Community Health Systems reported a loss for the fourth quarter of 2015, as the Franklin, Tenn.-based for-profit hospital operator's profits were dragged down by lower admissions and costs associated with its 38-hospital spinoff.
CHS reported operating revenue fell to $4.8 billion in the final quarter of 2015, down 2.4 percent from the same period of the year prior. The slump in revenue was partially attributable to a 3.6 percent decrease in total admissions year over year. When adjusted for outpatient activity, admissions were down 1.5 percent in the fourth quarter of last year, compared to the same period of 2014.
CHS Chairman and CEO Wayne T. Smith said patient volume in the fourth quarter of 2014 was strong due to higher admissions and emergency room visits attributed to respiratory illness and the flu.
Certain adjustments affected CHS' financial results in the fourth quarter, including an increase in its allowance for doubtful accounts, and expenses related to the planned spin-off of a new company. Last August, CHS announced plans for a spin-off transaction to create Quorum Health Corp. — a new, publicly traded company with 38 affiliated hospitals and related outpatient services in 16 states. The transaction is expected to close during the first half of 2016.
Mr. Smith said CHS' financial results were also hurt by slower-than-expected benefits from its 2014 acquisition of Health Management Associates in Naples, Fla.
"It is taking longer than expected to achieve operational improvements in some of the former HMA markets; however, we continue to see opportunities in these markets and remain convinced that performance will improve over time," said Mr. Smith.
CHS ended the final quarter of 2015 with a loss of $83 million, down from a profit of $100 million a year earlier.
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