Franklin, Tenn.-based Community Health Systems has signed a definitive agreement to sell Commonwealth Health, a three-hospital system in Pennsylvania, to Tenor Health Foundation, a newly formed nonprofit organization.
Eight things to know:
1. The deal includes Regional Hospital of Scranton (186 beds), Moses Taylor Hospital in Scranton (122 beds) and Wilkes-Barre General Hospital (369 beds).
2. CHS terminated a previous agreement to sell the facilities for about $120 million to WoodBridge Healthcare in November. The proposed hospital sales are part of CHS’ broader divestiture strategy.
3. CHS said the transaction is contingent on Tenor securing funding. Once funding is finalized, the sale is expected to close in the fourth quarter, pending customary regulatory approvals. Financial terms of the transaction were not disclosed.
4. The sale would see CHS exit the Pennsylvania market.
5. Tenor was founded by CEO Radha Savitala, a healthcare attorney who led transactions for Orange, Calif.-based Prime Healthcare for more than 10 years and worked with senior executives on growth strategies, according to the company’s website.
6. Tenor aims to own, lease and manage small to medium-sized hospitals with 50 to 200 beds. Its target market are hospitals that are at moderate or high financial risk and are critically or moderately essential to their communities.
7. The company acquired Sharon (Pa.) Regional Hospital — formerly owned by Dallas-based Steward Health Care — in January and reopened the hospital in May .
8. Tenor’s hospital operations strategy will emphasize revenue cycle efficiency, strategic service line expansion, and disciplined expense management across labor, professional services, purchased services, and supply chain operations.
