U.S. Sen. Bob Casey has alleged that Franklin, Tenn.-based Community Health System prioritizes profits over quality care and is demanding the system find a trustworthy buyer for two of its Pennsylvania hospitals it plans to sell.
In a July 25 letter to CHS CEO Tim Hingtgen, Mr. Casey claims that the for-profit system buys and sells hospitals, often without fulfilling its commitment to invest in them. CHS plans to take in $1 billion in revenue from hospital sales in 2024 and aims to sell Wilkes-Barre (Pa.) General Hospital and Moses Taylor/Regional Hospital in Scranton, Pa.
"Community Health Services has repeatedly forgone efforts to invest in their Pennsylvania facilities and risked the quality and accessibility of care for Pennsylvanians in the pursuit of profit for their shareholders and executives," Mr. Casey wrote. "It is CHS' responsibility to find a trustworthy buyer who has a strong record and experience in running hospitals in order to provide a pathway to safe, affordable and accessible care for their patients and to the Northeastern Pennsylvania community."
The 71-hospital-system, which has more than $11.5 billion in long-term debt, is also under federal investigation for practices and procedures related to utilization review, inpatient admission and inpatient dialysis at its hospitals. In 2018, CHS agreed to pay the Justice Department $262 million to resolve allegations it billed government payers for outpatient and observational services as inpatient services, and paid physicians for referrals.
CHS reported a net loss of $13 million in the second quarter, compared to a net loss of $38 million in the second quarter last year, according to financial results published July 24.
The health system has not purchased a hospital in the last eight years, but has added beds to existing facilities. Since 2020, it has offloaded more than 30 hospitals. Last year, the company sold eight hospitals as well as the sale of a majority interest in another.
"We are proud of our Commonwealth Health hospitals' track record of delivering safe, quality care in their communities and have been working diligently with numerous state officials over the last year to identify a sustainable path forward for these hospitals," a spokesperson for CHS said in a statement shared with Becker's. "We look forward to sharing with [Mr. Casey's] office all of the work that we have done to try to make these hospitals sustainable in the short term and for the future."