TENET HEALTHCARE CORP
For the period ended Sep 30, 2026. Filed Oct 29, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Oct 29, 2026
THC$283.33-1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-07-29.
0000070318-26-000037
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-10-29.
0000070318-26-000050
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 177 previous paragraphs and 164 current paragraphs.
87 unchanged; 58 reworded; 19 added; 30 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 27 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
We remain focused on executing the strategies described in the Management Overview section of MD&A in our Annual Report, including expanding our Ambulatory Care segment, driving growth in our Hospital Operations segment, improving the customer care experience, improving profitability and managing our capital structure. For additional information regarding these strategies, refer to the above‑referenced section in our Annual Report.
Current report
We continue to pursue advantageous opportunities to grow our portfolio of hospitals and other healthcare facilities. In August 2026, we expanded our footprint in Nacogdoches, Texas, with the opening of the 210‑bed Nacogdoches Medical Center South Campus, as well as a 21‑bed inpatient rehabilitation center.
Current report
Additionally, we previously entered into certain agreements with Catholic Health Initiatives (“CHI”), now known as CommonSpirit Health, relating to Conifer, whereby the parties agreed, in part, to the early conclusion and transition of our revenue cycle management services by December 31, 2026 (collectively, the “CHI Agreements”). During the three months ended September 30, 2026, we assessed the periods over which we expect to satisfy the performance obligations under the CHI Agreements based on our current transition progress. We will substantially complete the transition by October 30, 2026 rather than December 31, 2026, as originally expected. As a result, in the three months ended September 30, 2026, we recognized a cumulative catch-up adjustment that increased net operating revenues by $97 million. See Note 1 to the accompanying Condensed Consolidated Financial Statements for additional information regarding the CHI Agreements.
Current report
•Net proceeds from the issuance of an aggregate principal amount of $2.000 billion of our 6.250% senior unsecured notes due September 2034 (the “2034 Senior Notes”);
Current report
•The redemption, using the issuance proceeds and cash on hand, of all $1.500 billion in aggregate principal amount of our 5.125% senior secured first lien notes due November 2027 (the “2027 Senior Secured First Lien Notes”) and the redemption of $500 million of the then-outstanding $1.750 billion aggregate principal amount of our 6.125% senior unsecured notes due October 2028 (the “2028 Senior Notes”);
Current report
•Aggregate payments of $255 million to purchase 970 thousand shares of our common stock;
Current report
•Capital expenditures totaling $198 million;
Current report
•Income tax payments of $163 million; and
Current report
•Interest payments of $99 million.
Current report
The Centers for Medicare & Medicaid Services (“CMS”), an agency of the U.S. Department of Health and Human Services, administers Medicare and co-administers with the individual states both Medicaid and the Children’s Health Insurance Program. A significant portion of our patient volumes and revenues is derived from government healthcare programs; changes in eligibility, coverage, funding and reimbursement under these programs may affect our patient volumes, payer mix, revenues and cash flows.
Current report
•A market basket increase of 3.2% for Medicare severity‑adjusted diagnosis‑related groups (“MS‑DRG”) operating payments for hospitals reporting specified quality measure data and that are meaningful users of electronic health record technology; CMS also finalized a 0.9% multifactor productivity reduction required by the Affordable Care Act that results in a net operating payment update of 2.3% before budget neutrality adjustments;
Current report
•An increase in the cost outlier threshold from $40,397 to $49,346;
Current report
•A 3.0% net increase in the capital federal MS‑DRG rate; and
Current report
•Updates to the three factors used to determine the amount and distribution of Medicare uncompensated care disproportionate share hospital payments.
Current report
Same‑hospital net operating revenues increased by $247 million, or 6.2%, and by $496 million, or 4.1%, during the three and nine months ended September 30, 2026, respectively, driven by higher patient volumes as well as continued pricing strength, partially offset by a less favorable payer mix. Additionally, during the three months ended September 30, 2026, we recognized cumulative catch-up adjustments associated with the CHI Agreements that increased net operating revenues by $97 million.
Current report
Same‑hospital salaries, wages and benefits expense decreased by $44 million, or 2.3%, in the three months ended September 30, 2026, primarily due to higher employee benefits cost during the 2025 period. Same‑hospital salaries, wages and benefits expense as a percentage of net operating revenues decreased by 380 basis points to 43.4% in the three months ended September 30, 2026.
Current report
Other operating expenses increased by $13 million, or 6.7%, during the three months ended September 30, 2026. The change was driven by (1) a $7 million increase in same‑facility other operating expenses and (2) a $6 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities. Other operating expenses as a percentage of net operating revenues in the three months ended September 30, 2026 was generally consistent with the same period in 2025 at 15.0%.
Current report
Net cash used in investing activities decreased by $68 million, or 8%, during the nine months ended September 30, 2026 compared to the same period in 2025. This decrease was primarily attributable to (1) lower capital expenditures, largely related to the completion of our Florida Coast Medical Center in September 2025, and (2) lower spending on acquisitions of controlling interests in businesses and joint ventures due to the timing of transactions, partially offset by (3) an increase in expenditures for marketable securities and long-term investments, reflecting the investment of funds held for insurance-related obligations and increased equity investments to support the continued growth of our Ambulatory Care segment.
Current report
Net cash used in financing activities increased by $931 million, or 47%, during the nine months ended September 30, 2026 compared to the same period in 2025. This increase was primarily due to Conifer’s redemption of CHI’s minority interest effective January 1, 2026 and an increase in cash used to purchase our common stock during the 2026 period. Financing activities in 2026 also included the issuance of our 2034 Senior Notes, the net proceeds from which, together with cash on hand, were used to finance the redemption of all of our 2027 Senior Secured First Lien Notes and the partial redemption of our 2028 Senior Notes. These transactions reduced our secured debt and refinanced a portion of our near-term maturities with notes due in 2034. For additional information, see Note 5 to the accompanying Condensed Consolidated Financial Statements.
Removed paragraphs (30)
Previous report
Expanding Our Ambulatory Care Segment—We continue to focus on opportunities to expand our Ambulatory Care segment through acquisitions, organic growth in our physician relationships and service lines, construction of new outpatient centers and strategic partnerships. We believe USPI’s ASCs and surgical hospitals offer many advantages to patients and physicians, including greater affordability, predictability, flexibility and convenience. Moreover, due in part to advancements in surgical techniques, medical technology and anesthesia, as well as the lower cost structure and greater efficiencies that are attainable at a specialized outpatient site, we believe the volume and complexity of surgical cases performed in an outpatient setting will continue to increase over time. Historically, our outpatient services have generated significantly higher margins for us than inpatient services.
Previous report
Driving Growth in Our Hospital Operations Segment—We remain committed to better positioning our hospitals and competing more effectively in the ever‑evolving healthcare environment by focusing on driving performance through operational effectiveness, investing in our physician enterprise, particularly our specialist network, enhancing patient and physician satisfaction, growing our higher‑demand clinical service lines, expanding patient and physician access, and optimizing our portfolio of assets. We believe our efforts in these areas improve the quality of care we deliver and enhance growth.
Previous report
Improving the Customer Care Experience—As consumers continue to become more engaged in managing their health, we recognize that understanding what matters most to them and earning their loyalty is imperative to our success. As such, we have enhanced our focus on treating our patients as traditional customers by: (1) establishing networks of physicians and facilities that provide convenient access to services across the care continuum; (2) expanding service lines aligned with growing community demand, including a focus on aging and chronic disease patients; (3) offering greater affordability and predictability, including simplified registration and discharge procedures, particularly in our outpatient centers; (4) improving our culture of service; and (5) offering health programs and educational materials tailored to meet the needs of the communities we serve.
Previous report
Recent advancements in technology and applications in healthcare have allowed us to accelerate the adoption of artificial intelligence (“AI”) and Generative AI-enabled tools in areas such as clinical care coordination, medical documentation, revenue cycle management and administrative services. When used responsibly, we believe AI has the potential to enhance our business processes and support efficient delivery of high‑quality care.
Previous report
Improving Profitability—We continue to focus on growing patient volumes and effective cost management as a means to improve profitability. We believe that emphasis on higher‑demand clinical service lines, focus on expanding our ambulatory care business, cultivation of our culture of service and utilization of contracting strategies that create shared value with payers should help us grow our patient volumes over time. We are also continuing to pursue new opportunities to enhance efficiency, including further integration of enterprise‑wide centralized support functions, outsourcing additional functions unrelated to direct patient care and reducing clinical contract variation.
Previous report
Managing Our Capital Structure—All of our long‑term debt has a fixed rate of interest, except for outstanding borrowings under our senior secured revolving credit facility (the “Credit Agreement”), of which we had none at June 30, 2026. In addition, the maturity dates of our notes are staggered from 2027 through 2033. We believe that our capital structure helps to minimize the near‑term impact of increases in interest rates, and the staggered maturities of our debt allow us to retire or refinance our debt over time.
Previous report
•$1.042 billion of payments to purchase 5.675 million shares of our common stock;
Previous report
•Interest payments of $341 million;
Previous report
•$322 million of income tax payments;
Previous report
•$168 million of capital expenditures.
Previous report
The Centers for Medicare & Medicaid Services (“CMS”) is an agency of the U.S. Department of Health and Human Services that administers a number of government programs authorized by federal law; it is the single largest payer of healthcare services in the United States. Medicare is a federally funded health insurance program primarily for individuals 65 years of age and older, as well as some younger people with certain disabilities and conditions, and is provided without regard to income or assets. Medicaid is co‑administered by the states and is jointly funded by the federal government and state governments. Medicaid is the nation’s main public health insurance program for people with low incomes and is the largest source of health coverage in the United States. The Children’s Health Insurance Program (“CHIP”), which is also co‑administered by the states and jointly funded, provides health coverage to children in families with incomes too high to qualify for Medicaid, but too low to afford private coverage. Unlike Medicaid, the CHIP is limited in duration and requires the enactment of reauthorizing legislation. Funding for the CHIP has been reauthorized through federal fiscal year (“FFY”) 2029.
Previous report
During the three and six months ended June 30, 2026, we recognized $413 million and $826 million, respectively, of revenue related to the termination of the revenue cycle management agreement between Catholic Health Initiatives (“CHI”), now known as CommonSpirit Health, and Conifer. See Note 1 to the accompanying Condensed Consolidated Financial Statements for additional information regarding this transaction.
Previous report
Same‑hospital net operating revenues increased by $241 million, or 6.1%, during the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was primarily attributable to higher patient volumes, partially offset by a less favorable payer mix, during the 2026 period.
Previous report
Same‑hospital net operating revenues increased by $247 million, or 3.1%, during the six months ended June 30, 2026 compared to the same period in 2025. This change was primarily driven by the same factors discussed above.
Previous report
Same‑hospital salaries, wages and benefits expense increased by $51 million, or 1.4%, in the six months ended June 30, 2026 compared to the same period in 2025. This increase was primarily attributable to the same factors discussed above. Same‑hospital salaries, wages and benefits expense as a percentage of net operating revenues decreased by 80 basis points to 45.1% in the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Previous report
Same‑hospital supplies expense increased by $26 million, or 2.2%, in the six months ended June 30, 2026 compared to the same period in 2025. This increase was driven by the same factors described above. Same‑hospital supplies expense as a percentage of net operating revenues in the six months ended June 30, 2026 was generally consistent with the same period in 2025 at 14.7%.
Previous report
Same‑hospital other operating expenses increased by $76 million, or 4.2%, in the six months ended June 30, 2026 compared to the same period in 2025. In addition to the factors discussed above, this change was also attributable to higher professional and consulting fees during the 2026 period. Same‑hospital other operating expenses as a percentage of net operating revenues in the six months ended June 30, 2026 was generally consistent with the same period in 2025 at 22.7%.
Previous report
Other operating expenses increased by $18 million, or 9.7%, during the three months ended June 30, 2026 compared to the same period in 2025. The change was driven by (1) a $10 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) an $8 million increase in same‑facility other operating expenses. Other operating expenses as a percentage of net operating revenues in the three months ended June 30, 2026 was generally consistent with the same period in 2025 at 14.6%.
Previous report
Income Tax Expense
Previous report
A reconciliation between the amount of reported income tax expense and the amount computed by multiplying income before income taxes by the statutory federal tax rate is presented below.
Previous report
Income before income taxes for the six months ended June 30, 2026 and 2025 was $2.472 billion and $1.407 billion, respectively. The change in our valuation allowance during each of the six-month periods in 2026 and 2025 was attributable to a decrease related to changes in the realizability of deferred tax assets, partially offset by an increase related to interest expense carryforwards.
Previous report
Net cash used in investing activities was $520 million during the six months ended June 30, 2026 compared to $501 million during the six months ended June 30, 2025. The change between the 2026 and 2025 periods was primarily attributable to an increase in purchases of marketable securities and long-term investments of $39 million, partially offset by decreases in capital expenditures and payments for purchases of businesses or joint venture interests of $18 million and $17 million, respectively, during the 2026 period.
Previous report
Net cash used in financing activities was $2.419 billion and $1.644 billion during the six months ended June 30, 2026 and 2025, respectively. The change between the 2026 and 2025 periods was primarily attributable to (1) Conifer’s redemption of CHI’s minority equity interest effective January 1, 2026, which transaction was the primary driver of a $479 million increase in payments for purchases of noncontrolling interests, and (2) an increase of $265 million in purchases of our common stock, in each case during the 2026 period.
Previous report
We have not relied on commercial paper or other short-term financing arrangements or entered into repurchase agreements or other short-term financing arrangements not otherwise reported in our balance sheet. In addition, we do not have significant exposure to floating interest rates given that all of our current long-term indebtedness has fixed rates of interest except for borrowings, if any, under our Credit Agreement.
Previous report
We consider our critical accounting estimates to be those that (1) involve significant judgments and uncertainties, (2) require estimates that are more difficult for management to determine, and (3) may produce materially different outcomes under different conditions or when using different assumptions. Our critical accounting estimates cover the following areas:
Previous report
•Recognition of net operating revenues, including contractual allowances and implicit price concessions;
Previous report
•Accruals for general and professional liability risks;
Previous report
•Impairment of long‑lived assets;
Previous report
•Impairment of goodwill; and
Previous report
•Accounting for income taxes.
Reworded paragraphs (58)
Previous wording
Our business consists of our Hospital Operations and Services (“Hospital Operations”) segment and our Ambulatory Care segment. Our Hospital Operations segment is comprised of our acute care and specialty hospitals, a network of employed physicians and ancillary outpatient facilities. At June 30, 2026, our subsidiaries operated 50 hospitals serving primarily urban and suburban communities in eight states. Our Hospital Operations segment also included 135 outpatient facilities, including urgent care centers, imaging centers, off-campus hospital emergency departments and micro‑hospitals, at June 30, 2026. In addition, our Hospital Operations segment provides revenue cycle management and value-based care services to hospitals and other healthcare facilities, health systems, physician practices, employers and other clients through Conifer Health Solutions, LLC (“Conifer”).
Current wording
Our business consists of our Hospital Operations and Services (“Hospital Operations”) segment and our Ambulatory Care segment. Our Hospital Operations segment is comprised of our acute care and specialty hospitals, a network of employed physicians and ancillary outpatient facilities. At September 30, 2026, our subsidiaries operated 51 hospitals serving primarily urban and suburban communities in eight states. Our Hospital Operations segment also included 135 outpatient facilities, including urgent care centers, imaging centers, off-campus hospital emergency departments and micro‑hospitals, at September 30, 2026. In addition, our Hospital Operations segment provides revenue cycle management and value-based care services to hospitals and other healthcare facilities, health systems, physician practices, employers and other clients through Conifer Health Solutions, LLC (“Conifer”).
Previous wording
Our Ambulatory Care segment, through USPI Holding Company, Inc. (together with its subsidiaries, “USPI”), held ownership interests in 538 ambulatory surgery centers (each, an “ASC”), 405 of which are consolidated, and 26 surgical hospitals, eight of which are consolidated, in 37 states at June 30, 2026. USPI’s facilities offer a range of procedures and service lines, including, among other specialties: orthopedics, total joint replacement, and spinal and other musculoskeletal procedures; gastroenterology; pain management; otolaryngology (ear, nose and throat); ophthalmology; and urology.
Current wording
Our Ambulatory Care segment, through USPI Holding Company, Inc. (together with its subsidiaries, “USPI”), held ownership interests in 535 ambulatory surgery centers (each, an “ASC”), 406 of which are consolidated, and 25 surgical hospitals, seven of which are consolidated, in 37 states at September 30, 2026. USPI’s facilities offer a range of procedures and service lines, including, among other specialties: orthopedics, total joint replacement, and spinal and other musculoskeletal procedures; gastroenterology; pain management; otolaryngology (ear, nose and throat); ophthalmology; and urology.
Previous wording
In certain cases, information presented in MD&A for our Hospital Operations segment is described as presented on a same‑hospital basis, which includes facilities we operated for the entirety of the periods presented. For the six-month periods ended June 30, 2026 and 2025, information presented on a same‑hospital basis includes the results of our same 49 hospitals and those outpatient centers we operated throughout both periods, and excludes the results of: Florida Coast Medical Center, the acute care hospital we opened in Florida in September 2025; businesses classified as discontinued operations for accounting purposes during those periods; and other ancillary facilities acquired or divested during the reporting periods that have a limited financial or operational impact. We present same‑hospital data because we believe it provides investors with useful information regarding the performance of our current portfolio of hospitals and other operations that are comparable for the periods presented. Furthermore, same‑hospital data may more clearly reflect recent trends we are experiencing with respect to volumes, revenues and expenses exclusive of variations caused by the addition or disposition of individual hospitals and other operations.
Current wording
In certain cases, information presented in MD&A for our Hospital Operations segment is described as presented on a same‑hospital basis, which includes facilities we operated for the entirety of the periods presented. For the nine-month periods ended September 30, 2026 and 2025, information presented on a same‑hospital basis includes the results of our same 49 hospitals and those outpatient centers we operated throughout both periods, and excludes the results of: Nacogdoches Medical Center South Campus, the acute care hospital we opened in Texas in August 2026; Florida Coast Medical Center, the acute care hospital we opened in Florida in September 2025; businesses classified as discontinued operations for accounting purposes during those periods; and other ancillary facilities acquired or divested during the reporting periods that have a limited financial or operational impact. We present same‑hospital data because we believe it provides investors with useful information regarding the performance of our current portfolio of hospitals and other operations that are comparable for the periods presented. Furthermore, same‑hospital data may more clearly reflect recent trends we are experiencing with respect to volumes, revenues and expenses exclusive of variations caused by the addition or disposition of individual hospitals and other operations.
Previous wording
In the Management Overview section of MD&A in our Annual Report on Form 10-K for the year ended December 31, 2025 (“Annual Report”), we described several key trends that continue to impact the healthcare industry, along with other factors affecting our business environment and operations, including the potential impact of changes in federal and state healthcare laws, regulations, funding policies and reimbursement practices. We continue to monitor developments affecting Medicaid funding, health insurance marketplace enrollment and payer mix, as well as the influence of geopolitical dynamics, trade tensions, tariffs and export control rules on pricing and availability within global supply chains. These challenges underscore the importance of operational discipline and adaptive cost management as we navigate the evolving healthcare landscape.
Current wording
In the Management Overview section of MD&A in our Annual Report on Form 10-K for the year ended December 31, 2025 (“Annual Report”), we described several key trends that continue to impact the healthcare industry, along with other factors affecting our business environment and operations, including the potential impact of changes in federal and state healthcare laws, regulations, funding policies and reimbursement practices. We continue to monitor developments affecting Medicaid funding, health insurance marketplace enrollment and payer mix. Thus far in 2026, we have experienced a decrease in admissions among patients with coverage through health insurance exchanges, resulting in an unfavorable shift in our payer mix. We are also monitoring broader economic conditions, including inflationary pressures and the influence of geopolitical dynamics, trade tensions, tariffs and export control rules on pricing and availability within global supply chains. These challenges underscore the importance of operational discipline and adaptive cost management as we navigate the evolving healthcare landscape.
Previous wording
Our ability to execute on our strategies and respond to the aforementioned trends in the current operating environment is subject to numerous risks and uncertainties, all of which may cause actual results to be materially different from expectations. For information about risks and uncertainties that could affect our results of operations, see the Forward‑Looking Statements and Risk Factors sections in Part I of our Annual Report.
Current wording
Our ability to execute on our strategies and respond to trends in the current operating environment is subject to numerous risks and uncertainties, all of which may cause actual results to be materially different from expectations. For information about risks and uncertainties that could affect our results of operations, see the Forward‑Looking Statements and Risk Factors sections in Part I of our Annual Report.
Previous wording
The following table presents selected operating statistics for our Hospital Operations and Ambulatory Care segments on a continuing operations basis:
Current wording
The following table presents selected operating statistics for our Hospital Operations and Ambulatory Care segments on a continuing operations basis. Unless otherwise indicated, comparisons of results of operations for the three months ended September 30, 2026 are to the corresponding period in 2025.
Previous wording
The 5.3% increase in our Ambulatory Care segment’s total consolidated cases in the three months ended June 30, 2026, as compared to the same period in 2025, was primarily attributable to incremental case volume from our 2025 and 2026 acquisitions and de novo development, partially offset by a decrease in same-facility case volume and the impact of the closure and sale of certain facilities.
Current wording
Total admissions increased by 3,938, or 3.3%, total emergency department visits increased by 24,384, or 4.6%, and charity and uninsured admissions increased by 1,401, or 26.0%, in the three months ended September 30, 2026. The 3.5% increase in our Ambulatory Care segment’s total consolidated cases in the three months ended September 30, 2026 was primarily attributable to incremental case volume from our 2025 and 2026 acquisitions and de novo development, partially offset by a decrease in same-facility case volume and the impact of the closure and sale of certain facilities.
Previous wording
Consolidated net operating revenues increased by $357 million, or 6.8%, in the three months ended June 30, 2026 compared to the same period in 2025. The increase of $239 million, or 6.0%, in our Hospital Operations segment’s net operating revenues for the three‑month period in 2026, as compared to the same period in 2025, was primarily attributable to higher patient volumes, partially offset by a less favorable payer mix, during the 2026 period.
Current wording
Consolidated net operating revenues increased by $342 million, or 6.5%, in the three months ended September 30, 2026. The increase of $246 million, or 6.1%, in our Hospital Operations segment’s net operating revenues for the three‑month period in 2026 was driven by higher patient volumes as well as continued pricing strength, partially offset by a less favorable payer mix.
Previous wording
Net operating revenues in our Ambulatory Care segment increased by $118 million, or 9.3%, in the three months ended June 30, 2026 compared to the same period in 2025. This change was primarily driven by our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities. Same-facility revenue growth, driven byincremental revenue from negotiated commercial rate increases, higher patient acuity and the addition of new service lines, also contributed to this increase.
Current wording
Net operating revenues in our Ambulatory Care segment increased by $96 million, or 7.5%, in the three months ended September 30, 2026. This change was primarily driven by our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities. Same-facility revenue growth, driven by incremental revenue from negotiated commercial rate increases and the addition of new service lines, also contributed to this increase.
Previous wording
Salaries, wages and benefits expense for our Hospital Operations segment increased by $47 million, or 2.5%, in the three months ended June 30, 2026 compared to the same period in 2025. This increase was primarily attributable to annual merit increases for certain of our employees and higher incentive compensation expense, partially offset by a decrease in health benefits cost as compared to the 2025 period. On a per adjusted admission basis, salaries, wages and benefits expense decreased by 0.6% in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Current wording
Salaries, wages and benefits expense for our Hospital Operations segment decreased by $40 million, or 2.1%, in the three months ended September 30, 2026 primarily due to higher employee benefits cost in the 2025 period, partially offset by higher incentive compensation expense in the 2026 period. On a per adjusted admission basis, salaries, wages and benefits expense decreased by 5.7% in the three months ended September 30, 2026.
Previous wording
Supplies expense for our Hospital Operations segment increased by $15 million, or 2.5%, during the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This change was primarily due to higher patient volumes during the 2026 period, partially offset by our continued focus on cost‑efficiency measures. These measures include product standardization, contract management, improved utilization, bulk purchases, focused spending and operational improvements, among others. On a per adjusted admission basis, supplies expense decreased by 0.7% in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Current wording
Supplies expense for our Hospital Operations segment increased by $22 million, or 3.7%, during the three months ended September 30, 2026. This change was primarily due to higher patient volumes during the 2026 period, partially offset by our continued focus on cost‑efficiency measures. These measures include product standardization, contract management, improved utilization, bulk purchases, focused spending and operational improvements, among others. On a per adjusted admission basis, supplies expense during the three months ended September 30, 2026 was generally consistent with the same period in 2025.
Previous wording
Other operating expenses for our Hospital Operations segment increased by $37 million, or 4.0%, in the three months ended June 30, 2026 compared to the same period in 2025. This increase was primarily attributable to increases in malpractice expense and medical fees during the 2026 period. On a per adjusted admission basis, other operating expenses increased by 0.8% in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Current wording
Other operating expenses for our Hospital Operations segment increased by $52 million, or 5.6%, in the three months ended September 30, 2026. This change was primarily attributable to increases in malpractice expense and medical fees during the 2026 period. On a per adjusted admission basis, other operating expenses increased by 1.8% in the three months ended September 30, 2026.
Previous wording
Cash and cash equivalents were $2.170 billion at June 30, 2026 compared to $2.967 billion at March 31, 2026. Significant cash flow items in the three months ended June 30, 2026 included:
Current wording
Cash and cash equivalents were $2.674 billion as of September 30, 2026 compared to $2.170 billion as of June 30, 2026. Significant cash flow items in the three months ended September 30, 2026 included:
Previous wording
•Net cash provided by operating activities before payments for interest, taxes, restructuring charges, acquisition‑related costs, and litigation costs and settlements of $1.275 billion;
Current wording
•Net cash provided by operating activities before payments for interest, taxes, restructuring charges, acquisition‑related costs, and litigation costs and settlements of $1.562 billion;
Previous wording
•Distributions paid to noncontrolling interests totaling $201 million; and
Current wording
•Distributions paid to noncontrolling interests totaling $216 million;
Previous wording
Net cash provided by operating activities was $2.226 billion in the six months ended June 30, 2026 compared to $1.751 billion in the six months ended June 30, 2025. Key factors contributing to the change between the 2026 and 2025 periods included the following:
Current wording
Net cash provided by operating activities was $3.507 billion in the nine months ended September 30, 2026 compared to $2.809 billion in the nine months ended September 30, 2025. Key factors contributing to the change between the 2026 and 2025 periods included the following:
Previous wording
•Interest payments that were $34 million lower in the 2026 period;
Current wording
•Interest payments that were $35 million lower in the 2026 period;
Previous wording
•An $88 million increase in income tax payments during the 2026 period; and
Current wording
•A $164 million increase in income tax payments during the 2026 period; and
Previous wording
•reductions to Medicare and Medicaid disproportionate share hospital (“DSH”) payments, which began for Medicare payments in FFY 2014 and, under current law, are scheduled to commence for Medicaid payments on October 1, 2027.
Current wording
•reductions to Medicare and Medicaid disproportionate share hospital (“DSH”) payments, which began for Medicare payments in federal fiscal year (“FFY”) 2014 and, under current law, are scheduled to commence for Medicaid payments on October 1, 2027.
Previous wording
Over the past several years, various laws and regulations lengthened the enrollment period, expanded income eligibility, and provided enhanced premium tax credits to eligible individuals purchasing Affordable Care Act coverage through state and federal health insurance marketplaces – all of which led to higher enrollment numbers, particularly in states that have not expanded Medicaid. Certain of these provisions expired at the end of 2025, resulting in significant increases in health insurance premiums and decreases in enrollment and insurance coverage. These changes have contributed to a rise in the number of uninsured and shifts of individuals from commercial coverage to government program coverage or other more limited coverage alternatives. As a result, we expect an adverse impact on our patient volumes, payer mix and revenues. We continue to monitor the extent to which decreases in insurance coverage will adversely affect these metrics and our overall results of operations.
Current wording
Over the past several years, various laws and regulations lengthened the enrollment period, expanded income eligibility, and provided enhanced premium tax credits to eligible individuals purchasing Affordable Care Act coverage through state and federal health insurance marketplaces – all of which led to higher enrollment numbers, particularly in states that have not expanded Medicaid. Certain of these provisions expired at the end of 2025, resulting in significant increases in health insurance premiums and decreases in enrollment and insurance coverage. These changes have contributed to a rise in the number of uninsured and shifts of individuals from commercial coverage to government program coverage or other more limited coverage alternatives. Thus far in 2026, we have experienced a decrease in admissions among patients with coverage through health insurance exchanges, resulting in an unfavorable shift in our payer mix. We continue to monitor the extent to which decreases in insurance coverage will adversely affect these metrics and our overall results of operations.
Previous wording
Our total net patient service revenues from the hospitals and related outpatient facilities in our Hospital Operations segment for services provided to patients enrolled in the Original Medicare Plan were $534 million and $530 million for the three months ended June 30, 2026 and 2025, respectively, and $1.099 billion and $1.078 billion for the six months ended June 30, 2026 and 2025, respectively. A general description of the types of payments we receive for services provided to patients enrolled in the Original Medicare Plan is provided in our Annual Report. Recent regulatory and legislative updates to the terms of these payment systems and their estimated effect on our revenues can be found under “Regulatory and Legislative Updates” below.
Current wording
Our total net patient service revenues from the hospitals and related outpatient facilities in our Hospital Operations segment for services provided to patients enrolled in the Original Medicare Plan were $532 million and $512 million for the three months ended September 30, 2026 and 2025, respectively, and $1.631 billion and $1.590 billion for the nine months ended September 30, 2026 and 2025, respectively. A general description of the types of payments we receive for services provided to patients enrolled in the Original Medicare Plan is provided in our Annual Report. Recent regulatory and legislative updates to the terms of these payment systems and their estimated effect on our revenues can be found under “Regulatory and Legislative Updates” below.
Previous wording
Medicaid programs and the corresponding reimbursement methodologies vary from state‑to‑state and from year‑to‑year. In addition to traditional Medicaid programs, we also receive DSH and other supplemental revenues under various state Medicaid programs. All Medicaid patient service revenue is presented net of provider taxes or assessments paid by our hospitals. During the three and six months ended June 30, 2026 and 2025, revenue from Medicaid programs included $447 million and $351 million, respectively, and $751 million and $677 million, respectively, of revenue attributable to DSH and other supplemental programs. Revenues from Medicaid programs constituted approximately 12% and 11% of the total net patient service revenues of our hospitals and related outpatient facilities for the six-month periods ended June 30, 2026 and 2025, respectively.
Current wording
Medicaid programs and the corresponding reimbursement methodologies vary from state‑to‑state and from year‑to‑year. In addition to traditional Medicaid programs, we also receive DSH and other supplemental revenues under various state Medicaid programs. All Medicaid patient service revenue is presented net of provider taxes or assessments paid by our hospitals. During the three and nine months ended September 30, 2026 and 2025, revenue from Medicaid programs included $356 million and $346 million, respectively, and $1.107 billion and $1.023 billion, respectively, of revenue attributable to DSH and other supplemental programs. Revenues from Medicaid programs constituted approximately 12% and 11% of the total net patient service revenues of our hospitals and related outpatient facilities for the nine-month periods ended September 30, 2026 and 2025, respectively.
Previous wording
Proposed Payment and Policy Changes to the Medicare Inpatient Prospective Payment Systems—Section 1886(d) of the Social Security Act requires CMS to update Medicare inpatient FFS payment rates for hospitals reimbursed under the inpatient prospective payment systems (“IPPS”) annually. The updates generally become effective October 1, the beginning of the FFY. In April 2026, CMS issued proposed changes to the Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and Fiscal Year 2027 Rates (“Proposed IPPS Rule”). According to CMS, the combined impact of the proposed payment and policy changes in the Proposed IPPS Rule for operating costs will yield an average 1.0% increase in Medicare operating payments for proprietary hospitals in FFY 2027.
Current wording
Payment and Policy Changes to the Medicare Inpatient Prospective Payment Systems—Section 1886(d) of the Social Security Act requires CMS to update Medicare inpatient FFS payment rates for hospitals reimbursed under the inpatient prospective payment systems (“IPPS”) annually. The updates generally become effective October 1, the beginning of the FFY. In August 2026, CMS issued final changes to the Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and Fiscal Year 2027 Rates, which release was later updated by CMS’ September 2026 issuance of the 2027 IPPS Final Rule Correction Notice to fix technical and typographical errors (both releases, the “Final IPPS Rule”). According to CMS, the combined impact of the payment and policy changes in the Final IPPS Rule for operating costs will yield an average 1.4% increase in Medicare operating payments for proprietary hospitals in FFY 2027. The Final IPPS Rule includes the following payment and policy changes, among others:
Previous wording
Proposed Payment and Policy Changes to the Medicare Outpatient Prospective Payment and Ambulatory Surgery Center Payment Systems—In July 2026, CMS released the proposed policy changes and payment rates for the Hospital Outpatient Prospective Payment System (“OPPS”) and Ambulatory Surgical Center Payment System for Calendar Year (“CY”) 2027 (“Proposed OPPS/ASC Rule”). CMS projects that the impact of the payment and policy changes in the Proposed OPPS/ASC Rule will yield an average 7.4% net increase in Medicare FFS OPPS payments for proprietary hospitals in CY 2027. The proposed net increase includes a reduction in overall Medicare FFS OPPS payments for proprietary hospitals due to CMS’ proposal to revise its November 2023 final rule entitled Hospital OPPS: Remedy for 340B-Acquired Drug Payment Policy for CYs 2018‑2022. In the prior rule, CMS proposed a reduction in non‑drug items and services by 0.5% per year until the prescribed payment reduction total had been recovered in full. This revised 340B remedy provision in the Proposed OPPS/ASC Rule updates the annual offset percentage for non-drug items and services from 0.5% to 3.0% starting in CY 2027; CMS estimates this increased offset will remain in effect through CY 2029. In addition, CMS projects that the impact of the payment and policy changes in the Proposed OPPS/ASC Rule will yield an average increase of 2.4% in Medicare FFS ASC payments.
Current wording
Proposed Payment and Policy Changes to the Medicare Outpatient Prospective Payment and Ambulatory Surgery Center Payment Systems—In July 2026, CMS released the proposed policy changes and payment rates for the Hospital Outpatient Prospective Payment System (“OPPS”) and Ambulatory Surgical Center Payment System for Calendar Year (“CY”) 2027 (“Proposed OPPS/ASC Rule”). CMS projects that the impact of the payment and policy changes in the Proposed OPPS/ASC Rule will yield an average 7.4% net increase in Medicare FFS OPPS payments for proprietary hospitals in CY 2027. The proposed net increase includes a favorable 340B Acquired Drug Cost Survey budget neutrality adjustment and a revision to the reduction in overall Medicare FFS OPPS payments due to CMS’ proposal to accelerate the annual offset percentage for non-drug items and services from 0.5% to 3.0% starting in CY 2027. In addition, CMS projects that the impact of the payment and policy changes in the Proposed OPPS/ASC Rule will yield an average increase of 2.4% in Medicare FFS ASC payments.
Previous wording
As described in detail in our Annual Report, in addition to payments from government programs, we receive revenue under contracts with commercial insurers, including both managed care arrangements with various HMOs and PPOs and indemnity‑based agreements. These contracts offer varying structures for patient access, utilization and reimbursement. Our top 10 managed care payers generated 66% of our managed care net patient service revenues for the six months ended June 30, 2026. During the same period, national payers generated 50% of our managed care net patient service revenues; the remainder came from regional or local payers.
Current wording
As described in detail in our Annual Report, in addition to payments from government programs, we receive revenue under contracts with commercial insurers, including both managed care arrangements with various HMOs and PPOs and indemnity‑based agreements. These contracts offer varying structures for patient access, utilization and reimbursement. Our top 10 managed care payers generated 66% of our managed care net patient service revenues for the nine months ended September 30, 2026. During the same period, national payers generated 51% of our managed care net patient service revenues; the remainder came from regional or local payers.
Previous wording
The amount of our managed care net patient service revenues, including Medicare and Medicaid managed care programs, from our hospitals and related outpatient facilities during the three months ended June 30, 2026 and 2025 was $2.470 billion and $2.423 billion, respectively, and $4.864 billion and $4.823 billion during the six months ended June 30, 2026 and 2025, respectively. All Medicaid managed care patient service revenue is presented net of provider taxes or assessments paid by our hospitals.
Current wording
The amount of our managed care net patient service revenues, including Medicare and Medicaid managed care programs, from our hospitals and related outpatient facilities during the three months ended September 30, 2026 and 2025 was $2.490 billion and $2.374 billion, respectively, and $7.354 billion and $7.197 billion during the nine months ended September 30, 2026 and 2025, respectively. All Medicaid managed care patient service revenue is presented net of provider taxes or assessments paid by our hospitals.
Previous wording
The following table presents our consolidated net operating revenues, operating expenses and operating income, both in dollar amounts and as percentages of net operating revenues, on a continuing operations basis:
Current wording
The following table presents our consolidated net operating revenues, operating expenses and operating income, both in dollar amounts and as percentages of net operating revenues, on a continuing operations basis. Unless otherwise indicated, comparisons of results of operations for the three and nine months ended September 30, 2026 are to the corresponding periods in 2025.
Previous wording
Consolidated net operating revenues increased $502 million, or 4.8%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Our Hospital Operations segment’s net operating revenues increased by $258 million, or 3.2%, during the six months ended June 30, 2026 compared to the same period in 2025. This increase was primarily driven by higher patient volumes, partially offset by a less favorable payer mix, during the six months ended June 30, 2026.
Current wording
Consolidated net operating revenues increased by $844 million, or 5.3%, for the nine months ended September 30, 2026. Our Hospital Operations segment’s net operating revenues increased by $504 million, or 4.2%, during the nine months ended September 30, 2026, primarily driven by higher patient volumes as well as continued pricing strength, partially offset by a less favorable payer mix, during the 2026 period. Additionally, in the three months ended September 30, 2026, we recognized cumulative catch-up adjustments associated with the CHI Agreements that increased revenue from contract termination by $233 million and net operating revenues by $97 million.
Previous wording
Same‑hospital salaries, wages and benefits expense increased by $39 million, or 2.1%, in the three months ended June 30, 2026 compared to the same period in 2025. This change was primarily driven by annual merit increases for certain of our employees and higher incentive compensation expense, partially offset by a decrease in health benefits cost, during the 2026 period. Same‑hospital salaries, wages and benefits expense as a percentage of net operating revenues decreased by 170 basis points to 44.7% in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Current wording
Same‑hospital salaries, wages and benefits expense increased by $7 million, or 0.1%, in the nine months ended September 30, 2026. This increase was primarily attributable to annual merit increases for certain employees and higher incentive compensation expense, partially offset by higher employee benefits cost in the 2025 period. Same‑hospital salaries, wages and benefits expense as a percentage of net operating revenues decreased by 180 basis points to 44.5% in the nine months ended September 30, 2026.
Previous wording
Same‑hospital supplies expense increased by $12 million, or 2.0%, in the three months ended June 30, 2026 compared to the same period in 2025. This increase was driven by higher patient volumes during the 2026 period, partially offset by our cost‑efficiency measures. Same‑hospital supplies expense as a percentage of net operating revenues decreased from 15.1% for the three months ended June 30, 2025 to 14.5% for the three months ended June 30, 2026.
Current wording
Same‑hospital supplies expense increased by $20 million, or 3.4%, and by $46 million, or 2.6%, during the three and nine months ended September 30, 2026, respectively. These increases were driven by higher patient volumes during the 2026 period, partially offset by our cost‑efficiency measures. Same‑hospital supplies expense as a percentage of net operating revenues decreased by 40 basis points and 30 basis points during the three and nine months ended September 30, 2026, respectively.
Previous wording
Same‑hospital other operating expenses increased by $51 million, or 5.6%, in the three months ended June 30, 2026 compared to the same period in 2025. This increase was primarily attributable to increases in medical fees and malpractice expense during the 2026 period. Same‑hospital other operating expenses as a percentage of net operating revenues in the three months ended June 30, 2026 was generally consistent with the same period in 2025 at 22.8%.
Current wording
Same‑hospital other operating expenses increased by $67 million, or 7.4%, and by $143 million, or 5.3%, during the three and nine months ended September 30, 2026, respectively. The increase in each period was primarily attributable to higher medical fees and malpractice expense during the 2026 periods. Same‑hospital other operating expenses as percentages of net operating revenues during the three and nine months ended September 30, 2026 were generally consistent with the corresponding periods in 2025.
Previous wording
Our Ambulatory Care segment’s net operating revenues increased by $118 million, or 9.3%, during the three months ended June 30, 2026 compared to the same period in 2025. The change was driven by (1) a $71 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $47 million increase in same‑facility net operating revenues, which was primarily attributable to incremental revenue from negotiated commercial rate increases, higher patient acuity and the addition of new service lines.
Current wording
Our Ambulatory Care segment’s net operating revenues increased by $96 million, or 7.5%, during the three months ended September 30, 2026. The change was driven by (1) a $57 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $39 million increase in same‑facility net operating revenues, which was primarily attributable to incremental revenue from negotiated commercial rate increases and the addition of new service lines.
Previous wording
During the six months ended June 30, 2026, net operating revenues in our Ambulatory Care segment increased by $244 million, or 9.9%, as compared to the same period in 2025. This increase was driven by (1) a $148 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) an increase of $96 million in same‑facility net operating revenues attributable to incremental revenue from negotiated commercial rate increases, higher patient acuity and the addition of new service lines.
Current wording
During the nine months ended September 30, 2026, net operating revenues in our Ambulatory Care segment increased by $340 million, or 9.1%. This increase was driven by (1) a $205 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) an increase of $135 million in same‑facility net operating revenues attributable to the same factors described above.
Previous wording
Salaries, wages and benefits expense increased by $24 million, or 7.6%, during the three months ended June 30, 2026 compared to the same period in 2025. This change was driven by (1) a $11 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $13 million increase in same‑facility salaries, wages and benefits expense. As a percentage of net operating revenues, salaries, wages and benefits expense decreased to 24.4% for the three months ended June 30, 2026 from 24.7% for the same period in 2025.
Current wording
Salaries, wages and benefits expense increased by $9 million, or 2.8%, during the three months ended September 30, 2026. This change was driven by (1) a $5 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $4 million increase in same‑facility salaries, wages and benefits expense. As a percentage of net operating revenues, salaries, wages and benefits expense decreased to 23.7% for the three months ended September 30, 2026 from 24.8% for the same period in 2025.
Previous wording
Salaries, wages and benefits expense increased by $59 million, or 9.7%, during the six months ended June 30, 2026 compared to the same period in 2025. This change was driven by (1) a $29 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) an increase of $30 million in same‑facility salaries, wages and benefits expense. Same‑facility salaries, wages and benefits expense as a percentage of net operating revenues in the six months ended June 30, 2026 was generally consistent with the same period in 2025 at 24.7%.
Current wording
Salaries, wages and benefits expense increased by $68 million, or 7.4%, during the nine months ended September 30, 2026. This change was driven by (1) a $34 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) an increase of $34 million in same‑facility salaries, wages and benefits expense. Salaries, wages and benefits expense as a percentage of net operating revenues decreased 40 basis points to 24.3% during the nine months ended September 30, 2026.
Previous wording
Supplies expense increased by $37 million, or 11.1%, during the three months ended June 30, 2026 compared to the same period in 2025. The change was driven by (1) an $15 million increase related to our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $22 million increase in same‑facility supplies expense, due primarily to higher patient acuity and the addition of new service lines. Supplies expense as a percentage of net operating revenues increased to 26.6% for the three months ended June 30, 2026 from 26.1% for the same period in 2025.
Current wording
Supplies expense increased by $30 million, or 8.9%, during the three months ended September 30, 2026. The change was driven by (1) an $8 million increase related to our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $22 million increase in same‑facility supplies expense, due primarily to the addition of new service lines. Supplies expense as a percentage of net operating revenues increased to 26.8% for the three months ended September 30, 2026 from 26.4% for the same period in 2025.
Previous wording
Supplies expense increased by $76 million, or 11.7%, during the six months ended June 30, 2026 compared to the same period in 2025. The change was driven by (1) a $42 million increase related to our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $34 million increase in same‑facility supplies expense, due primarily to higher patient acuity and the addition of new service lines. Supplies expense as a percentage of net operating revenues increased to 26.8% for the six months ended June 30, 2026 from 26.4% for the same period in 2025.
Current wording
Supplies expense increased by $106 million, or 10.7%, during the nine months ended September 30, 2026. The change was driven by (1) a $50 million increase related to our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $56 million increase in same‑facility supplies expense, due primarily to the addition of new service lines. Supplies expense as a percentage of net operating revenues increased to 26.8% for the nine months ended September 30, 2026 from 26.4% for the same period in 2025.
Previous wording
Other operating expenses increased by $39 million, or 10.7%, during the six months ended June 30, 2026 compared to the same period in 2025. The change was driven by (1) a $25 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $14 million increase in same‑facility other operating expenses. Other operating expenses as a percentage of net operating revenues in the six months ended June 30, 2026 was generally consistent with the same period in 2025 at 14.9%.
Current wording
Other operating expenses increased by $52 million, or 9.3%, during the nine months ended September 30, 2026. The change was driven by (1) a $31 million increase from our 2025 and 2026 acquisitions, de novo development and purchases of controlling interests, partially offset by the impact of the closure and sale of certain facilities, and (2) a $21 million increase in same‑facility other operating expenses. Other operating expenses as a percentage of net operating revenues in the nine months ended September 30, 2026 was generally consistent with the same period in 2025 at 14.9%.
Previous wording
During the six months ended June 30, 2026, our Ambulatory Care segment paid an aggregate of $128 million to acquire controlling ownership interests in eight ASCs and a noncontrolling ownership interest in an additional ASC. In the same period, this segment also commenced operations at four de novo ASCs and ceased operations at eight ASCs.
Current wording
During the nine months ended September 30, 2026, our Ambulatory Care segment paid an aggregate of $211 million to acquire controlling ownership interests in 13 ASCs and noncontrolling ownership interests in an additional two ASCs. In the same period, this segment also commenced operations at four de novo ASCs and ceased operations at 17 ASCs and one surgical hospital.
Previous wording
We recorded net gains from the sale, consolidation and deconsolidation of facilities totaling $34 million during the six months ended June 30, 2026. The activity during this period primarily included an $18 million gain from the consolidation of an ASC and net gains of $11 million related to the sale of certain facilities, both in our Ambulatory Care segment.
Current wording
We recorded gains from the sale, consolidation and deconsolidation of facilities totaling $43 million during the nine months ended September 30, 2026. The activity during this period, substantially all of which occurred in our Ambulatory Care segment, primarily included gains totaling $23 million from the consolidation of four ASCs and gains of $16 million related to the closure or sale of ASCs.
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Previous report — wording carried elsewhere
Total admissions increased by 3,327, or 2.8%, total emergency department visits increased by 13,986, or 2.6%, and charity and uninsured admissions increased by 1,007, or 19.2%, in the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Previous report — wording carried elsewhere
From time to time, we expect to engage in additional capital markets, bank credit and other financing activities depending on our needs and financing alternatives available at that time. We believe our existing debt agreements provide flexibility for future secured or unsecured borrowings.