The great patient influx
If HCA Healthcare's second-quarter earnings are any kind of bellwether for hospital systems, then it's clear patients came back in droves to get emergency care or elective care that had to be delayed because of the coronavirus pandemic.
The big picture: "Our volume, as indicated in the second quarter, will return to 2019 levels and perhaps moderately above that," HCA's CFO Bill Rutherford told investors.
By the numbers: HCA's net profit jumped 34% year over year, totaling $1.45 billion in the quarter, while revenue increased 30% to $14.4 billion.
- Even when compared to the same quarter in 2019, before the pandemic suppressed patient volumes, HCA's net profit and revenue increased 85% and 15%, respectively.
- HCA raised its revenue and profitability estimates for the second straight quarter and now expects 2021's adjusted earnings to be 16% higher than originally forecast in February.
- HCA's stock soared 14% and lifted the prospects of competing hospital chains Tenet Healthcare, Community Health Systems and Universal Health Services.
What to watch: The Delta variant, which now makes up 83% of COVID-19 cases. HCA was unconcerned when asked if the Delta variant would suppress patient visits like last year.
- "We've proven the ability to manage through different cycles as they present themselves," Rutherford said.
- Indeed, HCA posted huge profits in the middle of the pandemic and subsequently returned $1.6 billion in taxpayer bailout funds.
The bottom line: Health care spending is back up to America's historically high levels as more of the population has gotten vaccinated. Hospitals, especially those treating patients with commercial insurance, are benefiting greatly as a result.