Dive Brief:
- HCA Healthcare slashed its 2026 earnings guidance after the growing amount of uninsured Americans — mostly as a result of turbulence on the Affordable Care Act exchanges — ate into the for-profit hospital giant’s income in the second quarter.
- HCA now expects net income between $6.3 billion and $6.7 billion this year, compared with previous guidance of between $6.5 billion and $7 billion, the company disclosed on Tuesday.
- The earnings cut, which comes 10 days before HCA is scheduled to officially announce second-quarter results, spooked investors worried that hospitals had underestimated the impact of the ACA turmoil on their finances this year. HCA’s stock fell almost 10% in premarket trading following the release, which also dragged down shares in other hospital operators including Community Health Systems, Tenet Healthcare and Universal Health Services.
Dive Insight:
Millions of Americans left the ACA exchanges this year after more generous financial aid from the federal government expired, causing premiums to skyrocket. Many of those people have become uninsured, according to experts, a worrying trend for hospitals that have to contend with lower demand for elective services and higher uncompensated care costs.
HCA had braced for the impact, telling investors it expected to lose between $600 million and $900 million this year as a result of the ACA turmoil. HCA lost $150 million in the first quarter. But the financial toll ballooned in the second, according to HCA’s Tuesday release.
HCA said it lost $400 million in the second quarter as a result of payer mix shift “primarily due to patients who lost coverage on the health insurance exchanges.”
“We expected some acceleration [to the ACA impact] exiting Q1, although the magnitude is a surprise,” J.P. Morgan analyst Benjamin Rossi wrote in a note on Tuesday.
HCA now expects to lose up to $1.1 billion from the ACA coverage decline this year, according to Rossi.
HCA called out declining surgical volumes in the second quarter, which also likely contributed to the company’s decision to lower its 2026 earnings guidance.
But overall, HCA expects its second-quarter results to be stronger than in the prior year, due to higher admissions and emergency room visits, along with increased benefit from Medicaid supplemental payments from states, especially Florida.
HCA anticipates second-quarter revenues of about $20.2 billion, up from $18.6 billion the same time last year, and net income just below $1.7 billion, about $50 million higher than the same time last year.
Both results would come in above Wall Street’s consensus expectations.
HCA is scheduled to officially announce second-quarter results on July 24.
