DaVita HealthCare Partners Inc. reported that adjusted net income rose almost 4% for the fourth quarter of 2015 to $214 million, or $1.01 per share, compared to $208 million, or $0.96 per share, in the same quarter of 2014.
Adjusted net income for the year was $828 million, or $3.83 per share, which excluded items such as an estimated accrual for damages and liabilities associated with an investigation into DaVita Rx and a whistleblower settlement charge. Net income including these items was $270 million, or $1.25 per share.
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During an earnings call, CEO Kent Thiry said he expects 2016 to be “another solid year.”
Total U.S. dialysis treatments for the fourth quarter of 2015 were 6,649,227, or 84,061 treatments per day, representing a per day increase of 3.2% over the fourth quarter of 2014. Normalized non-acquired treatment growth in the fourth quarter of 2015 as compared to the fourth quarter of 2014 was 3.7%. DaVita provided dialysis services to a total of approximately 190,000 patients at 2,369 outpatient dialysis centers, of which 2,251 centers are located in the United States and 118 centers are located in ten countries outside of the United States. During the fourth quarter of 2015, DaVita opened a 26 new dialysis centers and sold one dialysis center in the United States. The company also acquired 14 dialysis centers and opened one new dialysis center outside of the United States.
Thiry discusses Kidney Care division obstacles, advantages in future
“With respect to Kidney Care and looking out three, four, five years, there’s one big downside and three attractive upsides,” said Thiry. “The big downside is what will happen to private pay. It is unfortunate that we have a large cost shift in our dialysis industry in America with private patients paying a lot more to subsidize the 80% to 90% of our patients that are Medicare and Medicaid. And when you put that on top of payer consolidation, distributed risk pools, exchanges, and other things going on, it would not be prudent to not be nervous about what will happen with private pay.”
He said the upsides include the ESA market, integrated care, and the return of the market basket update in 2019.Thiry said DaVita Kidney Care is seeking a new partnership for providing Erythropoiesis Stimulating Agents, which he said they spend about $800 million a year on. “We are intensely looking for the right long-term partner or partners and hope to consummate some type of long-term partnership well before the expiration of our current contract at the end of 2018.”
Thiry said he is optimistic about DaVita’s ability to perform well in integrated care models. “We are very competent at this. Regardless of who has the risk, we think we will be one of the subcontractors of choice.”