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Diving briefs:
Ascension Health has concluded a decisive agreement to acquire full ownership of Texas Hospital and its supporting businesses from Community Health System for $460 million, the Health System said Tuesday. Ascension Seton, a subsidiary of Ascension Texas, will purchase the remaining 80% stake in the 126-bed Cedar Park Regional Medical Center. The system already had a small number of interest in Cedar Park, but Ascension said taking full ownership represents a “critical step” towards expanding health services and care access to the central Texas community. The transaction is expected to close this summer, subject to regulatory approval.
Dive Insights:
CHS said plans to sell Cedar Park Regional Medical Center have been in work since at least the fourth quarter of 2024. During the fourth quarter revenue call, CEO Tim Hintgen hinted at the transaction, saying the provider is likely to bring in more hospital sales and generate “meaning revenue” for the health system.
Buyer Ascension Seton operates a network of 13 hospitals and more than 200 care sites, according to an Ascensions press release.
CHS is chasing hospital sales as the Tennessee-based system aims to interpret the portfolio.
The provider is one of the nation’s largest commercial operators, with a portfolio of around 70 hospitals and over 1,000 care sites in its 14 states. However, CHS has been struggling financially recently compared to its peers. Last year, the system said it would sell more than $1 billion in facilities to improve liquidity.
This year, CHS sold Florida-based ShorePoint Health System to AdventHealth in March for $260 million, completed a deal with Duke Health in April, and sold Lake Norman Regional Medical Center for $284 million.
CHS and Ascension have announced their latest deals as hospital mergers and acquisitions are generally popular amidst the volatility of the market.
According to a recent report by Kaufman Hall, only five transactions were announced in the first quarter compared to last year’s 20. Most systems aiming to trade amidst the market slump were in financial trouble, according to consultants.
CHS losses increased between 2023 and 2024, up from a loss of $133 million, due to medical professional fees and refusals from payers.
