Segment and Geographic Information

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment and Geographic Information

NOTE 11 — SEGMENT AND GEOGRAPHIC INFORMATION

We operate in one line of business, which is operating hospitals and related health care entities. We operate in two geographically organized groups: the National and American Groups. The National Group includes 83 hospitals located in Alaska, California, Florida, southern Georgia, Idaho, Indiana, northern Kentucky, Nevada, New Hampshire, South Carolina, Utah and Virginia, and the American Group includes 79 hospitals located in Colorado, northern Georgia, Kansas, southern Kentucky, Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas. We also operate six hospitals in England, and these facilities are included in the Corporate and other group.

Adjusted segment EBITDA is defined as income before depreciation and amortization, interest expense, losses (gains) on sales of facilities, losses on retirement of debt, legal claim costs, income taxes and net income attributable to noncontrolling interests. We use adjusted segment EBITDA as an analytical indicator for purposes of allocating resources to geographic areas and assessing their performance. Adjusted segment EBITDA is commonly used as an analytical indicator within the health care industry, and also serves as a measure of leverage capacity and debt service ability. Adjusted segment EBITDA should not be considered as a measure of financial performance under generally accepted accounting principles, and the items excluded from adjusted segment EBITDA are significant components in understanding and assessing financial performance. Because adjusted segment EBITDA is not a measurement determined in accordance with generally accepted accounting principles and is thus susceptible to varying calculations, adjusted segment EBITDA, as presented, may not be comparable to other similarly titled measures of other companies. The geographic distributions of our revenues, equity in earnings of affiliates, adjusted segment EBITDA and depreciation and amortization for the quarters and six months ended June 30, 2015 and 2014 are summarized in the following table (dollars in millions):

	Quarter						Six Months
	2015			2014			2015			2014
Revenues:
National Group	$	4,698		$	4,270		$	9,348		$	8,432
American Group		4,699			4,447			9,200			8,599
Corporate and other		500			513			1,025			1,031
	$	9,897		$	9,230		$	19,573		$	18,062
Equity in earnings of affiliates:
National Group	$	(4	)	$	(3	)	$	(7	)	$	(6	)
American Group		(8	)		(8	)		(16	)		(15	)
Corporate and other		2			2			(6	)		3
	$	(10	)	$	(9	)	$	(29	)	$	(18	)
Adjusted segment EBITDA:
National Group	$	1,086		$	946		$	2,165		$	1,803
American Group		1,043			1,133			1,991			1,983
Corporate and other		(121	)		(79	)		(187	)		(142	)
	$	2,008		$	2,000		$	3,969		$	3,644
Depreciation and amortization:
National Group	$	188		$	190		$	377		$	377
American Group		222			210			443			415
Corporate and other		59			54			122			109
	$	469		$	454		$	942		$	901
Adjusted segment EBITDA	$	2,008		$	2,000		$	3,969		$	3,644
Depreciation and amortization		469			454			942			901
Interest expense		425			427			844			887
Losses (gains) on sales of facilities		5			(11	)		(4	)		(32	)
Losses on retirement of debt		125			226			125			226
Legal claim costs		—			—			—			78
Income before income taxes	$	984		$	904		$	2,062		$	1,584