Community Health Systems (NYSE: CYH) saw a significant boost in outpatient surgical volumes in its fourth quarter.
That was largely thanks to ambulatory surgery center (ASC) growth, too, according to CHS CEO Tim Hingtgen..
“We are very well positioned for outpatient surgery, and as a result, same-store ASC cases increased 14% last year,” Hingtgen said during his company’s 2024 fourth-quarter earnings call.
The CEO added that CHS ended the year with a total of 47 ambulatory surgery centers within its markets.
Tennessee-based CHS operates a large network of hospitals, emergency rooms and outpatient facilities across the United States. The system has expanded in southern states, in particular, in the last quarter.
“These projects have further improved our competitive position in our Tennessee and Alabama markets, and both continue to ramp up nicely, and we invested in procedural capacity, such as expanding and upgrading cardiac cath lab and other procedural spaces in several health systems,” Hingtgen said.
CHS’ recent acquisitions of urgent care clinics are helping with funneling patients into the ASC setting where appropriate, he continued.
“In 2024, [we saw] significant expansion in outpatient access, such as primary care specialty practices and urgent care centers, in addition to de novo projects,” he said. “We acquired 10 urgent care clinics in Tucson, Arizona, broadening our geographic footprint and ability to care for more patients in this market.”
These channels help broaden CHS’ reach and create referrals for ambulatory surgery centers.
Still, there were challenges, particularly in areas like insurance downgrades and denials, as well as rising medical specialist fees and anesthesia costs, Hingtgen said. To mitigate these pressures, CHS expanded its in-sourcing of hospital services, like anesthesiology, he said.
“In the fourth quarter, for instance, we rapidly sourced anesthesiology in one of our larger markets, a move which we are confident will lead to better, more integrated care and services in the most cost effective manner,” he said. “We anticipate further expansion of internally managed, hospital-based provider services in 2025, which is leading to greater provider satisfaction and stability, positive quality outcomes for our patients, and the opportunity for cost savings.”
Although CHS also invested in hospital expansions, Hingtgen said there is strong momentum in outpatient and ASC settings, which reflects a broader industry trend of shifting appropriate surgeries to more cost-effective facilities with shorter recovery times for patients.
“On our last call, we mentioned the impact of [insurance] downgrades and denials, which continue to be a troubling trend for health care providers,” he said. “However, that situation has shown some stabilization since the third quarter, our utilization management and physician advisor programs are performing as expected as these clinicians advocate for our patients to receive the appropriate care in appropriate settings.”
Net operating revenues for the three months ended Dec. 31, 2024, totaled about $3.3 billion, a 2.6% increase compared to $3.2 billion for the same period in 2023.
Net operating revenues for the year ended Dec. 31, 2024, totaled $12.6 billion, a 1.2% increase compared to $12.5 billion for the same period in 2023.
During 2024, CHS completed two hospital divestitures, one of which was completed on Aug. 1, and one of which was completed on Oct. 1. In 2025, as of Feb. 19, CHS had divested its 50% interest in a hospital as well, with that divesture completed on Feb. 1.
