Company Quick10K Filing
Quick10K
HCA Healthcare
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$124.60 342 $42,650
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
10-Q 2015-09-30 Quarter: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-K 2014-12-31 Annual: 2014-12-31
10-Q 2014-09-30 Quarter: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-K 2013-12-31 Annual: 2013-12-31
8-K 2019-06-12 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2019-06-05 Other Events, Exhibits
8-K 2019-04-30 Earnings, Regulation FD, Other Events, Exhibits
8-K 2019-04-26 Officers, Amend Bylaw, Shareholder Vote, Exhibits
8-K 2019-03-28 Officers, Exhibits
8-K 2019-02-21 Officers, Exhibits
8-K 2019-01-30 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2019-01-29 Earnings, Regulation FD, Other Events, Exhibits
8-K 2019-01-17 Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K 2019-01-17 Other Events, Exhibits
8-K 2018-12-20 Officers
8-K 2018-10-30 Earnings, Regulation FD, Other Events, Exhibits
8-K 2018-09-07 Officers, Exhibits
8-K 2018-08-23 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2018-08-09 Other Events, Exhibits
8-K 2018-07-25 Earnings, Regulation FD, Other Events, Exhibits
8-K 2018-05-01 Earnings, Regulation FD, Other Events, Exhibits
8-K 2018-04-26 Officers, Shareholder Vote
8-K 2018-03-30 Officers, Exhibits
8-K 2018-03-13 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2018-01-30 Earnings, Regulation FD, Other Events, Exhibits
8-K 2018-01-17 Officers, Exhibits
PNW Pinnacle West Capital 10,390
VEDL Vedanta 8,380
CNK Cinemark Holdings 4,830
ACHC Acadia Healthcare Company 2,860
ALLK Allakos 1,820
PLG Platinum Group Metals 46
JNP Juniper Pharmaceuticals 0
KLDK Global House Holdings 0
ISRB Inspired Builders 0
VLDI Validian 0
HCA 2019-03-31
Note 1 - Basis of Presentation and Significant Accounting Policies
Note 2 - Acquisitions and Dispositions
Note 3 - Income Taxes
Note 4 - Earnings per Share
Note 5 - Investments of Insurance Subsidiaries
Note 6 - Financial Instruments
Note 7 - Assets and Liabilities Measured At Fair Value
Note 8 - Long-Term Debt
Note 9 - Leases
Note 10 - Contingencies
Note 11 - Share Repurchases Transactions and Other Comprehensive Loss
Note 12 - Segment and Geographic Information
Note 13 - Supplemental Condensed Consolidating Financial Information
Item 2. Management's Discussion and Analysis Of
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-31.1 d738201dex311.htm
EX-31.2 d738201dex312.htm
EX-32 d738201dex32.htm

HCA Healthcare Earnings 2019-03-31

HCA 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

HCA Healthcare, Inc.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
 
10-Q
​​​​​​​
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
March 31, 2019
​​​​​​​
Or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                to                 
Commission file number
1-11239
HCA Healthcare, Inc.
(Exact name of registrant as specified in its charter)
Delaware
 
27-3865930
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
   
One Park Plaza
Nashville, Tennessee
 
37203
(Address of principal executive offices)
 
(Zip Code)
(615)
 344-9551
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  
    No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
 S-T
during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  
    No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule
 12b-2
of the Exchange Act.
Large accelerated filer
 
 
Accelerated filer
 
Non-accelerated
filer
 
 
Smaller reporting company
 
Emerging growth company
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
 
Trading Symbol(s)
 
 
Name of each exchange on which registered
Voting common stock, $.01 par value
 
 
HCA
 
 
New York Stock Exchange
Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.
Class of Common Stock
 
Outstanding at April 30, 2019
Voting common stock, $.01 par value
 
342,307,400 shares
 
 
 
   
 
 
HCA HEALTHCARE, INC.
Form 10-Q
March 31, 2019
 
 
Page of
Form 10-Q
 
Part I.
 
Financial Information
  
 
       
Item 1.
 
Financial Statements (Unaudited):
  
 
       
   
2
 
       
   
3
 
       
   
4
 
       
   
5
 
       
   
6
 
       
   
7
 
       
Item 2.
   
25
 
       
Item 3.
   
38
 
       
Item 4.
   
38
 
       
Part II.
   
 
       
Item 1.
   
38
 
       
Item 1A.
   
39
 
       
Item 2.
   
39
 
       
Item 6.
   
40
 
      
  
41
  
 
1
 
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATED INCOME STATEMENTS
FOR THE QUARTERS ENDED MARCH 31, 2019 AND 2018
Unaudited
(Dollars in millions, except per share amounts)
                 
 
2019
   
2018
 
Revenues
 
$
12,517
    $
11,423
 
                 
Salaries and benefits
   
5,647
     
5,289
 
Supplies
   
2,041
     
1,915
 
Other operating expenses
   
2,299
     
2,110
 
Equity in earnings of affiliates
   
(11
)
   
(9
)
Depreciation and amortization
   
619
     
553
 
Interest expense
   
461
     
431
 
Losses (gains) on sales of facilities
   
1
     
(405
)
                 
   
11,057
     
9,884
 
                 
Income before income taxes
   
1,460
     
1,539
 
Provision for income taxes
   
279
     
257
 
                 
Net income
   
1,181
     
1,282
 
Net income attributable to noncontrolling interests
   
142
     
138
 
                 
Net income attributable to HCA Healthcare, Inc.
 
$
1,039
    $
1,144
 
                 
Per share data:
   
     
 
Basic earnings
 
$
3.03
    $
3.26
 
Diluted earnings
 
$
2.97
    $
3.18
 
Shares used in earnings per share calculations (in millions):
   
     
 
Basic
   
342.876
     
350.850
 
Diluted
   
350.316
     
359.749
 
 
 
 
 
 
The accompanying notes are an integral part of the condensed consolidated financial statements.
 
2
 
 
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME STATEMENTS
FOR THE QUARTERS ENDED MARCH 31, 2019 AND 2018
Unaudited
(Dollars in millions)
                 
 
2019
   
2018
 
Net income
 
$
1,181
    $
1,282
 
Other comprehensive income (loss) before taxes:
   
     
 
Foreign currency translation
   
20
     
54
 
                 
Unrealized gains (losses) on
available-for-sale
securities
   
8
     
(5
)
                 
Defined benefit plans
   
     
 
Pension costs included in salaries and benefits
   
3
     
5
 
                 
   
3
     
5
 
                 
Change in fair value of derivative financial instruments
   
(18
)
   
35
 
Interest benefits included in interest expense
   
(5
)
   
 
                 
   
(23
)
   
35
 
                 
Other comprehensive income before taxes
   
8
     
89
 
Income taxes related to other comprehensive income items
   
1
     
8
 
                 
Other comprehensive income
   
7
     
81
 
                 
Comprehensive income
   
1,188
     
1,363
 
Comprehensive income attributable to noncontrolling interests
   
142
     
138
 
                 
Comprehensive income attributable to HCA Healthcare, Inc.
 
$
1,046
    $
1,225
 
                 
 
 
 
 
The accompanying notes are an integral part of the condensed consolidated financial statements.
 
3
 
 
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited
(Dollars in millions)
 
March 31,
2019
  
December 31,
2018
 
ASSETS
  
   
 
Current assets:
  
   
 
Cash and cash equivalents
 
$
531
  $
502
 
Accounts receivable
  
7,420
   
6,789
 
Inventories
  
1,778
   
1,732
 
Other
  
1,379
   
1,190
 
         
  
11,108
   
10,213
 
         
Property and equipment, at cost
  
44,583
   
42,965
 
Accumulated depreciation
  
(23,455
)
  
(23,208
)
         
  
21,128
   
19,757
 
         
Investments of insurance subsidiaries
  
338
   
362
 
Investments in and advances to affiliates
  
246
   
232
 
Goodwill and other intangible assets
  
8,159
   
7,953
 
Right-of-use
operating lease assets
  
1,812
   
 
Other
  
588
   
690
 
         
 
$
43,379
  $
39,207
 
         
LIABILITIES AND STOCKHOLDERS’ DEFICIT
  
   
 
Current liabilities:
  
   
 
Accounts payable
 
$
2,693
  $
2,577
 
Accrued salaries
  
1,424
   
1,580
 
Other accrued expenses
  
2,618
   
2,624
 
Long-term debt due within one year
  
3,796
   
788
 
         
  
10,531
   
7,569
 
         
Long-term debt, less net debt issuance costs of $170 and $157
  
31,019
   
32,033
 
Professional liability risks
  
1,313
   
1,275
 
Right-of-use
operating lease obligations
  
1,494
   
 
Income taxes and other liabilities
  
1,277
   
1,248
 
         
Stockholders’ deficit:
  
   
 
Common stock $0.01 par; authorized 1,800,000,000 shares; outstanding 343,030,500 shares in 2019 and 342,895,200 shares in 2018
  
3
   
3
 
Accumulated other comprehensive loss
  
(374
)
  
(381
)
Retained deficit
  
(3,983
)
  
(4,572
)
         
Stockholders’ deficit attributable to HCA Healthcare, Inc.
  
(4,354
)
  
(4,950
)
Noncontrolling interests
  
2,099
   
2,032
 
         
  
(2,255
)
  
(2,918
)
         
 
$
43,379
  $
39,207
 
         
The accompanying notes are an integral part of the condensed consolidated financial statements.
 
4
 
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
FOR THE QUARTERS ENDED MARCH 31, 2019 AND 2018
Unaudited
(Dollars in millions)
                                                         
 
Equity (Deficit) Attributable to HCA Healthcare, Inc.
   
Equity
Attributable to
Noncontrolling
Interests
   
Total
   
 
Common Stock
   
Capital in
Excess of
Par
Value
   
Accumulated
Other
Comprehensive
Loss
   
Retained
Deficit
   
 
Shares
(in millions)
   
Par
Value
   
Balances, December 31, 2017
   
350.092
    $
4
    $
    $
(278
)   $
(6,532
)   $
1,811
    $
(4,995
)
Comprehensive income
   
     
     
     
81
     
1,144
     
138
     
1,363
 
Repurchase of common stock
   
(4.370
)    
     
114
     
     
(537
)    
     
(423
)
Share-based benefit plans
   
5.265
     
     
(114
)    
     
     
     
(114
)
Cash dividends declared ($0.35 per share)
   
     
     
     
     
(126
)    
     
(126
)
Distributions
   
     
     
     
     
     
(92
)    
(92
)
Other
   
     
     
     
     
     
(47
)    
(47
)
                                                         
Balances, March 31, 2018
   
350.987
     
4
     
     
(197
)    
(6,051
)    
1,810
     
(4,434
)
Comprehensive income
   
     
     
     
(64
)    
820
     
146
     
902
 
Repurchase of common stock
   
(4.670
)    
(1
)    
(93
)    
     
(376
)    
     
(470
)
Share-based benefit plans
   
0.443
     
     
96
     
     
     
     
96
 
Cash dividends declared ($0.35 per share)
   
     
     
     
     
(124
)    
     
(124
)
Distributions
   
     
     
     
     
     
(93
)    
(93
)
Other
   
     
     
(3
)    
     
     
1
     
(2
)
                                                         
Balances, June 30, 2018
   
346.760
     
3
     
     
(261
)    
(5,731
)    
1,864
     
(4,125
)
Comprehensive income
   
     
     
     
(5
)    
759
     
137
     
891
 
Repurchase of common stock
   
(2.518
)    
     
(55
)    
     
(247
)    
     
(302
)
Share-based benefit plans
   
0.844
     
     
54
     
     
     
     
54
 
Cash dividends declared ($0.35 per share)
   
     
     
     
     
(123
)    
     
(123
)
Distributions
   
     
     
     
     
     
(130
)    
(130
)
Other
   
     
     
1
     
     
     
4
     
5
 
                                                         
Balances, September 30, 2018
   
345.086
     
3
     
     
(266
)    
(5,342
)    
1,875
     
(3,730
)
Comprehensive income
   
     
     
     
(20
)    
1,064
     
181
     
1,225
 
Repurchase of common stock
   
(2.512
)    
     
(69
)    
     
(266
)    
     
(335
)
Share-based benefit plans
   
0.321
     
     
79
     
     
     
     
79
 
Cash dividends declared ($0.35 per share)
   
     
     
     
     
(123
)    
     
(123
)
Distributions
   
     
     
     
     
     
(126
)    
(126
)
Reclassification of stranded tax effects
   
     
     
     
(95
)    
95
     
     
 
Other
   
     
     
(10
)    
     
     
102
     
92
 
                                                         
Balances, December 31, 2018
   
342.895
     
3
     
     
(381
)    
(4,572
)    
2,032
     
(2,918
)
Comprehensive income
   
     
     
     
7
     
1,039
     
142
     
1,188
 
Repurchase of common stock
   
(2.106
)    
     
32
     
     
(310
)    
     
(278
)
Share-based benefit plans
   
2.242
     
     
(29
)    
     
     
     
(29
)
Cash dividends declared ($0.40 per share)
   
     
     
     
     
(140
)    
     
(140
)
Distributions
   
     
     
     
     
     
(136
)    
(136
)
Other
   
     
     
(3
)    
     
     
61
     
58
 
                                                         
Balances, March 31, 2019
   
343.031
   
$
3
   
$
   
$
(374
)
 
$
(3,983
)
 
$
2,099
   
$
(2,255
)
                                                         
 
 
 
 
 
The accompanying notes are an integral part of the condensed consolidated financial statements.
 
5
 
 
 
HCA HEALTHCARE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE QUARTERS ENDED MARCH 31, 2019 AND 2018
Unaudited
(Dollars in millions)
 
2019
  
2018
 
Cash flows from operating activities:
  
   
 
Net income
 
$
1,181
  $
1,282
 
Adjustments to reconcile net income to net cash provided by operating activities:
  
   
 
Decrease in cash from operating assets and liabilities:
  
   
 
Accounts receivable
  
(369
)
  
(4
)
Inventories and other assets
  
(174
)
  
(218
)
Accounts payable and accrued expenses
  
(651
)
  
(263
)
Depreciation and amortization
  
619
   
553
 
Income taxes
  
269
   
246
 
Losses (gains) on sales of facilities
  
1
   
(405
)
Amortization of debt issuance costs
  
8
   
8
 
Share-based compensation
  
62
   
60
 
Other
  
28
   
24
 
         
Net cash provided by operating activities
  
974
   
1,283
 
         
Cash flows from investing activities:
  
   
 
Purchase of property and equipment
  
(781
)
  
(694
)
Acquisition of hospitals and health care entities
  
(1,474
)
  
(379
)
Disposal of hospitals and health care entities
  
30
   
767
 
Change in investments
  
36
   
11
 
Other
  
24
   
(40
)
         
Net cash used in investing activities
  
(2,165
)
  
(335
)
         
Cash flows from financing activities:
  
   
 
Issuances of long-term debt
  
1,500
   
 
Net change in revolving bank credit facilities
  
460
   
270
 
Repayment of long-term debt
  
(49
)
  
(50
)
Distributions to noncontrolling interests
  
(136
)
  
(92
)
Payment of debt issuance costs
  
(22
)
  
(2
)
Payment of cash dividends
  
(141
)
  
(123
)
Repurchases of common stock
  
(278
)
  
(423
)
Other
  
(118
)
  
(191
)
         
Net cash provided by (used in) financing activities
  
1,216
   
(611
)
         
Effect of exchange rate changes on cash and cash equivalents
  
4
   
17
 
         
Change in cash and cash equivalents
  
29
   
354
 
Cash and cash equivalents at beginning of period
  
502
   
732
 
         
Cash and cash equivalents at end of period
 
$
531
  $
1,086
 
         
Interest payments
 
$
580
  $
549
 
Income tax payments, net
 
$
10
  $
11
 
The accompanying notes are an integral part of the condensed consolidated financial statements.
 
6
 
HCA HEALTHCARE, INC.
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 
NOTE 1 — BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
 
Reporting Entity
 
HCA Healthcare, Inc. is a holding company whose affiliates own and operate hospitals and related health care entities. The term “affiliates” includes direct and indirect subsidiaries of HCA Healthcare, Inc. and partnerships and joint ventures in which such subsidiaries are partners. At March 31, 2019, these affiliates owned and operated 185 hospitals, 124 freestanding surgery centers and provided extensive outpatient and ancillary services. HCA Healthcare, Inc.’s facilities are located in 21 states and England. The terms “Company,” “HCA,” “we,” “our” or “us,” as used herein and unless otherwise stated or indicated by context, refer to HCA Healthcare, Inc. and its affiliates. The terms “facilities” or “hospitals” refer to entities owned and operated by affiliates of HCA and the term “employees” refers to employees of affiliates of HCA.
Basis of Presentation
 
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form
 10-Q
and Article 10 of Regulation
 S-X.
Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal and recurring nature.
The majority of our expenses are “costs of revenues” items. Costs that could be classified as general and administrative would include our corporate office costs, which were $86 million and $81 million for the quarters ended March 31, 2019 and 2018, respectively. Operating results for the quarter ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. For further information, refer to the consolidated financial statements and footnotes thereto included in our annual report on Form
 10-K
for the year ended December 31, 2018.
Revenues
 
Our revenues generally relate to contracts with patients in which our performance obligations are to provide health care services to the patients. Revenues are recorded during the period our obligations to provide health care services are satisfied.
Our performance obligations for inpatient services are generally satisfied over periods that average approximately five days
, and revenues are recognized based on charges incurred in relation to total expected charges.
Our performance obligations for outpatient services are generally satisfied over a period of less than one day
. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, Medicaid, managed care health plans and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payers. The payment arrangements with third-party payers for the services we provide to the related patients typically specify payments at amounts less than our standard charges. Medicare generally pays for inpatient and outpatient services at prospectively determined rates based on clinical, diagnostic and other factors. Services provided to patients having Medicaid coverage are generally paid at prospectively determined rates per discharge, per identified service or per covered member. Agreements with commercial insurance carriers, managed care and preferred provider organizations generally provide for payments based upon predetermined rates per diagnosis, per diem rates or discounted
fee-for-service
rates. Our revenues for the quarter ended March 31, 2019 include $86 million related to the resolution of transaction price differences regarding certain out-of-network services performed in prior periods. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in managed care contractual terms resulting from contract renegotiations and renewals.
7
 
 
HCA HEALTHCARE, INC.
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 
NOTE 1 — BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)
 
Revenues (continued)
 
Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual allowances under managed care and commercial insurance plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured discounts and contractual discounts). We also record estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record
self-pay
revenues at the estimated amounts we expect to collect. Our revenues from third-party payers and others (including uninsured patients) for the quarters ended March 31, 2019 and 2018 are summarized in the following table (dollars in millions):
                                 
 
2019
   
Ratio
   
2018
   
Ratio
 
Medicare
 
$
2,770
     
22.1
%
  $
2,524
     
22.1
%
Managed Medicare
   
1,589
     
12.7
     
1,399
     
12.3
 
Medicaid
   
347
     
2.8
     
281
     
2.5
 
Managed Medicaid
   
613
     
4.9
     
561
     
4.9
 
Managed care and insurers
   
6,426
     
51.4
     
6,062
     
53.1
 
International (managed care and insurers)
   
297
     
2.4
     
305
     
2.7
 
Other
   
475
     
3.7
     
291
     
2.4
 
                                 
Revenues
 
$
12,517
     
100.0
%
  $
11,423
     
100.0
%
                                 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
To quantify the total impact of the trends related to uninsured accounts, we believe it is beneficial to view total uncompensated care, which is comprised of charity care, uninsured discounts and implicit price concessions. A summary of the estimated cost of total uncompensated care for the quarters ended March 31, 2019 and 2018 follows (dollars in millions):
                 
 
2019
   
2018
 
Patient care costs (salaries and benefits, supplies, other operating expenses and depreciation and amortization)
 
$
10,606
    $
9,867
 
Cost-to-charges ratio (patient care costs as percentage of gross patient charges)
   
11.8
%
   
12.4
%
Total uncompensated care
 
$
7,085
    $
6,252
 
Multiply by the cost-to-charges ratio
   
11.8
%
   
12.4
%
                 
Estimated cost of total uncompensated care
 
$
836
    $
775
 
                 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total uncompensated care as a percentage of the sum of revenues and total uncompensated care was 36.1% and 35.4% for the quarters ended March 31, 2019 and 2018, respectively. The total uncompensated care amounts include charity care of $2.905 billion and $1.879 billion, and the related estimated costs of charity care were $343 million and $233 million for the quarters ended March 31, 2019 and 2018, respectively.
Reclassifications
 
Certain prior year amounts have been reclassified to conform to the current year presentation.
8
 
 
HCA HEALTHCARE, INC.
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 
NOTE 2 — ACQUISITIONS AND DISPOSITIONS
 
During the quarter ended March 31, 2019, we paid $1.398 billion to acquire a
seven
-hospital health system in North Carolina and $76 million to acquire other nonhospital health care entities. During the quarter ended March 31, 2018, we paid $360 million to acquire a hospital facility and $19 million to acquire other nonhospital health care entities. Purchase price amounts have been allocated to the related assets acquired and liabilities assumed based upon their respective fair values. The purchase price paid in excess of the fair value of identifiable net assets of these acquired entities aggregated $207 million for the quarter ended March 31, 2019. The consolidated financial statements include the accounts and operations of the acquired entities subsequent to the respective acquisition dates. The pro forma effects of these acquired entities on our results of operations for periods prior to the respective acquisition dates were not significant.
During the quarter ended March 31, 2019, we received proceeds of $25 million and recognized a net pretax loss of $
1
 million related to a sale of a hospital facility in one of our Louisiana markets. During the quarter ended March 31, 2019, we also received proceeds of $5 million related to sales of real estate and other investments. During the quarter ended March 31, 2018, we received proceeds of $758 million and recognized a net pretax gain of $376 million related to the sale of the two hospital facilities in our Oklahoma market. During the quarter ended March 31, 2018, we also received proceeds of $9 million and recognized a net pretax gain of $29 million related to sales of real estate and other investments.
NOTE 3 — INCOME TAXES
 
Our provision for income taxes for the quarters ended March 31, 2019 and 2018 was $279 million and $257 million, respectively, and the effective tax rates were 21.2% and 18.4%, respectively. Our provision for income taxes included tax benefits related to the settlement of employee equity awards of $49 million and $92 million for the quarters ended March 31, 2019 and 2018, respectively.
Our liability for unrecognized tax benefits was $457 million, including accrued interest of $53 million, as of March 31, 2019 ($435 million and $48 million, respectively, as of December 31, 2018). Unrecognized tax benefits of $143 million ($137 million as of December 31, 2018) would affect the effective rate, if recognized.
The Internal Revenue Service began an examination of the Company’s 2016 and 2017 federal income tax returns during 2019. We are also subject to examination by state and foreign taxing authorities. Depending on the resolution of any federal, state and foreign tax disputes, the completion of examinations by federal, state or foreign taxing authorities, or the expiration of statutes of limitation for specific taxing jurisdictions, we believe it is reasonably possible that our liability for unrecognized tax benefits may significantly increase or decrease within the next 12 months. However, we are currently unable to estimate the range of any possible change.
NOTE 4 — EARNINGS PER SHARE
 
We compute basic earnings per share using the weighted average number of common shares outstanding. We compute diluted earnings per share using the weighted average number of common shares outstanding, plus the dilutive effect of outstanding equity awards and potential shares, computed using the treasury stock method.
9
 
 
HCA HEALTHCARE, INC.
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
 
NOTE 4 — EARNINGS PER SHARE (continued)
 
The following table sets forth the computation of basic and diluted earnings per share for the quarters ended March 31, 2019 and 2018 (dollars and shares in millions, except per share amounts):
                 
 
2019
   
2018
 
Net income attributable to HCA Healthcare, Inc.
 
$
1,039
    $
1,144
 
                 
Weighted average common shares outstanding
   
342.876
     
350.850
 
Effect of dilutive incremental shares
   
7.440
     
8.899
 
                 
Shares used for diluted earnings per share
   
350.316
     
359.749
 
                 
Earnings per share:
   
     
 
Basic earnings
 
$
3.03
    $
3.26
 
Diluted earnings
 
$
2.97
    $
3.18
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOTE 5 — INVESTMENTS OF INSURANCE SUBSIDIARIES
 
A summary of our insurance subsidiaries’ investments at March 31, 2019 and December 31, 2018 follows (dollars in millions):
                                 
 
March 31, 2019
 
 
Amortized
Cost
   
Unrealized
Amounts
   
Fair
Value
   
 
Gains
   
Losses
   
Debt securities
 
$
336
   
$
11
   
$
   
$
347
 
Money market funds and other
   
81
     
     
     
81
 
                                 
 
$
417
   
$
11
   
$
     
428