Franklin, Tenn.-based Community Health Systems, which operates 118 hospitals, saw its net loss grow in the third quarter of 2018.
CHS said revenues dipped to $3.45 billion in the third quarter of 2018, down 6 percent from $3.67 billion in the same period of the year prior. The decline was partially attributable to CHS operating 15 fewer hospitals in the third quarter of 2018 than in the same period of 2017. On a same-hospital basis, revenues climbed 3.2 percent year over year.
CHS said same-hospital admissions decreased 2.3 percent year over year. When adjusted for outpatient activity, admissions were down 0.8 percent in the third quarter of 2018 compared to the same period a year earlier.
After factoring in operating expenses and one-time charges, CHS ended the third quarter of 2018 with a net loss attributable to stockholders of $325 million. That's compared to the third quarter of 2017, when the company recorded a net loss of $110 million.
"We are pleased with the progress we made in the third quarter, and we are encouraged by the momentum we are seeing from strategic and operational initiatives that have been implemented across our portfolio of hospitals," CHS Chairman and CEO Wayne T. Smith said in an earnings release. "We are especially pleased with same-store performance in many of our core markets."
As part of a turnaround plan put into place in 2016, CHS announced plans in 2017 to sell off 30 hospitals. The company completed the divestiture plan Nov. 1, 2017. To further reduce its debt, CHS intends to sell another group of hospitals with combined revenues of $2 billion. The company has already made progress toward that goal.
During 2018, CHS has completed nine hospital divestitures and entered into definitive agreements to sell five others.
"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," Mr. Smith said.
In addition to the hospital divestitures, CHS plans to close two hospitals by the end of this year. Knoxville, Tenn.-based Tennova Healthcare, which is part of CHS, will shut down Regional Medical Center in Knoxville and Lakeway Regional Hospital in Morristown, Tenn., on Dec. 28.
When asked about the planned closures on an earnings call Oct. 30, CHS Executive Vice President and CFO Tom Aaron said shutting down the two hospitals "is an important part about trying to accelerate and making sure we get down to the right portfolio of hospitals."
Mr. Smith said closing the two hospitals "is the right decision" for CHS.
"This has no reflection on the employees or the physicians," he said. "This is a good group of people. They're qualified. They do excellent work. It's a market share issue for us and how we can best consolidate in the market."
CHS' long-term debt totaled $13.54 billion as of Sept. 30, a decrease from $13.88 billion at the end of last year.
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