King of Prussia, Pa.-based Universal Health Services reported an operating income of $454 million (9.6% margin) in the third quarter of 2026, down from a $522 million operating income (11.6% margin) during the same period last year, according to financial results published Oct. 27.
The news release comes after UHS completed its acquisition of Talkspace, a virtual behavioral health company, in mid-August for $835 million.
Here are eight things to know:
1. UHS’ net income attributable to the company was $309 million in the third quarter of 2026, down from $373 million in the third quarter of 2025.
2. The health system’s total revenue was $4.7 billion in the third quarter of 2026, up from $4.5 billion during the same period in 2025. Total expenses were $4.3 billion in the third quarter, up from $4 billion during the same quarter last year.
3. UHS had $5.6 billion in long-term debt as of Sept. 30, 2026, up from $4 billion on Dec. 31, 2025.
4. Interest expense rose 46% year over year to $56.3 million, up from $38.4 million for the three months ended Sept. 30, 2025. “The increase in interest rates during the past few years has increased our interest expense significantly thereby reducing our free cash flow,” the release said. “As such, the effects of increased borrowing rates have adversely impacted our results of operations, financial condition and cash flows. We cannot predict future changes to interest rates, however, significant increases in our borrowing rates could have a material unfavorable impact on our future results of operations and our ability to access the capital markets on favorable terms.”
5. On a same-facility basis, acute care hospital adjusted admissions rose 4.9% for the three months ended Sept. 30, 2026, while net revenue per adjusted admission fell 1.7%.
6. UHS’ results included a favorable net pre-tax impact of $47 million in connection with increases in amounts received from Medicaid supplemental payment programs, mainly in Washington, D.C., and California. UHS also added $26 million to liability reserves, connected mostly to a tentative settlement agreement in lawsuits involving Cumberland Hospital for Children and Adolescents in New Kent, Va.
7. “Legislation adopted on July 4, 2025, attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditures,” the news release said. “That legislation also places limits on provider fees used to increase federal Medicaid funding to states and eliminated certain exchange premium tax credits beyond 2025. As these provisions become effective over the next several years, they may be expected to reduce our revenues and likely increase the level of uncompensated care provided by our facilities.”
8. UHS comprises 30 inpatient acute care facilities, 388 inpatient behavioral health facilities, 169 outpatient and other facilities, nationwide virtual behavioral health services, an insurance offering, a physician network and various related services with locations in 40 states, Washington, D.C., Puerto Rico, Ireland and the United Kingdom. It has more than 102,000 employees.
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