The divesture is one of several the health system pursued in 2023 to ease its finances.
Community Health Systems (CHS) was aggressive as a seller this past year in the face of financial turbulence.
The for-profit system's latest deal, a sale of three Florida hospitals to Tampa General Hospital for $294 million, closed earlier this month to give CHS additional resources as it attempts to claw out of the red in 2024.
In the transaction, 120-bed Bravera Health Brooksville in Brooksville, 128-bed Bravera Health Seven Rivers in Crystal River, and 124-bed Bravera Health Spring Hill go to Tampa General Hospital, along with their associated assets, physician clinic operations and outpatient services.
The move followed a string of sales by CHS in 2023. The system agreed to sell two North Carolina hospitals to Novant Health for $320 million in February before signing a deal to sell an El Dorado-based single hospital to South Arkansas Regional Hospital in April. CHS also completed a $92 million sale of a West Virginia hospital to Vandalia Health after agreeing to the transaction in January.
In the second-quarter earnings call with investors, CHS CEO Tim Hingtgen said the divestures "enable us to deliberately focus our resources in markets that we aim as most investable and that can produce greater growth and returns over the long term."
CHS will hope that by trimming down its portfolio and shifting its full focus onto key markets that it can turn around its margins heading into the new year.
The system's recent earnings report revealed it suffered net losses for the third-straight quarter, despite rising patient volume and efforts to bring down labor costs.
"Inflationary pressures continue to impact operating expenses and margins," Hingtgen said on the third-quarter earnings call. "While we remain highly confident in the potential of our overall portfolio, the growth in margin development opportunities in a small number of markets have been hindered in this rising cost environment. We are taking swift and necessary steps to mitigate these headwinds."
After signaling a desire to sell in 2023, CHS may not be done exploring opportunities entering the coming year.
Jay Asser is the contributing editor for strategy at HealthLeaders.
KEY TAKEAWAYS
CHS' sale of Bravera Health Brooksville, Bravera Health Seven Rivers, and Bravera Health Spring Hill to Tampa Bay General Hospital closed this month.
The move followed multiple other divestures by the system this year, which saw CHS finish in the red for three straight quarters.