King of Prussia, Pa.-based Universal Health Services is seeing almost no offset from commercial coverage as patients drop off the ACA exchanges, CFO Steve Filton said on the for-profit system’s July 28 earnings call.
Responding to an analyst question about uncompensated care trends, Mr. Filton said the decline in exchange enrollment during the quarter was matched almost dollar-for-dollar by a rise in self-pay volume.
“What was fairly apparent in the second quarter was that the decline in exchange volumes was offset almost on a direct one-for-one basis to an increase in self-pay volumes,” Mr. Filton said. “It felt like virtually everyone who lost their exchange coverage became an uninsured patient.”
UHS had originally assumed that 10% to 20% of patients losing exchange coverage would pick up other commercial insurance, most likely through an employer, Mr. Filton said.
“That didn’t seem to be true, and probably that phenomena is what gave rise to the $10 million increase in our exchange impact projection from $75 million to $85 million,” he said.
Exchange volumes fell about 15% year over year in the second quarter, less steep than the more than 25% decline UHS had built into its original 2026 forecast. The system, however, said it expects the full-year pretax financial headwind to land near the upper end of its guidance, citing shifts in exchange “metal tier” selection as another factor
pressuring results.
UHS recorded an operating income of $516.7 million (11.1% operating margin) during the second quarter of 2026, compared to an operating income of $500.3 million (11.7% margin) during the same period last year.
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