Chicago-based CommonSpirit, one of the largest nonprofit health systems in the country, is undergoing a "comprehensive portfolio review" as it reorganizes into fewer geographical regions, its CFO told an investor call Oct. 12.
The system, which operates 142 hospitals across the country, is aiming to restructure its geographical split into just five regions rather than the current eight, Dan Morissette, CFO, said on the call. The system remains "committed to its current markets," he added.
The news follows restructuring over multiple divisions in recent months including the merging of all the system's California hospital operations into one mega-division.
Of its current regions, three were particularly underperforming in fiscal 2023, namely the Pacific Northwest, the Southeast and Texas, which reported EBIDA losses of $106 million, $163 million and $208 million, respectively, in the year ending June 30.
Specific focus points to help improve the situations in each of those regions include length-of-stay issues in the Pacific Northwest and reducing costs and expanding ambulatory care in Texas, John Petersdorf, senior vice president of operational finance, said on the call. In the Southeast, meanwhile, the focus would be on expanding ambulatory services and there were "significant opportunities" in Tennessee and Kentucky, Mr. Petersdorf added.
Behavioral health and non-acute services could be a specific focus for CommonSpirit going forward in terms of potential merger and acquisition, Mr. Morissette said.
"It is a comprehensive portfolio review," he said. "We are certainly all ears. There is a very intentional focus on each geographical market."
CommonSpirit reported an operating loss of $1.39 billion for the 2023 fiscal year on revenue of $34.51 billion. There was a "marked" improvement in the fourth quarter, something the system is aiming to build on in fiscal 2024, Mr. Petersdorf said on the call.
CommonSpirit has not yet responded to a request for comment and more detail.