U.S. authorities are looking into billing practices and the medical necessity of heart procedures performed at hospitals operated by HCA Holdings Inc, the company revealed in a regulatory filing on Monday.
HCA, in an unusual move, also issued a detailed rebuttal defending itself against a not-yet, published report by The New York Times in which it said it believes the newspaper will question physician decisions at its hospitals regarding certain heart procedures.
HCA shares fell about 6 percent.
The U.S. hospital operator said the Department of Justice was reviewing whether charges to the federal government related to use of implantable cardio-defibrillators (ICDs) met with Medicare billing criteria. It said the department would be reviewing ICD billing and medical records at 95 of its hospitals.
HCA also said the U.S. Attorney’s office in Miami had requested information on reviews assessing the medical necessity of certain interventional heart procedures. The company said it believes such reviews have taken place at about 10 of its hospitals, primarily in Florida.
Separately, HCA reported better-than-expected quarterly earnings as more patients were treated at its facilities and the company maintained its 2012 earnings forecast.
Hospital operators such as HCA and Community Health Systems Inc are set to see higher admissions of insured customers as a result of President Barack Obama’s healthcare reform law that was recently upheld by the Supreme Court.
Net income for the second quarter rose to $391 million, or 85 cents per share, from $229 million, or 43 cents per share, a year earlier.
Excluding one-time gains, earnings were 85 cents per share. Analysts’ average forecast was 78 cents per share, according to Thomson Reuters I/B/E/S.
Revenue rose 12 percent to $8.11 billion. Admissions to facilities owned for at least one year, combined with outpatient volumes, increased 3.9 percent.
HCA said it expects to gain about $325 million to $350 million in 2012 from estimated electronic health record incentive income.
The Nashville, Tenn.-based company maintained its 2012 earnings per share forecast of between $3.57 and $3.77 per share before one-time items, on revenue of between $32 billion and $33 billion. Analysts on average were estimating 2012 earnings of $3.69 per share on revenue of $35.56 billion.
Community Health, the No. 2 U.S. hospital operator, last month posted quarterly profit above analysts’ estimates and reaffirmed its full-year profit forecast.
HCA shares were down $1.78, or 6.6 percent, at $24.82 in late morning trade on the New York Stock Exchange.
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