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November 17, 2016 12:00 AM

CHS has buyer for hospitals in Spokane, Wash.

Dave Barkholz
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    Struggling Community Health Systems has agreed to sell its two-hospital system in Spokane, Wash. for $425 million.

    MultiCare Health System is buying Rockwood Health System, which includes 388-bed Deaconess Hospital in Spokane, 123-bed Valley Hospital in Spokane Valley and the multi-specialty Rockwood Clinic. The companies said the price is subject to certain unidentified adjustments.

    CHS is divesting hospitals and other assets to reduce a crushing $15 billion debt.

    “Rockwood Health System is a strong healthcare system, and we have carefully considered how to position it for future success,” said CHS CEO Wayne Smith. “The hospitals and clinic will benefit from joining a growing regional health system that is expanding its network across the Pacific Northwest.”

    Not-for-profit MultiCare owns five hospitals in the Tacoma area, including Tacoma General Hospital and MultiCare Good Samaritan. The system has annual revenue of about $2 billion, while the CHS system in Spokane has revenue of $525 million, MultiCare CEO Bill Robertson said.

    The deal is expected to close in the first quarter of 2017 and is subject to regulatory approvals.

    CHS is the nation's second-largest investor-owned hospital company with 158 hospitals.

    Earlier this month, CHS said it was trying to sell 17 hospitals, its home-care business and other real estate. Those deals were expected to bring about $1.2 billion, all of which is to be used to reduce debt.

    CHS, which is considering selling off its entire company, has a debt level 6.5 times EBITDA, an amount nearly twice that of rival HCA Holdings. CHS has struggled to digest its $7.6 billion acquisition of Health Management Associates in 2014.

    It's made several moves to try and right its course. In April, CHS spun-off 38 small and rural hospitals into a separate company, Quorum Health Corp.

    CHS said it would look to divest hospitals that were outside of its half-dozen or so core markets where it has multiple hospitals fed by physician clinics and ambulatory centers.

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      • Transformation
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      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Opinion
      • Bold Moves
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      • Vital Signs Blog
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • Data Center
      • Data Center Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
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    • MORE+
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