UHS Profit Falls as Medicaid Boost Shrinks

The Tip Desk · November 8, 2026 · 3 min read

Net income attributable to UHS was $308.7 million, or $5.22 a share, as third-quarter revenue growth slowed to 5.3%.

Universal Health Services, Inc. (UHS) reported net income attributable to UHS of $308.7 million, or $5.22 a share, for the third quarter of 2026, down from $373.0 million, or $5.86 a share, a year earlier.

Net revenues rose 5.3% to $4.733 billion, a slower pace than the 8.3% increase in the second quarter and 9.6% in the first. EBITDA net of NCI was $640.4 million, a 13.5% margin, versus $684.2 million, or 15.2% of revenue, a year earlier. Adjusted EBITDA net of NCI was $624.6 million, or 13.2% of revenue.

The company said third-quarter results included an aggregate net favorable pre-tax impact of about $21 million that was not in its July 2026 operating forecast. That net item comprised a $47 million favorable net pre-tax effect, net of related provider taxes, from higher amounts received from Medicaid supplemental payment programs in various states, primarily Washington, D.C. and California, offset by a $26 million unfavorable pre-tax increase to reserves for self-insured professional and general liability claims tied to a tentative settlement in the Cumberland Hospital litigation. In the year-ago quarter, a similar net favorable item of about $55 million included $90 million of pre-tax Washington, D.C. Medicaid directed-payment reimbursements and a $35 million pre-tax reserve charge.

A year earlier, Medicaid supplemental programs had been a larger lift. In the second quarter of 2026, a Florida Medicaid directed-payment program had produced a $100 million favorable net pre-tax impact. The third-quarter supplemental-payment benefit was smaller, and the liability-reserve increase was of a similar size to the $28 million reserve increase recorded in the second quarter.

At acute care hospitals owned in both periods, adjusted admissions and adjusted patient days each rose 4.9% from the third quarter of 2025. Net revenue per adjusted admission and per adjusted patient day each fell 1.7%. Same-facility acute care revenues increased 4.7%. Behavioral health same-facility adjusted admissions rose 2.5% and adjusted patient days 2.1%; net revenue per adjusted admission rose 1.7% and per adjusted patient day 2.1%. Same-facility behavioral health revenues increased 4.0%.

Interest expense, net, was $56.3 million, compared with $38.4 million a year earlier. Debt was $5.707 billion and debt to total capitalization was 42.9%. The company said it completed its acquisition of Talkspace, Inc. in August 2026 and listed integration as a forward-looking risk.

In the third quarter, UHS repurchased 1.35 million shares for about $242.1 million, at an average price of about $179 a share. Remaining repurchase authorization was about $735.4 million as of September 30, 2026. Available borrowing capacity on the $1.5 billion revolving credit facility was $1.187 billion.

The company said it believes a substantial portion of the tentative Cumberland settlement and related expenses is covered by commercial excess insurance, with the remainder covered by reserves recorded in connection with the litigation. Terms of the aggregate settlement are confidential.