Quorum Health began selling off hospitals in 2016, and the Brentwood, Tenn.-based company plans to further refine its hospital portfolio this year.
Quorum is focused on selling hospitals to improve financial performance. Since its spinoff from Franklin, Tenn.-based Community Health Systems in April 2016, Quorum has divested 10 hospitals and closed one other. The company has received $86.5 million in net proceeds from hospital divestitures, and it has used the bulk of those funds — $84.8 million — to pay down its debt, according to a March 12 filing with the Securities and Exchange Commission.
In the filing, Quorum said it intends to divest or close underperforming hospitals. Quorum President and CEO Bob Fish provided more details about the company's divestiture plan during a fourth-quarter earnings call on March 13.
Mr. Fish said the company is actively marketing both individual hospitals and groups of hospitals. "We continue to see active interest in the assets being marketed," he said. "Once we're able to complete our currently planned divestitures, we expect the profile of our business to consist of 18 to 20 premier rural and non-urban hospitals generating $1.2 million to $1.4 million in revenue with enterprise adjusted EBITDA margins in the mid-teens."
Quorum, which currently owns 27 hospitals, plans to make progress toward its divestiture goal this year. In January, the company entered into a definitive agreement to sell Scenic Mountain Medical Center in Big Spring, Texas. Quorum expects that deal to close by the end of April.
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