HCA Healthcare

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HCA Healthcare, Inc.
FormerlyHCA Holdings, Inc.
TypePublic
IndustryHealth care
Founded1968; 54 years ago (1968)
Nashville, Tennessee, U.S.
FoundersThomas F. Frist Sr., Thomas F. Frist Jr., Jack C. Massey
Headquarters
Nashville, Tennessee
,
U.S.
Number of locations
186 hospitals, approximately 2,000 sites of care located in 21 states and the United Kingdom[1]
Area served
United States and United Kingdom
Key people
Sam Hazen (CEO)
John Reay (CEO, HCA UK)[2]
RevenueIncreaseUS$51.53 billion (2020)[3]
IncreaseUS$3.759 billion (2020)[3]
Number of employees
235,000 (2021)[4]
Websitehcahealthcare.com

HCA Healthcare is an American for-profit operator of health care facilities that was founded in 1968. It is based in Nashville, Tennessee, and, as of May 2020, owns and operates 186 hospitals and approximately 2,000 sites of care, including surgery centers, freestanding emergency rooms, urgent care centers and physician clinics in 21 states and the United Kingdom.[5] As of 2021, HCA Healthcare is ranked #62 on the Fortune 500 rankings of the largest United States corporations by total revenue.[6]

The company engaged in illegal accounting and other crimes in the 1990s that resulted in the payment of more than $2 billion in federal fines and other penalties, and the dismissal of the CEO Rick Scott by the board of directors.[7]

By conducting large-scale clinical research with partners including the Harvard Pilgrim Institute and the CDC, and using data gathered from their patients, HCA Healthcare has published several medical studies in peer-reviewed journals, including the REDUCE MRSA study[8] published in the New England Journal of Medicine.

History[edit]

Early years[edit]

HCA founders (left to right) Thomas Frist Sr., Jack Massey, Thomas Frist Jr.

Hospital Corporation of America (HCA) was founded in 1968 in Nashville, Tennessee, by Thomas F. Frist Sr., Thomas F. Frist Jr. and Jack C. Massey.[9] The founders envisioned a company that would bring together hospitals to deliver patient-focused care while using the combined resources of the organization to strengthen hospitals and improve the practice of medicine.[10] The company began with Nashville's Park View Hospital, which the elder Frist had founded in 1960 with other doctors and where he was serving as chief executive.[10]

The company included 11 hospitals when it filed its initial public offering on the New York Stock Exchange (NYSE) in 1969[10] and had 26 hospitals and 3,000 beds by the end of the year.[9][10]

Parkview Hospital circa 1968

Growth and merger[edit]

HCA's first office in Nashville, Tennessee

The 1970s were characterized by rapid growth in the industry and for HCA Healthcare. In the early 1980s, the focus shifted to consolidation with HCA Healthcare acquiring General Care Corporation, General Health Services, Hospital Affiliates International and Health Care Corporation. By the end of 1981, the company operated 349 hospitals with more than 49,000 beds.[11] Operating revenues had grown to $2.4 billion.[9]

In 1987, HCA Healthcare, which had grown to operate 463 hospitals (255 owned and 208 managed), spun off HealthTrust, a privately owned, 104-hospital company. Believing its stock was undervalued, the company completed a $5.1 billion leveraged management buyout led by chairman Thomas F. Frist, Jr.[12] in 1988.[9] HCA Healthcare re-emerged as a public company in 1992.

In February 1994, HCA Healthcare merged with Louisville, Kentucky-based Columbia Hospital Corporation, which earlier had acquired 73 hospitals of Galen Health Care from Humana,[13] to form Columbia/HCA.[14] Related names of note include HCA International[15] and Health Corporation of America.

Columbia Hospital Corporation[edit]

In 1988, Rick Scott and Richard Rainwater each put up $125,000 in working capital in their new company, Columbia Hospital Corporation;[16] they borrowed the remaining money needed to purchase two struggling hospitals in El Paso for $60 million.[17] Then they acquired a neighboring hospital and shut it down. Within a year, the remaining two were doing much better.[18] By the end of 1989, Columbia Hospital Corporation owned four hospitals with a total of 833 beds.[17]

In 1992, Columbia made a stock purchase of Basic American Medical, which owned eight hospitals, primarily in southwestern Florida. In September 1993, Columbia did another stock purchase, worth $3.4 billion, of Galen Healthcare, which had been spun off by Humana Inc. several months earlier.[19] At the time, Galen had approximately 90 hospitals. After the purchase, Galen stockholders had 82% of the stock in the combined company, with Scott still running the company.[17]

Recent history[edit]

On November 17, 2006, HCA became a private company for the third time when it completed a merger in which the company was acquired by a private investor group including affiliates of Kohlberg Kravis Roberts and Bain Capital, together with Merrill Lynch and HCA Healthcare founder Thomas F. Frist, Jr. The total transaction was valued at approximately $33 billion, making it the largest leveraged buyout in history at the time, eclipsing the 1989 buyout of RJR Nabisco.[20]

In May 2010, HCA announced that the corporation would once again go public with an expected $4.6-billion IPO as HCA Holdings, Inc. In March 2011, HCA sold 126.2 million shares for $30 each, raising about $3.79 billion, at that time, the largest private-equity backed IPO in U.S. history.[21] In May 2017, the corporation was renamed HCA Healthcare.[22]

In December 2018, a historical marker was installed in the parking lot of HCA's Sarah Cannon Cancer Center in Nashville, formerly the location of HCA's first hospital, Park View Hospital.[23]

In 2018, the company was ranked No. 67 in the 2019 Fortune 500 list of the largest United States corporations by total revenue.[24]

In May 2021, the company finalized a deal with Google to develop healthcare algorithms using patient records.[25] In August 2021, HCA announced a deal with Venture capital firm General Catalyst to develop digital solutions to streamline workflows and improve patient care; as part of the deal, HCA sold its healthcare app development firm PatientKeeper to General Catalyst's portfolio company Commure.[26]

Facilities[edit]

United States[edit]

As of 2020, HCA operated 186 hospitals and approximately 1,800 sites of care, including surgery centers, freestanding ERs, urgent care centers, and physician clinics located in 21 U.S. states and in the United Kingdom.[27] In July 2007, HCA sold its hospitals in Switzerland.[28]

As of 2018, HCA had 50 hospitals and 31 surgery centers in Florida.[29] In Texas, as of 2018 it had 53 hospitals.[30] In Tennessee, where it began, it had 13 hospitals as of 2019.[27]

Between 2003 and 2017, HCA did not enter any new markets; in 2017, it acquired the Memorial University Medical Center in Savannah, Georgia which added to its existing seven hospitals in the state. In 2019 it purchased Mission Health System which operates hospitals in North Carolina.[31]

In 2017, it acquired three Houston hospitals from Tenet Healthcare.[32]

In January 2020, HCA Healthcare acquired Valify, a healthcare cost-management company.[33][34]

In May 2020, HCA acquired 49-bed Shands Starke (Fla.) Regional Medical Center and 25-bed Shands Live Oak (Fla.) Regional Medical Center from CHS. HCA is operating the two facilities as off-campus emergency departments of Lake City (Fla.) Medical Center and North Florida Regional Medical Center in Gainesville.[35]

United Kingdom[edit]

HCA International, the "UK arm" of Hospital Corporation of America, "caters for around half of all private patients in London."[15] The main hospital sites within the United Kingdom it operates include:

It opened urgent care walk-in centres at London Bridge Hospital and the Portland Hospital in March 2018. It claims that patients, on average, wait just seven minutes to see a nurse and 17 minutes to see a doctor.[37]

The Princess Grace Hospital specializes in breast cancer and surgery, aided by Kefah Mokbel and Nick Perry who, in 2005, founded The London Breast Institute.

Significant areas of operation[edit]

Medical education[edit]

In recent years, HCA Healthcare has become a significant provider of clinical and medical education. It is the largest sponsor of graduate medical education programs in the U.S., with 56 teaching hospitals in 14 states, primarily in regions with a deficit of physician training programs. The company includes Research College of Nursing and Mercy School of Nursing, and has several advanced nursing simulation training centers.[38] In early 2020, it completed the purchase of a majority stake in Galen College of Nursing,[39] which operates five campuses and offers Bachelor of Science and Associate of Science nursing degrees.[40]

Stroke care[edit]

HCA Healthcare treats approximately 50,000 stroke patients annually at 31 recognized comprehensive stroke centers. The average time between a patient's arrival and receiving needed medication as of November 2019 was 42 minutes—30% faster than the national standard.[41]

Maternal safety[edit]

HCA Healthcare delivers nearly one of every 17 babies born in the United States, more than 219,000 in 2019. Maternal mortality at HCA Healthcare hospitals was less than half the national rate in 2019. March of Dimes is a national partner of HCA Healthcare.[42]

Enhanced surgical recovery (ESR)[edit]

HCA Healthcare has developed an ESR protocol that reduces recovery times, complications and opioid use after surgery. Based on data collected from nearly 50,000 joint replacement, gynecologic oncology, colorectal and bariatric surgeries from January 1 – December 31, 2019, the HCA Healthcare ESR protocol reduced average length of stay by 3.63 days, resulting in nearly 59,000 fewer days in the hospital for its patients recovering from surgery. In 2019, HCA dispensed 1.57 million fewer morphine medications to surgery patients, a 50% decrease in total morphine equivalence per encounter.[43]

Workforce education and support[edit]

HCA Healthcare invests in workforce education and leadership programs for its approximately 280,000 employees and affiliates, including 98,000 registered nurses and 46,000 physicians (2020).[44] HCA spent $70.8 million in student loan assistance, tuition reimbursement, and certification support through its voucher program in 2019. The HCA Healthcare Hope Fund provides financial support to employees suffering hardship due to natural disaster, illness, injury, domestic violence, the death of a loved one, or other unavoidable circumstance. The fund distributed $7.7 million in 2019 and has provided $56 million in support since 2005.[45]

Community engagement[edit]

HCA Healthcare supports local communities through the HCA Healthcare Foundation and HCA Healthcare corporate sponsorships, as well as through the grassroots efforts of employees and affiliates.[46] The company provides support for childhood and youth development programs, scholarships, community-based health clinics and the operating budgets of not-for-profit organizations. HCA Healthcare provided $45 million in charitable contributions across the United States in 2019.[47]

Legal liabilities[edit]

In 1993, lawsuits were filed against HCA by former employees who alleged that the company had engaged in questionable Medicare billing practices.[7] In 1997, with a federal investigation by the FBI, the IRS and the Department of Health and Human Services in its early stages, the Columbia/HCA board of directors forced Rick Scott to resign as chairman and CEO amid growing evidence that the company "had kept two sets of books, one to show the government and one with actual expenses listed."[7] Thomas Frist, a co-founder of HCA and brother of U.S. Senator Bill Frist, returned to the company as CEO in 1997[7] and called on longtime friend and colleague Jack O. Bovender, Jr. to help him turn the company around.[48]

The federal probe culminated in 2003 with "the government receiving a total of over $2 billion in criminal fines and civil penalties for systematically defrauding federal health care programs."[49] Columbia/HCA pleaded guilty to 14 felonies and admitted to systematically overcharging the government. The federal probe has been referred to as the longest and costliest investigation for health-care fraud in U.S. history.[48]

2005 insider trading suit[edit]

In July 2005, U.S. Senator Bill Frist sold all of his HCA shares, which were held in a blind trust, two weeks before disappointing earnings sent the stock on a 9-point plunge. At the time, Frist was considering a run for president and said that he had sold his shares to avoid the appearance of a conflict of interest.[50] When the company disclosed that other executives had also sold their shares during that same time, shareholders alleged that the company had made false claims about its profits to drive up the price, which then fell when the company reported disappointing financial results. Eleven of HCA's senior officers were sued for accounting fraud and insider trading.[51] HCA settled the lawsuit in August 2007, agreeing to pay $20 million to the shareholders but admitting no wrongdoing, and no charges were brought.[52]

See also[edit]

  • Rick Scott, former chairman and CEO, former governor of Florida, and current U.S Senator
  • Jack Bovender, former chairman and CEO (2002–2009)

References[edit]

  1. ^ "HCA Healthcare Fact Sheet" (PDF). HCA Healthcare. June 2019. Retrieved 23 June 2020.
  2. ^ "John Reay President and Chief Executive Officer". HCA Healthcare. Retrieved 23 June 2020.
  3. ^ a b "HCA Healthcare Annual Report Pursuant to Section 13 or 15(D) of the Securities Exchange Act of 1934" (PDF). HCA Healthcare. 20 February 2020. Retrieved 23 June 2020.
  4. ^ "HCA Healthcare". fortune.com. Retrieved 8 December 2021.
  5. ^ "HCA Healthcare - Corporate Profile".
  6. ^ "Fortune 500". fortune.com. Retrieved 8 December 2021.
  7. ^ a b c d Appleby, Julie (December 18, 2002). "HCA to settle more allegations for $631M". USA Today.
  8. ^ "REDUCE MRSA | HAI Prevention Epicenters Program | CDC". 13 February 2019.
  9. ^ a b c d "Our History". HCA Healthcare. Retrieved 2018-06-22.
  10. ^ a b c d "Dr. Thomas Frist Sr., HCA Founder, Dies at 87". The New York Times. January 8, 1998.
  11. ^ Brett Kellman (16 August 2018). "HCA: From single hospital to health care behemoth". The Tennessean. Retrieved 24 June 2020.
  12. ^ Freudenheim, Milt. Buyout Set For Chain Of Hospitals. The New York Times, November 22, 1988.
  13. ^ Steve Ivey; Ed Green (11 November 2011). "Humana's history has been one of recognizing opportunities". Louisville Business Journal. Retrieved 24 June 2020.
  14. ^ "Factbox: Hospital operator HCA goes public again". Reuters. 9 March 2011. Retrieved 24 June 2020.
  15. ^ a b Paul Gallagher (June 14, 2013). "World's largest private healthcare company HCA plans expansion into NHS". The Independent.
  16. ^ Milt Freudenheim (October 4, 1993). "Largest Publicly Held Hospital Chain Is Planned". The New York Times.
  17. ^ a b c Floyd Norris (October 6, 1994). "Efficiencies of scale are taken to the nth degree at Columbia". The New York Times. Retrieved August 16, 2015.
  18. ^ "Time 25". Time. June 17, 1996. Retrieved April 5, 2009.[dead link]
  19. ^ Kathryn Jones (November 21, 1993). "A Hospital Giant Comes to Town, Bringing Change". The New York Times.
  20. ^ Sorkin, Andrew Ross. "HCA Buyout Highlights Era of Going Private." New York Times, July 25, 2006.
  21. ^ "HCA IPO prices at $30, sells more shares: sources". Reuters. 9 March 2011. Retrieved 2015-02-02.
  22. ^ Emily Overholt (May 2, 2017). "HCA Holdings, Inc. to change name to include 'healthcare" - Nashville Business Journal"". Nashville Business Journal. Retrieved September 16, 2020.
  23. ^ Stinnett, Joel (December 7, 2018). "Nashville marks the spot where HCA was born". Nashville Business Journal. Retrieved December 10, 2018.
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  25. ^ Evans, Melanie (2021-05-26). "WSJ News Exclusive | Google Strikes Deal With Hospital Chain to Develop Healthcare Algorithms". Wall Street Journal. ISSN 0099-9660. Retrieved 2021-06-28.
  26. ^ Brian, Gormley (August 18, 2021). "General Catalyst, HCA Healthcare Team Up on Digital Innovation". The Wall Street Journal.
  27. ^ a b HCA Fact Sheet 2014. HCA currently owns the University of Central Florida College of Medicine and controls the board of directors for the medical school which it purchased in August 2017. "HCA Facts" (PDF). Archived from the original (PDF) on September 5, 2015. Retrieved September 9, 2017.
  28. ^ HCA sells Switzerland hospitals BizJournals.com (Nashville Business Journal), June 20, 2007.
  29. ^ "Metro Orlando to get 3 new hospitals". BizJournals.com (Orlando Business Journal). Retrieved 2019-06-09.
  30. ^ "HCA now owns 53 hospitals in Texas". www.beckershospitalreview.com. Retrieved 2019-06-09.
  31. ^ "HCA's success over 50 years banks on sticking with the basics". Modern Healthcare. 2018-10-06. Retrieved 2019-06-09.
  32. ^ "HCA Announces Agreement to Acquire Three Houston Hospitals from Tenet - HCA Investor Center". investor.hcahealthcare.com. Retrieved 20 December 2018.
  33. ^ "HCA Healthcare Acquires Technology and Analytics Company Valify". Bloomberg.com (Press release). 2020-01-10. Retrieved 2020-03-19.
  34. ^ "HCA Healthcare Acquires Technology and Analytics Company Valify". www.nasdaq.com (Press release). Retrieved 2020-03-19.
  35. ^ "For-profit hospital M&A update: 12 deals involving CHS, HCA and Quorum". beckershospitalreview.com. Retrieved 2020-05-13.
  36. ^ 52 Alderly Road
  37. ^ "HCA expands network of urgent care centres". LaingBuisson. 12 March 2018. Retrieved 11 May 2018.
  38. ^ "HCA Healthcare Welcomes Record Class of 1,453 Residents and Fellows". HCA Healthcare. 1 July 2019. Retrieved 6 July 2020.
  39. ^ "HCA Healthcare Completes Purchase of Majority Stake in Galen College of Nursing". Bloomberg News. 7 January 2020. Retrieved 6 July 2020.
  40. ^ "Campuses and Programs". Galen College of Nursing. Retrieved 6 July 2020.
  41. ^ "HCA Healthcare responds to stroke 30% faster than the national standard". HCA Healthcare. 19 November 2019. Retrieved 6 July 2020.
  42. ^ "Preterm Elective Childbirth". HCA Healthcare. Retrieved 6 July 2020.
  43. ^ "HCA Healthcare Enhanced Surgical Recovery (ESR)". HCA Healthcare. Retrieved 6 July 2020.
  44. ^ "Fact Sheet" (PDF). HCA Healthcare. June 30, 2020. Retrieved September 15, 2020.
  45. ^ "Investing in Our People". HCA Healthcare. Retrieved 6 July 2020.
  46. ^ "Corporate Contributions Policy and Criteria". HCA Healthcare. Retrieved 6 July 2020.
  47. ^ . HCA Healthcare Support https://hcahealthcareimpact.com/caring-for-communities/community-support/title=Community Support Check |url= value (help). Retrieved 9 July 2020. Missing or empty |title= (help)
  48. ^ a b David Stires (9 February 2004). "Bringing HCA Back to Life After years of scandal, the hospital chain is healthy again--and might just be a buy". Fortune. Retrieved 19 June 2020.
  49. ^ "Largest Health Care Fraud Case in U.S. History Settled". US Department of Justice. 26 June 2003. Retrieved 19 June 2020.
  50. ^ Jonathan M. Katz (21 September 2005). "Senator Sold Stock Before Price Dropped". The Washington Post. Retrieved 30 June 2020.
  51. ^ "In re HCA Inc., Securities Litigation". Retrieved Jul 26, 2013.
  52. ^ "HCA settles insider trading lawsuit for $20 million". law.com. 14 August 2007. Retrieved 30 June 2020.

Further reading[edit]

External links[edit]