1 / 22

Bear Stearns/Sept.

Vic Campbell Senior Vice President Larry Kloess CEO, Centennial Hospital Mark Kimbrough VP, Investor Relations. HCA. 2004. Bear Stearns/Sept.

paula-harris
Télécharger la présentation

Bear Stearns/Sept.

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Vic Campbell Senior Vice President Larry Kloess CEO, Centennial Hospital Mark Kimbrough VP, Investor Relations HCA 2004 Bear Stearns/Sept.

  2. This presentation contains forward-looking statements based on current management expectations. Those forward-looking statements include all statements other than those made solely with respect to historical fact. Numerous risks, uncertainties and other factors may cause actual results to differ materially from those expressed in any forward-looking statements. These factors include, but are not limited to (i) increases in the amount and risk of collectability of uninsured accounts and deductibles and co-pay amounts for insured accounts, (ii) the ability to achieve operating and financial targets and achieve expected levels of patient volumes and control the costs of providing services, (iii) the highly competitive nature of the health care business, (iv) the efforts of insurers, health care providers and others to contain health care costs, (v) possible changes in the Medicare and Medicaid programs that may impact reimbursements to health care providers and insurers, (vi) the ability to attract and retain qualified management and personnel, including affiliated physicians, nurses and medical support personnel, (vii) potential liabilities and other claims that may be asserted against the Company, (viii) fluctuations in the market value of the Company’s common stock, (ix) the impact of the Company’s charity care and self-pay discounting policy changes, (x) changes in accounting practices, (xi) changes in general economic conditions, (xii) future divestitures which may result in charges, (xiii) changes in revenue mix and the ability to enter into and renew managed care provider arrangements on acceptable terms, (xiv) the availability and terms of capital to fund the expansion of the Company’s business, (xv) changes in business strategy or development plans, (xvi) delays in receiving payments for services provided, (xvii) the possible enactment of Federal or state health care reform, (xviii) the outcome of pending and any future tax audits and litigation associated with the Company’s tax positions, (xix) the outcome of the Company’s continuing efforts to monitor, maintain and comply with appropriate laws, regulations, policies and procedures and the Company’s corporate integrity agreement with the government, (xx) changes in Federal, state or local regulations affecting the health care industry, (xxi) the ability to successfully integrate the operations of Health Midwest, (xxii) the ability to develop and implement the payroll and human resources information system within the expected time and cost projections and, upon implementation, to realize the expected benefits and efficiencies, and (xxiii) other risk factors detailed in the Company’s filings with the SEC. Many of the factors that will determine the Company’s future results are beyond the ability of the Company to control or predict. In light of the significant uncertainties inherent in the forward-looking statements contained herein, readers should not place undue reliance on forward-looking statements, which reflect management’s views only as of the date hereof. The Company undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise. All references to “Company” and “HCA” as used throughout this document refer to HCA Inc. and its affiliates. HCA 2004 Bear Stearns/Sept. 2

  3. HCA is located in 16 of 20 Fastest Growing Large US Cities % % % % Dallas/Ft. Worth +12% • Generally 25-40% Market Share • 40% of facilities in Texas & Florida Denver +9% Kansas City +5% U.K. Las Vegas +22% Nashville +8% Switzerland Richmond +8% Austin +18% Southern California +9% Panhandle +10% % % Palm Beach +11% Percent Growth in Market Population 2000-2005 Tampa Bay +8% Houston +10% Dade +8% Compared to the National Average of 4.5%

  4. 37 ER Expansions 37 ER Expansions New Denver Facility Patient Safety & Infrastructure Expansions Routine New Facilities HCA Capital Expenditures Billions 2004E $1.65 2000 $1.2 2001 $1.4 2002 $1.7 2003 $1.8 Expansions Open Heart, Imaging Cardiology, Oncology, etc. 54 Facilities with Surgery and/or ICU/CCU expansions Four New Facilities 378 Beds 1,565 New Beds Distribution of Capital Dollars 2002 and Beyond

  5. Inpatient Admissions and Outpatient Visits 1980 - 2002 Inpatient Admissions Outpatient Visits (millions) Admissions (millions) Outpatient Visits Source: AHA Annual Survey, 1980 - 2002

  6. Socio-Demographics—Age WaveDriving Healthcare Utilization 1.62% 3-Year CAGR 1.56% 3-Year CAGR 1.59% 3-Year CAGR 1.58% 3-Year CAGR 125 121 119 120 1.7% 117 1.6% 115 1.6% 113 1.58% CAGR 2003-2012 115 1.6% 112 1.5% 110 1.6% 108 110 106 1.6% 105 1.6% 103 1.6% 105 102 1.6% 100 1.6% 98 1.5% 100 97 1.6% 96 1.5% 1.4% 95 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Acute Care Utilization Index (2003=100) Baby Boomer Impact Accelerates

  7. HCA Admission Trends 2001 to 2Q 2004Same Facility 15.4% HCA Growing Medicare Market Share Growth in Medicare Admissions 1998-2001 Market Competitors HCA * *2Q includes same-market admissions

  8. Inpatient Admissions Growth Continues to Vary Widely by Market Nashville 1 +13.0% Tampa Bay +3.2% D/FW +3.0% Austin +5.1% Brownsville/ Valley +13.0% Cent. La. -2.0% Mid. Ga -1.4% Denver 2 +2.7% Jacksonville +7.4% MidAmer Una. -3.1% NW Ga. +11.3% North VA -2.5% Dade +2.5% Top 15 Markets in Admissions Growth +18,367/ +5.2% Atlanta +9.0% Lafayette +6.0% Far West Una. -3.4% Orlando -0.7% Chattanooga +8.6% Swiss -5.4% Panhandle +4.6% Delta Una. -8.3% Oklahoma -1.8% Indy -12.5% Treas. Coast -2.9% Bottom 15 Markets in Admissions Growth -6,787/ -3.2% Las Vegas +3.3% 1 West VA -1.8% Houston -2.7% So. Cal -7.5% S.Carolina -2.0% 5,000 +1.5% same facility +1.9% same market June YTD – Same Market 4,000 3,000 2,000 Admissions Change 1,000 - El Paso +4.9% (1,000) Total Admissions Determine Bubble Size (2,000) 1: Same Market 2: Denver is a non-consolidating JV Market (3,000) -20% -15% -10% -5% 0% 5% 10% 15% 20% Admissions % Change Volume Variance by Market – June YTD

  9. Inpatient Surgery Trends Improving2001 to 2nd Quarter 2004 - Same Facility 1 1 1 1 1: Includes Kansas City facilities.

  10. Enhanced Outpatient Services Focus Outpatient Diagnostic Services Hospital Based 12.5% Freestanding • Imaging • Cardiology • Oncology • Orthopedics • Neurology Outpatient ER 9.4% 37.2% O/P Comprised of Three Business Lines 2003 % of HCA Net Revenue As a % of Outpatient Surgeries 70% Outpatient Surgeries Hospital Based 15.3% ASC Based 30%

  11. 2004 Managed Care Contracting 35% 42% 55% 75% 95% 100% 6,844 Facility Level Active Contracts 2005 Contract Pricing Timeline* 1Q04 2Q04 3Q04 4Q04 2005 Cumulative Pre-2004 *Anticipated Completion Dates Net Revenue per Adjusted Admission Managed Care & Other Discounted 11.1% 9.9% 16% 15.0% 13.3% 13.0% 11.4% 11.1% 10.5% 9.6% 9.2% 7.3% 7.0% 0% 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 83% of 2004 and 50% of 2005 contracts completed. 11

  12. Medicare Reimbursement Improves Oct. 1, 2004with Outlier Threshold Change and Full Market Basket Update Medicare Outlier Payments % of O/L Payments to Total Medicare $240 4.7% $218 3.7% $284 5.1% Dollars in Millions $60 2.0% 6 months • Medicare outlier threshold of $16,350 (Oct ‘00), $21,025 (Oct ‘01), • $33,560 (Oct ‘02), $30,150 (Oct ‘03) and $25,800 (Oct ’04) • Law changed for 2003 to base outlier cost-to-charge ratio on latest • “filed” cost reports versus latest “settled” cost reports.

  13. +4.7% +6.5% +5.1% +4.5% JUNE YTD 15% vs. Q103 25% vs. Q103 29% vs. Q103 33% vs. Q103 29% vs. Q103 Nursing Total Operations* Labor Cost Wage Rate Same Facility - % Change from PY 2001 2002 2003 2004 1 2Q 01 4Q 01 2Q 02 4Q 02 2Q 03 4Q 03 1Q 01 3Q 01 1Q 02 3Q 02 1Q 03 3Q 03 2Q 04 1Q 04 1: Includes Kansas City facilities. Contract Labor Reduction $/Adj. Patient Day * Eastern and Western Consolidated Operations

  14. Bad Debt Impact on Operating Expenses per Adjusted Admission Operating Expense/AA (Adj. For Bad Debt) Operating Expense/AA 2001 2002 2003 2004 7.0% 7.4% 9.4% Operating Expenses/AA – Percent Change from Prior Year 6.5% 6.7% 6.4% Same Facility – Percent Change from Prior Year

  15. The Genesis of the Bad Debt/CharityCare Issue HCA is in 14 of the 20 highest uninsured states, with 72% of its hospitals in those states 17.0% 13.1% 13.1% 22.2% 21.2% 15.9% National Average: 15.2% 1 19.3% 19.2% 18.1% 15.1% 15.4% 15.4% 16.4% 23.5% 20.3% 14.6% 23.5% HCA Weighted Average: 22.6% 2 16.7% 19.7% 29.7% 25.6% 22.8% 22.2% >20% Uninsured 15-20% Uninsured <15% Uninsured 1: U.S. Census Bureau “Health Insurance Coverage in the United States: 2002”. 2: Kaiser Commission: Health Ins. Coverage of Nonelderly Adults 2001-2002.

  16. Bad Debts & CharityQuarterly Trending $912 $837 $893 $795 $1B $786 $610 $587 $567 $514 $491 $0 Bad Debts Charity Bad Debts & Charity Bad Debts 14% BD % of Net Revenue

  17. HCA Reduces Malpractice Reserves by $59 Million in 2Q 2004 HCA Large Claims Declining 17

  18. HCA is Investing Significantly in Programsfor Patient Safety and Improved Patient Outcomes  E MAR: Medication Error Prevention  E POM: Physician Order Entry  100% Participation in CMS Quality Reporting Initiative  Member of NQF and Leapfrog  Cardiovascular, OB and Emergency Department Initiatives

  19. Accounts Receivable IndicatorsCash Collections % Adj. Net Revenue / Days in A/R Cash Collections % Adjusted Net Revenue Days in Accounts Receivable 2003 2004 2002

  20. Strong Cash Flow Trends Provide Opportunities Net Cash Provided by Operating Activities Dollars in Millions Capital Reinvestment $1.65B in 2004 Balance Sheet 55% @ 6/30/04 Debt-to-debt and total equity ratio Share Repurchase Program $7.5B in 8 years New Dividend Policy $250mm annually Excluding settlements with government agencies and investigation related costs.

  21. Employee Satisfaction (Gallup Score) Employee Turnover Nurse Turnover Employee Satisfaction at Record Levels Turnover Rate Satisfaction Score 21

  22. In Summary We Have…. Great Assets Excellent Investment Opportunities Strong Cash Flows Excellent Long-Term Earnings Growth Outlook A prudent financial strategy that provides for a strong balance sheet and return of cash to shareholders through share repurchase and/or dividends

More Related