I work for a hospital that is part of HCA Holding Inc. (Hospital Corporation of America). On the Morningstar Industry Performance website, HCA is part of the Medical Care industry, which has shown a 5-year return of 4.5% and a 1-year return of 19.7%. HCA Holdings is one of the two largest companies in this industry, with a market capitalization of over $13 billion. HCA has a one year return of 80.8%, but there is no 5-year return available because the company only became public in 2011 with an Initial Public Offering (IPO) after several years as a privately owned company. HCA accounts for 4% of all hospital admissions in the US and is the largest operators of hospitals in the US.
HCA had become a private company in 2006 with one of the largest leveraged buyouts in history, valued at $33 billion. So the company now is valued at much less than they were in 2006. It has gone through a period of restructuring and is developing new strategies to secure the long term success of the company. The operating margin of HCA is better than the industry average, but their revenue growth is below average.
HCA has had a mixed history and had periods in which management was found to be overcharging the government and engaging in Medicare fraud. In 2000 they agreed to pay over $800 million in fines to the government, at that time the larges fraud settlement in US history: (http://www.forbes.com/2000/12/15/1215disaster.html). Several changes in ownership structure and management followed.
Now that the company is public again, it will be interesting to see if current management is able to return the company to responsible operation and steady growth in the industry.
The Health Care industry faces many challenges related to the increasing cost of providing health care and the Affordable Health Care Act. This article (http://www.healthcarefinancenews.com/news/4-industry-issues-plaguing-healthcare-ceos-2012) points out that the industry needs to move from "volume to value," contain cost increases, align and partner with physicians, and find ways to offer "wellness" as opposed to just dealing with health problems.
The hospital where I work has been recognized as the top cardiac surgery hospital in South Carolina for the last four years, provides on-line pre-registration and scheduling, and has a free consultation program (Consult-A-Nurse) to help patients with questions and referrals. The company appears to be moving in a positive direction and taking steps to improve its service and image: http://grandstrandmed.com/© BrainMass Inc. brainmass.com September 25, 2018, 11:32 pm ad1c9bdddf - https://brainmass.com/business/initial-public-offering/comment-hospital-corporation-american-holding--518781
It was a very wise decision for HCA Incorporated to return to a status as a public organization, due to the fact that as a private organization there was a great deal of fraud and other unscrupulous activities that have severely damaged the reputation of this organization. It is quite clear that in order for this ...