King of Prussia, Pa.-based Universal Health Services projects net revenues to hit up to $15.7 billion in 2024, which would represent year-year-year growth of up to 10%, executives said during the company's Feb. 28 earnings call.
The for-profit health system recorded an operating income of $1.2 billion (8.2% margin) in 2023 — up from a $1 billion gain (7.5% margin) in 2022 — and could potentially return to double-digit revenue growth this year.
"The core operating assumptions underlying our 2024 operating results forecast … largely reflect the historical pre-COVID trends in the respective businesses," Marc Miller, president and CEO, said. "We anticipate that volumes in our acute segment will moderate from the elevated 2023 levels, but conversely, acuity and pricing in our acute business will increase, and for the full year, both metrics will resemble the patterns we experienced before the pandemic."
UHS said it expects operating results to return to pre-pandemic levels despite healthcare's shift from inpatient to outpatient settings and pressure from payers to restrain reimbursement increases in various ways.
"We expect continued improvement in premium pay labor trends and general cost trends that will remain largely stable in 2024," Mr. Miller said. "Specifically, physician expenses, which were a major headwind in 2023, are expected to grow by the overall inflation rate in 2024."
UHS operates 27 acute care hospitals, which continued to see strong demand for services in the fourth quarter. Adjusted admissions increased 5.6% while overall surgical volumes were up 4% year over year.
The health system's behavioral business — which comprises more than 333 inpatient behavioral health facilities — remains robust with same-store adjusted patient day growth in 2024 projected to surpass the 2.1% growth reported in 2023.
"A significant driver of behavioral volume upside is due to our success in filling vacant positions," Mr. Miller said. "But we acknowledge that specialty workforce shortages in certain markets continue to be an obstacle to even more volume growth."