On Monday, HCA Holdings, Inc. (NYSE:HCA) announced its second quarter 2012 results. It was also responding to reports that authorities were examining the possibility that HCA was performing unnecessary cardiac procedures and/or engaging in improper billing practices.
HCA “owns and operates approximately 163 hospitals and approximately 109 freestanding surgery centers in 20 states and London, England.” Headquartered in Nashville, Tennessee, HCA has a long and storied past – associated with prominent politicians and at least one well-publicized scandal.
HCA was founded in the 1960s by a group led by Dr. Thomas Frist, Sr., the father of former U.S. Senate Majority Leader Bill Frist. Over the years it has gone public, private, public, private and finally public for a third time. Over this time it’s also been relatively active in mergers, acquisitions and spin-offs.
In 1994, HCA merged with Columbia Hospital Corporation, which had been co-founded by Rick Scott, the current governor of Florida. With Scott as Chairman and CEO of what had become known as Columbia/HCA, the company became involved in a wide-ranging frauds which included improper billing practices. Columbia/HCA eventually plead guilty to over a dozen felonies and paid $100s of millions in fines. Mr. Scott was forced out and the company was renamed HCA.
In the current controversies, the company reported that the U.S. Department of Justice will be reviewing billing and medical records related to implantable cardio-defibrillators at 95 of its hospitals. This is reportedly part of a nationwide review. In addition, the U.S. Attorney’s office in Miami separately has requested information on evaluations assessing the medical necessity of a variety of cardiology services performed at HCA-affiliated hospitals. At this time HCA is unable to predict the potential effect, if any, of these reviews.