By Padmanabhan Ananthan and Christy Santhosh
Jan 27 (Reuters) – HCA Healthcare on Tuesday forecast 2026 profit above Wall Street estimates, as it expects to offset headwinds from expiring subsidies with about $400 million in cost savings, sending the hospital operator’s shares up 11%.
As subsidies under Affordable Care Act or Obamacare plans expire this year, hospitals like HCA are set to face declining patient volumes for elective surgeries, preventive visits, and diagnostics, alongside rising uncompensated care costs from treating more uninsured patients.
HCA Chief Financial Officer Mike Marks said the company anticipates a decline of about 30% in utilization from those individuals no longer having coverage compared to when they had health care insurance through ACA plans.
Raking in patients who are insured under government-backed plans provides reliable reimbursement for hospital services, compared to uninsured cases that often result in uncompensated care, which amass costs and bad debt for hospital operators.
The company said it is leveraging advanced analytics, AI and automation, and shared service platforms to drive its cost-saving financial resiliency program.
“We have planned elements to drive better capacity management, including managing throughput and length of stay in our inpatient settings, in our emergency rooms and our operating rooms,” said Marks.
HCA reported total revenue of $19.51 billion in the fourth quarter, missing expectations of $19.68 billion.
On an adjusted basis, the company posted a profit of $8.01 per share, beating analysts’ estimate of $7.46 per share.
The company expects 2026 profit in the range of $29.10 to $31.50 per share, the midpoint of which is above analysts’ average estimate of $29.46 per share, according to data compiled by LSEG.
The company also authorized a share repurchase program for up to $10 billion of its outstanding common stock.
(Reporting by Padmanabhan Ananthan and Christy Santhosh in Bengaluru; Editing by Shilpi Majumdar and Maju Samuel)
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