HCA Healthcare Raises 2025 Guidance After Strong Q3 Performance

HCA Healthcare, one of the largest hospital chains in the United States, has updated its 2025 guidance following a robust third-quarter performance that surpassed investor expectations. The company reported significant growth in revenue and net income, driven by increased patient volumes, improved payer mix, and supplemental payment programs.

Financial Highlights and Updated Guidance

HCA Healthcare reported a 9.6% year-over-year increase in revenues to $19.16 billion for the third quarter of 2025. Net income attributable to HCA saw a substantial 29% improvement, reaching $1.64 billion, or $6.96 per diluted share. These results prompted the company to raise its full-year 2025 guidance, with revenues now expected to fall between $75 billion and $76.5 billion, and adjusted EBITDA between $15.25 billion and $15.65 billion.

Chief Financial Officer Mike Marks highlighted positive movements in HCA's payer mix, with commercial and Medicare visits showing notable increases. On a same-facility basis, commercial equivalent admissions rose 3.7%, while Medicare grew by 3.4%. This favorable payer mix, combined with improved dispute resolution with payers and increased Medicaid state supplemental payment revenues, contributed to a 6.1% year-over-year growth in inpatient revenue per equivalent admission.

Operational Performance and Cost Management

HCA Healthcare demonstrated solid demand across its 191-hospital network. Same-facility admissions increased by 2.1%, while equivalent admissions grew 2.4%. Emergency room visits saw a 1.3% uptick, despite what management described as a slow start to the respiratory season. Inpatient and outpatient surgeries also showed modest growth of 1.4% and 1.1%, respectively.

The company's ability to manage operating expenses was a key factor in its strong performance. Contract labor spending remained flat compared to the prior year, representing 4.2% of HCA's total labor costs. Executives also highlighted efforts in managing supply utilization, monitoring tariff risk with vendor contracts, and implementing new technologies as contributors to limited expense growth.

Policy Uncertainty and Future Outlook

While HCA Healthcare's performance has been strong, the company faces potential challenges related to healthcare policy uncertainty. CEO Sam Hazen addressed the ongoing discussions about extending enhanced subsidies for Affordable Care Act exchange plans, stating that the company continues to advocate for the extension. However, management was cautious about predicting the impact of potential policy changes on utilization patterns in the coming quarters.

Despite these uncertainties, HCA executives expressed confidence in the company's ability to maintain volume growth within the 2% to 3% range into 2026. They anticipate operating costs to follow "mostly stable trends consistent with the past couple of years," with the company's resilience plan expected to provide some relief against potential pressures.