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Universal Health CEO On The Inverse Relationship Between Insurance Holders And Bad Debt

Universal Health CEO On The Inverse Relationship Between Insurance Holders And Bad Debt

Shares of Universal Health Services, Inc. (NYSE: UHS) are up over 40 percent year-to-date and are trading near lifetime highs. The company recently came out with better-than-expected Q1 results.

Universal Health Services CEO Alan Miller was on CNBC Friday to discuss the changes that the health care system has witnessed and how more people being insured is impacting the company.

Information: A Big Change

"I think the biggest change is all of the information. Everybody has information and it's huge," Miller began.

"In our business, patients have information; they have all sorts of information that they talk to doctors in hospitals about, where in the past they just, for the most parts, said, 'Okay doc, here is what I have,' and the doctor told you what they were going to do."

Related Link: Health Insurance Innovations Reports Q1 EPS $0.01 Vs. Est. $0.08

More Insured People = Lower Bad Debt

Miller was asked if more people being insured now than previously is helping Universal's bottom line. He replied, "Yes it is. It has helped us with regard to bad debt, because we had to take care of those people.

"As you know, people present themselves. They must be taken care of, and we had bad debt. All the hospitals had bad debt that was approaching between 15 and 20, 25 percent in some cases.

"Ours was a little under 20 and that has gone down substantially because people have coverage. They can pay, and we help them pay. We help them so that they can be registered in exchanges and have a source of payment," Miller concluded.

Image Credit: Public Domain


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