Earnings in the first quarter of 2013 for Health Management Associates fell in step with its preview earlier this month, as the Naples, Fla.-based for-profit hospital chain recorded a 38.7 percent drop in profit, from $37.7 million in 2012 to $23.1 million this year.
Health Management officials predicted first-quarter admissions and revenue would be down due to higher rates of uncompensated care and an increase in observation rates. The company's provision for doubtful accounts, or bad debt, increased by almost $40 million year over year, while same-hospital operating statistics were down almost across the board: admissions fell 8.8 percent, adjusted admissions dropped 5.8 percent, surgeries fell 5.6 percent and patient days declined 6.3 percent.
First-quarter net revenue for Health Management also dropped by $2.3 million between the first quarter of 2012 and the most recent quarter, totaling a shade above $1.48 billion. The hospital company lowered its guidance for the rest of the 2013 fiscal year.
"Our first-quarter results did not meet our expectations and reflect a difficult operating environment. I believe, however, that we have taken the necessary steps to adjust our cost structure going forward to achieve our previously updated 2013 annual guidance," said Health Management President and CEO Gary Newsome in a news release. "As we transition into this new era of healthcare reform, we intend to continue our patient-centered approach to healthcare delivery while increasing efficiency and ultimately quality as we enable America's best local healthcare."
Within its earnings release, Health Management executives also said the Securities and Exchange Commission subpoenaed the company, requesting several documents related to its accounts receivable, billing write-downs, contractual adjustments and other finance-related issues. Health Management said it is cooperating with the SEC's investigation, though it is unknown what the impact the investigation will have.
Health Management officials predicted first-quarter admissions and revenue would be down due to higher rates of uncompensated care and an increase in observation rates. The company's provision for doubtful accounts, or bad debt, increased by almost $40 million year over year, while same-hospital operating statistics were down almost across the board: admissions fell 8.8 percent, adjusted admissions dropped 5.8 percent, surgeries fell 5.6 percent and patient days declined 6.3 percent.First-quarter net revenue for Health Management also dropped by $2.3 million between the first quarter of 2012 and the most recent quarter, totaling a shade above $1.48 billion. The hospital company lowered its guidance for the rest of the 2013 fiscal year.
"Our first-quarter results did not meet our expectations and reflect a difficult operating environment. I believe, however, that we have taken the necessary steps to adjust our cost structure going forward to achieve our previously updated 2013 annual guidance," said Health Management President and CEO Gary Newsome in a news release. "As we transition into this new era of healthcare reform, we intend to continue our patient-centered approach to healthcare delivery while increasing efficiency and ultimately quality as we enable America's best local healthcare."
Within its earnings release, Health Management executives also said the Securities and Exchange Commission subpoenaed the company, requesting several documents related to its accounts receivable, billing write-downs, contractual adjustments and other finance-related issues. Health Management said it is cooperating with the SEC's investigation, though it is unknown what the impact the investigation will have.
More Articles on Health Management Associates:
HMA, Florida Blue Strike Accountable Care Deal
78 Statistics on For-Profit Hospital Operator Executive Compensation
For-Profit Hospital Stock Report: Week of April 22-26, 2013