reported a 13% increase in first-quarter earnings Tuesday, attributing the unexpectedly strong gain in part to increased insurance payments from hospitals and clinics it has owned for at least one year.
The largest hospital chain in the U.S. said that for the first quarter ended March 31, net income rose to $306 million, or 53 cents a diluted share, from $271 million, or 42 cents a share, a year earlier. The consensus estimate of analysts polled by
First Call/Thomson Financial
was 46 cents a share.
Including gains on sales of facilities, restructuring costs and expenses from defending itself in a federal criminal fraud investigation, net income totaled $296 million, or 52 cents a diluted share, compared to $322 million, or 50 cents a share, a year earlier.
Revenue fell 9% to $4.3 billion from $4.7 billion a year ago. The decline reflected a reduction in the number of hospitals operated by the Nashville, Tenn.-based company, from 273 to 192 in the last year. Even so, same-facility revenue rose 6.4% in the quarter.
Over the past two years, Columbia/HCA has been the target of a federal inquiry into whether the company has defrauded Medicare and other government health insurance programs. Columbia/HCA is currently in settlement talks with the
During this time, several top executives have left the company and Columbia/HCA has halted its formerly aggressive expansion, selling its prescription benefit management unit and spinning off hospitals.
Shares of the company rose 1 7/8, or 7%, to 28 3/8 in midday trading Tuesday. (Columbia/HCA closed up 1 3/4, or 7%, at 28 1/4.)