Quorum reports $29.2M net loss in third quarter
- Quorum Health continues to struggle as it restructures its portfolio, ending the 2017 third quarter with a net loss of $29.2 million versus a loss of $7 million in the same period last year.
- Revenues fell to $499.3 million, largely attributed to hospital divestitures and loss of revenues from the California Hospital Quality Assurance Fee program.
- The Brentwood, Tenn.-based health system plans more divestitures in the future as it works to reduce debt.
“As we execute our strategy to divest underperforming hospitals, we have completed six transactions through the third quarter with another already completed in the fourth quarter,” Thomas Miller, president and CEO, said in an earnings release. “We expect more divestiture completions in 2018 as we remain dedicated to reducing our debt, managing our costs and increasing our profitability.”
Most of the $43.1 million in proceeds from the six divestitures went to offset debt, the company said.
The 31-hospital system, which spun off from Community Health Systems in 2015, is indicative of many organizations that are struggling to make ends meet as the focus shifts from inpatient to outpatient care.
Quorum shed two hospitals — N.C.-based Sandhills Regional Medical Center and Barrow Regional Medical Center in Georgia — in late 2016. This year’s sales have included Cherokee Medical Center in Alabama, Trinity Hospital of Augusta in Georgia and Sunbury Hospital and Lock Haven Hospital in Pennsylvania.
Tenet has also taken the divestiture route in the face of falling profits. The Dallas-based health system recently announced it is selling eight U.S. hospitals and all nine of its UK facilities, for an expected yield of $900 million to $1 billion. And it signaled plans to exit the Chicago market, where its market share is small, with the sale of MacNeal Hospital to Loyola Medicine.
The trend is likely to continue as the industry continues to shift care to lower-cost outpatient settings. “Health systems are under pressure to ensure they have the right assets in the right place to optimize care,” Anu Singh, managing director at Kaufman Hall, told Healthcare Dive recently.
- Quorum Health Quorum Health Corporation Announced Third Quarter 2017 Operating Results
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