New Memorial Hospital still on despite owner's struggles

Margarita Cambest
  • Memorial Hospital's struggling parent company wants to sell 17 hospitals.
  • Work on the new York County hospital continues despite the uncertainty.

The parent company of Memorial Hospital is looking to tighten purse strings and sell off hospitals.

An exterior rendering of the new Memorial Hospital shown during the groundbreaking ceremony Tuesday, May 10, 2016, at the former Hawk Lake Golf Course in West Manchester Township. Amanda J. Cain photo

Ahead of Community Health Systems' third-quarter earnings report two weeks ago, shares of the Tennessee-based health care system dropped by 50 percent and remained low last week. That came after a news release announcing a 12 percent decrease in total admissions when compared with the same period in 2015 and a $77 million operating loss.

CHS operates 158 hospitals in 22 states, including 17 in Pennsylvania. Memorial Hospital is located in Spring Garden Township, but CHS is in the process of building a replacement facility in West Manchester Township.

“I won’t say they should be worried, but it raises questions about if Memorial will continue to be part of Community Health or maybe (part of) bigger players who may be active in the local community,” York College assistant professor Pawan Madhogarhia said. He coordinates the NASDAQ training lab on York’s campus, where students learn to use industry software, experience currency trading and analyze financial markets.

What's it going to cost? Pa. hospital bills vary widely

CHS announced Wednesday it is now looking to sell 17 hospitals, five more than previously announced, to raise the capital to pay back billions in debt.

“The question is whether they’ll be able to pay their debts and if the company is able to go forward with the earnings they’re generating,” Madhogarhia said.

CHS expanded quickly in 2014 after acquiring Florida-based Health Management Associates. The struggling hospital operator had already acquired Memorial Hospital in 2012 in a contract that included the 100-bed hospital, the Surgical Center of York and other outpatient and ancillary services. It also included an agreement to construct a replacement hospital within five years of the closing date, according to a CHS news release.

Construction on the $120 million replacement hospital on Loucks Road began in May. When finished, it will feature private patient rooms, an expanded emergency department and a neonatal intensive care unit, Memorial Hospital spokesman Jason McSherry said.

Memorial Hospital breaks ground on new facility

Gettle Incorporated contractor Joseph Brady, of New Bloomfield, Perry County works on a site light pole  Tuesday, Nov. 1, 2016, at the new site for Memorial Hospital in West Manchester Township. Amanda J. Cain photo

In a statement, McSherry said the hospital continues to invest in resources to enhance care and is committed to meeting the health care needs of the community.

“Site preparation and excavation activities continue to progress on our replacement hospital, and the final land development plans were approved by West Manchester Township last week,” he said in an email. “In addition to ongoing construction for our replacement hospital, Memorial welcomed a pediatric specialty practice and a family medicine practice to our network of services this year. Memorial will always be focused on providing quality health care services to our community.”