Franklin,Tenn.-based Community Health Systems, a huge for-profit company, plans to sell off 38 hospitals, most of them in small and rural markets, and shift its focus to large markets and regional networks. The hospitals and a consulting subsidiary will be spun off into a new publicly traded company.
Partial translation: The company wants to move away from rural hospitals, which aren’t doing very well these days.The sales would mean that CHS, which now has 196 hospitals, would lose its status as the largest U.S. hospital company by hospital count.
The new company will be called Quorum Health Corp. to retain the identity of its consulting arm, Quorum Health Resources.
“This transaction will allow Quorum Health Corp.’s hospitals to focus on the changes in the healthcare delivery system, which are different in smaller community hospitals than in our larger and more urbanized markets,” CEO Wayne Smith said.
“At the same time, the transaction will facilitate a sharper focus on the hospitals that are retained by Community Health Systems, especially in high-opportunity markets and in areas where we are building regional healthcare networks.”