Dive Brief:
- On Friday, LifePoint Hospitals, Inc. announced a 5% increase in profits in the first quarter.
- The rural hospital operator's top and bottom lines both exceeded analysts' expectations.
- LifePoint's Chief Executive, William Carpenter, attributes the first-quarter results to improved volumes, effective cost management and the benefits of healthcare reform.
Dive Insight:
"We continue to believe that the reduction in one-day stay is generally reflective of industry trends toward outpatient services," Chief Financial Officer Leif Murphy told the Wall Street Journal.
LifePoint saw $13 million in first-quarter profits from new healthcare coverage and expects to benefit by between $40 and $50 million this year from healthcare reform. It is anticipated that up to $30 million of healthcare reform-related profits will come from Medicaid expansion. According to The Wall Street Journal, although LifePoint's home state of Tennessee has not yet expanded its Medicaid program, Jeffries analysts said that pressure from the federal government could provide the necessary political cover for some states to pass the legislation. LifePoint expects to benefit $12 to $20 million this year from government-run public exchanges.