Company: UHS
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000950170-25-027785
Chunk: 173

Company: UNIVERSAL HEALTH SERVICES INC
Filing Date: 2025-02-26
Form: 10-K
Item: Item 1B
Chunk 173
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 hedge transactions that do not qualify for the short-cut method, at the hedge’s inception and on a regular basis thereafter, a formal assessment is performed to determine whether changes in the fair values or cash flows of the derivative instruments have been highly effective in offsetting changes in cash flows of the hedged items and whether they are expected to be highly effective in the future.

The fair value of interest rate swap agreements approximates the amount at which they could be settled, based on estimates obtained from the counterparties. When applicable, we assess the effectiveness of our hedge instruments on a quarterly basis. Although we do not anticipate nonperformance by our counterparties to interest rate swap agreements, the counterparties expose us to credit risk in the event of nonperformance. We do not hold or issue derivative financial instruments for trading purposes.

75

When applicable, we measure our interest rate swaps at fair value on a recurring basis. The fair value of our interest rate swaps is based on quotes from our counterparties.  We consider those inputs to be “level 2” in the fair value hierarchy as outlined in the authoritative guidance for disclosures in connection with derivative instruments and hedging activities.   

The table below presents information about our long-term financial instruments that are sensitive to changes in interest rates as of December 31, 2024. For debt obligations, the table presents principal cash flows and related weighted-average interest rates by contractual maturity dates.

Maturity Date, Fiscal Year Ending December 31

(dollar amounts in thousands)

    2025

    2026

    2027

    2028

    2029

    Thereafter

    Total

    Long-term debt:

    Fixed rate:

    Debt
     
    $
    10,059

    $
    708,317

    $
    11,501

    $
    12,402

    $
    508,665

    $
    1,931,356

    $
    3,182,300

    Average interest rates

    3.2
    %

    3.2
    %

    3.7
    %

    3.6
    %

    3.6
    %

    3.8
    %

    3.5
    %

    Variable rate:

    Debt
     
    $
    30,000

    $
    30,000

    60,000

    60,000

    1,142,241