Becker's Hospital Review

21 CFO / FINANCE Highmark Health sees net income rise to $1.1B in 2017 By Ayla Ellison P ittsburgh-based Highmark Health, the parent company of insurer High- mark and Allegheny Health Network in Pittsburgh, posted operating income of $616 million in 2017, up from $62 million in 2016. The company's health plan business re- ported an operating gain of $750 million in 2017, an increase of $508 million over the year prior. "These gains were the result of significant progress in the government business, which delivered a $411 million improvement over prior year, as well as an increase in commercial business results of nearly $100 million to $317 million," High- mark said in a news release. On the provider side, Allegheny Health Net- work reported revenues of $3.1 billion, up 8 percent from the year prior. e health sys- tem ended 2017 with operating income of $31 million, compared to an operating loss of $33 million in 2016. Highmark Health said several factors, including stable hospi- tal volumes and more efficient revenue cycle operations, fueled AHN's strong financial results in 2017. Highmark Health reported net income of nearly $1.1 billion in 2017, up from $59 mil- lion in the year prior. "anks to our steady progress and continued momentum, we delivered our strongest finan- cial performance and a capital level of $6.5 billion in 2017, confirming that our strategy is working and that consumers are benefit- ting from increased access to high-quality, community-based, affordable healthcare," said David Holmberg, president and CEO of Highmark Health. "While there is still work to do, we remain firmly committed to, and are well on our way toward, getting healthcare right." n CHS hires debt advisers: 4 things to know By Ayla Ellison F ranklin, Tenn.-based Community Health Systems has hired Citigroup Global Markets, Credit Suisse Securities, JPMorgan Chase, and Lazard Freres & Co. as financial advisers, according to a Securities and Exchange Commission filing. Here are four things to know. 1. CHS said it retained the financial advisers to assist the company in explor- ing refinancing options for its capital structure. 2. CHS' March 15 filing with the SEC came two days after Reorg Research re- ported CHS retained Lazard as a restructuring adviser. CHS shares tumbled 9.8 percent March 13 after the Reorg Research report was released. CHS shares dropped another 1.34 percent March 14, closing the day at $4.43 per share. 3. CHS ended the fourth quarter of 2017 with a net loss of $2 billion on $3.1 billion in revenues. That's compared to the same period of 2016, when the company reported a net loss of $220 million on revenues of $4.5 billion. 4. To improve its finances and reduce its heavy debt load, CHS put a turn- around plan into place in 2016. As part of the initiative, the company an- nounced plans in 2017 to sell off 30 hospitals. CHS completed the divestiture plan Nov. 1. With the help of proceeds from the hospital sales, CHS brought down its long-term debt load from $14.8 billion at the end of 2016 to $13.9 billion at the end of last year. To further reduce its debt, CHS plans to sell an- other group of hospitals with combined revenue of $2 billion. n Nashville General Hospital seeks $46.6M to remain afloat, mayor offers support By Alia Paavola N ashville (Tenn.) General Hospital officials requested $46.6 million from Tennessee for operations in the upcoming fiscal year — a request met with unwavering support from Nashville's newly appointed Mayor, David Briley, according to The Tennessean. Mr. Briley's support comes as a huge relief for the city's public safety-net hos- pital, which was slated to cease inpatient care by the end of fiscal year 2018 under the former mayor's administration. In November, former Nashville Mayor Megan Barry, citing skyrocketing costs and competition, announced the decision to end inpatient care at the safety-net fa- cility — drawing substantial community backlash. However, Ms. Barry resigned as mayor March 6 after admitting to felony theft for using city dollars to fund personal vacations with her head of security, with whom she was having an affair. Mr. Briley, who was appointed after Ms. Barry's scandal, said he disagreed with the former mayor's decision to transition the facility to an ambulatory care center. "Our city has a very long commitment to providing a safety net for health- care in the community," Mr. Briley said during a budget hearing. "That will not change this year." The hospital's $46.6 million request is less than the hospital received the pre- vious fiscal year. n

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