The CEO of Franklin-based Community Health Systems says his company is looking to buy more non-profit hospitals over the next few years. Wayne Smith made his remarks in San Francisco, at a gathering of healthcare companies and potential investors.
Community Health has purchased more than 100 hospitals since 2000. Smith says about half of those were non-profits, mostly owned by cities and counties. Now they’re an important part of his company’s bottom line.
“We’ve been able to take these low margin hospitals and turn them into 15, 16 percent margin hospitals over three, four, five years. I don’t see us not able to do that going forward. I think the dynamics are pretty much the same.”
Community Health System’s competitors, including LifePoint and HCA, have also been aggressive in buying non-profits.
Analysts expect 2013 to be a difficult year for the nation’s government and church-owned hospitals. This week, Standard and Poor’s said possible cuts in Medicare along with the costs of implementing healthcare reform could put most in a fiscal squeeze. Many could have no choice but to merge or find a buyer.