CHS sells another hospital to HCA
- Just two weeks after agreeing to sell a Texas hospital to HCA Healthcare, Community Health Systems announced it is selling a hospital in Florida to the Nashville-based hospital chain.
- CHS announced it has signed a definitive agreement to sell 126-bed Highlands Regional Medical Center in Sebring, Fla. The news follows CHS’ announcement earlier this month of plans to sell Weatherford Regional Medical Center in Weatherford, Texas, to HCA.
- Both agreements are part of CHS’ 30 planned hospital divestitures for 2017. The company owns, operates or leases 137 hospitals in 21 states, according to their website.
In February, CHS announced plans to sell at least 25 hospitals this year after losing $1.7 billion in 2016. The divestitures are part of a restructuring plan to drill down about $15 billion in debt incurred with the company’s 2014 purchase of Health Management Associates for $7.5 billion.
In April, CHS completed the sale of Stringfellow Memorial Hospital in Anniston, Ala. The following month, it completed the sale of eight hospitals to Steward Health and announced an agreement to sell a Louisiana hospital to subsidiaries of CHRISTUS Health.
The divestitures continued last month with the sale of five Pennsylvania hospitals to Reading Health System.
During a May earnings call, CHS CEO Wayne Smith said the company’s hospital divestiture plan encompassed 10 deals involving 30 hospitals. Of those, 11 had closed, 12 were under definitive agreement and seven had letters of intent.
“These divestitures account for approximately $3.4 billion of annual revenue and mid-single digit EBITDA margins,” Smith said during the call. “Estimated gross proceeds from these divestitures including working capital are projected to generate $2 billion.
He added that the system will focus less on divestitures in the future.
Terms of the Florida hospital sale were not disclosed. The deal is expected to close this fall, pending regulatory approvals. Once completed, Highland Regional will be part of HCA’s East Florida Division.