CHS previewed year-end operating results yesterday. The for-profit hospital chain expects full-year adjusted EBITDA, a measure of profitability, will hover between $1.83 billion and $1.85 billion. This would be at least 6.5 percent lower than 2012’s adjusted EBITDA of $1.98 billion. CHS’ net revenue is expected to total about $13 billion, a tick lower than 2012.
The sizable declines run in lockstep with CHS’ operating figures. The company expects a 6.7 percent decrease in full-year admissions and a 4 percent drop in full-year adjusted admissions compared with 2012. Same-hospital admissions and adjusted admissions are projected to be even worse: a decline of 7.2 percent and 4.7 percent, respectively. CHS attributed the sluggish volumes, particularly in the fourth quarter, to softer flu rates and lower readmissions.
CHS released a preview of its 2013 results as the company prepares to complete its acquisition of Naples, Fla.-based Health Management Associates. Health Management shareholders will vote on the pending deal tomorrow.
CHS did not factor in merger-related expenses to its preview, nor did it factor the $98 million reserve set aside to cover a settlement with the Department of Justice. In the third quarter, the company announced the DOJ is investigating CHS’ Medicare short-stay hospital admissions at the company’s 326-bed Laredo (Texas) Medical Center.
CHS also announced more than $4 billion in new financing for the Health Management acquisition. The chain believes its net revenue this year could top $21 billion, and adjusted EBITDA could reach $3.2 billion, if and when the deal is closed.
More Articles on CHS:
For-Profit Hospital Stocks in 2013: The Year in Review
The Most Influential Hospital Transactions of 2013
American Federation of Teachers Criticizes CHS-HMA Transaction
At the Becker's 11th Annual IT + Revenue Cycle Conference: The Future of AI & Digital Health, taking place September 14–17 in Chicago, healthcare executives and digital leaders from across the country will come together to explore how AI, interoperability, cybersecurity, and revenue cycle innovation are transforming care delivery, strengthening financial performance, and driving the next era of digital health. Apply for complimentary registration now.
