- Lifepoint Health has signed a definitive agreement to sell three Louisiana hospitals to Allegiance Health Management of Shreveport, Minden Press-Herald reported.
- The facilities in the deal include Minden Medical Center, Mercy Regional Medical Center and Acadian Medical Center. The transaction is expected to close by the end of the year. Financial details were not disclosed.
- Once the sale is complete, Lifepoint, which now operates 71 hospitals in 22 states, will own only one hospital in Louisiana.
Many for-profit hospital systems are divesting properties to focus on profitable markets and chip away at their debt.
Tenet and Community Health Systems, both with debt loads close to $15 billion in 2017, have been selling off facilities in efforts to trim their portfolio and focus on more profitable geographies.
Lifepoint Health reported a net loss of $27 million in Q4 last year, down from a net income of $46.6 million in the quarter a year earlier.
For the full year, the system disclosed a net income of $112.9 million, down from $131.8 million the prior year. The 71-hospital system experienced a 2.7% decrease in patient admissions in 2017 and ended with a net long-term debt load of $2.8 billion.
In an earnings call, the Louisiana markets weren't mentioned, but Lifepoint CEO Bill Carpenter called out one hospital the operator was losing to a competitor in the Georgia market over surgical volumes. Lifepoint ended up divesting its property in the market.
"Outside of that, I think the majority of this is either some slower acuity procedures moving into some physician practices within the community, but the vast majority of it is I think just the general slowdown that we are all experiencing in surgical volumes for the course of 2017," he said on the Q4 earnings call.
As for-profit systems explore and narrow their market focus, hospital divestitures are expected to continue. But they are still looking for select opportunities.
HCA continues to add inpatient beds, for example, and while systems are exploring outpatient access points, certain inpatient services yield higher per-patient-per-service revenue.
These sales also allow other systems to grow and scale their intended target demographic. AHM currently operates 13 hospitals in Louisiana, Texas, Mississippi and Arkansas.