(Adds analyst, CEO comments)
By Susan Kelly
May 4 (Reuters) - Hospital operator Tenet Healthcare Corp on Monday posted a net profit in the first quarter, compared with a year-ago loss, as more people with health insurance used its facilities.
The third-largest U.S. for-profit hospital chain said the number of uninsured and charity patients it treated continued to decline, while its paying admissions jumped 6.2 percent, reflecting growth in newly insured patients.
Hospitals are benefiting as the expansion of insurance to more Americans under the Affordable Care Act boosts demand for healthcare.
“We are seeing people able to sign up sooner and better able to navigate the systems and use the services,” said Mizuho Securities analyst Sheryl Skolnick.
Tenet rival HCA Holdings Inc, the largest U.S. hospital operator, last month cited stronger admissions in reporting preliminary results that beat market expectations.
Dallas, Texas-based Tenet posted first-quarter net income of $47 million, or 47 cents a share, compared with a net loss of $32 million, or 33 cents, a year earlier.
Earnings before interest, tax, depreciation and amortization, excluding special items, rose 37 percent to $529 million.
Tenet said its adjusted patient admissions, which include both inpatient and outpatient figures, climbed 5.9 percent from the same period a year ago, at its facilities operated for at least one year. Uninsured and charity admissions fell 13.9 percent.
Outpatient visits increased by 7.6 percent. Tenet is expanding its outpatient centers to capitalize on a broader move toward less-invasive procedures that is allowing more patients to avoid lengthy hospital stays. It is also upgrading its emergency departments to make them faster and more appealing, Tenet Chief Executive Trevor Fetter said in an interview.
“We’ve had very strong growth now for several quarters and that has continued. We think two-thirds of the growth is due to our strategies and our investments,” Fetter said.
Net operating revenue, after provision for doubtful accounts, rose 12.8 percent to $4.43 billion.
Tenet also confirmed its outlook for 2015 EBITDA, excluding special items, in a range of $2.05 billion to $2.15 billion.
Tenet’s shares rose about 2 percent in after-hours trading from a close of $49.49 Monday on the New York Stock Exchange. (Reporting by Susan Kelly in Chicago; Editing by Chris Reese and Cynthia Osterman)