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Embattled HCA Reaps Strong Profits From California Hospitals

Hospital chain HCA Holdings Inc., under government scrutiny for allegedly performing unnecessary surgeries and other medical procedures on some Florida patients, has posted healthy profits at its three hospitals in Southern California.

The Nashville, Tenn., company said in a securities filing Monday that officials with the U.S. attorney’s office in Miami had requested information about medical necessity reviews for certain “cardiology services.” HCA said those reviews had occurred at about 10 of its hospitals, primarily in Florida.

Overall, the company has 163 hospitals and 110 surgery centers across the country. In a statement, the company said “HCA-affiliated physicians and employees strive to provide the highest quality care and minimize adverse outcomes.”

The company’s filing came just before the New York Times published a story late Monday indicating that HCA cardiologists in Florida were performing unnecessary procedures, such as inserting stents, on patients to boost revenue.

A spokesman for HCA declined to comment on whether any of HCA’s California hospitals are subject to the federal inquiry.

In Southern California, HCA runs Riverside Community Hospital, Los Robles Regional Medical Center in Thousand Oaks and West Hills Hospital and Medical Center.

All three hospitals have generated strong profits for HCA in recent years, according to state records. Riverside Community, the largest of the three with 373 beds, had an operating profit margin of 13% last year on total operating revenue of $410 million.

Operating margin is a key measure of hospitals’ financial performance.

The average operating margin for California hospitals was 3.4% at the end of last year, according to the Office of Statewide Health Planning and Development. Los Robles Regional had a 14% operating margin in 2010, the most recent data available.

The West Hills hospital had an 11% margin in 2010. HCA also runs Los Robles SurgiCenter and West Hills Surgical Center. Shares in HCA rallied Tuesday nearly 5% after falling on the initial disclosure of the federal scrutiny. The stock was up $1.15, or 4.5%, to $26.70 in Tuesday trading.

Source: LA Times at,0,2053482.story

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