HCA Holdings, Inc. (HCA)

HCA 
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HCA Holdings, Inc. (HCA)

Barclays Global Healthcare Conference

March 12, 2013 2:30 pm ET

Executives

W. Mark Kimbrough - Vice President of Investor Relations

Victor L. Campbell - Senior Vice President

Analysts

Joshua R. Raskin - Barclays Capital, Research Division

Presentation

Joshua R. Raskin - Barclays Capital, Research Division

Alright there we go. So before we introduce the team from HCA, who probably needs no introduction; they've been at our conference, probably longer than I have, now that I think about it. But first, we're going to go to some of the audience response questions. You guys have been seeing these all day. So hopefully, you get it. First one, hopefully, is obvious for these guys. Do you think health reform will be a positive for HCA in 2014, 1 being very negative, 2 being very positive and anywhere in between, go for it.

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

We get immediate responses. There we go. So, wow, interesting. There are a couple people still holding out for very negative. That's an interesting [indiscernible] .

W. Mark Kimbrough

Raise your hand, who's that?

Joshua R. Raskin - Barclays Capital, Research Division

Clearly haven't read our reports. Number two, second question is around contracting rates on exchanges. Do you think HCA be able to receive rates that are closer to commercial; #5 or all the way down, as well as Medicaid rates, which would be #1. Go for it.

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

I was hoping Stan [ph] would push a button and could I see which one. But anyway, it looks like people leaning more towards the commercial or slightly below that, which sounds better. Number three, utilization trends in 2013. Do you think you'll see a significant increase, that's 1, all the way down to a significant decrease. Think about broad volume metrics for HCA, specifically this year. Go for it.

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

So it looks like a certain bias, certainly a bias towards increase. Everyone's either in the no change to the increase side, and mostly in the not so significant, which makes sense. I think it's consistent with the second half.

All right, next question please. How would you like to see HCA deploy their capital in 2013? Would that be M&A, repurchases, dividends, repay some of the debt or invest in the core business; 1 through 5? Go for it.

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

Wow. Now there's certainly a lack of consensus on that one. That's interesting. So you guys got a lot of work to do, it looks like. You've got a bunch of stuff to do.

Next question. Do you think the company will grow earnings? We've been defining that as EPS all day. It's an easy one. Yes or no?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

Wow, this is the first unanimous vote.

W. Mark Kimbrough

Thank you. We are happy with the results. Thank you very much.

Joshua R. Raskin - Barclays Capital, Research Division

Thanks for coming.

W. Mark Kimbrough

Vic will be at bar buy drinks.

Joshua R. Raskin - Barclays Capital, Research Division

It looks like Mark has done his job. Here we go. All right, next -- we got 2 more, I think. Do you own -- currently own shares in HCA? 1, yes, 2, no.

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

They're all going to say yes because [indiscernible] .

W. Mark Kimbrough

There we go. Look at this.

Joshua R. Raskin - Barclays Capital, Research Division

[indiscernible] That is a split. All right. And then I guess let's get the sentiment question. Is your current bias more positive or negative or neutral, with a 2 in between?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

Oh, so half og you don't own it, but only 40% of you think that it's not a good idea. Interesting. All right. Clearly we've got to them this, there's 40% of people that need to read my research.

So let's jump into it. I'll do very brief introductions. To my immediate right, Mark Kimbrough, who everyone knows coordinates everything with the Street, Investor Relations, and has been wearing that hat, and multiple other roles for a while, although certainly not as long as Vic Campbell, to his immediate right, too, has been with the company for, I'm going to guess, 30 ...

Victor L. Campbell

40.

Joshua R. Raskin - Barclays Capital, Research Division

40 years. I was thinking of 30. All right, 40 years, which is impressive. So he's got me in terms of ages of life -- years of life. And then all the way to my far right, Sam Hazen, who we'll call our guest of honor today. Sam is the President of Operations, basically runs all of the facilities. So you think of him as the, in charge of the largest portfolio of facilities in the country. I think Sam previously ran the Western operations, which was 60-some-odd hospitals before that, and I think started at Humana once upon a time, as some of my friends in Louisville are correct as well.

So I'm going to do some of the Q&A while we're here. And then we're going to Poinciana 3 to go through some of the audience questions. The one that I want to start with is quality. We have not softened up, in my opinion, about the differentiation around quality. When we went through the initiation process, one of the things that impressed us the most was that no matter what metric we looked at, whether it was readmittance or any of the broad-based outcomes, the data that we could get our hands on, HCA was at the top of the list. I'm assuming that's not an accident. Maybe you can talk to them about how did you get there? And then, more importantly, why is it important? How does this help the company from a financial perspective?

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