UNIVERSAL HEALTH SERVICES INC

Previous wording

As of September 30, 2025, we owned and/or operated 374 inpatient facilities and 156 outpatient and other facilities located in 39 states, Washington, D.C., the United Kingdom and Puerto Rico. We have changed the method of our outpatient behavioral health care facility counts during the third quarter of 2025 and substantially all of the increase from prior periods relates to that change in convention.

Current wording

As of March 31, 2026, we owned and/or operated 375 inpatient facilities and 168 outpatient and other facilities located in 40 states, Washington, D.C., the United Kingdom and Puerto Rico.

Previous wording

34 free-standing emergency departments, and;

Current wording

35 free-standing emergency departments, and;

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10 outpatient centers & 1 surgical hospital.

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13 outpatient centers & 1 surgical hospital.

Previous wording

Net revenues from our acute care hospitals, outpatient facilities and commercial health insurer accounted for 59% and 57% of our consolidated net revenues during the three-month periods ended September 30, 2025 and 2024, respectively, and 57% of our consolidated net revenues during each of the nine-month periods ended September 30, 2025 and 2024.

Current wording

Net revenues from our acute care hospitals, outpatient facilities and commercial health insurer accounted for 58% of our consolidated net revenues during each of the three-month periods ended March 31, 2026 and 2025. Net revenues from our behavioral health care facilities and commercial health insurer accounted for 42% of our consolidated net revenues during each of the three-month periods ended March 31, 2026 and 2025.

Previous wording

Our behavioral health care facilities located in the U.K. generated net revenues of approximately $264 million and $230 million during the three-month periods ended September 30, 2025 and 2024, respectively, and $738 million and $651 million during the nine-month periods ended September 30, 2025 and 2024, respectively. Total assets at our U.K. behavioral health care facilities were approximately $1.532 billion as of September 30, 2025 and $1.358 billion as of December 31, 2024.

Current wording

Our behavioral health care facilities located in the U.K. generated net revenues of approximately $261 million and $227 million during the three-month periods ended March 31, 2026 and 2025, respectively. Total assets at our U.K. behavioral health care facilities were approximately $1.522 billion as of March 31, 2026 and $1.531 billion as of December 31, 2025.

Previous wording

You should carefully review the information contained in this Quarterly Report and should particularly consider any risk factors that we set forth in our Annual Report on Form 10-K for the year ended December 31, 2024, this Quarterly Report and in other reports or documents that we file from time to time with the Securities and Exchange Commission (the “SEC”). In this Quarterly Report, we state our beliefs of future events and of our future financial performance. This Quarterly Report contains “forward-looking statements” that reflect our current estimates, expectations and projections about our future results, performance, prospects and opportunities. Forward-looking statements include, among other things, the information concerning our possible future results of operations, business and growth strategies, financing plans, expectations that regulatory developments or other matters will or will not have a material adverse effect on our business or financial condition, our competitive position and the effects of competition, the projected growth of the industry in which we operate, and the benefits and synergies to be obtained from our completed and any future acquisitions, and statements of our goals and objectives, and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “appears,” “projects” and similar expressions, as well as statements in future tense, identify forward-looking statements. In evaluating those statements, you should specifically consider various factors, including the risks related to healthcare industry trends and those set forth in Part 1, Item 1A. Risk Factorsand Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk Factorsin our Annual Report on Form 10-K for the year ended December 31, 2024 and in Part II, Item 1A. Risk Factors and Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk Factors, as included herein. Those factors may cause our actual results to differ materially from any of our forward-looking statements.

Current wording

You should carefully review the information contained in this Quarterly Report and should particularly consider any risk factors that we set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, this Quarterly Report and in other reports or documents that we file from time to time with the Securities and Exchange Commission (the “SEC”). In this Quarterly Report, we state our beliefs of future events and of our future financial performance. This Quarterly Report contains “forward-looking statements” that reflect our current estimates, expectations and projections about our future results, performance, prospects and opportunities. Forward-looking statements include, among other things, the information concerning our possible future results of operations, business and growth strategies, financing plans, expectations that regulatory developments or other matters will or will not have a material adverse effect on our business or financial condition, our competitive position and the effects of competition, the projected growth of the industry in which we operate, and the benefits and synergies to be obtained from our completed and any future acquisitions, and statements of our goals and objectives, and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “appears,” “projects” and similar expressions, as well as statements in future tense, identify forward-looking statements. In evaluating those statements, you should specifically consider various factors, including the risks related to healthcare industry trends and those set forth in Part 1, Item 1A. Risk Factorsand Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk Factorsin our Annual Report on Form 10-K for the year ended December 31, 2025 and in Part II, Item 1A. Risk Factors and Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk

Previous wording

as discussed below in Sources of Revenue, we receive revenues from various state and county-based programs, including Medicaid in all the states in which we operate. We receive annual Medicaid revenues of approximately $100 million, or greater, from each of Texas, California, Nevada, Washington, D.C., Illinois, Pennsylvania, Kentucky, Tennessee, Virginia, Massachusetts, Michigan, Florida, Mississippi and Washington. Most of these programs are approved on a year-to-year basis and there is no assurance that these revenues will continue at their current rates or at all. We are therefore particularly sensitive to potential reductions in Medicaid and other state-based revenue programs as well as regulatory, economic, environmental and competitive changes in those states;

Current wording

as discussed below in Sources of Revenue, we receive revenues from various state and county-based programs, including Medicaid in all the states in which we operate. We receive annual Medicaid revenues of approximately $100 million, or greater, from each of Nevada, California, Texas, Washington, D.C., Illinois, Pennsylvania, Kentucky, Ohio, Virginia, Massachusetts, Michigan, Mississippi, Florida and Tennessee. Most of these programs are approved on a year-to-year basis and there is no assurance that these revenues will continue at their current rates or at all. We are therefore particularly sensitive to potential reductions in Medicaid and other state-based revenue programs as well as regulatory, economic, environmental and competitive changes in those states;

Previous wording

legislation adopted on July 4, 2025 (the One Big Beautiful Bill Act), attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditure. That legislation also places limits on provider fees used to increase federal Medicaid funding to states. The legislation prohibits states not previously having expanded Medicaid eligibility to 138% of federal poverty level from increasing the rate of current provider fees which fund certain state supplemental payments or increasing the base of the fee to a class or items of services that the fee did not previously cover. That current provider fee threshold will remain at 6%. For states having expanded Medicaid eligibility under the legislation, the provider fee threshold will be reduced by 0.5% annually between federal fiscal years 2028 and 2032 with the resulting threshold ultimately becoming 3.5%. The legislation also eliminates certain insurance exchange premium tax credits beyond 2025 and exchange enrollment is expected to be adversely impacted. Extension of the tax credits is currently the subject of United States Congressional debate as part of the federal budget negotiation, and we cannot predict whether these subsidies will ultimately be adopted in federal fiscal year 2026. All of these factors, which could have a material unfavorable impact on our results of operations, may be expected to reduce our revenue and likely increase the level of uncompensated care provided by our facilities;

Current wording

legislation adopted on July 4, 2025 (the One Big Beautiful Bill Act), attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditure. That legislation also places limits on provider fees used to increase federal Medicaid funding to states. The legislation prohibits states not previously having expanded Medicaid eligibility to 138% of federal poverty level from increasing the rate of current provider fees which fund certain state supplemental payments or increasing the base of the fee to a class or items of services that the fee did not previously cover. That current provider fee threshold will remain at 6%. For states having expanded Medicaid eligibility under the legislation, the provider fee threshold will be reduced by 0.5% annually between federal fiscal years 2028 and 2032 with the resulting threshold ultimately becoming 3.5%. Under current law, and based on our current expectations, we estimate that, commencing with the 2028 state fiscal years, our aggregate annual net benefit will be reduced, on an annually increasing and relatively pro rata basis, by approximately $432 million to $480 million by 2032. The legislation also eliminates certain insurance exchange premium tax credits beyond 2025 and exchange enrollment is expected to be adversely impacted. On January 8, 2026, the U.S. House of Representatives passed H.R.1834 to extend for three years the enhanced premium tax credits ("EPTCs") that expired on December 31, 2025. As of early May 2026, no legislation extending the EPTCs has been enacted, and there can be no assurance regarding the timing or outcome of future legislative action. We cannot predict whether these subsidies will ultimately be adopted in federal fiscal year 2026. All of these factors, which could have a material unfavorable impact on our results of operations, may be expected to reduce our revenue and likely increase the level of uncompensated care provided by our facilities;

Previous wording

there are additional legislative changes that are likely to result in major changes in the health care delivery system on a national or state level. For example, Congress has reduced to $0 the penalty for failing to maintain health coverage that was part of the original Patient Protection and Affordable Care Act, as amended by the Health and Education Reconciliation Act (collectively, the “ACA") as part of the Tax Cuts and Jobs Act. The Biden administration had issued executive orders implementing a special enrollment period permitting individuals to enroll in health plans outside of the annual open enrollment period and reexamining policies that may undermine the ACA or the Medicaid program. The Inflation Reduction Act of 2022 (“IRA”) was passed on August 16, 2022, which among other things, allows for the Centers for Medicare and Medicaid Services ("CMS") to negotiate prices for certain single-source drugs reimbursed under Medicare Part B and Part D. The American Rescue Plan Act’s expansion of subsidies to purchase coverage through an ACA exchange, which the IRA continued through 2025, has increased exchange enrollment. However, the Trump administration has already taken steps to undo these Biden-era initiatives, including adopting legislation eliminating certain exchange premium tax credits;

Current wording

there are additional legislative changes that are likely to result in major changes in the health care delivery system on a national or state level, including changes in the structure and administration of, and funding for, federal and state agencies and programs. For example, Congress has reduced to $0 the penalty for failing to maintain health coverage that was part of the original Patient Protection and Affordable Care Act, as amended by the Health and Education Reconciliation Act (collectively, the “ACA") as part of the Tax Cuts and Jobs Act. The Biden administration had issued executive orders implementing a special enrollment period permitting individuals to enroll in health plans outside of the annual open enrollment period and reexamining policies that may undermine the ACA or the Medicaid program. The Inflation Reduction Act of 2022 (“IRA”) was passed on August 16, 2022, which among other things, allows for the Centers for Medicare and Medicaid Services ("CMS") to negotiate prices for certain single-source drugs reimbursed under Medicare Part B and Part D. The American Rescue Plan Act’s expansion of subsidies to purchase coverage through an ACA exchange, which the IRA continued through 2025, has increased exchange enrollment. These enhanced subsidies expired on December 31, 2025;

Previous wording

the increase in interest rates during the past few years has increased our interest expense significantly increasing our expenses and reducing our free cash flow and our ability to access the capital markets on favorable terms. As such, the effects of increased borrowing rates have adversely impacted our results of operations, financial condition and cash flows. We cannot predict future changes to interest rates, however, significant increases in our borrowing rates could have a material unfavorable impact on our future results of operations;

Current wording

the increase in interest rates during the past few years has increased our interest expense significantly, increasing our expenses and reducing our free cash flow and our ability to access the capital markets on favorable terms. As such, the effects of increased borrowing rates have adversely impacted our results of operations, financial condition and cash flows. We cannot predict future changes to interest rates, however, significant increases in our borrowing rates could have a material unfavorable impact on our future results of operations. Our $700 million, 1.65% senior notes ("2026 Notes") mature on September 1, 2026. Market interest rates have increased significantly since the 2026 Notes were issued in 2021. We expect that we will refinance the 2026 Notes at significantly higher interest rates which will significantly increase our interest expense thereby decreasing our net income attributable to UHS;

Previous wording

the Full-Year Continuing Appropriations and Extensions Act, 2025 extended appropriations to federal agencies for continuing projects and activities through September 30, 2025. In the past several years political disputes concerning authorization of a federal budget have led to shutdown of substantial portions of the federal government and other federal budget authorization delays have occurred. Currently, the United States Congress has failed to approve a federal budget for federal fiscal year 2026 and a federal shutdown began on October 1, 2025. Federal budget delays and federal government shutdowns are unpredictable and may occur in the future. We cannot predict whether or not there will be future legislation halting a federal government shutdown, however, our operating cash flows and results of operations could be materially unfavorably impacted by the federal government shutdown;

Current wording

as of early May 2026, Congress has enacted appropriations legislation funding most federal agencies for fiscal year 2026, following a lapse in appropriations affecting certain Department of Homeland Security operations that began on February 14, 2026 and was resolved on April 30, 2026. In the past several years political disputes concerning authorization of a federal budget have led to shutdown of substantial portions of the federal government and other federal budget authorization delays have occurred. Federal budget delays and federal government shutdowns are unpredictable and may occur in the future. We cannot predict whether or not there will be future appropriations legislation avoiding a federal government shutdown, however, our operating cash flows and results of operations could be materially unfavorably impacted by the federal government shutdown;

Previous wording

as part of the Consolidated Appropriations Act of 2021 (the "CAA"), Congress passed legislation aimed at preventing or limiting patient balance billing in certain circumstances. The CAA addresses surprise medical bills stemming from emergency services, out-of-network ancillary providers at in-network facilities, and air ambulance carriers. The CAA prohibits surprise billing when out-of-network emergency services or out-of-network services at an in-network facility are provided, unless informed consent is received. In these circumstances providers are prohibited from billing the patient for any amounts that exceed in-network cost-sharing requirements. HHS, the Department of Labor and the Department of the Treasury have issued rules to implement the legislation. The rules have limited the ability of our hospital-based physicians to receive payments for services at usually higher out-of-network rates in certain circumstances, and, as a result, have caused us to increase subsidies to these physicians or to replace their services at a higher cost level;

Current wording

as part of the Consolidated Appropriations Act of 2021 (the "CAA"), Congress passed legislation aimed at preventing or limiting patient balance billing in certain circumstances. The CAA addresses surprise medical bills stemming from emergency services, out-of-network ancillary providers at in-network facilities, and air ambulance carriers. The CAA prohibits surprise billing when out-of-network emergency services or out-of-network services at an in-network facility are provided, unless informed consent is received. In these circumstances providers are prohibited from billing the patient for any amounts that exceed in-network cost-sharing requirements. HHS, the Department of Labor and the Department of the

Previous wording

uninsured and self-pay patients treated at our acute care facilities unfavorably impact our ability to satisfactorily and timely collect our self-pay patient accounts;

Current wording

uninsured and self-pay patients treated at our facilities unfavorably impact our ability to satisfactorily and timely collect our self-pay patient accounts;

Previous wording

the healthcare industry is labor intensive and salaries, wages and benefits are subject to inflationary pressures, as are supplies expense and other operating expenses. In the past, staffing shortages have, at times, required us to hire expensive temporary personnel and/or enhance wages and benefits to recruit and retain nurses and other clinical staff and support personnel. At certain facilities, particularly within our behavioral health care segment, there have been occasions when we were unable to fill all vacant positions and, consequently, we were required to limit patient volumes. We have also experienced general inflationary cost increases related to certain of our other operating expenses. Many of these factors, which had a material unfavorable impact on our results of operations in prior years, have moderated more recently. However, we cannot predict future inflationary increases, which if significant, could have a material unfavorable impact on our future results of operations. We have experienced inflationary pressures, primarily in personnel costs, although those pressures have moderated more recently. The extent of any future impacts from inflation on our business and our results of operations will be dependent upon how long the elevated inflation levels persist and the extent to which the rate of inflation further increases, if at all, neither of which we are able to predict. If elevated levels of inflation were to persist or if the rate of inflation were to accelerate, our expenses could increase faster than anticipated and we may utilize our capital resources sooner than expected. Further, given the complexities of the reimbursement landscape in which we operate, our ability to pass on increased costs associated with providing healthcare to Medicare and Medicaid patients is limited due to various federal, state and local laws, which in certain circumstances, limit our ability to increase prices;

Current wording

We have experienced inflationary pressures, primarily in personnel costs, although those pressures have moderated more recently. The extent of any future impacts from inflation on our business and our results of operations will be dependent upon how long the elevated inflation levels persist and the extent to which the rate of inflation further increases, if at all, neither of which we are able to predict. If elevated levels of inflation were to persist or if the rate of inflation were to accelerate, our expenses could increase faster than anticipated and we may utilize our capital resources sooner than expected. Further, given the complexities of the reimbursement landscape in which we operate, our ability to pass on increased costs associated with providing healthcare to Medicare and Medicaid patients is limited due to various federal, state and local laws, which in certain circumstances, limit our ability to increase prices.

Previous wording

Legislation adopted on July 4, 2025 attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditures and the legislation also places limits on provider taxes used to increase federal Medicaid funding to states. In addition, insurance exchange subsidies are scheduled to expire later this year which could unfavorably impact insurance exchange enrollment. Extension of these subsidies is currently the subject of Congressional debate as part of the federal budget negotiation, and we cannot predict whether these subsidies will ultimately be adopted in federal fiscal year 2026. As these provisions become effective over the next several years, they may be expected to reduce our revenues and likely increase the level of uncompensated care provided by our facilities. Please see Sources of Revenue below for additional disclosure related to Medicaid supplemental payment programs in various states in which we operate.

Current wording

Legislation adopted on July 4, 2025 attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditures and the legislation also places limits on provider taxes used to increase federal Medicaid funding to states. In addition, insurance exchange subsidies expired on December 31, 2025 which could unfavorably impact insurance exchange enrollment. As these provisions become effective over the next several years, they may be expected to reduce our revenues and likely increase the level of uncompensated care provided by our facilities. Please see Sources of Revenue below for additional disclosure related to Medicaid supplemental payment programs in various states in which we operate.

Previous wording

Net revenues increased by 13.4%, or $532 million, to $4.495 billion during the three-month period ended September 30, 2025, as compared to $3.963 billion during the third quarter of 2024. The net increase was primarily attributable to: (i) a $431 million, or 11.3%, increase in net revenues generated from our acute care hospital services and behavioral health services operated during both periods (which we refer to as “Same Facility”), and; (ii) an other combined net increase of $101 million, consisting primarily of $58 million of combined net revenues generated during the third quarter of 2025 at two newly constructed acute care hospitals located in Las Vegas, Nevada (West Henderson Hospital which opened during the fourth quarter of 2024), and Washington, D.C. (Cedar Hill Regional Medical Center which opened during the second quarter of 2025). Included in the $431 million of increased net revenues, on a Same Facility basis, during the third quarter of 2025, as compared to the comparable quarter of 2024, was $90 million recorded during the third quarter of 2025 in connection with a recently approved Medicaid state directed payment program in Washington, D.C. covering the period of October 1, 2024 through September 30, 2025.

Current wording

Net revenues increased by 9.6%, or $395 million, to $4.495 billion during the three-month period ended March 31, 2026, as compared to $4.100 billion during the first quarter of 2025. The net increase was primarily attributable to: (i) a $313 million, or 7.9%, increase in net revenues generated from our acute care hospital services and behavioral health services operated during both periods (which we refer to as “Same Facility”), and; (ii) an other combined net increase of $82 million, consisting of a $48 million increase in provider tax assessments (which had no impact on income before income taxes since the amounts offset between net revenues and other operating expenses) and other combined net increase of $34 million consisting primarily of the net revenues generated during the first quarter of 2026 at a newly constructed acute care hospital located in Washington, D.C. (Cedar Hill Regional Medical Center which opened during the second quarter of 2025).

Previous wording

Income before income taxes (before income attributable to noncontrolling interests) increased by $155 million, or 46%, to $497 million during the three-month period ended September 30, 2025 as compared to $342 million during the third quarter of 2024. The net increase was due to:

Current wording

Income before income taxes (before income attributable to noncontrolling interests) increased by $49 million, or 12%, to $469 million during the three-month period ended March 31, 2026 as compared to $420 million during the first quarter of 2025. The net increase was due to:

Previous wording

an increase of $99 million at our acute care facilities, as discussed below in Acute Care Hospital Services;

Current wording

an increase of $25 million at our acute care facilities, as discussed below in Acute Care Hospital Services;

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an increase of $28 million at our behavioral health care facilities, as discussed below in Behavioral Health Care Services;

Current wording

an increase of $26 million at our behavioral health care facilities, as discussed below in Behavioral Health Care Services, and;

Previous wording

Net income attributable to UHS increased by $114 million, or 44%, to $373 million during the three-month period ended September 30, 2025, as compared to $259 million during the third quarter of 2024. This increase was primarily attributable to:

Current wording

Net income attributable to UHS increased by $32 million, or 10%, to $349 million during the three-month period ended March 31, 2026, as compared to $317 million during the first quarter of 2025. This increase was primarily attributable to:

Previous wording

a decrease of $94 million resulting from an increase in the provision for income taxes resulting primarily from: (i) the increase in the provision for income taxes resulting from the $331 million increase in income before income taxes, and; (ii) a $14 million increase in the provision for income taxes due to a decrease in the net benefit recorded in connection with ASU 2016-09 ($1.9 million net benefit recorded during the first nine months of 2025 as compared to $15.5 million during the first nine months of 2024).

Current wording

a decrease of $12 million resulting from an increase in the provision for income taxes resulting primarily from the increase in the provision for income taxes resulting from the $44 million increase in income before income taxes ($49 million increase in income before income taxes net of a $5 million increase in income attributable to noncontrolling interests).

Previous wording

The following table sets forth certain operating statistics for our acute care hospital services for the three and nine-month periods ended September 30, 2025 and 2024.

Current wording

The following table sets forth certain operating statistics for our acute care hospital services for the three-month periods ended March 31, 2026 and 2025.

Previous wording

The following table summarizes the results of operations for our acute care facilities on a Same Facility basis and is used in the discussion below for the three and nine-month periods ended September 30, 2025 and 2024 (dollar amounts in thousands):

Current wording

The following table summarizes the results of operations for our acute care facilities on a Same Facility basis and is used in the discussion below for the three-month periods ended March 31, 2026 and 2025 (dollar amounts in thousands):

Previous wording

During the three-month period ended September 30, 2025, net revenue per adjusted admission increased by 9.8% while net revenue per adjusted patient day increased 11.5%, as compared to the comparable quarter of 2024. During the three-month period ended September 30, 2025, as compared to the comparable prior year quarter, inpatient admissions to our acute care hospitals increased by 1.5% while adjusted admissions (adjusted for outpatient activity) increased by 2.0%. Patient days at these facilities decreased by 0.1% and adjusted patient days increased by 0.4% during the three-month period ended September 30, 2025, as compared to the comparable prior year quarter. The average length of inpatient stay at these facilities was 4.8 days during each of the three-month periods ended September 30, 2025 and 2024, respectively. The occupancy rate, based on the average available beds at these facilities, was 65% and 66% during the three-month periods ended September 30, 2025 and 2024, respectively.

Current wording

During the three-month period ended March 31, 2026, net revenue per adjusted admission increased by 6.3% while net revenue per adjusted patient day increased 5.5%, as compared to the comparable quarter of 2025. During the three-month period ended March 31, 2026, as compared to the comparable prior year quarter, inpatient admissions to our acute care hospitals decreased by 1.5% while adjusted admissions (adjusted for outpatient activity) were unchanged. Patient days at these facilities decreased by 0.7% and adjusted patient days increased by 0.8% during the three-month period ended March 31, 2026, as compared to the comparable prior year quarter. The average length of inpatient stay at these facilities was 4.9 days during each of the three-month periods ended March 31, 2026 and 2025, respectively. The occupancy rate, based on the average available beds at these facilities, was 69% and 70% during the three-month periods ended March 31, 2026 and 2025, respectively.

Previous wording

On a Same Facility basis, during the three-month period ended September 30, 2025, as compared to the comparable quarter of 2024, salaries, wages and benefits expense increased by $41 million, or 4.6%. Contributing to the increase in salaries, wages and benefits was an increase in our patient volumes during the third quarter of 2025 as compared to the comparable quarter of 2024. As a percentage of net revenues, salaries, wages and benefits expense decreased to 38.6% during the third quarter of 2025 as compared to 41.7% during the third quarter of 2024.

Current wording

On a Same Facility basis, during the three-month period ended March 31, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $39 million, or 4.3%. As a percentage of net revenues, salaries, wages and benefits expense decreased to 38.6% during the first quarter of 2026 as compared to 40.0% during the first quarter of 2025.

Previous wording

Other operating expenses increased by $95 million, or 15.8%, during the third quarter of 2025, as compared to the comparable quarter of 2025. Operating expenses incurred by our commercial health insurer, consisting primarily of medical costs, increased by $45 million, or 35.8% (due to a corresponding increase in membership), during the third quarter of 2025, as compared to the comparable quarter of 2024. Excluding the operating costs of our commercial insurer from each period, other operating expenses increased by $49 million, or 10.4%. Contributing to the increased operating expenses during the third quarter of 2025, as compared to the comparable quarter of 2024, was a $21 million, or 13.3%, aggregate increase in physician expenses incurred at certain hospitals. As a percentage of net revenues, other operating expenses increased to 28.6% during the third quarter of 2025, as compared to 27.8% during the comparable quarter of 2024.

Current wording

Other operating expenses increased by $90 million, or 14.0%, during the first quarter of 2026, as compared to the comparable quarter of 2025. Operating expenses incurred by our commercial health insurer, consisting primarily of medical costs, increased by $45 million, or 27.6% (due to an increase in membership), during the first quarter of 2026, as compared to the comparable quarter of 2025. Excluding the operating costs of our commercial insurer from each period, other operating expenses increased by $45 million, or 9.3%. Contributing to the increased operating expenses during the first quarter of 2026, as compared to the comparable quarter of 2025, was a $20 million, or 12.3%, aggregate increase in physician expenses incurred at certain hospitals. As a percentage of net revenues, other operating expenses increased to 29.5% during the first quarter of 2026, as compared to 28.0% during the comparable quarter of 2025.

Previous wording

The following table summarizes the results of operations for all our acute care operations during the three and nine-month periods ended September 30, 2025 and 2024. These amounts include: (i) our acute care results on a Same Facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of recently acquired and/or opened facilities and businesses. Dollar amounts below are reflected in thousands.

Current wording

The following table summarizes the results of operations for all our acute care operations during the three-month periods ended March 31, 2026 and 2025. These amounts include: (i) our acute care results on a Same Facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of recently acquired and/or opened facilities and businesses. Dollar amounts below are reflected in thousands.

Previous wording

During the nine-month period ended September 30, 2025, as compared to the comparable prior year period, net revenues from our acute care hospital services increased by $763 million, or 11.5%, due to: (i) the $580 million, or 9.1% increase in Same Facility revenues, as discussed above, and; (ii) an other combined net increase of $183 million consisting primarily of $128 million of combined net revenues generated during the first nine months of 2025 at two newly constructed and recently opened acute care hospitals, as mentioned above, and a $50 million increase in provider tax assessments.

Current wording

During the three-month period ended March 31, 2026, as compared to the comparable prior year quarter, net revenues from our acute care hospital services increased by $252 million, or 10.7%, due to: (i) the $188 million, or 8.2% increase in Same Facility revenues, as discussed above, and; (ii) an other combined net increase of $64 million consisting of increased provider tax assessments and the net revenues generated during the first quarter of 2026 at a newly constructed acute care hospital located in Washington, D.C. (Cedar Hill Regional Medical Center which opened during the second quarter of 2025).

Previous wording

Income before income taxes increased by $99 million, or 49%, to $300 million, or 11.4% of net revenues during the third quarter of 2025, as compared to $201 million, or 8.9% of net revenues during the comparable quarter of 2024. The increase resulted primarily from: (i) the $133 million, or 65%, increase in income before income taxes from our acute care hospital services, on a Same Facility basis, as discussed above, partially offset by; (ii) a $19 million pre-tax loss incurred during the third quarter of 2025 at the recently completed and opened Cedar Hill Regional Medical Center, and; (iii) an $18 million legal reserve established during the third quarter of 2025 in connection with the verdict in the Pinnacle litigation in Washoe County, Nevada, against certain subsidiaries of ours, as disclosed in Note 6 to the Condensed Consolidated Financial Statements - Commitments and Contingencies.

Current wording

Income before income taxes increased by $25 million, or 10%, to $288 million, or 11.0% of net revenues during the first quarter of 2026, as compared to $263 million, or 11.1% of net revenues during the comparable quarter of 2025. The increase resulted primarily from: (i) the $36 million, or 14%, increase in income before income taxes from our acute care hospital services, on a Same Facility basis, as discussed above, partially offset by; (ii) an $11 million increase in the aggregate pre-tax losses incurred during the first quarter of 2026, as compared to the first quarter of 2025, at the recently completed and opened Cedar Hill Regional Medical Center located in Washington, D.C., as well as the new acute care hospital being constructed in Palm Beach Gardens, FL (Alan B. Miller Medical Center) that is scheduled to be completed and opened during the second quarter of 2026.

Previous wording

During the three-month period ended September 30, 2025, as compared to the comparable quarter of 2024, salaries, wages and benefits expense increased by $74 million, or 8.3%. The increase was due primarily to the above-mentioned $41 million, or 4.6%, increase related to our acute care hospital services, on a Same Facility basis, as well as the salaries, wages and benefits expense incurred at the two above-mentioned newly constructed and recently opened acute care hospitals.

Current wording

During the three-month period ended March 31, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $57 million, or 6.3%. The increase was due primarily to the above-mentioned $39 million, or 4.3%, increase related to our acute care hospital services, on a Same Facility basis, as well as the salaries, wages and benefits expense incurred at the two above-mentioned newly constructed acute care hospitals.

Previous wording

Supplies expense increased by $22 million, or 6.5%, during the third quarter of 2025, as compared to the comparable quarter of 2024. The increase was due to the above-mentioned $12 million increase related to our acute care hospital services, on a Same Facility basis, as well as the supplies expense incurred during the third quarter of 2025 at the two above-mentioned newly constructed and recently opened acute care hospitals.

Current wording

Supplies expense increased by $19 million, or 5.5%, during the first quarter of 2026, as compared to the comparable quarter of 2025. The increase was due to the above-mentioned $17 million increase related to our acute care hospital services, on a Same Facility basis, as well as the supplies expense incurred during the first quarter of 2026 at Cedar Hill Regional Medical Center.

Previous wording

The following tables show the amounts recorded at our acute care hospitals for charity care and uninsured discounts, based on charges at established rates, for the three and nine-month periods ended September 30, 2025 and 2024:

Current wording

The following tables show the amounts recorded at our acute care hospitals for charity care and uninsured discounts, based on charges at established rates, for the three-month periods ended March 31, 2026 and 2025:

Previous wording

The following table sets forth certain operating statistics for our behavioral health care services for the three and nine-month periods ended September 30, 2025 and 2024.

Current wording

The following table sets forth certain operating statistics for our behavioral health care services for the three-month periods ended March 31, 2026 and 2025.

Previous wording

The following table summarizes the results of operations for our behavioral health care facilities, on a Same Facility basis, and is used in the discussions below for the three and nine-month periods ended September 30, 2025 and 2024 (dollar amounts in thousands):

Current wording

The following table summarizes the results of operations for our behavioral health care facilities, on a Same Facility basis, and is used in the discussions below for the three-month periods ended March 31, 2026 and 2025 (dollar amounts in thousands):

Previous wording

During the three-month period ended September 30, 2025, net revenue per adjusted admission increased by 8.8% while net revenue per adjusted patient day increased by 7.9%, as compared to the comparable quarter of 2024. During the three-month period ended September 30, 2025, as compared to the comparable prior year quarter, inpatient admissions and adjusted admissions to our behavioral health care hospitals increased by 0.8% and 0.5%, respectively. Patient days at these facilities increased by 1.2% and adjusted patient days increased by 1.3% during the three-month period ended September 30, 2025, as compared to the comparable prior year quarter. The average length of inpatient stay at these facilities was 13.6 days and 13.5 days during the three-month periods ended September 30, 2025 and 2024, respectively. The occupancy rate, based on the average available beds at these facilities, was 74% and 73% during the three-month periods ended September 30, 2025 and 2024, respectively.

Current wording

During the three-month period ended March 31, 2026, net revenue per adjusted admission increased by 6.2% while net revenue per adjusted patient day increased by 5.8%, as compared to the comparable quarter of 2025. During the three-month period ended March 31, 2026, as compared to the comparable prior year quarter, inpatient admissions and adjusted admissions to our behavioral health care hospitals increased by 1.1% and 1.2%, respectively. Patient days at these facilities increased by 1.4% and adjusted patient days increased by 1.6% during the three-month period ended March 31, 2026, as compared to the comparable prior year quarter. The average length of inpatient stay at these facilities was 13.7 days during each of the three-month periods ended March 31, 2026 and 2025. The occupancy rate, based on the average available beds at these facilities, was 74% during each of the three-month periods ended March 31, 2026 and 2025.

Previous wording

On a Same Facility basis during the three-month period ended September 30, 2025, as compared to the comparable quarter of 2024, salaries, wages and benefits expense increased by $81 million or 8.9%. The increase during the third quarter of 2025, as compared to the comparable quarter of 2024, was due to a 4.9% increase in salaries, wages and benefits expense per average full time equivalent employee, as well as a 3.8% increase in the average number of full-time equivalent employees. As a percentage of net revenues during each quarter, salaries, wages and benefits expense decreased to 54.6% during the third quarter of 2025 as compared to 54.8% during the third quarter of 2024.

Current wording

On a Same Facility basis during the three-month period ended March 31, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $73 million or 8.0%. The increase during the first quarter of 2026, as compared to the comparable quarter of 2025, was due to a 5.2% increase in salaries, wages and benefits expense per average full time equivalent employee, as well as a 2.7% increase in the average number of full-time equivalent employees. As a percentage of net revenues during each quarter, salaries, wages and benefits expense increased to 54.6% during the first quarter of 2026 as compared to 54.3% during the first quarter of 2025.

Previous wording

Other operating expenses increased by $62 million, or 6.6%, during the first nine months of 2025, as compared to the comparable period of 2024. As a percentage of net revenues during each period, other operating expenses decreased to 18.7% during the first nine months of 2025 as compared to 18.9% during the first nine months of 2024.

Current wording

Other operating expenses increased by $15 million, or 4.6%, during the first quarter of 2026, as compared to the comparable quarter of 2025. As a percentage of net revenues during each quarter, other operating expenses decreased to 18.4% during the first quarter of 2026, as compared to 18.9% during the first quarter of 2025.

Previous wording

Supplies expense increased by $2 million, or 3.6%, during the third quarter of 2025, as compared to the comparable quarter of 2024. As a percentage of net revenues during each quarter, supplies expense decreased to 3.3% during the third quarter of 2025, as compared to 3.5% during the comparable quarter of 2024.

Current wording

Supplies expense increased by $3 million, or 6.3%, during the first quarter of 2026, as compared to the comparable quarter of 2025. As a percentage of net revenues during each quarter, supplies expense remained unchanged at 3.2% during each of the three-month periods ended March 31, 2026 and 2025.

Previous wording

The following table summarizes the results of operations for all our behavioral health care services during the three and nine-month periods ended September 30, 2025 and 2024. These amounts include: (i) our behavioral health care results on a Same Facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of facilities acquired or opened during the past year. Dollar amounts below are reflected in thousands.

Current wording

The following table summarizes the results of operations for all our behavioral health care services during the three-month periods ended March 31, 2026 and 2025. These amounts include: (i) our behavioral health care results on a Same Facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of facilities acquired or opened during the past year. Dollar amounts below are reflected in thousands.

Previous wording

During the three-month period ended September 30, 2025, as compared to the comparable prior year quarter, net revenues generated from our behavioral health services increased by $154 million, or 9.0%. The increase was primarily attributable to the above-mentioned $154 million, or 9.3%, increase in net revenues at our behavioral health facilities, on a Same Facility basis.

Current wording

During the three-month period ended March 31, 2026, as compared to the comparable prior year quarter, net revenues generated from our behavioral health services increased by $143 million, or 8.2%. The increase was primarily attributable to the above-mentioned $125 million, or 7.3%, increase in net revenues at our behavioral health facilities, on a Same Facility basis.