Community Health Systems Inc. (CYH, Financial) filed Quarterly Report for the period ended 2010-09-30.
Community Health Systems Inc. has a market cap of $2.78 billion; its shares were traded at around $29.29 with a P/E ratio of 10.3 and P/S ratio of 0.2. Community Health Systems Inc. had an annual average earning growth of 21.9% over the past 10 years. GuruFocus rated Community Health Systems Inc. the business predictability rank of 3.5-star.CYH is in the portfolios of Richard Snow of Snow Capital Management, L.P., Ron Baron of Baron Funds, Steven Cohen of SAC Capital Advisors, George Soros of Soros Fund Management LLC, Jeremy Grantham of GMO LLC.
The payment rates under the Medicare program for hospital inpatient and outpatient acute care services are based on a prospective payment system, depending upon the diagnosis of a patients condition. These rates are indexed for inflation annually, although increases have historically been less than actual inflation. On August 16, 2010, CMS issued the final rule to adjust this index by 2.6% for hospital inpatient acute care services that are reimbursed under the prospective payment system. The final rule also makes other payment adjustments that, coupled with the 0.25% reduction to hospital inpatient rates implemented pursuant to the Reform Legislation referred to below, yield a net 0.4% reduction in reimbursement for hospital inpatient acute care services beginning October 1, 2010. The Reform Legislation implemented a 0.25% reduction to hospital inpatient rates effective April 1, 2010 and 0.25% reductions to hospital outpatient rates effective January 1, 2010 and January 1, 2011. Reductions in the rate of increase or overall reductions in Medicare reimbursement may cause a decline in the growth of our net operating revenues.
Operating expenses, excluding depreciation and amortization, as a percentage of net operating revenues, remained consistent at 86.7% for each of the three-month periods ended September 30, 2010 and 2009. Salaries and benefits, as a percentage of net operating revenues, remained consistent at 40.1% for each of the three-month periods ended September 30, 2010 and 2009. Provision for bad debts as a percentage of net operating revenues, increased 0.1% to 12.4% for the three months ended September 30, 2010, compared to 12.3% for the three months ended September 30, 2009. Supplies, as a percentage of net operating revenues, decreased 0.3% to 13.6% for the three months ended September 30, 2010, as compared to 13.9% for the three months ended September 30, 2009. This decrease in supplies is due primarily to improved pricing under our group purchasing program. Other operating expenses, as a percentage of net operating revenues, increased 0.2% to 18.6% for the three months ended September 30, 2010, as compared to 18.4% for the three months ended September 30, 2009. This increase is due primarily to an increase in costs associated with new provider tax or hospital fee programs offset by decreases in costs associated with contract labor and malpractice claims. Rent, as a percentage of net operating revenues, remained consistent at 2.0% for each of the three-month periods ended September 30, 2010 and 2009. Equity in earnings of unconsolidated affiliates, as a percentage of net operating revenues, increased 0.1% to 0.3% for the three months ended September 30, 2010, compared to 0.2% for the three months ended September 30, 2009.
Each of income from continuing operations and net income, as a percentage of net operating revenues, increased from 2.4% for the three months ended September 30, 2009 to 2.6% for the three months ended September 30, 2010. The increase in both income from continuing operations and net income, as a percentage of net operating revenues, is primarily a result of the 0.2% decrease of our interest expense as a percentage of net operating revenues.
Net income attributable to noncontrolling interests as a percentage of net operating revenues decreased 0.1% to 0.4% for the three months ended September 30, 2010, as compared to 0.5% for the three months ended September 30, 2009.
Operating expenses, excluding depreciation and amortization, as a percentage of net operating revenues, decreased 0.1% to 86.6% for the nine months ended September 30, 2010, compared to 86.7% for the nine months ended September 30, 2009. Salaries and benefits, as a percentage of net operating revenues, increased 0.1% to 40.2% for the nine months ended September 30, 2010, compared to 40.1% for the nine months ended September 30, 2009. Provision for bad debts, as a percentage of net operating revenues, increased 0.1% to 12.1% for the nine months ended September 30, 2010, compared to 12.0% for the nine months ended September 30, 2009. Supplies, as a percentage of net operating revenues, decreased 0.2% to 13.7% for the nine months ended September 30, 2010, as compared to 13.9% for the nine months ended September 30, 2009. This decrease in supplies is due primarily to improved pricing under our group purchasing program. Other operating expenses, as a percentage of net operating revenues, decreased 0.1% to 18.6% for the nine months ended September 30, 2010, as compared to 18.7% for the nine months ended September 30, 2009. Rent, as a percentage of net operating revenues, remained consistent at 2.0% for each of the nine-month periods ended September 30, 2010 and 2009. Equity in earnings of unconsolidated affiliates, as a percentage of net operating revenues, decreased 0.1% to 0.3% for the nine months ended September 30, 2010, compared to 0.4% for the nine months ended September 30, 2009.
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Community Health Systems Inc. has a market cap of $2.78 billion; its shares were traded at around $29.29 with a P/E ratio of 10.3 and P/S ratio of 0.2. Community Health Systems Inc. had an annual average earning growth of 21.9% over the past 10 years. GuruFocus rated Community Health Systems Inc. the business predictability rank of 3.5-star.CYH is in the portfolios of Richard Snow of Snow Capital Management, L.P., Ron Baron of Baron Funds, Steven Cohen of SAC Capital Advisors, George Soros of Soros Fund Management LLC, Jeremy Grantham of GMO LLC.
Highlight of Business Operations:
Self-pay revenues represented approximately 11.8% and 11.3% of our net operating revenues for the three months ended September 30, 2010 and 2009, respectively, and 11.6% and 11.2% of our net operating revenues for the nine months ended September 30, 2010 and 2009, respectively. The value of charity care services relative to total net operating revenues was approximately 4.3% and 4.0% for the three months ended September 30, 2010 and 2009, respectively, and approximately 4.2% and 3.8% for the nine months ended September 30, 2010 and 2009, respectively.The payment rates under the Medicare program for hospital inpatient and outpatient acute care services are based on a prospective payment system, depending upon the diagnosis of a patients condition. These rates are indexed for inflation annually, although increases have historically been less than actual inflation. On August 16, 2010, CMS issued the final rule to adjust this index by 2.6% for hospital inpatient acute care services that are reimbursed under the prospective payment system. The final rule also makes other payment adjustments that, coupled with the 0.25% reduction to hospital inpatient rates implemented pursuant to the Reform Legislation referred to below, yield a net 0.4% reduction in reimbursement for hospital inpatient acute care services beginning October 1, 2010. The Reform Legislation implemented a 0.25% reduction to hospital inpatient rates effective April 1, 2010 and 0.25% reductions to hospital outpatient rates effective January 1, 2010 and January 1, 2011. Reductions in the rate of increase or overall reductions in Medicare reimbursement may cause a decline in the growth of our net operating revenues.
Operating expenses, excluding depreciation and amortization, as a percentage of net operating revenues, remained consistent at 86.7% for each of the three-month periods ended September 30, 2010 and 2009. Salaries and benefits, as a percentage of net operating revenues, remained consistent at 40.1% for each of the three-month periods ended September 30, 2010 and 2009. Provision for bad debts as a percentage of net operating revenues, increased 0.1% to 12.4% for the three months ended September 30, 2010, compared to 12.3% for the three months ended September 30, 2009. Supplies, as a percentage of net operating revenues, decreased 0.3% to 13.6% for the three months ended September 30, 2010, as compared to 13.9% for the three months ended September 30, 2009. This decrease in supplies is due primarily to improved pricing under our group purchasing program. Other operating expenses, as a percentage of net operating revenues, increased 0.2% to 18.6% for the three months ended September 30, 2010, as compared to 18.4% for the three months ended September 30, 2009. This increase is due primarily to an increase in costs associated with new provider tax or hospital fee programs offset by decreases in costs associated with contract labor and malpractice claims. Rent, as a percentage of net operating revenues, remained consistent at 2.0% for each of the three-month periods ended September 30, 2010 and 2009. Equity in earnings of unconsolidated affiliates, as a percentage of net operating revenues, increased 0.1% to 0.3% for the three months ended September 30, 2010, compared to 0.2% for the three months ended September 30, 2009.
Each of income from continuing operations and net income, as a percentage of net operating revenues, increased from 2.4% for the three months ended September 30, 2009 to 2.6% for the three months ended September 30, 2010. The increase in both income from continuing operations and net income, as a percentage of net operating revenues, is primarily a result of the 0.2% decrease of our interest expense as a percentage of net operating revenues.
Net income attributable to noncontrolling interests as a percentage of net operating revenues decreased 0.1% to 0.4% for the three months ended September 30, 2010, as compared to 0.5% for the three months ended September 30, 2009.
Operating expenses, excluding depreciation and amortization, as a percentage of net operating revenues, decreased 0.1% to 86.6% for the nine months ended September 30, 2010, compared to 86.7% for the nine months ended September 30, 2009. Salaries and benefits, as a percentage of net operating revenues, increased 0.1% to 40.2% for the nine months ended September 30, 2010, compared to 40.1% for the nine months ended September 30, 2009. Provision for bad debts, as a percentage of net operating revenues, increased 0.1% to 12.1% for the nine months ended September 30, 2010, compared to 12.0% for the nine months ended September 30, 2009. Supplies, as a percentage of net operating revenues, decreased 0.2% to 13.7% for the nine months ended September 30, 2010, as compared to 13.9% for the nine months ended September 30, 2009. This decrease in supplies is due primarily to improved pricing under our group purchasing program. Other operating expenses, as a percentage of net operating revenues, decreased 0.1% to 18.6% for the nine months ended September 30, 2010, as compared to 18.7% for the nine months ended September 30, 2009. Rent, as a percentage of net operating revenues, remained consistent at 2.0% for each of the nine-month periods ended September 30, 2010 and 2009. Equity in earnings of unconsolidated affiliates, as a percentage of net operating revenues, decreased 0.1% to 0.3% for the nine months ended September 30, 2010, compared to 0.4% for the nine months ended September 30, 2009.
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