Nashville-based HCA is on a relative hospital buying spree. Company executives told investors Tuesday that they see an opening as the health care business becomes more challenging, especially for some of its competitors.
Primarily, HCA has been buying hospitals owned by Franklin’s Community Health Systems and its subsidiaries, which are struggling under a mountain of debt after over-extending themselves in recent years.
CEO Milton Johnson told analysts on a quarterly earnings call that until now, HCA hasn’t been interested in acquiring new hospitals, rather, growing existing facilities.
“HCA has been primarily an organic growth company because of the richness and depth of our markets and population growth of many of our markets, and we continue to see that opportunity,” he said. “But certainly these acquisitions can compliment that.”
Even when HCA has bought hospitals, they’re mostly where the company already has a presence. This year, they entered their first new market since 2003, striking a deal with a big medical center in Savannah, Georgia.
But all the acquisitions aren’t necessarily exciting to analysts. One says the purchases show that growth is stalling in HCA’s existing hospitals. The stock market also didn’t like the company’s quarterly performance. Shares dropped nearly five percent for the day. But seen as an industry bellwether, competing hospital chains experienced even greater market losses on the day.
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