The Healthcare Breakdown No. 016 - Breaking down where are you getting those numbers from anyways?
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What we’re breaking down: Where healthcare company financials live
What you’ll learn: Step-by-step how to find audited financials
Why it matters: Are you going to take their word for it, or are you going to look for yourself?
Read time: Less time than a Proust novel, for sure (4 minutes for real though)
So, Ascension lost $2B eh?
Hospitals are having the worst year financially ever you say?
Bright Health’s publicist said they went bankrupt because of external market factors, right?
Well, how in the world should I know?
Let me check the financials.
The next question that comes up after, “how do you keep your hair looking so full,” is, “where are you pulling those numbers from?”
Here’s your breakdown quick reference on where to get the numbers:
SEC.gov – when it’s a public company
Google – when you have no idea what you’re doing
MSRB website – when the company issues municipal bonds
IRS 990 – when you want old IRS tax reports for non-profit entities
Don’t forget: Healthcare Breakdown - The Finance Course! is now live. I dare you to have more fun.
Here’s the breakdown:
1. SEC.gov
This is the real site you want: https://www.sec.gov/edgar/search/
What to search for: Publicly traded companies
What you will find: All the required filings for publicly traded companies. There will be more than you probably care about unless you are opening a hedge fund, in which case I doubt you’re reading this anyways. Have fun in Turks and Caicos with your in-laws this Christmas!
What it looks like: Here you go!
The go-to for pulling publicly traded companies.
Thank goodness SPACS are a thing so we have a front row seat to the InsurTech carnage. I mean it’s sad. I’m sad about it. But like, can’t look away.
2. Google
If you don’t know how to navigate to Google, please, leave the internet now.
I mean, just Google it.
What to search for: Anything you can’t find the other places. This is either a first stop or last resort. Usually, last resort.
What you will find: A whole bunch of irrelevant junk you probably have no interest in. But occasionally may just strike bronze.
What it looks like: I don’t know why I am explaining this but…
Here are some results for searching for “AdventHealth financial statements 2022.”
You can see it’s a mix. Usually it’s articles about a health systems financials. There is rarely a link to the actual audited financial statements.
Occasionally you will get a hit on the company’s website linking to the watered down, vanilla community report. Or worse, the management’s discussion of results… ugh.
I mean, if you want to read about financial statements in sentence form, hey, I support you.
Anyways, Google.
3. MSRB website
Here’s the website you want: https://emmalabs.msrb.org/ActiveLabs
What to search for: Non-profit health systems and hospitals
What you will find: A whooooooole bunch of irrelevant things, but also! The audited financials for hospitals and health systems that issue bonds (which is most of them).
What it looks like: Bear with me on this one..
Ok, mayyyyybe I simplified that search experience a little bit. Maybe.
Ok, yes, I did. Sorry.
There can be a little art to this search experience. And by art I mean banging your head against a wall trying to sift through all the issuers, types of filings, and document dates.
But it’s worth it!
The most important thing to note is the issuer is almost never just the health system’s name. It’s usually a Hospital authority doing the issuing.
The filters are also very useful as you can search just for audited financials for example.
I am sure that in 15 to 189 minutes you’ll have it down pat.
4. IRS 990 forms
Here’s the website you want: https://projects.propublica.org/nonprofits/
What to search for: Non-profit health systems and hospitals
What you will find: Old AF, IRS-990 forms for every entity required to file as a non-profit with the IRS. And occasionally an audited financial report.
What it looks like: Voila!
A couple things to note here.
First, 990s are not equivalent to audited financials. Audited accounting rules and IRS rules are different. Loopholes and such.
To that point, there are 3 things I like to use 990s for.
Finding individual hospitals that don’t have stand alone audited financials.
Finding salaries of executives. Not my favorite thing to throw stones at, but that’s a different topic.
Seeing what foreign investments have been made.
All it takes is a bit of scrolling or some CTRL+F to find some pretty interesting stuff.
For example, Novant parked $521M in the Caribbean in 2020. I wonder which bank in Curacao they used.
They didn’t even invite me to their yacht party. Rude.
There you have it.
4 ways to find those pesky numbers and call out your favorite health system near you.
Laters gators.