Triad Hospitals Inc.

Triad Hospitals Inc. took steps to assure analysts that its earnings estimates are sound after Prudential Securities said Nov. 8 that it had lowered the hospital group’s rating from “buy” to “hold.”

Prudential slashed its ratings for all of the hospital industry from “market outperform” to “underperform.”

Triad owns Northwest Health System Inc., the parent of Northwest Medical Center of Benton County and Northwest Medical Center of Washington County.

Hospital stocks have been questions since Tenet Healthcare Corp., the second-largest for-profit hospital group in the nation, was accused of collecting excessive outlier payments from the Medicare program. Outlier payments offset medical costs that exceed fixed Medicare reimbursements. Tenet has reportedly admitted to an aggressive pricing strategy. A federal audit of company finances is underway.

Hospitals typically receive 5 percent of their Medicare reimbursements from outlier payments. Recent reports show about 23.5 percent of Tenet’s Medicare income came from outlier payments.

Triad reported Nov. 14 in its quarterly report that it received 36.2 percent of its total patient revenues from Medicare and Medicaid patients in 2003’s third frame.

Triad reported $894 million in total revenue — a 7.8 percent gain. Income from operations was up dramatically from $6.5 million in the same quarter last year, to $32.6 million this year.