NetCare Health Systems last week said it plans to unload four of its 14 hospitals as part of a strategy to focus on larger markets.
The hospitals for sale are 34-bed Central Texas Hospital in Cameron; 39-bed Chatuge Regional Hospital and Nursing Home in Hiawassee, Ga.; 40-bed Marshall County Medical Center in Holly Springs, Miss.; and 50-bed Stone County Hospital in Wiggins, Miss.
"They are all in small markets, and we just feel we can do a better job providing care in those communities that are larger," said Michael Koban Jr., president and chief executive officer of Nashville-based NetCare.
By larger, he said he meant communities like one near Dallas-Denton, Texas, with a population of about 100,000, where the company owns 110-bed Denton Community Hospital.
All four of the hospitals the company is selling have experienced turnover at the top management levels in the past year, which some of the former hospital CEOs had attributed to difficulties in turning around the hospitals' financial performances (May 10, p. 76).
Koban declined to provide revenue figures for each hospital. Of the company's 10 other hospitals, however, eight are the only ones in their communities, and the other two are one of two hospitals in their communities, he said.
The company does not plan to sell any of its other holdings, Koban said.
NetCare has not identified buyers for the four hospitals yet.
"We would be open to any reasonable sort of proposal," Koban said. NetCare was formed as a private, for-profit company in 1996. Its annual revenues are between $275 million and $300 million, according to the company.
NetCare was formed to acquire and operate acute-care community hospitals in nonurban markets, but Koban doesn't define his company as a rural provider. Instead, he said, NetCare seeks markets with few healthcare delivery options.
"Everyone always says rural," he said. "We've always said less competitive."