Community Health Systems, based in Franklin, Tenn., has signed a definitive agreement to enter into a long-term lease of Munroe Regional Medical Center in Ocala, Fla.
Under the deal, CHS will prepay Munroe Regional $200 million to operate the hospital for 40 years. In addition, CHS will invest $150 million to expand and improve the facility and commit another $75 million to go toward Munroe Regional's maintenance, physician recruitment and other service areas. The agreement also includes a clinical affiliation with UF Health Shands in Jacksonville, Fla., which will have a 20 percent stake in Munroe Regional.
The 421-bed Munroe Regional, which was a public-owned hospital, had previously signed a definitive agreement with Naples, Fla.-based Health Management Associates in December. CHS completed its acquisition of Health Management in January and had to sign the Munroe Regional deal with its name.
CHS expects the lease will go live in the second quarter of this year, pending regulatory approval. The company became the largest for-profit hospital chain in the country by number after its acquisition of Health Management. CHS owns, leases or operates 206 hospitals in 29 states, and with Munroe Regional, 26 of those hospitals would be in Florida.
Last year, the board of trustees at Munroe Regional chose Health Management as its suitor over Duke LifePoint Healthcare, a Brentwood, Tenn.-based joint venture between LifePoint Hospitals in Brentwood and Durham, N.C.-based Duke University Health System.
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