Franklin, Tenn.-based Community Health Systems has sold 43 hospitals over the past two years to help reduce its heavy debt load, and the company plans to continue its divestiture spree this year.
As part of a turnaround plan put into place in 2016, CHS announced plans in 2017 to sell off 30 hospitals. After completing the divestiture plan Nov. 1, 2017, CHS said it planned to sell another group of hospitals that had accounted for $2 billion in combined revenue in 2017.
The company made progress toward its goal in 2018. CHS sold 13 hospitals last year that had roughly $1.1 billion in combined revenue in 2017. The divestitures generated about $400 million in gross proceeds, according to the company's presentation at the J.P. Morgan Healthcare Conference in San Francisco.
The hospital divestitures have helped CHS reduce its debt load. The company's long-term debt totaled $13.54 billion as of Sept. 30, down from $13.88 billion at the end of 2017.
CHS has five hospitals under definitive agreement to sell. The company said those deals and other transactions under consideration are expected to close this year and generate about $900 million in gross proceeds.
CHS ended the third quarter of 2018 with a net loss of $325 million, but leaders expect the company's financial picture to improve as its hospital portfolio shrinks. "We believe our overall performance will continue to improve as we complete additional divestitures and direct our investments into markets where we have the greatest opportunities for growth," CHS Chairman and CEO Wayne T. Smith said in a third-quarter earnings release.
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