||||
Managed Medicare |
3,546 | 11.1 | 3,250 | 10.5 | ||||||||||||
Medicaid |
1,188 | 3.7 | 1,248 | 4.0 | ||||||||||||
Managed Medicaid |
1,798 | 5.6 | 1,816 | 5.9 | ||||||||||||
Managed care and other insurers |
18,071 | 56.4 | 17,324 | 56.2 | ||||||||||||
International (managed care and other insurers) |
814 | 2.5 | 926 | 3.0 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
32,497 | 101.4 | 31,205 | 101.1 | |||||||||||||
Uninsured |
1,593 | 5.0 | 750 | 2.4 | ||||||||||||
Other |
1,066 | 3.3 | 1,286 | 4.2 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues before provision for doubtful accounts |
35,156 | 109.7 | 33,241 | 107.7 | ||||||||||||
Provision for doubtful accounts |
(3,104 | ) | (9.7 | ) | (2,392 | ) | (7.7 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues |
$ | 32,052 | 100.0 | % | $ | 30,849 | 100.0 | % | ||||||||
|
|
|
|
|
|
|
|
Consolidated and same facility revenue per equivalent admission increased 1.6% and 2.0%, respectively, in the third quarter of 2017, compared to the third quarter of 2016. Consolidated and same facility equivalent admissions increased 2.5% and 0.3%, respectively, in the third quarter of 2017, compared to the third quarter of 2016. Consolidated and same facility outpatient surgeries declined 2.1% and 4.2%, respectively, in the third quarter of 2017, compared to the third quarter of 2016. Consolidated inpatient surgeries increased 1.6% and same facility inpatient surgeries declined 0.7% in the third quarter of 2017, compared to the third quarter of 2016. Consolidated and same facility emergency department visits increased 2.5% and 0.3%, respectively, in the third quarter of 2017, compared to the third quarter of 2016.
Our uninsured revenues increased $513 million and $843 million, respectively, for the quarter and nine months ended September 30, 2017 compared to the quarter and nine months ended September 30, 2016. The provision for doubtful accounts increased $431 million and $712 million, respectively, for the quarter and nine months ended September 30, 2017, which offset the majority of the increases in uninsured revenues during the same periods. During these periods we also experienced declines in the percentages of our total uncompensated care that related to uninsured discounts, with uninsured discounts comprising 59% and 64%, respectively, of total uncompensated care for the quarters ended September 30, 2017 and 2016, and 62% and 63%, respectively, of total uncompensated care for the nine months ended September 30, 2017 and 2016.
29
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
Revenue/Volume Trends (Continued)
To quantify the total impact of and trends related to uninsured accounts, we believe it is beneficial to view the direct uninsured revenue deductions (charity care and uninsured discounts) and provision for doubtful accounts in combination, rather than each separately. At September 30, 2017, our allowance for doubtful accounts represented 99.1% of the $5.465 billion total patient due accounts receivable balance. The patient due accounts receivable balance represents the estimated uninsured portion of our accounts receivable. A summary of these adjustments to revenues amounts, related to uninsured accounts, for the quarters and nine months ended September 30, 2017 and 2016 follows (dollars in millions):
Quarter | Nine Months | |||||||||||||||||||||||||||||||
2017 | Ratio | 2016 | Ratio | 2017 | Ratio | 2016 | Ratio | |||||||||||||||||||||||||
Charity care |
$ | 1,235 | 20 | % | $ | 1,046 | 20 | % | $ | 3,494 | 20 | % | $ | 3,100 | 21 | % | ||||||||||||||||
Uninsured discounts |
3,583 | 59 | 3,327 | 64 | 10,539 | 62 | 9,539 | 63 | ||||||||||||||||||||||||
Provision for doubtful accounts |
1,271 | 21 | 840 | 16 | 3,104 | 18 | 2,392 | 16 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Totals |
$ | 6,089 | 100 | % | $ | 5,213 | 100 | % | $ | 17,137 | 100 | % | $ | 15,031 | 100 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same facility uninsured admissions increased by 2,354 admissions, or 6.4%, in the third quarter of 2017, compared to the third quarter of 2016. Same facility uninsured admissions increased by 4.9%, in the second quarter of 2017, compared to the second quarter of 2016. Same facility uninsured admissions increased by 3.2%, in the first quarter of 2017, compared to the first quarter of 2016. Same facility uninsured admissions in 2016, compared to 2015, declined 0.3% in the fourth quarter of 2016, increased 0.7% in the third quarter of 2016, increased 5.7% in the second quarter of 2016 and increased 10.6% in the first quarter of 2016.
The approximate percentages of our admissions related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and other insurers and the uninsured for the quarters and nine months ended September 30, 2017 and 2016 are set forth in the following table.
Quarter | Nine Months | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Medicare |
30 | % | 30 | % | 31 | % | 31 | % | ||||||||
Managed Medicare |
15 | 15 | 16 | 15 | ||||||||||||
Medicaid |
5 | 6 | 5 | 6 | ||||||||||||
Managed Medicaid |
13 | 12 | 12 | 12 | ||||||||||||
Managed care and other insurers |
28 | 29 | 28 | 29 | ||||||||||||
Uninsured |
9 | 8 | 8 | 7 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
100 | % | 100 | % | 100 | % | 100 | % | |||||||||
|
|
|
|
|
|
|
|
30
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
Revenue/Volume Trends (Continued)
The approximate percentages of our inpatient revenues, before provision for doubtful accounts, related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and other insurers and the uninsured for the quarters and nine months ended September 30, 2017 and 2016 are set forth in the following table.
Quarter | Nine Months | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Medicare |
27 | % | 27 | % | 27 | % | 28 | % | ||||||||
Managed Medicare |
12 | 12 | 12 | 12 | ||||||||||||
Medicaid |
4 | 6 | 5 | 6 | ||||||||||||
Managed Medicaid |
5 | 6 | 6 | 6 | ||||||||||||
Managed care and other insurers |
47 | 49 | 47 | 48 | ||||||||||||
Uninsured |
5 | | 3 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
100 | % | 100 | % | 100 | % | 100 | % | |||||||||
|
|
|
|
|
|
|
|
At September 30, 2017, we had 89 hospitals in the states of Texas and Florida. During the third quarter of 2017, 56% of our admissions and 48% of our revenues were generated by these hospitals. Uninsured admissions in Texas and Florida represented 70% of our uninsured admissions during the third quarter of 2017.
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. In 2011, the Centers for Medicare & Medicaid Services (CMS) approved a Medicaid waiver that allows Texas to continue receiving supplemental Medicaid reimbursement while expanding its Medicaid managed care program. Texas currently operates its Medicaid Waiver Program pursuant to this waiver, which CMS has agreed to extend through December 2017. We cannot predict whether the Texas Medicaid Waiver Program will be further extended, be revised or that revenues recognized from the program will not decline.
The Texas Medicaid Waiver Program includes two primary components: an indigent care component and a Delivery System Reform Incentive Payment (DSRIP) component. Initiatives under the DSRIP program are designed to provide incentive payments to hospitals and other providers for their investments in delivery system reforms that increase access to health care, improve the quality of care and enhance the health of patients and families they serve. We provide indigent care services in several communities in the state of Texas, in affiliation with other hospitals. The state of Texas has been involved in efforts to increase the indigent care provided by private hospitals. As a result of additional indigent care being provided by private hospitals, public hospital districts or counties in Texas have available funds that were previously devoted to indigent care. The public hospital districts or counties are under no contractual or legal obligation to provide such indigent care. The public hospital districts or counties have elected to transfer some portion of these available funds to the states Medicaid program. Such action is at the sole discretion of the public hospital districts or counties. It is anticipated that these contributions to the state will be matched with federal Medicaid funds. The state then may make supplemental payments to hospitals in the state for Medicaid services rendered. Hospitals receiving Medicaid supplemental payments may include those that are providing additional indigent care services. Our Texas Medicaid revenues included Medicaid supplemental payments of $60 million ($26 million DSRIP related and $34 million indigent care related) and $109 million ($25 million DSRIP related and $84 million indigent care related) during the third quarters of 2017 and 2016, respectively, and $261 million ($82 million DSRIP related and $179 million indigent care related) and $293 million ($78 million DSRIP related and $215 million indigent care related) during the first nine months of 2017 and 2016, respectively.
31
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
Revenue/Volume Trends (Continued)
In addition, we receive supplemental payments in several other states. We are aware these supplemental payment programs are currently being reviewed by certain state agencies and CMS, and some states have made waiver requests to CMS to replace their existing supplemental payment programs. It is possible these reviews and waiver requests will result in the restructuring of such supplemental payment programs and could result in the payment programs being reduced or eliminated. Because deliberations about these programs are ongoing, we are unable to estimate the financial impact the program structure modifications, if any, may have on our results of operations.
Operating Results Summary
The following is a comparative summary of results of operations for the quarters and nine months ended September 30, 2017 and 2016 (dollars in millions):
Quarter | ||||||||||||||||
2017 | 2016 | |||||||||||||||
Amount | Ratio | Amount | Ratio | |||||||||||||
Revenues before provision for doubtful accounts |
$ | 11,967 | $ | 11,110 | ||||||||||||
Provision for doubtful accounts |
1,271 | 840 | ||||||||||||||
|
|
|
|
|||||||||||||
Revenues |
10,696 | 100.0 | 10,270 | 100.0 | ||||||||||||
Salaries and benefits |
5,081 | 47.5 | 4,740 | 46.1 | ||||||||||||
Supplies |
1,777 | 16.6 | 1,699 | 16.5 | ||||||||||||
Other operating expenses |
2,075 | 19.4 | 1,896 | 18.5 | ||||||||||||
Equity in earnings of affiliates |
(13 | ) | (0.1 | ) | (22 | ) | (0.2 | ) | ||||||||
Depreciation and amortization |
539 | 5.0 | 495 | 4.9 | ||||||||||||
Interest expense |
427 | 4.0 | 432 | 4.2 | ||||||||||||
Gains on sales of facilities |
(7 | ) | (0.1 | ) | (3 | ) | | |||||||||
Losses on retirement of debt |
39 | 0.4 | 4 | | ||||||||||||
Legal claim costs |
| | 11 | 0.1 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
9,918 | 92.7 | 9,252 | 90.1 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income before income taxes |
778 | 7.3 | 1,018 | 9.9 | ||||||||||||
Provision for income taxes |
248 | 2.3 | 273 | 2.6 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income |
530 | 5.0 | 745 | 7.3 | ||||||||||||
Net income attributable to noncontrolling interests |
104 | 1.0 | 127 | 1.3 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income attributable to HCA Healthcare, Inc. |
$ | 426 | 4.0 | $ | 618 | 6.0 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
% changes from prior year: |
||||||||||||||||
Revenues |
4.2 | % | 4.2 | % | ||||||||||||
Income before income taxes |
(23.6 | ) | 20.6 | |||||||||||||
Net income attributable to HCA Healthcare, Inc. |
(31.1 | ) | 37.7 | |||||||||||||
Admissions(a) |
2.7 | 0.7 | ||||||||||||||
Equivalent admissions(b) |
2.5 | 1.5 | ||||||||||||||
Revenue per equivalent admission |
1.6 | 2.7 | ||||||||||||||
Same facility % changes from prior year(c): |
||||||||||||||||
Revenues |
2.3 | 4.0 | ||||||||||||||
Admissions(a) |
0.6 | 0.7 | ||||||||||||||
Equivalent admissions(b) |
0.3 | 1.3 | ||||||||||||||
Revenue per equivalent admission |
2.0 | 2.7 |
32
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
Operating Results Summary (Continued)
Nine Months | ||||||||||||||||
2017 | 2016 | |||||||||||||||
Amount | Ratio | Amount | Ratio | |||||||||||||
Revenues before provision for doubtful accounts |
$ | 35,156 | $ | 33,241 | ||||||||||||
Provision for doubtful accounts |
3,104 | 2,392 | ||||||||||||||
|
|
|
|
|||||||||||||
Revenues |
32,052 | 100.0 | 30,849 | 100.0 | ||||||||||||
Salaries and benefits |
14,878 | 46.4 | 14,133 | 45.8 | ||||||||||||
Supplies |
5,369 | 16.8 | 5,131 | 16.6 | ||||||||||||
Other operating expenses |
5,970 | 18.6 | 5,617 | 18.2 | ||||||||||||
Equity in earnings of affiliates |
(36 | ) | (0.1 | ) | (44 | ) | (0.1 | ) | ||||||||
Depreciation and amortization |
1,581 | 4.9 | 1,463 | 4.8 | ||||||||||||
Interest expense |
1,257 | 3.9 | 1,275 | 4.1 | ||||||||||||
Gains on sales of facilities |
(10 | ) | | (8 | ) | | ||||||||||
Losses on retirement of debt |
39 | 0.1 | 4 | | ||||||||||||
Legal claim costs |
| | 33 | 0.1 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
29,048 | 90.6 | 27,604 | 89.5 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income before income taxes |
3,004 | 9.4 | 3,245 | 10.5 | ||||||||||||
Provision for income taxes |
902 | 2.8 | 898 | 2.9 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income |
2,102 | 6.6 | 2,347 | 7.6 | ||||||||||||
Net income attributable to noncontrolling interests |
360 | 1.2 | 377 | 1.2 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income attributable to HCA Healthcare, Inc. |
$ | 1,742 | 5.4 | $ | 1,970 | 6.4 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
% changes from prior year: |
||||||||||||||||
Revenues |
3.9 | % | 4.8 | % | ||||||||||||
Income before income taxes |
(7.4 | ) | 11.7 | |||||||||||||
Net income attributable to HCA Healthcare, Inc. |
(11.6 | ) | 27.3 | |||||||||||||
Admissions(a) |
1.8 | 1.1 | ||||||||||||||
Equivalent admissions(b) |
2.1 | 2.3 | ||||||||||||||
Revenue per equivalent admission |
1.7 | 2.4 | ||||||||||||||
Same facility % changes from prior year(c): |
||||||||||||||||
Revenues |
3.0 | 4.4 | ||||||||||||||
Admissions(a) |
1.0 | 1.0 | ||||||||||||||
Equivalent admissions(b) |
1.2 | 2.0 | ||||||||||||||
Revenue per equivalent admission |
1.8 | 2.3 |
(a) | 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. |
(b) | Equivalent admissions are used by management and certain investors as a general measure of combined inpatient and outpatient volume. Equivalent admissions are computed by multiplying admissions (inpatient volume) by the sum of gross inpatient revenues and gross outpatient revenues and then dividing the resulting amount by gross inpatient revenues. The equivalent admissions computation equates outpatient revenues to the volume measure (admissions) used to measure inpatient volume, resulting in a general measure of combined inpatient and outpatient volume. |
(c) | Same facility information excludes the operations of hospitals and their related facilities which were either acquired or divested during the current and prior period. |
33
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
Quarters Ended September 30, 2017 and 2016
Net income attributable to HCA Healthcare, Inc. totaled $426 million, or $1.15 per diluted share, for the third quarter of 2017, compared to $618 million, or $1.59 per diluted share, for the third quarter of 2016. Third quarter 2017 results include additional expenses and losses of revenues estimated at approximately $140 million, or $0.24 per diluted share, associated with the impact of hurricanes Harvey and Irma on our Texas, Florida, Georgia and South Carolina facilities, and a negative impact to operating results related to the Texas Medicaid Waiver program of approximately $50 million, or $0.08 per diluted share, related to final settlement amounts for the program year ended September 30, 2017. The amount associated with the hurricanes is prior to any insurance recoveries which we may receive. Third quarter 2017 results also include net gains on sales of facilities of $7 million, or $0.01 per diluted share, and losses on retirement of debt of $39 million, or $0.07 per diluted share. Third quarter 2016 results include legal claim costs of $11 million, or $0.02 per diluted share, losses on retirement of debt of $4 million, or $0.01 per diluted share, and net gains on sales of facilities of $3 million, or $0.01 per diluted share. Our provision for income taxes for the third quarter of 2016 also included tax benefits of $51 million, or $0.13 per diluted share, primarily related to the resolution of federal income tax issues for our 2011 and 2012 tax years. All per diluted share disclosures are based upon amounts net of the applicable income taxes. Shares used for diluted earnings per share were 369.834 million shares for the quarter ended September 30, 2017 and 389.592 million shares for the quarter ended September 30, 2016. During 2016 and the first nine months of 2017, we repurchased 36.325 million and 17.847 million shares of our common stock, respectively.
Revenues before provision for doubtful accounts increased 7.7% for the third quarter of 2017 compared to the third quarter of 2016. The provision for doubtful accounts increased $431 million, from $840 million in the third quarter of 2016 to $1.271 billion in the third quarter of 2017. The provision for doubtful accounts relates primarily to uninsured amounts due directly from patients, including copayment and deductible amounts for patients who have health care coverage. The self-pay revenue deductions for charity care and uninsured discounts increased $189 million and $256 million, respectively, during the third quarter of 2017, compared to the third quarter of 2016. The sum of the provision for doubtful accounts, uninsured discounts and charity care, as a percentage of the sum of revenues, the provision for doubtful accounts, uninsured discounts and charity care, was 36.3% for the third quarter of 2017, compared to 33.7% for the third quarter of 2016. At September 30, 2017, our allowance for doubtful accounts represented 99.1% of the $5.465 billion total patient due accounts receivable balance, including accounts, net of estimated contractual discounts, related to patients for which eligibility for Medicaid coverage or uninsured discounts was being evaluated.
Revenues increased 4.2% due to the combined impact of revenue per equivalent admission growth of 1.6% and a 2.5% increase in equivalent admissions for the third quarter of 2017 compared to the third quarter of 2016. Same facility revenues increased 2.3% due to the combined impact of a 2.0% increase in same facility revenue per equivalent admission and a 0.3% increase in same facility equivalent admissions for the third quarter of 2017 compared to the third quarter of 2016.
Salaries and benefits, as a percentage of revenues, were 47.5% in the third quarter of 2017 and 46.1% in the third quarter of 2016. Salaries and benefits per equivalent admission increased 4.6% in the third quarter of 2017 compared to the third quarter of 2016. Same facility labor rate increases averaged 3.3% for the third quarter of 2017 compared to the third quarter of 2016.
Supplies, as a percentage of revenues, were 16.6% in the third quarter of 2017 and 16.5% in the third quarter of 2016. Supply costs per equivalent admission increased 2.1% in the third quarter of 2017 compared to the third quarter of 2016. Supply costs per equivalent admission increased 2.9% for medical devices, 0.8% for pharmacy supplies and 1.8% for general medical and surgical items in the third quarter of 2017 compared to the third quarter of 2016.
34
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
Quarters Ended September 30, 2017 and 2016 (continued)
Other operating expenses, as a percentage of revenues, were 19.4% in the third quarter of 2017 and 18.5% in the third quarter of 2016. 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. The increase in other operating expenses, as a percentage of revenues, for the third quarter of 2017 compared to the third quarter of 2016 was due to small increases in many of the other operating expense components. Provisions for losses related to professional liability risks were $116 million and $106 million for the third quarters of 2017 and 2016, respectively.
Equity in earnings of affiliates was $13 million and $22 million in the third quarters of 2017 and 2016, respectively.
Depreciation and amortization increased $44 million, from $495 million in the third quarter of 2016 to $539 million in the third quarter of 2017. The increase in depreciation relates to both acquired facilities and increased routine capital expenditures.
Interest expense was $427 million in the third quarter of 2017 and $432 million in the third quarter of 2016. Our average debt balance was $32.337 billion for the third quarter of 2017 compared to $31.358 billion for the third quarter of 2016. The average effective interest rate for our long-term debt declined to 5.2% from 5.5% for the quarters ended September 30, 2017 and 2016, respectively.
During the third quarters of 2017 and 2016, we recorded net gains on sales of facilities of $7 million and $3 million, respectively.
During June 2017, we issued $1.500 billion aggregate principal amount of 5.500% senior secured notes due 2047. We used the net proceeds for general corporate purposes, including funding the purchase of certain hospital acquisitions, and the redemption, during July 2017, of all $500 million aggregate principal amount of our existing 8.000% senior notes maturing in October 2018. The pretax loss on retirement of debt was $39 million. During August 2016, we issued $1.200 billion aggregate principal amount of 4.500% senior secured notes due 2027. We used the net proceeds for general corporate purposes and to retire a portion of one of our senior secured term loans. We also entered into a joinder agreement to retire the remaining portion of this senior secured term loan using proceeds from a new $1.200 billion senior secured term loan facility maturing in February 2024. The pretax loss on retirement of debt was $4 million.
We recorded $11 million of legal claim costs during the third quarter of 2016 related to the Health Midwest litigation.
The effective tax rates were 36.7% and 30.6% for the third quarters of 2017 and 2016, respectively. The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships. Our provisions for income taxes for the third quarters of 2017 and 2016 included tax benefits of $4 million and $11 million, respectively, related to excess tax benefits from employee equity award settlements. Our provision for income taxes for the third quarter of 2016 also included a tax benefit of $51 million primarily related to the resolution of federal income tax issues for our 2011 and 2012 tax years. Our provision for income taxes for the third quarter of 2017 also included $4 million of reductions in interest expense (net of tax). Excluding the effect of these adjustments, the effective tax rate for the third quarters of 2017 and 2016 would have been 37.8% and 37.6%, respectively.
Net income attributable to noncontrolling interests declined from $127 million for the third quarter of 2016 to $104 million for the third quarter of 2017. The decline in net income attributable to noncontrolling interests related primarily to one of our Texas markets.
35
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
Nine months Ended September 30, 2017 and 2016
Net income attributable to HCA Healthcare, Inc. totaled $1.742 billion, or $4.64 per diluted share, in the nine months ended September 30, 2017 compared to $1.970 billion, or $4.93 per diluted share, in the nine months ended September 30, 2016. The first nine months of 2017 results include additional expenses and losses of revenues estimated at approximately $140 million, or $0.24 per diluted share, associated with the impact of hurricanes Harvey and Irma on our Texas, Florida, Georgia and South Carolina facilities, and a negative impact to operating results related to the Texas Medicaid Waiver program of approximately $50 million, or $0.08 per diluted share, related to final settlement amounts for the program year ended September 30, 2017. The amount associated with the hurricanes is prior to any insurance recoveries which we may receive. The first nine months of 2017 results also include net gains on sales of facilities of $10 million, or $0.02 per diluted share, and losses on retirement of debt of $39 million, or $0.07 per diluted share. The first nine months of 2016 results include legal claim costs of $33 million, or $0.05 per diluted share, losses on retirement of debt of $4 million, or $0.01 per diluted share, and net gains on sales of facilities of $8 million, or $0.01 per diluted share. Our provision for income taxes for the first nine months of 2016 also included tax benefits of $51 million, or $0.13 per diluted share, primarily related to the resolution of federal income tax issues for our 2011 and 2012 tax years. All per diluted share disclosures are based upon amounts net of the applicable income taxes. Shares used for diluted earnings per share were 375.013 million shares and 399.577 million shares for the nine months ended September 30, 2017 and 2016, respectively. During 2016 and the first nine months of 2017, we repurchased 36.325 million and 17.847 million shares of our common stock, respectively.
For the first nine months of 2017, consolidated and same facility admissions increased 1.8% and 1.0%, respectively, compared to the first nine months of 2016. Consolidated and same facility outpatient surgical volumes declined 0.8% and 2.0%, respectively, during the first nine months of 2017, compared to the first nine months of 2016. Consolidated and same facility inpatient surgeries increased 1.0% and 0.1%, respectively, in the first nine months of 2017, compared to the first nine months of 2016. Consolidated and same facility emergency department visits increased 1.7% and 0.7%, respectively, during the nine months ended September 30, 2017, compared to the nine months ended September 30, 2016.
Revenues before provision for doubtful accounts increased 5.8% for the first nine months of 2017 compared to the first nine months of 2016. Provision for doubtful accounts increased $712 million from $2.392 billion in the first nine months of 2016 to $3.104 billion in the first nine months of 2017. The provision for doubtful accounts relates primarily to uninsured amounts due directly from patients, including copayment and deductible amounts for patients who have health care coverage. The self-pay revenue deductions for charity care and uninsured discounts increased $394 million and $1.000 billion, respectively, during the first nine months of 2017, compared to the first nine months of 2016. The sum of the provision for doubtful accounts, uninsured discounts and charity care, as a percentage of the sum of revenues, the provision for doubtful accounts, uninsured discounts and charity care, was 34.8% for the first nine months of 2017, compared to 32.8% for the first nine months of 2016. At September 30, 2017, our allowance for doubtful accounts represented approximately 99.1% of the $5.465 billion total patient due accounts receivable balance, including accounts, net of estimated contractual discounts, related to patients for which eligibility for Medicaid coverage or uninsured discounts was being evaluated.
Revenues increased 3.9% primarily due to the combined impact of revenue per equivalent admission growth of 1.7% and an increase of 2.1% in equivalent admissions for the first nine months of 2017 compared to the first nine months of 2016. Same facility revenues increased 3.0% due to the combined impact of a 1.8% increase in same facility revenue per equivalent admission and a 1.2% increase in same facility equivalent admissions for the first nine months of 2017 compared to the first nine months of 2016.
36
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
Nine months Ended September 30, 2017 and 2016 (continued)
Salaries and benefits, as a percentage of revenues, were 46.4% in the first nine months of 2017 and 45.8% in the first nine months of 2016. Salaries and benefits per equivalent admission increased 3.1% in the first nine months of 2017 compared to the first nine months of 2016. Same facility labor rate increases averaged 2.7% for the first nine months of 2017 compared to the first nine months of 2016.
Supplies, as a percentage of revenues, were 16.8% in the first nine months of 2017 and 16.6% in the first nine months of 2016. Supply costs per equivalent admission increased 2.5% in the first nine months of 2017 compared to the first nine months of 2016. Supply costs per equivalent admission increased 5.1% for medical devices and 1.6% for general medical and surgical items, and were flat for pharmacy supplies in the first nine months of 2017 compared to the first nine months of 2016.
Other operating expenses, as a percentage of revenues, increased to 18.6% in the first nine months of 2017 from 18.2% in the first nine months of 2016. 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. Provisions for losses related to professional liability risks were $353 million and $329 million for the first nine months of 2017 and 2016, respectively.
Equity in earnings of affiliates was $36 million and $44 million in the first nine months of 2017 and 2016, respectively.
Depreciation and amortization increased $118 million, from $1.463 billion in the first nine months of 2016 to $1.581 billion in the first nine months of 2017. The increase in depreciation relates to both acquired facilities and increased routine capital expenditures.
Interest expense was $1.257 billion for the first nine months of 2017 and $1.275 billion for the first nine months of 2016. Our average debt balance was $31.846 billion for the first nine months of 2017 compared to $31.002 billion for the first nine months of 2016. The average effective interest rate for our long-term debt declined from 5.5% for the nine months ended September 30, 2016 to 5.3% for the nine months ended September 30, 2017.
During the first nine months of 2017 and 2016, we recorded net gains on sales of facilities of $10 million and $8 million, respectively.
During June 2017, we issued $1.500 billion aggregate principal amount of 5.500% senior secured notes due 2047. We used the net proceeds for general corporate purposes, including funding the purchase of certain hospital acquisitions, and the redemption, during July 2017, of all $500 million aggregate principal amount of our existing 8.000% senior notes maturing in October 2018. The pretax loss on retirement of debt was $39 million. During August 2016, we issued $1.200 billion aggregate principal amount of 4.500% senior secured notes due 2027. We used the net proceeds for general corporate purposes and to retire a portion of one of our senior secured term loans. We also entered into a joinder agreement to retire the remaining portion of this senior secured term loan using proceeds from a new $1.200 billion senior secured term loan facility maturing in February 2024. The pretax loss on retirement of debt was $4 million.
37
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Results of Operations (continued)
Nine months Ended September 30, 2017 and 2016 (continued)
We recorded $33 million of legal claim costs during the first nine months of 2016 related to the Health Midwest litigation.
The effective tax rates were 34.1% and 31.3% for the first nine months of 2017 and 2016, respectively. The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships. Our provision for income taxes for the first nine months of 2017 and 2016 included tax benefits of $80 million and $129 million, respectively, related to excess tax benefits from employee equity award settlements. Our provision for income taxes for the first nine months of 2016 also included a tax benefit of $51 million primarily related to the resolution of federal income tax issues for our 2011 and 2012 tax years. Our provision for income taxes for the first nine months of 2017 also included $16 million of reductions in interest expense (net of tax). Excluding the effect of these adjustments, the effective tax rate for the first nine months of 2017 and 2016 would have been 37.7% and 37.6%, respectively.
Net income attributable to noncontrolling interests declined from $377 million for the first nine months of 2016 to $360 million for the first nine months of 2017. The decline in net income attributable to noncontrolling interests related primarily to one of our Texas markets.
Liquidity and Capital Resources
Cash provided by operating activities totaled $3.692 billion in the first nine months of 2017 compared to $3.954 billion in the first nine months of 2016. The $262 million decline in cash provided by operating activities in the first nine months of 2017 compared to the first nine months of 2016 primarily related to the $245 million decline in net income. The combined interest payments and net tax payments in the first nine months of 2017 and 2016 were $2.294 billion and $2.229 billion, respectively. Working capital totaled $3.837 billion at September 30, 2017 and $3.252 billion at December 31, 2016.
Cash used in investing activities was $3.172 billion in the first nine months of 2017 compared to $2.234 billion in the first nine months of 2016. Acquisitions of hospitals and health care entities increased from $468 million in the first nine months of 2016 to $1.142 billion in the first nine months of 2017. Excluding acquisitions, capital expenditures were $2.033 billion in the first nine months of 2017 and $1.884 billion in the first nine months of 2016. Capital expenditures, excluding acquisitions, are expected to approximate $3.0 billion in 2017. At September 30, 2017, there were projects under construction which had estimated additional costs to complete and equip over the next five years of approximately $3.5 billion. We expect to finance capital expenditures with internally generated and borrowed funds.
Cash used in financing activities totaled $448 million in the first nine months of 2017 compared to $1.784 billion in the first nine months of 2016. During the first nine months of 2017, net cash flows used in financing activities included a net increase of $1.452 billion in our indebtedness, repurchases of common stock of $1.475 billion, distributions to noncontrolling interests of $363 million and payments of debt issuance costs of $25 million. During the first nine months of 2016, net cash flows used in financing activities included a net increase of $906 million in our indebtedness, repurchases of common stock of $2.213 billion, distributions to noncontrolling interests of $342 million and payments of debt issuance costs of $40 million.
We are a highly leveraged company with significant debt service requirements. Our debt totaled $32.953 billion at September 30, 2017. Our interest expense was $1.257 billion for the first nine months of 2017 and $1.275 billion for the first nine months of 2016.
38
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Liquidity and Capital Resources (continued)
In addition to cash flows from operations, available sources of capital include amounts available under our senior secured credit facilities ($2.037 billion and $2.154 billion available as of September 30, 2017 and October 31, 2017, respectively) and anticipated access to public and private debt markets.
During June 2017, we issued $1.500 billion aggregate principal amount of 5.500% senior secured notes due 2047. We used the net proceeds for general corporate purposes, including funding the purchase of certain hospital acquisitions, and the redemption, during July 2017, of all $500 million aggregate principal amount of our existing 8.000% senior notes maturing in October 2018. The pretax loss on retirement of debt was $39 million.
During June 2017, we amended our senior secured revolving credit facilities by (i) increasing the commitments under the senior secured asset-based revolving credit facility to $3.750 billion, (ii) extending the maturity date of the revolving credit commitments to June 28, 2022, (iii) amending the incremental facility provisions to permit the incurrence of additional incremental credit facilities in an aggregate principal amount of $1.5 billion and (iv) providing that the commitment fee for unutilized commitments under the senior secured asset-based revolving credit facility shall be 0.250% per annum.
During August 2016, we issued $1.200 billion aggregate principal amount of 4.500% senior secured notes due 2027. We used the net proceeds for general corporate purposes and to retire a portion of one of our senior secured term loans. We also entered into a joinder agreement to retire the remaining portion of this senior secured term loan using proceeds from a new $1.200 billion senior secured term loan facility maturing in February 2024. The pretax loss on retirement of debt was $4 million.
During March 2016, we issued $1.500 billion aggregate principal amount of 5.250% senior secured notes due 2026. We used the net proceeds for general corporate purposes and to retire a portion of one of our senior secured term loans. We also entered into a joinder agreement to retire the remaining portion of this senior secured term loan using proceeds from a new $1.500 billion senior secured term loan facility maturing in March 2023.
Investments of our professional liability insurance subsidiaries, to maintain statutory equity and pay claims, totaled $421 million and $385 million at September 30, 2017 and December 31, 2016, respectively. An insurance subsidiary maintained net reserves for professional liability risks of $202 million and $215 million at September 30, 2017 and December 31, 2016, respectively. Our facilities are insured by a 100% owned insurance subsidiary for losses up to $50 million per occurrence; however, this coverage is subject to a $15 million per occurrence self-insured retention. Net reserves for the self-insured professional liability risks retained were $1.378 billion and $1.279 billion at September 30, 2017 and December 31, 2016, respectively. Claims payments, net of reinsurance recoveries, during the next 12 months are expected to approximate $419 million. We estimate that approximately $372 million of the expected net claim payments during the next 12 months will relate to claims subject to the self-insured retention.
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.
Market Risk
We are exposed to market risk related to changes in market values of securities. The investments in debt and equity securities of our 100% owned insurance subsidiaries were $418 million and $3 million, respectively, at
39
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Liquidity and Capital Resources (continued)
Market Risk (continued)
September 30, 2017. These investments are carried at fair value, with changes in unrealized gains and losses being recorded as adjustments to other comprehensive income. At September 30, 2017, we had a net unrealized gain of $16 million on the insurance subsidiaries investment securities.
We are exposed to market risk related to market illiquidity. Investments in debt and equity securities of our 100% owned insurance subsidiaries could be impaired by the inability to access the capital markets. Should the 100% owned insurance subsidiaries require significant amounts of cash in excess of normal cash requirements to pay claims and other expenses on short notice, we may have difficulty selling these investments in a timely manner or be forced to sell them at a price less than what we might otherwise have been able to in a normal market environment. We may be required to recognize other-than-temporary 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.
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. Our interest rate swap agreements involve the exchange of fixed and variable rate interest payments between two parties, based on common notional principal amounts and maturity dates. The notional amounts of the swap agreements represent balances used to calculate the exchange of cash flows and are not our assets or liabilities. Our credit risk related to these agreements is considered low because the swap agreements are with creditworthy financial institutions. The interest payments under these agreements are settled on a net basis. These derivatives have been recognized in the financial statements at their respective fair values. Changes in the fair value of these derivatives, which are designated as cash flow hedges, are included in other comprehensive income, and changes in the fair value of derivatives which have not been designated as hedges are recorded in operations.
With respect to our interest-bearing liabilities, approximately $4.486 billion of long-term debt at September 30, 2017 was subject to variable rates of interest, while the remaining balance in long-term debt of $28.467 billion at September 30, 2017 was subject to fixed rates of interest. Both the general level of interest rates and, for the senior secured credit facilities, our leverage affect our variable interest rates. Our variable debt is comprised primarily of amounts outstanding under the senior secured credit facilities. Borrowings under the senior secured credit facilities bear interest at a rate equal to an applicable margin plus, at our option, either (a) a base rate determined by reference to the higher of (1) the federal funds rate plus 0.50% and (2) the prime rate of Bank of America or (b) a LIBOR rate for the currency of such borrowing for the relevant interest period. The applicable margin for borrowings under the senior secured credit facilities may fluctuate according to a leverage ratio. The average effective interest rate for our long-term debt declined from 5.5% for the nine months ended September 30, 2016 to 5.3% for the nine months ended September 30, 2017.
The estimated fair value of our total long-term debt was $34.998 billion at September 30, 2017. 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. Based on a hypothetical 1% increase in interest rates, the potential annualized reduction to future pretax earnings would be approximately $45 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.
We are exposed to currency translation risk related to our foreign operations. Our international operations represented 2.6% and 2.5%, respectively, of our consolidated revenues for the quarter and nine months ended September 30, 2017. The United Kingdoms vote to exit the European Union in June 2016 contributed to a 16.8% decline in the Great British pound (GBP) to US dollar (USD) translation ratio during 2016. However, the GBP/USD translation ratio has stabilized (6.6% increase) during the first nine months of 2017. We currently do not consider the market risk related to GBP/USD translation to be material to our consolidated financial statements or our liquidity.
40
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Tax Examinations
We are subject to examination by federal, state and foreign taxing authorities. Management believes HCA Healthcare, Inc. and its predecessors, subsidiaries and affiliates properly reported taxable income and paid taxes in accordance with applicable laws and agreements established with IRS, state and foreign taxing authorities and final resolution of any disputes will not have a material, adverse effect on our results of operations or financial position. 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.
Operating Data
2017 | 2016 | |||||||
Number of hospitals in operation at: |
||||||||
March 31 |
171 | 168 | ||||||
June 30 |
172 | 169 | ||||||
September 30 |
177 | 169 | ||||||
December 31 |
170 | |||||||
Number of freestanding outpatient surgical centers in operation at: |
||||||||
March 31 |
118 | 116 | ||||||
June 30 |
119 | 116 | ||||||
September 30 |
119 | 117 | ||||||
December 31 |
118 | |||||||
Licensed hospital beds at(a): |
||||||||
March 31 |
44,374 | 43,817 | ||||||
June 30 |
44,727 | 44,127 | ||||||
September 30 |
46,250 | 44,226 | ||||||
December 31 |
44,290 | |||||||
Weighted average licensed beds(b): |
||||||||
Quarter: |
||||||||
First |
44,362 | 43,780 | ||||||
Second |
44,605 | 44,064 | ||||||
Third |
45,887 | 44,188 | ||||||
Fourth |
44,274 | |||||||
Year |
44,077 | |||||||
Average daily census(c): |
||||||||
Quarter: |
||||||||
First |
26,699 | 26,325 | ||||||
Second |
25,353 | 25,199 | ||||||
Third |
25,653 | 24,748 | ||||||
Fourth |
25,096 | |||||||
Year |
25,340 | |||||||
Admissions(d): |
||||||||
Quarter: |
||||||||
First |
485,761 | 479,568 | ||||||
Second |
473,174 | 467,218 | ||||||
Third |
482,557 | 469,764 | ||||||
Fourth |
475,281 | |||||||
Year |
1,891,831 | |||||||
Equivalent admissions(e): |
||||||||
Quarter: |
||||||||
First |
812,192 | 798,001 | ||||||
Second |
809,367 | 792,599 | ||||||
Third |
818,887 | 799,120 | ||||||
Fourth |
801,799 | |||||||
Year |
3,191,519 |
41
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Operating Data (Continued)
2017 | 2016 | |||||||
Average length of stay (days)(f): |
||||||||
Quarter: |
||||||||
First |
4.9 | 5.0 | ||||||
Second |
4.9 | 4.9 | ||||||
Third |
4.9 | 4.8 | ||||||
Fourth |
4.9 | |||||||
Emergency room visits(g): |
||||||||
Quarter: |
||||||||
First |
2,163,138 | 2,133,289 | ||||||
Second |
2,116,123 | 2,093,039 | ||||||
Third |
2,130,460 | 2,077,938 | ||||||
Fourth |
2,074,074 | |||||||
Year |
8,378,340 | |||||||
Outpatient surgeries(h): |
||||||||
Quarter: |
||||||||
First |
225,915 | 226,486 | ||||||
Second |
234,215 | 234,578 | ||||||
Third |
224,252 | 229,054 | ||||||
Fourth |
242,095 | |||||||
Year |
932,213 | |||||||
Inpatient surgeries(i): |
||||||||
Quarter: |
||||||||
First |
133,341 | 131,840 | ||||||
Second |
134,553 | 134,068 | ||||||
Third |
137,187 | 135,013 | ||||||
Fourth |
136,385 | |||||||
Year |
537,306 | |||||||
Days revenues in accounts receivable(j): |
||||||||
Quarter: |
||||||||
First |
48 | 52 | ||||||
Second |
49 | 50 | ||||||
Third |
51 | 49 | ||||||
Fourth |
50 | |||||||
Outpatient revenues as a % of patient revenues(k): |
||||||||
Quarter: |
||||||||
First |
37 | % | 38 | % | ||||
Second |
38 | % | 38 | % | ||||
Third |
38 | % | 39 | % | ||||
Fourth |
39 | % | ||||||
Year |
38 | % |
42
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Operating Data (Continued)
BALANCE SHEET DATA
% of Accounts Receivable | ||||||||||||
Under 91 Days | 91 180 Days | Over 180 Days | ||||||||||
Accounts receivable aging at September 30, 2017(l): |
||||||||||||
Medicare and Medicaid |
11 | % | 1 | % | 1 | % | ||||||
Managed care and other discounted |
29 | 5 | 5 | |||||||||
Uninsured |
21 | 6 | 21 | |||||||||
|
|
|
|
|
|
|||||||
Total |
61 | % | 12 | % | 27 | % | ||||||
|
|
|
|
|
|
(a) | Licensed beds are those beds for which a facility has been granted approval to operate from the applicable state licensing agency. |
(b) | Represents the average number of licensed beds, weighted based on periods owned. |
(c) | Represents the average number of patients in our hospital beds each day. |
(d) | 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. |
(e) | Equivalent admissions are used by management and certain investors as a general measure of combined inpatient and outpatient volume. Equivalent admissions are computed by multiplying admissions (inpatient volume) by the sum of gross inpatient revenues and gross outpatient revenues and then dividing the resulting amount by gross inpatient revenues. The equivalent admissions computation equates outpatient revenues to the volume measure (admissions) used to measure inpatient volume resulting in a general measure of combined inpatient and outpatient volume. |
(f) | Represents the average number of days admitted patients stay in our hospitals. |
(g) | Represents the number of patients treated in our emergency rooms. |
(h) | Represents the number of surgeries performed on patients who were not admitted to our hospitals. Pain management and endoscopy procedures are not included in outpatient surgeries. |
(i) | Represents the number of surgeries performed on patients who have been admitted to our hospitals. Pain management and endoscopy procedures are not included in inpatient surgeries. |
(j) | Revenues per day is calculated by dividing the revenues for the quarter by the days in the quarter. Days revenues in accounts receivable is then calculated as accounts receivable, net of allowance for doubtful accounts, at the end of the quarter divided by the revenues per day. Revenues used in this computation are net of the provision for doubtful accounts. |
(k) | Represents the percentage of patient revenues related to patients who are not admitted to our hospitals. |
(l) | Accounts receivable aging data is based upon consolidated gross accounts receivable of $11.396 billion (each 1% is equivalent to approximately $114 million of gross accounts receivable). |
43
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
The information called for by this item is provided under the caption Market Risk under Item 2, Managements Discussion and Analysis of Financial Condition and Results of Operations.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
HCAs chief executive officer and chief financial officer have reviewed and evaluated the effectiveness of HCAs disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934) as of the end of the period covered by this quarterly report. Based on that evaluation, the chief executive officer and chief financial officer have concluded HCAs disclosure controls and procedures were effective.
Changes in Internal Control Over Financial Reporting
During the period covered by this report, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
We operate in a highly regulated and litigious industry. As a result, various lawsuits, claims and legal and regulatory proceedings have been and can be expected to be instituted or asserted against us. We are also subject to claims and suits arising in the ordinary course of business, including claims for personal injuries or wrongful restriction of, or interference with, physicians staff privileges. In certain of these actions the claimants may seek punitive damages against us which may not be covered by insurance. We are also subject to claims by various taxing authorities for additional taxes and related interest and penalties. The resolution of any such lawsuits, claims or legal and regulatory proceedings could have a material, adverse effect on our results of operations, financial position or liquidity.
Health care companies are subject to numerous investigations by various governmental agencies. Further, under the federal False Claims Act, private parties have the right to bring qui tam, or whistleblower, suits against companies that submit false claims for payments to, or improperly retain overpayments from, the government. Some states have adopted similar state whistleblower and false claims provisions. Certain of our individual facilities have received, and from time to time, other facilities may receive, government inquiries from, and may be subject to investigation by, federal and state agencies. Depending on whether the underlying conduct in these or future inquiries or investigations could be considered systemic, their resolution could have a material, adverse effect on our results of operations, financial position or liquidity.
Reference is made to the factors set forth under the caption Forward-Looking Statements in Part I, Item 2 of this quarterly report on Form 10-Q and other risk factors described in our annual report on Form 10-K for the year ended December 31, 2016, which are incorporated herein by reference. There have not been any material changes to the risk factors previously disclosed in our annual report on Form 10-K for the year ended December 31, 2016.
44
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
During the quarter ended September 30, 2017, we repurchased 6,321,873 shares of our common stock at an average price of $80.44 per share through market purchases pursuant to the $2 billion share repurchase program authorized during November 2016. At September 30, 2017, we had $379 million of repurchase authorization available under the November 2016 authorization. During October 2017, our board of directors authorized a share repurchase program for up to $2 billion of our outstanding common stock.
The following table provides certain information with respect to our repurchases of common stock from July 1, 2017 through September 30, 2017 (dollars in millions, except per share amounts).
Period |
Total Number of Shares Purchased |
Average Price Paid per Share |
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs |
Approximate Dollar Value of Shares That May Yet Be Purchased Under Publicly Announced Plans or Programs |
||||||||||||
July 1, 2017 through July 31, 2017 |
1,663,241 | $ | 86.05 | 1,663,241 | $ | 744 | ||||||||||
August 1, 2017 through August 31, 2017 |
2,001,470 | $ | 79.22 | 2,001,470 | $ | 585 | ||||||||||
September 1, 2017 through September 30, 2017 |
2,657,162 | $ | 77.85 | 2,657,162 | $ | 379 | ||||||||||
|
|
|
|
|||||||||||||
Total for third quarter 2017 |
6,321,873 | $ | 80.44 | 6,321,873 | $ | 379 | ||||||||||
|
|
|
|
45
ITEM 6. | EXHIBITS |
(a) List of Exhibits:
31.1 | | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
31.2 | | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
32 | | |||
101 | | The following financial information from our quarterly report on Form 10-Q for the quarters and the nine months ended September 30, 2017 and 2016, filed with the SEC on November 7, 2017, formatted in Extensible Business Reporting Language: (i) the condensed consolidated balance sheets at September 30, 2017 and December 31, 2016, (ii) the condensed consolidated income statements for the quarters and nine months ended September 30, 2017 and 2016, (iii) the condensed consolidated comprehensive income statements for the quarters and nine months ended September 30, 2017 and 2016, (iv) the condensed consolidated statements of cash flows for the nine months ended September 30, 2017 and 2016 and (v) the notes to condensed consolidated financial statements. |
46
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
HCA Healthcare, Inc. | ||
By: |
/S/ WILLIAM B. RUTHERFORD | |
William B. Rutherford | ||
Executive Vice President and Chief Financial Officer |
Date: November 7, 2017
47
EXHIBIT 31.1
CERTIFICATION
I, R. Milton Johnson, certify that:
1. I have reviewed this quarterly report on Form 10-Q of HCA Healthcare, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
By: |
/S/ R. MILTON JOHNSON | |
R. Milton Johnson | ||
Chairman and Chief Executive Officer |
Date: November 7, 2017
EXHIBIT 31.2
CERTIFICATION
I, William B. Rutherford, certify that:
1. I have reviewed this quarterly report on Form 10-Q of HCA Healthcare, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
By: |
/S/ WILLIAM B. RUTHERFORD | |
William B. Rutherford | ||
Executive Vice President and Chief Financial Officer |
Date: November 7, 2017
EXHIBIT 32
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of HCA Healthcare, Inc. (the Company) on Form 10-Q for the quarter ended September 30, 2017, as filed with the Securities and Exchange Commission on the date hereof (the Report), each of the undersigned certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
By: |
/S/ R. MILTON JOHNSON | |
R. Milton Johnson | ||
Chairman and Chief Executive Officer |
November 7, 2017
By: |
/S/ WILLIAM B. RUTHERFORD | |
William B. Rutherford | ||
Executive Vice President and Chief Financial Officer |
November 7, 2017
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Oct. 31, 2017 |
|
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | HCA | |
Entity Registrant Name | HCA HEALTHCARE, INC. | |
Entity Central Index Key | 0000860730 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 354,052,500 |
Condensed Consolidated Income Statements (Unaudited) - USD ($) shares in Thousands, $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Income Statement [Abstract] | ||||
Revenues before provision for doubtful accounts | $ 11,967 | $ 11,110 | $ 35,156 | $ 33,241 |
Provision for doubtful accounts | 1,271 | 840 | 3,104 | 2,392 |
Revenues | 10,696 | 10,270 | 32,052 | 30,849 |
Salaries and benefits | 5,081 | 4,740 | 14,878 | 14,133 |
Supplies | 1,777 | 1,699 | 5,369 | 5,131 |
Other operating expenses | 2,075 | 1,896 | 5,970 | 5,617 |
Equity in earnings of affiliates | (13) | (22) | (36) | (44) |
Depreciation and amortization | 539 | 495 | 1,581 | 1,463 |
Interest expense | 427 | 432 | 1,257 | 1,275 |
Gains on sales of facilities | (7) | (3) | (10) | (8) |
Losses on retirement of debt | 39 | 4 | 39 | 4 |
Legal claim costs | 11 | 33 | ||
Total expenses including equity in earnings of affiliates | 9,918 | 9,252 | 29,048 | 27,604 |
Income before income taxes | 778 | 1,018 | 3,004 | 3,245 |
Provision for income taxes | 248 | 273 | 902 | 898 |
Net income | 530 | 745 | 2,102 | 2,347 |
Net income attributable to noncontrolling interests | 104 | 127 | 360 | 377 |
Net income attributable to HCA Healthcare, Inc. | $ 426 | $ 618 | $ 1,742 | $ 1,970 |
Per share data: | ||||
Basic earnings per share | $ 1.18 | $ 1.63 | $ 4.77 | $ 5.09 |
Diluted earnings per share | $ 1.15 | $ 1.59 | $ 4.64 | $ 4.93 |
Shares used in earnings per share calculations (in millions): | ||||
Basic | 360,170 | 378,199 | 365,398 | 386,968 |
Diluted | 369,834 | 389,592 | 375,013 | 399,577 |
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for Accounts receivable | $ 5,416 | $ 4,988 |
Debt issuance cost | $ 171 | $ 170 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,800,000,000 | 1,800,000,000 |
Common stock, shares outstanding | 356,979,800 | 370,535,900 |
Basis of Presentation and Significant Accounting Policies |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation and Significant Accounting Policies | NOTE 1 — BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Reporting Entity HCA Healthcare, Inc. is a holding company whose affiliates own and operate hospitals and related health care entities. The term “affiliates” includes direct and indirect subsidiaries of HCA Healthcare, Inc. and partnerships and joint ventures in which such subsidiaries are partners. At September 30, 2017, these affiliates owned and operated 177 hospitals, 119 freestanding surgery centers and provided extensive outpatient and ancillary services. HCA Healthcare, Inc.’s facilities are located in 20 states and England. The terms “Company,” “HCA,” “we,” “our” or “us,” as used herein and unless otherwise stated or indicated by context, refer to HCA Healthcare, Inc. and its affiliates. The terms “facilities” or “hospitals” refer to entities owned and operated by affiliates of HCA and the term “employees” refers to employees of affiliates of HCA. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal and recurring nature. The majority of our expenses are “costs of revenues” items. Costs that could be classified as general and administrative would include our corporate office costs, which were $91 million and $94 million for the quarters ended September 30, 2017 and 2016, respectively, and $273 million and $272 million for the nine months ended September 30, 2017 and 2016, respectively. Operating results for the quarter and nine months ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. For further information, refer to the consolidated financial statements and footnotes thereto included in our annual report on Form 10-K for the year ended December 31, 2016.
Revenues Revenues are recorded during the period the health care services are provided, based upon the estimated amounts due from the patients and third-party payers. Third-party payers include federal and state agencies (under the Medicare and Medicaid programs), managed care health plans and commercial insurance companies (including plans offered through the health insurance exchanges), and employers. Estimates of contractual allowances under managed care health plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured discounts and contractual discounts). We also record a provision for doubtful accounts (based primarily on historical collection experience) related to uninsured accounts to record net self-pay revenues at the estimated amounts we expect to collect. Our revenues from third-party payers, the uninsured and other for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
Recent Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board issued a final, converged, principles-based standard on revenue recognition. Companies across all industries will use a five-step model to recognize revenue from customer contracts. The new standard, which replaces nearly all existing revenue recognition guidance, will require significant management judgments and change the way many companies recognize revenue in their financial statements. In July 2015, the FASB decided to defer the effective date of the new revenue standard by one year to annual and interim periods beginning after December 15, 2017 for public entities and permit entities to adopt one year earlier if they choose. The FASB decided, based on its outreach to various stakeholders and continuing amendments to the new revenue standard, that a deferral was necessary to provide adequate time to effectively implement the new standard. We are continuing to evaluate the effects the adoption of this standard will have on our financial statements and financial disclosures. We believe the most significant impact will be to the presentation of our income statement where the provision for doubtful accounts will be recorded as a direct reduction to revenues and will not be presented as a separate line item. We expect to adopt the new standard using the full retrospective application, and we do not currently believe the adoption will have a significant impact on our recognition of net revenues or related disclosures for any period. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (“ASU 2016-02”), which requires lessees to recognize assets and liabilities for most leases. ASU 2016-02 is effective for public business entities for annual and interim periods beginning after December 15, 2018. Early adoption is permitted. ASU 2016-02’s transition provisions will be applied using a modified retrospective approach at the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the provisions of ASU 2016-02 to determine how our financial statements will be affected, and we believe the primary effect of adopting the new standard will be to record right-of-use assets and obligations for our leases currently classified as operating leases. Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
Acquisitions and Dispositions |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Acquisitions and Dispositions | NOTE 2 — ACQUISITIONS AND DISPOSITIONS During the nine months ended September 30, 2017, we paid $1.000 billion to acquire seven hospital facilities (one of the acquired hospital facilities has an effective acquisition date of October 1, 2017) and $142 million to acquire other nonhospital health care entities. During the nine months ended September 30, 2016, we paid $343 million to acquire three hospital facilities and $125 million to acquire other nonhospital health care entities. During the nine months ended September 30, 2017, we received proceeds of $24 million and recognized a net pretax gain of $10 million related to sales of real estate and other investments. During the nine months ended September 30, 2016, we received proceeds of $23 million and recognized a net pretax gain of $8 million related to sales of real estate and other investments. |
Income Taxes |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 3 — INCOME TAXES Our liability for unrecognized tax benefits was $429 million, including accrued interest of $40 million, as of September 30, 2017 ($418 million and $45 million, respectively, as of December 31, 2016). Unrecognized tax benefits of $136 million ($137 million as of December 31, 2016) would affect the effective rate, if recognized. Our provision for income taxes for the quarters ended September 30, 2017 and 2016, included tax benefits of $4 million and $11 million, respectively, and for the nine months ended September 30, 2017 and 2016, included tax benefits of $80 million and $129 million, respectively, related to the settlement of employee equity awards. Our provision for income taxes for the quarter and nine months ended September 30, 2017 also included $4 million and $16 million, respectively, of reductions in interest expense (net of tax). We also reduced our provision for income taxes for the quarter and nine months ended September 30, 2016 by $51 million, including interest of $17 million (net of tax) primarily related to the completion of IRS examinations which resolved all outstanding federal tax issues for our 2011 and 2012 tax years. We are subject to examination by federal, state and foreign taxing authorities. Depending on the resolution of any federal, state and foreign tax disputes, the completion of examinations by federal, state or foreign taxing authorities, or the expiration of statutes of limitation for specific taxing jurisdictions, we believe it is reasonably possible that our liability for unrecognized tax benefits may significantly increase or decrease within the next 12 months. However, we are currently unable to estimate the range of any possible change. |
Earnings Per Share |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | NOTE 4 — EARNINGS PER SHARE We compute basic earnings per share using the weighted average number of common shares outstanding. We compute diluted earnings per share using the weighted average number of common shares outstanding, plus the dilutive effect of outstanding equity awards and potential shares, computed using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share for the quarters and nine months ended September 30, 2017 and 2016 (dollars and shares in millions, except per share amounts):
|
Investments of Insurance Subsidiaries |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments of Insurance Subsidiaries | NOTE 5 — INVESTMENTS OF INSURANCE SUBSIDIARIES A summary of our insurance subsidiaries’ investments at September 30, 2017 and December 31, 2016 follows (dollars in millions):
At September 30, 2017 and December 31, 2016, the investments of our insurance subsidiaries were classified as “available-for-sale.” Changes in temporary unrealized gains and losses are recorded as adjustments to other comprehensive income (loss). Scheduled maturities of investments in debt securities at September 30, 2017 were as follows (dollars in millions):
The average expected maturity of the investments in debt securities at September 30, 2017 was 4.0 years, compared to the average scheduled maturity of 5.5 years. Expected and scheduled maturities may differ because the issuers of certain securities have the right to call, prepay or otherwise redeem such obligations prior to their scheduled maturity date. |
Financial Instruments |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | NOTE 6 — FINANCIAL INSTRUMENTS Interest Rate Swap Agreements We have entered into interest rate swap agreements to manage our exposure to fluctuations in interest rates. These swap agreements involve the exchange of fixed and variable rate interest payments between two parties based on common notional principal amounts and maturity dates. Pay-fixed interest rate swaps effectively convert LIBOR indexed variable rate obligations to fixed interest rate obligations. The interest payments under these agreements are settled on a net basis. The net interest payments, based on the notional amounts in these agreements, generally match the timing of the related liabilities for the interest rate swap agreements which have been designated as cash flow hedges. The notional amounts of the swap agreements represent amounts used to calculate the exchange of cash flows and are not our assets or liabilities. Our credit risk related to these agreements is considered low because the swap agreements are with creditworthy financial institutions. The following table sets forth our interest rate swap agreements, which have been designated as cash flow hedges, at September 30, 2017 (dollars in millions):
During the next 12 months, we estimate $3 million will be reclassified from other comprehensive income (“OCI”) to interest expense. Derivatives — Results of Operations The following table presents the effect of our interest rate swaps on our results of operations for the nine months ended September 30, 2017 (dollars in millions):
|
Assets and Liabilities Measured at Fair Value |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities Measured at Fair Value | NOTE 7 — ASSETS AND LIABILITIES MEASURED AT FAIR VALUE Accounting Standards Codification 820, Fair Value Measurements and Disclosures (“ASC 820”) emphasizes fair value is a market-based measurement, and fair value measurements should be determined based on the assumptions market participants would use in pricing assets or liabilities. ASC 820 utilizes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment. Cash Traded Investments Our cash traded investments are generally classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Certain types of cash traded instruments are classified within Level 3 of the fair value hierarchy because they trade infrequently and therefore have little or no price transparency. The valuation of these securities involves the consideration of market factors and management’s judgment. Derivative Financial Instruments We have entered into interest rate swap agreements to manage our exposure to fluctuations in interest rates. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. We incorporate credit valuation adjustments to reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements of these instruments. Although we determined the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. We assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions, and at September 30, 2017 and December 31, 2016, we determined the credit valuation adjustments were not significant to the overall valuation of our derivatives.
The following tables summarize our assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016, aggregated by the level in the fair value hierarchy within which those measurements fall (dollars in millions):
The $6 million reduction in the Level 3 investments of our insurance subsidiaries resulted from settlements. The estimated fair value of our long-term debt was $34.998 billion and $32.833 billion at September 30, 2017 and December 31, 2016, respectively, compared to carrying amounts, excluding net debt issuance costs, aggregating $33.124 billion and $31.546 billion, respectively. The estimates of fair value are generally based upon the quoted market prices or quoted market prices for similar issues of long-term debt with the same maturities. |
Long-Term Debt |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | NOTE 8 — LONG-TERM DEBT A summary of long-term debt at September 30, 2017 and December 31, 2016, including related interest rates at September 30, 2017, follows (dollars in millions):
2017 Activity During June 2017, we issued $1.500 billion aggregate principal amount of 5.500% senior secured notes due 2047. We used the net proceeds for general corporate purposes, including funding the purchase of certain hospital acquisitions, and the redemption, during July 2017, of all $500 million aggregate principal amount of our existing 8.000% senior notes maturing in October 2018. The pretax loss on retirement of debt was $39 million. During June 2017, we amended our senior secured revolving credit facilities by (i) increasing the commitments under the senior secured asset-based revolving credit facility to $3.750 billion, (ii) extending the maturity date of the revolving credit commitments to June 28, 2022, (iii) amending the incremental facility provisions to permit the incurrence of additional incremental credit facilities in an aggregate principal amount of $1.5 billion and (iv) providing that the commitment fee for unutilized commitments under the senior secured asset-based revolving credit facility shall be 0.250% per annum. |
Contingencies |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | NOTE 9 — CONTINGENCIES We operate in a highly regulated and litigious industry. As a result, various lawsuits, claims and legal and regulatory proceedings have been and can be expected to be instituted or asserted against us. We are also subject to claims and suits arising in the ordinary course of business, including claims for personal injuries or wrongful restriction of, or interference with, physicians’ staff privileges. In certain of these actions the claimants may seek punitive damages against us which may not be covered by insurance. We are also subject to claims by various taxing authorities for additional taxes and related interest and penalties. The resolution of any such lawsuits, claims or legal and regulatory proceedings could have a material, adverse effect on our results of operations, financial position or liquidity. Health care companies are subject to numerous investigations by various governmental agencies. Under the federal False Claims Act, private parties have the right to bring qui tam, or “whistleblower,” suits against companies that submit false claims for payments to, or improperly retain overpayments from, the government. Some states have adopted similar state whistleblower and false claims provisions. Certain of our individual facilities have received, and from time to time, other facilities may receive, government inquiries from, and may be subject to investigation by, federal and state agencies. Depending on whether the underlying conduct in these or future inquiries or investigations could be considered systemic, their resolution could have a material, adverse effect on our results of operations, financial position or liquidity. |
Capital Structure |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Text Block [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capital Structure | NOTE 10 — CAPITAL STRUCTURE The changes in stockholders’ deficit, including changes in stockholders’ deficit attributable to HCA Healthcare, Inc. and changes in equity attributable to noncontrolling interests, are as follows (dollars and shares in millions):
During the nine months ended September 30, 2017, we repurchased 17.847 million shares of our common stock at an average price of $82.62 per share through market purchases pursuant to the $2.0 billion share repurchase program authorized during November 2016. At September 30, 2017, we had $379 million of repurchase authorization available under the November 2016 authorization. During October 2017, our board of directors authorized a share repurchase program for up to $2 billion of our outstanding common stock.
The components of accumulated other comprehensive loss are as follows (dollars in millions):
|
Segment and Geographic Information |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment and Geographic Information | NOTE 11 — SEGMENT AND GEOGRAPHIC INFORMATION We operate in one line of business, which is operating hospitals and related health care entities. We operate in two geographically organized groups: the National and American Groups. The National Group includes 86 hospitals located in Alaska, California, Florida, southern Georgia, Idaho, Indiana, northern Kentucky, Nevada, New Hampshire, South Carolina, Utah and Virginia, and the American Group includes 85 hospitals located in Colorado, northern Georgia, Kansas, southern Kentucky, Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas. We also operate six hospitals in England, and these facilities are included in the Corporate and other group. Adjusted segment EBITDA is defined as income before depreciation and amortization, interest expense, gains on sales of facilities, losses on retirement of debt, legal claim costs, income taxes and net income attributable to noncontrolling interests. We use adjusted segment EBITDA as an analytical indicator for purposes of allocating resources to geographic areas and assessing their performance. Adjusted segment EBITDA is commonly used as an analytical indicator within the health care industry, and also serves as a measure of leverage capacity and debt service ability. Adjusted segment EBITDA should not be considered as a measure of financial performance under generally accepted accounting principles, and the items excluded from adjusted segment EBITDA are significant components in understanding and assessing financial performance. Because adjusted segment EBITDA is not a measurement determined in accordance with generally accepted accounting principles and is thus susceptible to varying calculations, adjusted segment EBITDA, as presented, may not be comparable to other similarly titled measures of other companies. The geographic distributions of our revenues, equity in earnings of affiliates, adjusted segment EBITDA and depreciation and amortization for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
|
Supplemental Condensed Consolidating Financial Information |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Condensed Consolidating Financial Information | NOTE 12 — SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION During December 2012, HCA Healthcare, Inc. issued $1.000 billion aggregate principal amount of 6.250% senior unsecured notes due 2021. These notes are senior unsecured obligations and are not guaranteed by any of our subsidiaries. HCA Inc., a direct wholly-owned subsidiary of HCA Healthcare, Inc., is the obligor under a significant portion of our other indebtedness, including our senior secured credit facilities, senior secured notes and senior unsecured notes (other than the senior unsecured notes issued by HCA Healthcare, Inc.). The senior secured notes and senior unsecured notes issued by HCA Inc. are fully and unconditionally guaranteed by HCA Healthcare, Inc. The senior secured credit facilities and senior secured notes are fully and unconditionally guaranteed by substantially all existing and future, direct and indirect, 100% owned material domestic subsidiaries that are “Unrestricted Subsidiaries” under our Indenture dated December 16, 1993 (except for certain special purpose subsidiaries that only guarantee and pledge their assets under our senior secured asset-based revolving credit facility). Our summarized condensed consolidating comprehensive income statements for the quarters and nine months ended September 30, 2017 and 2016, condensed consolidating balance sheets at September 30, 2017 and December 31, 2016 and condensed consolidating statements of cash flows for the nine months ended September 30, 2017 and 2016, segregating HCA Healthcare, Inc. issuer, HCA Inc. issuer, the subsidiary guarantors, the subsidiary non-guarantors and eliminations, follow: HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30, 2016 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2016 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016 (Dollars in millions)
|
Basis of Presentation and Significant Accounting Policies (Policies) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal and recurring nature. The majority of our expenses are “costs of revenues” items. Costs that could be classified as general and administrative would include our corporate office costs, which were $91 million and $94 million for the quarters ended September 30, 2017 and 2016, respectively, and $273 million and $272 million for the nine months ended September 30, 2017 and 2016, respectively. Operating results for the quarter and nine months ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. For further information, refer to the consolidated financial statements and footnotes thereto included in our annual report on Form 10-K for the year ended December 31, 2016. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | Revenues Revenues are recorded during the period the health care services are provided, based upon the estimated amounts due from the patients and third-party payers. Third-party payers include federal and state agencies (under the Medicare and Medicaid programs), managed care health plans and commercial insurance companies (including plans offered through the health insurance exchanges), and employers. Estimates of contractual allowances under managed care health plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured discounts and contractual discounts). We also record a provision for doubtful accounts (based primarily on historical collection experience) related to uninsured accounts to record net self-pay revenues at the estimated amounts we expect to collect. Our revenues from third-party payers, the uninsured and other for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recent Pronouncements | Recent Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board issued a final, converged, principles-based standard on revenue recognition. Companies across all industries will use a five-step model to recognize revenue from customer contracts. The new standard, which replaces nearly all existing revenue recognition guidance, will require significant management judgments and change the way many companies recognize revenue in their financial statements. In July 2015, the FASB decided to defer the effective date of the new revenue standard by one year to annual and interim periods beginning after December 15, 2017 for public entities and permit entities to adopt one year earlier if they choose. The FASB decided, based on its outreach to various stakeholders and continuing amendments to the new revenue standard, that a deferral was necessary to provide adequate time to effectively implement the new standard. We are continuing to evaluate the effects the adoption of this standard will have on our financial statements and financial disclosures. We believe the most significant impact will be to the presentation of our income statement where the provision for doubtful accounts will be recorded as a direct reduction to revenues and will not be presented as a separate line item. We expect to adopt the new standard using the full retrospective application, and we do not currently believe the adoption will have a significant impact on our recognition of net revenues or related disclosures for any period. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (“ASU 2016-02”), which requires lessees to recognize assets and liabilities for most leases. ASU 2016-02 is effective for public business entities for annual and interim periods beginning after December 15, 2018. Early adoption is permitted. ASU 2016-02’s transition provisions will be applied using a modified retrospective approach at the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the provisions of ASU 2016-02 to determine how our financial statements will be affected, and we believe the primary effect of adopting the new standard will be to record right-of-use assets and obligations for our leases currently classified as operating leases. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earning Per Share | We compute basic earnings per share using the weighted average number of common shares outstanding. We compute diluted earnings per share using the weighted average number of common shares outstanding, plus the dilutive effect of outstanding equity awards and potential shares, computed using the treasury stock method. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements and Disclosures | Accounting Standards Codification 820, Fair Value Measurements and Disclosures (“ASC 820”) emphasizes fair value is a market-based measurement, and fair value measurements should be determined based on the assumptions market participants would use in pricing assets or liabilities. ASC 820 utilizes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash Traded Investments | Cash Traded Investments Our cash traded investments are generally classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Certain types of cash traded instruments are classified within Level 3 of the fair value hierarchy because they trade infrequently and therefore have little or no price transparency. The valuation of these securities involves the consideration of market factors and management’s judgment. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments | Derivative Financial Instruments We have entered into interest rate swap agreements to manage our exposure to fluctuations in interest rates. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. We incorporate credit valuation adjustments to reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements of these instruments. Although we determined the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. We assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions, and at September 30, 2017 and December 31, 2016, we determined the credit valuation adjustments were not significant to the overall valuation of our derivatives. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Rate Swaps [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Rate Swap Agreements | Interest Rate Swap Agreements We have entered into interest rate swap agreements to manage our exposure to fluctuations in interest rates. These swap agreements involve the exchange of fixed and variable rate interest payments between two parties based on common notional principal amounts and maturity dates. Pay-fixed interest rate swaps effectively convert LIBOR indexed variable rate obligations to fixed interest rate obligations. The interest payments under these agreements are settled on a net basis. The net interest payments, based on the notional amounts in these agreements, generally match the timing of the related liabilities for the interest rate swap agreements which have been designated as cash flow hedges. The notional amounts of the swap agreements represent amounts used to calculate the exchange of cash flows and are not our assets or liabilities. Our credit risk related to these agreements is considered low because the swap agreements are with creditworthy financial institutions. |
Basis of Presentation and Significant Accounting Policies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Revenues from Third Party Payers, Uninsured and Other Payers | Our revenues from third-party payers, the uninsured and other for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
|
Earnings Per Share (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Computations of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share for the quarters and nine months ended September 30, 2017 and 2016 (dollars and shares in millions, except per share amounts):
|
Investments of Insurance Subsidiaries (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Investments | A summary of our insurance subsidiaries’ investments at September 30, 2017 and December 31, 2016 follows (dollars in millions):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Maturities of Investments | Scheduled maturities of investments in debt securities at September 30, 2017 were as follows (dollars in millions):
|
Financial Instruments (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Swap Agreements Designated as Cash Flow Hedges | The following table sets forth our interest rate swap agreements, which have been designated as cash flow hedges, at September 30, 2017 (dollars in millions):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
Effect of Interest Rate on Results of Operations | The following table presents the effect of our interest rate swaps on our results of operations for the nine months ended September 30, 2017 (dollars in millions):
|
Assets and Liabilities Measured at Fair Value (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The following tables summarize our assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016, aggregated by the level in the fair value hierarchy within which those measurements fall (dollars in millions):
|
Long-Term Debt (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-Term Debt | A summary of long-term debt at September 30, 2017 and December 31, 2016, including related interest rates at September 30, 2017, follows (dollars in millions):
|
Capital Structure (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Text Block [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Changes in Stockholders' Deficit and Equity | The changes in stockholders’ deficit, including changes in stockholders’ deficit attributable to HCA Healthcare, Inc. and changes in equity attributable to noncontrolling interests, are as follows (dollars and shares in millions):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Accumulated Other Comprehensive Loss | The components of accumulated other comprehensive loss are as follows (dollars in millions):
|
Segment and Geographic Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Geographic Distributions of Revenues, Equity in Earnings of Affiliates, Adjusted Segment EBITDA and Depreciation and Amortization | The geographic distributions of our revenues, equity in earnings of affiliates, adjusted segment EBITDA and depreciation and amortization for the quarters and nine months ended September 30, 2017 and 2016 are summarized in the following table (dollars in millions):
|
Supplemental Condensed Consolidating Financial Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Condensed Consolidating Comprehensive Income Statement | HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30, 2016 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING COMPREHENSIVE INCOME STATEMENT FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016 (Dollars in millions)
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Condensed Consolidating Balance Sheet | HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2016 (Dollars in millions)
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Condensed Consolidating Statement of Cash Flows | HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 (Dollars in millions)
HCA HEALTHCARE, INC. CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016 (Dollars in millions)
|
Basis of Presentation and Significant Accounting Policies - Additional Information (Detail) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017
USD ($)
State
Hospital
Surgery_Center
|
Sep. 30, 2016
USD ($)
|
Sep. 30, 2017
USD ($)
State
Hospital
Surgery_Center
|
Sep. 30, 2016
USD ($)
|
|
Accounting Policies [Abstract] | ||||
Number of owned and operated hospitals | Hospital | 177 | 177 | ||
Number of freestanding surgery centers | Surgery_Center | 119 | 119 | ||
Number of facilities locations | State | 20 | 20 | ||
General and administrative expense | $ | $ 91 | $ 94 | $ 273 | $ 272 |
Acquisitions and Dispositions - Additional Information (Detail) $ in Thousands |
9 Months Ended | ||
---|---|---|---|
Oct. 01, 2017
Hospital
|
Sep. 30, 2017
USD ($)
Hospital
|
Sep. 30, 2016
USD ($)
Hospital
|
|
Business Acquisition [Line Items] | |||
Number of hospitals purchased | Hospital | 7 | 3 | |
Effective date of Acquisition | Oct. 01, 2017 | ||
Proceeds from sale of business | $ 24,000 | $ 23,000 | |
Subsequent Event [Member] | |||
Business Acquisition [Line Items] | |||
Number of hospitals purchased | Hospital | 1 | ||
Real Estate and Other Investments [Member] | |||
Business Acquisition [Line Items] | |||
Proceeds from sale of business | 24,000 | 23,000 | |
Pretax gain (loss) on sales of business | 10,000 | 8,000 | |
Hospitals [Member] | |||
Business Acquisition [Line Items] | |||
Aggregate purchase price | 1,000,000 | 343,000 | |
Nonhospital Health Care [Member] | |||
Business Acquisition [Line Items] | |||
Aggregate purchase price | $ 142,000 | $ 125,000 |
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Income Tax Disclosure [Abstract] | |||||
Liability for unrecognized tax benefits | $ 429 | $ 429 | $ 418 | ||
Unrecognized tax benefits, accrued interest | 40 | 40 | 45 | ||
Unrecognized tax benefits that would impact effective tax rate | 136 | 136 | $ 137 | ||
Provision for tax benefits related to settlement of employee awards | 4 | $ 11 | 80 | $ 129 | |
Reductions in interest (net of tax) | $ 4 | 17 | $ 16 | 17 | |
Provision for income taxes | $ 51 | $ 51 |
Earnings Per Share - Schedule of Computations of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Earnings Per Share [Abstract] | ||||
Net income attributable to HCA Healthcare, Inc. | $ 426 | $ 618 | $ 1,742 | $ 1,970 |
Weighted average common shares outstanding | 360,170 | 378,199 | 365,398 | 386,968 |
Effect of dilutive incremental shares | 9,664 | 11,393 | 9,615 | 12,609 |
Shares used for diluted earnings per share | 369,834 | 389,592 | 375,013 | 399,577 |
Basic earnings per share | $ 1.18 | $ 1.63 | $ 4.77 | $ 5.09 |
Diluted earnings per share | $ 1.15 | $ 1.59 | $ 4.64 | $ 4.93 |
Investments of Insurance Subsidiaries - Schedule of Maturities of Investments (Detail) $ in Millions |
Sep. 30, 2017
USD ($)
|
---|---|
Investments, Debt and Equity Securities [Abstract] | |
Due in one year or less, Amortized Cost | $ 100 |
Due after one year through five years, Amortized Cost | 76 |
Due after five years through ten years, Amortized Cost | 178 |
Due after ten years, Amortized Cost | 50 |
Amortized Cost, Total | 404 |
Due in one year or less, Fair Value | 100 |
Due after one year through five years, Fair Value | 80 |
Due after five years through ten years, Fair Value | 187 |
Due after ten years, Fair Value | 51 |
Fair Value, Total | $ 418 |
Investments of Insurance Subsidiaries - Additional Information (Detail) |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Available for sale securities expected maturity of debt securities | 4 years |
Available for sale securities average scheduled maturity | 5 years 6 months |
Financial Instruments - Schedule of Interest Rate Swap Agreements Designated as Cash Flow Hedges (Detail) - Pay-Fixed Interest Rate Swaps [Member] |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
| |
Maturity Date, 2017 [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Notional Amount | $ 1,000,000,000 |
Fair Value | $ (3,000,000) |
Maturity Date | Dec. 31, 2017 |
Maturity Date, 2021 [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Notional Amount | $ 2,000,000,000 |
Fair Value | $ 30,000,000 |
Maturity Date | Dec. 31, 2021 |
Financial Instruments - Additional Information (Detail) $ in Millions |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
| |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Estimated amount reclassified from other comprehensive income to interest expense | $ 3 |
Financial Instruments - Effect of Interest Rate Swaps on Results of Operations (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Interest expense | $ 427 | $ 432 | $ 1,257 | $ 1,275 |
Interest Rate Swaps [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Loss Recognized in OCI on Derivatives, Net of Tax | 6 | |||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Interest Rate Swaps [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Interest expense | $ 17 |
Assets and Liabilities Measured at Fair Value - Additional Information (Detail) - USD ($) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Estimated fair value of long-term debt | $ 34,998 | $ 32,833 |
Carrying amounts of long-term debt | 33,124 | $ 31,546 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Reduction of insurance subsidiaries resulted from settlements | $ 6 |
Long-Term Debt - Schedule of Long-Term Debt (Detail) - USD ($) $ in Millions |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Debt Instrument [Line Items] | ||
Senior secured debt | $ 23,372 | $ 21,294 |
Net debt issuance costs | (171) | (170) |
Total debt (average life of 7.1 years, rates averaging 5.2%) | 32,953 | 31,376 |
Less amounts due within one year | 202 | 216 |
Long-term debt | 32,751 | 31,160 |
Senior Secured Asset-Based Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Long-term line of credit | 3,570 | 2,920 |
Senior Secured Term Loan Facilities [Member] | ||
Debt Instrument [Line Items] | ||
Senior secured debt | 3,915 | 3,981 |
Senior Secured Notes [Member] | ||
Debt Instrument [Line Items] | ||
Senior secured debt | 15,300 | 13,800 |
Other Senior Secured Debt [Member] | ||
Debt Instrument [Line Items] | ||
Other senior secured debt | 587 | 593 |
Senior Unsecured Notes [Member] | ||
Debt Instrument [Line Items] | ||
Senior unsecured notes | $ 9,752 | $ 10,252 |
Long-Term Debt - Schedule of Long-Term Debt (Parenthetical) (Detail) |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Debt Instrument [Line Items] | |
Total debt average term | 7 years 1 month 6 days |
Total debt average rate | 5.20% |
Senior Secured Asset-Based Revolving Credit Facility [Member] | |
Debt Instrument [Line Items] | |
Effective interest rate | 2.70% |
Senior Secured Term Loan Facilities [Member] | |
Debt Instrument [Line Items] | |
Effective interest rate | 3.60% |
Senior Secured Notes [Member] | |
Debt Instrument [Line Items] | |
Effective interest rate | 5.40% |
Other Senior Secured Debt [Member] | |
Debt Instrument [Line Items] | |
Effective interest rate | 5.80% |
Senior Unsecured Notes [Member] | |
Debt Instrument [Line Items] | |
Effective interest rate | 6.40% |
Capital Structure - Additional Information (Detail) - Common Stock [Member] - USD ($) |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2017 |
Oct. 31, 2017 |
Nov. 30, 2016 |
|
Capital Structure [Line Items] | |||
Repurchase of common stock, shares | (17,847,000) | ||
Repurchase price of common stock, per share | $ 82.62 | ||
Share repurchase program, remaining authorized repurchase amount | $ 379,000,000 | ||
Share repurchase program authorized amount | $ 2,000,000,000 | ||
Subsequent Event [Member] | |||
Capital Structure [Line Items] | |||
Share repurchase program authorized amount | $ 2,000,000,000 |
Capital Structure - Components of Accumulated Other Comprehensive Loss (Parenthetical) (Detail) $ in Millions |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
| |
Equity [Abstract] | |
Unrealized gains on available-for-sale securities, tax portion | $ 2 |
Foreign currency translation adjustments, income taxes | 34 |
Defined benefit plans, Expense reclassified into operations from other comprehensive income, Income tax benefits | 5 |
Change in fair value of derivative instruments, change in fair value of derivative instruments, income taxes | 3 |
Change in fair value of derivative instruments, Expense reclassified into operations from other comprehensive income, income tax benefits | $ 6 |
Segment and Geographic Information - Additional Information (Detail) - Hospital |
3 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Dec. 31, 2016 |
|
Segment Reporting Information [Line Items] | ||
Number of geographically organized groups | 2 | |
Number of owned and operated hospitals | 177 | |
Reorganization Group [Member] | National Group [Member] | ||
Segment Reporting Information [Line Items] | ||
Number of owned and operated hospitals | 86 | |
Reorganization Group [Member] | American Group [Member] | ||
Segment Reporting Information [Line Items] | ||
Number of owned and operated hospitals | 85 | |
Reorganization Group [Member] | Corporate and Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Number of owned and operated hospitals | 6 |
Segment and Geographic Information - Schedule of Geographic Distributions of Revenues, Equity in Earnings of Affiliates, Adjusted Segment EBITDA, Depreciation and Amortization and Assets (Detail) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Segment Reporting Information [Line Items] | ||||
Revenues | $ 10,696 | $ 10,270 | $ 32,052 | $ 30,849 |
Equity in earnings of affiliates | 13 | 22 | 36 | 44 |
Adjusted segment EBITDA | 1,776 | 1,957 | 5,871 | 6,012 |
Depreciation and amortization | 539 | 495 | 1,581 | 1,463 |
Interest expense | 427 | 432 | 1,257 | 1,275 |
Gains on sales of facilities | (7) | (3) | (10) | (8) |
Losses on retirement of debt | 39 | 4 | 39 | 4 |
Legal claim costs | 11 | 33 | ||
Income before income taxes | 778 | 1,018 | 3,004 | 3,245 |
National Group [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 5,036 | 4,882 | 15,344 | 14,780 |
Equity in earnings of affiliates | (8) | (13) | (17) | (17) |
Adjusted segment EBITDA | 975 | 1,073 | 3,268 | 3,342 |
Depreciation and amortization | 219 | 204 | 650 | 602 |
American Group [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 5,180 | 4,908 | 15,268 | 14,554 |
Equity in earnings of affiliates | (9) | (9) | (27) | (26) |
Adjusted segment EBITDA | 930 | 1,016 | 2,977 | 3,002 |
Depreciation and amortization | 251 | 231 | 727 | 675 |
Corporate and Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 480 | 480 | 1,440 | 1,515 |
Equity in earnings of affiliates | 4 | 8 | (1) | |
Adjusted segment EBITDA | (129) | (132) | (374) | (332) |
Depreciation and amortization | $ 69 | $ 60 | $ 204 | $ 186 |
Supplemental Condensed Consolidating Financial Information and Other Collateral-Related Information - Additional Information (Detail) - USD ($) |
Sep. 30, 2017 |
Dec. 31, 2012 |
---|---|---|
Supplemental Condensed Consolidating Financial Information [Line Items] | ||
Ownership percentage held by parent | 100.00% | |
Senior Unsecured Notes Due 2021 [Member] | ||
Supplemental Condensed Consolidating Financial Information [Line Items] | ||
Debt instrument, principal amount | $ 1,000,000,000 | |
Debt instrument, stated interest | 6.25% |