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Diving brief:

• HCA Healthcare reported profit lower than expected in third quarter and warned that financial woes could extend through the rest of the year, causing the for-profit health system’s stock price to fall 12% between Friday and Tuesday.
• THE Provider based in Nashville, Tennessee is recovering from back-to-back hurricanes that hit its Southeast portfolio this fall, resulting in in a $50 million revenue loss in the third trimester. Additional losses from hurricanes could reach $300 million next quarter, HCA Chief Financial Officer Mike Marks said on a Friday call with investors.
• HCA maintained its full-year revenue guidance of $69.8 billion to $71.8 billion. However, Marks said HCA now expects to be “in the lower half” of the range provided.

Dive overview:

HCA is still in shock Hurricanes Helene And Miltonthat hit the Southeast two weeks apart earlier this fall, executives told investors Friday morning. The health system had 29 hospitals affected by Helen and 34 hospitals affected by Milton, according to Marks.

While most hospitals are now operational, operations remain disrupted at Mission Hospital in Asheville, North Carolina, and HCA’s 455-bed University Hospital in Largo, Florida.

The mission hospital remains without potable water – a critical resource needed to disinfect equipment and ensure safety standards. Asheville anticipates the hospital will be without water for “several more weeks,” Marks said.

In the meantime, to continue treating patients, HCA has been bringing in water tankers daily — a task that will cost the health system $13 million through October, according to Marks.

CEO Sam Hazen said he expects “significant expenses and lost revenue” related to hurricane recovery in western North Carolina for at least the remainder of 2024, with some “manageable” impacts continuing through 2025.

Largo Hospital was flooded during Milton and is currently closed for repairs. Hazen expects hospital to reopen in December, with repairs costing appearing on the health system’s fourth quarter results.

HCA executives said the growing threat of hurricanes would not deter the operator’s long-term expansion strategy. HCA has a large presence in the hurricane belt in the United States and has already been affected by large storms, including Hurricane Ian in 2022.

“We strengthen our facilities as much as possible, but (hurricanes) are actually a way of life,” Hazen said. He added that the most recent storms have highlighted the unpredictable nature of extreme weather events. “I mean, Hurricane Helene was a Category 4 storm, and if you had asked me which two communities were hardest hit, I never in 100 years would have said Augusta, Georgia, and Asheville , in North Carolina.”

Analysts at TD Cowen said in a note that HCA’s “underlying performance was strong” in the quarter despite investors’ “high expectations.”

Overall, HCA reported third-quarter profit of $1.3 billion and revenue of $17.5 billion.

The operator primarily increased patient volume during the quarter, with same-facility inpatient admissions, emergency department visits and adjusted admissions all increasing approximately 4.5% year over year. other. However, the system saw outpatient surgeries decline 2% year over year.