Profit rises for LV hospital owner

Michelle Swafford

Thursday, Feb. 19, 2004 | 11:14 a.m.

Universal Health Services Inc., owner of four Las Vegas Valley hospitals, Wednesday reported a 6 percent increase in its profit for the fourth quarter.

The owner of Valley, Desert Springs, Summerlin and Spring Valley hospitals reported net income of $46.4 million, or 75 cents per share, up from $43.8 million, or 69 cents, in the year-ago quarter.

Universal Health, based in King of Prussia, Pa., reported fourth-quarter revenue of $949.4 million, up from $835.4 million in the year-ago quarter.

In mid-morning trading today, UHS shares were down 43 cents at $54.93 per share.

The Las Vegas market continues to be hot for the hospital operator, which operated 25 acute-care hospitals and 39 behavioral-health hospitals in the United States and Puerto Rico during the fourth quarter. Since then, the company opened Spring Valley Hospital Medical Center on Oct. 2 in southwest Las Vegas.

The 170-bed hospital is off to a solid start and has already opened its third floor to provide 35 additional beds, giving the hospital 135 beds in operation. The hospital will likely open 35 more beds on the fourth floor in 2004 and is awaiting licensure of a nursery for premature babies with complications.

Spring Valley isn't the only Universal Health hospital expanding to keep up with strong population growth in the Las Vegas area. Summerlin Hospital Medical Center is building a patient tower with 90 beds that is scheduled to open by summer. Valley Hospital Medical Center is upgrading some of its equipment and expanding its emergency room by 28 beds, bringing the total to 56 beds for emergency care. Desert Springs Hospital plans to upgrade its diagnostic equipment and its emergency room. It will also expand its services in 2004 with a 40-bed, long-term acute care unit and women's services, minus obstetrics.

Universal Health also announced plans last quarter to build a fifth hospital in the Las Vegas Valley. No timeline or size information has been released for the hospital planned for the intersection of I-215 and U.S. 95 in the Montecito Town Center.

Nationally, Universal Health increased its bed count by 297. But patient admissions on hospitals that had been owned for more than one year declined by 2.5 percent.

The number of days a patient occupied a bed rose 1.5 percent, meaning patients were sicker and in the hospital longer.

Local admissions and patient-days information was not available, but the hospitals say they are often near capacity because of the population growth and an overall shortage of beds in the valley.

The company spent more than $278 million on hospital acquisitions last year and said it will continue to look for opportunities.

Another highlight of Universal's earnings was an increase in doubtful accounts, which rose from 6.9 percent to 7.8 percent of revenue during the quarter. The company said this is primarily because of an increase in uninsured and self-pay patients, which affects the company's ability to collect on patient accounts.

Universal said it expects that trend to continue until the labor market improves.