Segment and Geographic Information

9 Months Ended

Sep. 30, 2020

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 96 hospitals located in Alaska, California, Florida, southern Georgia, Idaho, Indiana, northern Kentucky, Nevada, New Hampshire, North Carolina, South Carolina, Utah and Virginia, and the American Group includes 84 hospitals located in Colorado, northern Georgia, Kansas, southern Kentucky, Louisiana, Mississippi, Missouri, Tennessee and Texas. We also operate seven 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, 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 nine months ended September 30, 2020 and 2019 are summarized in the following table (dollars in millions):

	Quarter						Nine Months
	2020			2019			2020			2019
Revenues:
National Group	$	6,633		$	6,398		$	18,653		$	19,159
American Group		6,073			5,780			16,920			17,001
Corporate and other		605			516			1,667			1,653
	$	13,311		$	12,694		$	37,240		$	37,813
Equity in earnings of affiliates:
National Group	$	(23	)	$	2		$	(26	)	$	(3	)
American Group		(15	)		(10	)		(26	)		(32	)
Corporate and other		(2	)		4			4			12
	$	(40	)	$	(4	)	$	(48	)	$	(23	)
Adjusted segment EBITDA:
National Group	$	1,128		$	1,270		$	3,828		$	4,088
American Group		1,130			1,185			3,653			3,443
Corporate and other		(205	)		(170	)		(562	)		(412	)
	$	2,053		$	2,285		$	6,919		$	7,119
Depreciation and amortization:
National Group	$	312		$	291		$	930		$	839
American Group		286			277			868			828
Corporate and other		96			79			261			235
	$	694		$	647		$	2,059		$	1,902
Adjusted segment EBITDA	$	2,053		$	2,285		$	6,919		$	7,119
Depreciation and amortization		694			647			2,059			1,902
Interest expense		385			448			1,201			1,386
Losses (gains) on sales of facilities		(14	)		—			6			(17	)
Losses on retirement of debt		—			211			295			211
Income before income taxes	$	988		$	979		$	3,358		$	3,637