Dive Brief:

• People formerly covered by the Affordable Care Act exchanges are going uninsured at a much higher rate than HCA Healthcare previously assumed, hitting the hospital giant’s earnings in the second quarter.
• HCA’s patients who lost ACA coverage are going uninsured almost on a one to one basis, executives said during a Friday call with investors. That’s hitting HCA’s reimbursement and reducing demand for elective care, unfavorable trends that ate into the for-profit hospital operator’s income by about $400 million in the quarter.
• However, HCA’s bottom line benefited from accelerating volume growth overall, along with higher Medicaid payments in Florida. All told, the company beat analyst expectations on revenue and earnings in the second quarter, posting net income of $1.7 billion, up 3% year over year, on revenue of $20.2 billion, up 9% year over year.

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.

That pressure began bubbling up for hospitals in the first quarter but hit harder in the second. Ten days before Friday’s official earnings release, HCA pre-announced the results, warning investors that the growing number of uninsured Americans had taken a larger bite than expected out of its income.

HCA had previously thought that about 80% to 85% of patients leaving the exchanges would lose coverage, while the remainder would find other insurance plans.

But essentially all of them are going uninsured, according to HCA CEO Sam Hazen.

“We expected some of these patients to shift to other forms of coverage, but this did not happen,” Hazen said on the Friday call. “Instead, these patients migrated almost one for one to uninsured.”

As a result, HCA’s ACA volumes fell 15% year over year in the quarter, while its uninsured volumes rose 15% — not a great development, given uninsured patients yield much lower payments if their care is paid at all.

“For us, obviously, it’s not a good thing. We still have to take care of these patients, and we do. And our people do a wonderful job, but it does put pressure on [income],” Hazen said.

Patients losing insurance are also avoiding non-essential care, lowering demand for lucrative elective surgeries. HCA was already struggling to grow elective volumes, which generally yield higher profits, after they fell 2% in the first half of 2025.

But elective volumes dropped further in the first half of 2026, down 6%, according to Hazen.

“We are down this year more than we were last year,” the CEO said. “We do believe that [ACA patient] demand, which is a big piece of our elective declines on both inpatient and outpatient, is a part of it.”

Meanwhile, inpatient surgeries dropped 2.3% year over year in the quarter, while outpatient surgeries were down 4.4%.

“The magnitude of total surgical declines was unprecedented for HCA outside of COVID-impacts during 2020 [and] 2021,” J.P. Morgan analyst Benjamin Rossi wrote in a Monday note.

HCA, which operates 190 hospitals and 2,600 other sites of care in the U.S. and United Kingdom, is not the only major for-profit hospital operator struggling with the aftershocks of coverage losses on the ACA exchanges.

On Wednesday, Community Health Systems reported second-quarter results below internal expectations, blaming ACA volatility and budget-conscious Americans putting off non-essential care.

Tenet Healthcare, which reported Thursday, also said its ACA volumes and revenues were plummeting from more of those individuals going uninsured, though the operator managed to buck the pressures and outperform expectations in the second quarter.

HCA CFO Mike Marks said the hospital operator was pleased with its performance against the challenging policy backdrop. Analysts agreed that things could have been worse.

“Operating trends and costs generally look good,” Leerink Partners analyst Whit Mayo wrote in a note on Friday.

Though ACA volumes are plummeting, HCA’s volumes are up overall, helped by ER visits, cardiac procedures and rehab volumes, executives said.

HCA’s admissions increased 2.4% year over year, while emergency room visits were up 3.5%. HCA is also squeezing more revenue out of its admissions, with the operator’s revenue per equivalent admission up 6% and inpatient revenue per admission up 14.6% in the quarter.

HCA’s estimated $400 million in losses from the ACA challenges were also canceled out by the company’s benefit from add-on payments in Medicaid, mostly in Florida after the CMS approved the state’s new supplemental payment program in April.