HCA Healthcare executives told investors Friday they believe the first few years of healthcare cuts stemming from the One Big Beautiful Bill Act will be “manageable” for the for-profit hospital operator, which increased its 2025 guidance on above-expectation second-quarter revenues and earnings.
Grandfathering provisions from supplemental programs and the gradual phasing in of payment changes and policies tied to enrollment like work requirements should lessen the immediate impact, executives said. HCA Healthcare specifically sees about 60% of its Medicaid volumes and revenues in non-expansion states, further blunting any financial hits.
The impact of provisions that take effect during subsequent years as well as marketplace premium subsidies that could be expiring at the end of 2025 are less clear to the company, which said it will provide more information on in-development resiliency efforts to mitigate these and other policy actions, such as tariffs, when issuing 2026 guidance in the fourth quarter.
Still, CEO Sam Hazen said the company believes it can manage those impacts “without material impact to our long-term guidance.” Chief Financial Officer Mike Marks added that HCA benefits from the bill making 100% bonus depreciation permanent and in effect since inauguration day.
“Regardless of the outcome of these federal policies, we are optimistic about the future of HCA Healthcare,” Hazen said. “Our balance sheet is strong, we have an experienced, capable and disciplined team, and where appropriate we will adjust as we can and continue delivering on our mission.”
Friday morning, the hospital chain shared a 6.4% year-over-year increase in second-quarter revenues to $18.61 billion. Net income attributable to the company rose 13.1% to $1.65 billion ($6.83 per diluted share), and adjusted EBITDA increased 8.4% to $3.85 billion.
HCA also raised its 2025 estimated guidance ranges for each of these areas. Revenues previously targeting between $72.8 billion and $75.8 billion are now between $74 billion and $76 billion; net income attributable to HCA went from between $5.85 billion and $6.29 billion to between $6.11 billion and $6.48 billion; adjusted EBITDA from between $14.3 billion and $15.1 billion to between $14.7 billion and $15.3 billion; and earnings per diluted share from between $24.05 and $25.85 to $25.50 and $27.
In between clarifying questions on how various state-directed payments play into the guidance, investors zeroed in on volume metrics that had softened among fellow for-profits Tenet Healthcare and Community Health Systems. At HCA, on a year-over-year basis, second-quarter same-facility admissions increased 1.8%, same-facility equivalent admissions rose 1.7%, same-facility emergency room visits increased 1.3%, same-facility inpatient surgeries declined 0.3% and same-facility outpatient surgeries fell 0.6%.
HCA’s executives acknowledged that the first half of 2025’s same-facility equivalent admission growth of 2.3% was below the year’s original guidance of 3% to 4%. Half of that difference comes from below-expectation Medicaid and self-pay volumes, while the other half is slower-than-expected Medicare growth, Marks explained.
Hazen, in response to questions, urged analysts to “not just focus on the headlines” and consider more than the “one metric that everybody looks at.” He highlighted adjusted admission growth among all but one of HCA’s 15 domestic divisions, a 5% increase in cardiac procedure volumes, a 3% rise in obstetrics volumes and a 13% jump in neonatal volumes.
“This is how we look at it: We’ve had 16 consecutive quarters of volume growth, and so that consistency tells us that the network model that we’re investing in very heavily, and we’re focused around execution on … allowed us to sustain market share gains,” Hazen said. “And we think it adds value for our patients, it adds value for our physicians and we think it adds value for our shareholders.”
Responding to a question referencing CHS’ claims of waning consumer confidence affecting commercial volumes, HCA executives said they were pleased with their second-quarter payer mix and, based on their portfolio, couldn’t make any comments on that potential factor. Hazen did make a point to underscore last year’s substantial exchange volume growth (due to Medicaid redeterminations), which makes for tougher year-over-year comparisons.
Alongside the earnings numbers, HCA’s board declared a quarterly cash dividend of $0.72 per share. The company’s stock was trading about 2.5% below open as of Friday afternoon.