Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 24, 2020 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-15925 | |
Entity Registrant Name | COMMUNITY HEALTH SYSTEMS INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3893191 | |
Entity Address, Address Line One | 4000 Meridian Boulevard | |
Entity Address, City or Town | Franklin | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 37067 | |
City Area Code | 615 | |
Local Phone Number | 465-7000 | |
Title of 12(b) Security | Common Stock, $.01 par value | |
Trading Symbol | CYH | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 119,665,237 | |
Entity Central Index Key | 0001108109 | |
Amendment Flag | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Condensed Consolidated Statements of Income (Loss) [Abstract] | ||
Net operating revenues | $ 3,025 | $ 3,376 |
Operating costs and expenses: | ||
Salaries and benefits | 1,408 | 1,542 |
Supplies | 498 | 558 |
Other operating expenses | 737 | 811 |
Government and other legal settlements and related costs | 2 | 5 |
Lease cost and rent | 81 | 80 |
Depreciation and amortization | 144 | 153 |
Impairment and loss on sale of businesses, net | 45 | 38 |
Total operating costs and expenses | 2,915 | 3,187 |
Income from operations | 110 | 189 |
Interest expense, net | 262 | 257 |
Loss from early extinguishment of debt | 4 | 31 |
Equity in earnings of unconsolidated affiliates | (7) | (5) |
Loss before income taxes | (149) | (94) |
(Benefit from) provision for income taxes | (183) | 7 |
Net income (loss) | 34 | (101) |
Less: Net income attributable to noncontrolling interests | 16 | 17 |
Net income (loss) attributable to Community Health Systems, Inc. stockholders | $ 18 | $ (118) |
Earnings (loss) per share attributable to Community Health Systems, Inc. common stockholders: | ||
Basic | $ 0.15 | $ (1.04) |
Diluted | $ 0.15 | $ (1.04) |
Weighted-average number of shares outstanding: | ||
Basic | 114,301,519 | 113,257,608 |
Diluted | 114,379,331 | 113,257,608 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) [Abstract] | ||
Net income (loss) | $ 34 | $ (101) |
Other comprehensive income (loss), net of income taxes: | ||
Net change in fair value of interest rate swaps, net of tax | (2) | |
Net change in fair value of available-for-sale debt securities, net of tax | 2 | 2 |
Other comprehensive income | 2 | |
Comprehensive income (loss) | 36 | (101) |
Less: Comprehensive income attributable to noncontrolling interests | 16 | 17 |
Comprehensive income (loss) attributable to Community Health Systems, Inc. stockholders | $ 20 | $ (118) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 246 | $ 216 |
Patient accounts receivable | 2,100 | 2,258 |
Supplies | 354 | 354 |
Prepaid income taxes | 47 | 48 |
Prepaid expenses and taxes | 188 | 193 |
Other current assets | 425 | 358 |
Total current assets | 3,360 | 3,427 |
Property and equipment | 9,618 | 9,653 |
Less accumulated depreciation and amortization | (4,096) | (4,045) |
Property and equipment, net | 5,522 | 5,608 |
Goodwill | 4,322 | 4,328 |
Deferred income taxes | 50 | 38 |
Other assets, net | 2,191 | 2,208 |
Total assets | 15,445 | 15,609 |
Current liabilities: | ||
Current maturities of long-term debt | 30 | 20 |
Current operating lease liabilities | 132 | 136 |
Accounts payable | 727 | 811 |
Accrued liabilities: | ||
Employee compensation | 593 | 594 |
Accrued interest | 180 | 189 |
Other | 503 | 532 |
Total current liabilities | 2,165 | 2,282 |
Long-term debt | 13,525 | 13,385 |
Deferred income taxes | 29 | 200 |
Long-term operating lease liabilities | 514 | 487 |
Other long-term liabilities | 846 | 894 |
Total liabilities | 17,079 | 17,248 |
Redeemable noncontrolling interests in equity of consolidated subsidiaries | 502 | 502 |
Community Health Systems, Inc. stockholders' deficit: | ||
Preferred stock, $.01 par value per share, 100,000,000 shares authorized; none issued | ||
Common stock, $.01 par value per share, 300,000,000 shares authorized; 119,678,238 shares issued and outstanding at March 31, 2020, and 117,822,631 shares issued and outstanding at December 31, 2019 | 1 | 1 |
Additional paid-in capital | 2,001 | 2,008 |
Accumulated other comprehensive loss | (7) | (9) |
Accumulated deficit | (4,200) | (4,218) |
Total Community Health Systems, Inc. stockholders' deficit | (2,205) | (2,218) |
Noncontrolling interests in equity of consolidated subsidiaries | 69 | 77 |
Total stockholders' deficit | (2,136) | (2,141) |
Total liabilities and stockholders' deficit | $ 15,445 | $ 15,609 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Preferred stock, par value per share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value per share | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 119,678,238 | 117,822,631 |
Common stock, shares outstanding | 119,678,238 | 117,822,631 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 34 | $ (101) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 144 | 153 |
Deferred income taxes | (184) | 6 |
Government and other legal settlements and related costs | 2 | 5 |
Stock-based compensation expense | 2 | 3 |
Impairment and loss on sale of businesses, net | 45 | 38 |
Loss from early extinguishment of debt | 4 | 31 |
Other non-cash expenses, net | 49 | 36 |
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures: | ||
Patient accounts receivable | 158 | (10) |
Supplies, prepaid expenses and other current assets | (53) | 14 |
Accounts payable, accrued liabilities and income taxes | (78) | 17 |
Other | (66) | (59) |
Net cash provided by operating activities | 57 | 133 |
Cash flows from investing activities: | ||
Acquisitions of facilities and other related businesses | (4) | |
Purchases of property and equipment | (99) | (121) |
Proceeds from disposition of hospitals and other ancillary operations | 2 | 161 |
Purchases of available-for-sale debt securities and equity securities | (17) | (15) |
Proceeds from sales of available-for-sale debt securities and equity securities | 21 | 32 |
Increase in other investments | (16) | (34) |
Net cash (used in) provided by investing activities | (109) | 19 |
Cash flows from financing activities: | ||
Repurchase of restricted stock shares for payroll tax withholding requirements | (1) | (1) |
Deferred financing costs and other debt-related costs | (32) | (25) |
Proceeds from noncontrolling investors in joint ventures | 1 | |
Redemption of noncontrolling investments in joint ventures | (2) | (1) |
Distributions to noncontrolling investors in joint ventures | (30) | (27) |
Proceeds from sale-lease back | 2 | |
Other borrowings | 14 | 12 |
Issuance of long-term debt | 1,462 | 1,840 |
Proceeds from ABL facility | 540 | 25 |
Repayments of long-term indebtedness | (1,871) | (1,895) |
Net cash provided by (used in) financing activities | 82 | (71) |
Net change in cash and cash equivalents | 30 | 81 |
Cash and cash equivalents at beginning of period | 216 | 196 |
Cash and cash equivalents at end of period | 246 | 277 |
Supplemental disclosure of cash flow information: | ||
Interest payments | (264) | (189) |
Income tax refunds (payments), net | $ 2 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies Disclosure | 1. BASIS OF PRES ENTATION AND SIGNIFICANT ACCOUNTING POLICIES The unaudited condensed consolidated financial statements of Community Health Systems, Inc. (the “Parent” or “Parent Company”) and its subsidiaries (the “Company”) as of March 31, 2020 and December 31, 2019 and for the three-month periods ended March 31, 2020 and 2019, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such periods. All intercompany transactions and balances have been eliminated. The results of operations for the three months ended March 31, 2020, are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2020. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements. Actual results could differ from these estimates under different assumptions or conditions. Where applicable, the impact, if any, resulting from the emergence of a novel coronavirus (“COVID-19”) during the three months ended March 31, 2020, has been considered. Certain information and disclosures normally included in the notes to the consolidated financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission (the “SEC”). The Company believes the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2019, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 20, 2020 (“2019 Form 10-K”). Certain prior period amounts have been reclassified to conform to the current period presentation within the condensed consolidated statements of cash flows. During the first quarter of 2020, the Company early adopted the SEC’s Financial Disclosures About Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize a Registrant’s Securities rules, which simplify the disclosure requirements related to the Company’s registered debt securities under Rule 3-10 of Regulation S-X (see Note 15). Noncontrolling interests in less-than-wholly-owned consolidated subsidiaries of the Parent are presented as a component of total equity on the condensed consolidated balance sheets to distinguish between the interests of the Parent Company and the interests of the noncontrolling owners. Noncontrolling interests that are redeemable or may become redeemable at a fixed or determinable price at the option of the holder or upon the occurrence of an event outside of the control of the Company are presented in mezzanine equity on the condensed consolidated balance sheets. Substantially all of the Company’s operating costs and expenses are “cost of revenue” items. Operating costs that could be classified as general and administrative by the Company include the Company’s corporate office costs at its Franklin, Tennessee office, which were $37 million and $43 million for the three months ended March 31, 2020 and 2019, respectively. Included in these corporate office costs is stock-based compensation of $2 million and $3 million for the three months ended March 31, 2020 and 2019, respectively. Throughout these notes to the condensed consolidated financial statements, Community Health Systems, Inc., and its consolidated subsidiaries are referred to on a collective basis as the “Company.” This drafting style is not meant to indicate that the publicly traded Parent or any particular subsidiary of the Parent owns or operates any asset, business, or property. The hospitals, operations and businesses described in this filing are owned and operated by distinct and indirect subsidiaries of Community Health Systems, Inc. Revenue Recognition. Net Operating Revenues Net operating revenues are recorded at the transaction price estimated by the Company to reflect the total consideration due from patients and third-party payors in exchange for providing goods and services in patient care. These services are considered to be a single performance obligation and have a duration of less than one year. Revenues are recorded as these goods and services are provided. The transaction price, which involves significant estimates, is determined based on the Company’s standard charges for the goods and services provided, with a reduction recorded for price concessions related to third party contractual arrangements as well as patient discounts and other patient price concessions. During both of the three month periods ended March 31, 2020 and March 31, 2019, the impact of changes to the inputs used to determine the transaction price was considered immaterial. Currently, several states utilize supplemental reimbursement programs for the purpose of providing reimbursement to providers that is not specifically tied to an individual’s care, some of which offsets a portion of the cost of providing care to Medicaid and indigent patients. These programs are designed with input from the Centers for Medicare & Medicaid Services (“CMS”) and are funded with a combination of state and federal resources, including, in certain instances, fees or taxes levied on the providers. Under these supplemental programs, the Company recognizes revenue and related expenses in the period in which amounts are estimable and collection is reasonably assured. Reimbursement under these programs is reflected in net operating revenues and fees, taxes or other program-related costs are reflected in other operating expenses. The Company’s net operating revenues during the three months ended March 31, 2020 and 2019 have been presented in the following table based on an allocation of the estimated transaction price with the patient between the primary patient classification of insurance coverage (in millions): Three Months Ended March 31, 2020 2019 Medicare $ 756 $ 889 Medicaid 407 428 Managed Care and other third-party payors 1,832 2,025 Self-pay 30 34 Total $ 3,025 $ 3,376 Patient Accounts Receivable Patient accounts receivable are recorded at net realizable value based on certain assumptions determined by each payor. For third-party payors including Medicare, Medicaid, and Managed Care, the net realizable value is based on the estimated contractual reimbursement percentage, which is based on current contract prices or historical paid claims data by payor. For self-pay accounts receivable, which includes patients who are uninsured and the patient responsibility portion for patients with insurance, the net realizable value is determined using estimates of historical collection experience without regard to aging category. These estimates are adjusted for estimated conversions of patient responsibility portions, expected recoveries and any anticipated changes in trends. Patient accounts receivable can be impacted by the effectiveness of the Company’s collection efforts. Additionally, significant changes in payor mix, business office operations, economic conditions or trends in federal and state governmental healthcare coverage could affect the net realizable value of accounts receivable. The Company also continually reviews the net realizable value of accounts receivable by monitoring historical cash collections as a percentage of trailing net operating revenues, as well as by analyzing current period net revenue and admissions by payor classification, aged accounts receivable by payor, days revenue outstanding, the composition of self-pay receivables between pure self-pay patients and the patient responsibility portion of third-party insured receivables and the impact of recent acquisitions and dispositions. Final settlements for some payors and programs are subject to adjustment based on administrative review and audit by third parties. As a result of these final settlements, the Company has recorded amounts due to third-party payors of $87 million and $83 million as of March 31, 2020 and December 31, 2019, respectively, and these amounts are included in accrued liabilities-other in the accompanying condensed consolidated balance sheets. Amounts due from third-party payors were $131 million and $137 million as of March 31, 2020 and December 31, 2019, respectively, and are included in other current assets in the accompanying condensed consolidated balance sheets. Substantially all Medicare and Medicaid cost reports are final settled through 2016. Charity Care In the ordinary course of business, the Company renders services to patients who are financially unable to pay for hospital care. The Company’s policy is to not pursue collections for such amounts; therefore, the related charges for those patients who are financially unable to pay and that otherwise do not qualify for reimbursement from a governmental program are not reported in net operating revenues, and are thus classified as charity care. The Company determines amounts that qualify for charity care primarily based on the patient’s household income relative to the federal poverty level guidelines, as established by the federal government. These charity care services are estimated to be $166 million and $141 million for the three months ended March 31, 2020 and 2019, respectively, representing the value (at the Company’s standard charges) of these charity care services that are excluded from net operating revenues. The estimated cost incurred by the Company to provide these charity care services to patients who are unable to pay was approximately $ 19 million and $ 15 million during the three months ended March 31, 2020 and 2019, respectively. The estimated cost of these charity care services was determined using a ratio of cost to gross charges and applying that ratio to the gross charges associated with providing care to charity patients for the period. Accounting for the Impairment or Disposal of Long-Lived Assets. During the three months ended March 31, 2020, the Company recorded a total combined net impairment charge and gain on disposal of approximately $45 million. An impairment charge of approximately $64 million was recorded primarily to ad just the carrying value of long-lived assets at several hospitals where the Company is in discussions with potential buyers for divestiture at a sales price that indicates a fair value below carrying value. Included in the carrying value of the hospital disposal groups at March 31, 2020 is a net allocation of approximately $6 million of goodwill allocated from the hospital op erations reporting unit based on a calculation of the disposal groups’ relative fair value compared to the total reporting unit. The impairment charge was partially offset by a gain of approximately $19 million related to three hospitals sold on January 1, 2020. The Company will continue to evaluate the potential for further impairment of the long-lived assets of underperforming hospitals as well as evaluate offers for potential sales. Based on such analysis, additional impairment charges may be recorded in the future. During the three months ended March 31, 2019, the Company recorded a total combined impairment charge and loss on disposal of approximately $38 million to reduce the carrying value of closed hospitals and certain hospitals that have been deemed held for sale based on the difference between the carrying value of the hospital disposal groups compared to the estimated fair value less costs to sell. New Accounting Pronouncements . In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020- 04, “Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This ASU provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria that reference LIBOR or another rate that is expected to be discontinued. The amendments in the ASU are effective for all entities as of March 12, 2020 through December 31, 2022. The adoption of this guidance did not have a material impact on the Company’s condensed consolidated financial position or results of operations. The Company has evaluated all other recently issued, but not yet effective, ASUs and does not expect the eventual adoption of these ASUs to have a material impact on its condensed consolidated financial position or results of operations. |
Accounting for Stock-Based Comp
Accounting for Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Accounting for Stock-Based Compensation [Abstract] | |
Accounting for Stock-Based Compensation Disclosure | 2. ACCOUNTING FOR STOCK-BASED COMPENSATION Stock-based compensation awards have been granted under the Community Health Systems, Inc. Amended and Restated 2000 Stock Option and Award Plan, amended and restated as of March 20, 2013 (the “2000 Plan”), and the Community Health Systems, Inc. Amended and Restated 2009 Stock Option and Award Plan, which was amended and restated as of March 14, 2018 and approved by the Company’s stockholders at the annual meeting of stockholders held on May 15, 2018 (the “2009 Plan”). In addition, at the annual meeting of stockholders to be held on May 12, 2020 (the “2020 Annual Meeting”), the Company’s stockholders will be voting on whether or not to approve the further amendment and restatement of the 2009 Plan (the “Amended 2009 Plan”) which was approved by the Board of Directors on March 20, 2020. The 2000 Plan allowed for the grant of incentive stock options intended to qualify under Section 422 of the Internal Revenue Code (the “IRC”), as well as stock options which did not so qualify, stock appreciation rights, restricted stock, restricted stock units, performance-based shares or units and other share awards. Prior to being amended in 2009, the 2000 Plan also allowed for the grant of phantom stock. Persons eligible to receive grants under the 2000 Plan included the Company’s directors, officers, employees and consultants. All options granted under the 2000 Plan were “nonqualified” stock options for tax purposes. Generally, vesting of these granted options occurred in one-third increments on each of the first three anniversaries of the award date . Options granted since 2008 had a 10 -year contractual term. Pursuant to the amendment and restatement of the 2000 Plan dated March 20, 2013, no further grants will be awarded under the 2000 Plan. The 2009 Plan provides for the grant of incentive stock options intended to qualify under Section 422 of the IRC and for the grant of stock options which do not so qualify, stock appreciation rights, restricted stock, restricted stock units, performance-based shares or units and other share awards. Persons eligible to receive grants under the 2009 Plan include the Company’s directors, officers, employees and consultants. To date, all options granted under the 2009 Plan have been “nonqualified” stock options for tax purposes. Generally, vesting of these granted options occurs in one-third increments on each of the first three anniversaries of the award date . Options granted in 2011 or later have a 10 -year contractual term. As of March 31, 2020, 1,318,802 shares of unissued common stock were reserved for future grants under the 2009 Plan. In addition, if the Amended 2009 Plan is approved by the Company’s stockholders at the 2020 Annual Meeting, 9,000,000 additional shares of unissued common stock will be reserved for future grants under the Amended 2009 Plan. The exercise price of all options granted under the 2000 Plan and the 2009 Plan is equal to the fair value of the Company’s common stock on the option grant date. The following table reflects the impact of total compensation expense related to stock-based equity plans on the reported operating results for the respective periods (in millions): Three Months Ended March 31, 2020 2019 Effect on loss before income taxes $ (2) $ (3) Effect on net income (loss) $ (1) $ (2) At March 31, 2020, $25 million of unrecognized stock-based compensation expense related to outstanding unvested stock options, restricted stock and restricted stock units (the terms of which are summarized below) was expected to be recognized over a weighted-average period of 29 months. Of that amount, $4 million related to outstanding unvested stock options was expected to be recognized over a weighted-average period of 31 months and $21 million related to outstanding unvested restricted stock and restricted stock units was expected to be recognized over a weighted-average period of 28 months. There were no modifications to awards during the three months ended March 31, 2020 and 2019. The fair value of stock options was estimated using the Black Scholes option pricing model with the following assumptions and weighted-average fair values during the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Expected volatility 73.5 % 66.6 % Expected dividends - - Expected term 6 years 6 years Risk-free interest rate 1.0 % 2.6 % In determining the expected term, the Company examined concentrations of option holdings and historical patterns of option exercises and forfeitures, as well as forward-looking factors, in an effort to determine if there were any discernable employee populations. From this analysis, the Company identified two primary employee populations, one consisting of certain senior executives and the other consisting of substantially all other recipients. The expected volatility rate was estimated based on historical volatility. In determining expected volatility, the Company also reviewed the market-based implied volatility of actively traded options of its common stock and determined that historical volatility utilized to estimate the expected volatility rate did not differ significantly from the implied volatility. The expected term computation is based on historical exercise and cancellation patterns and forward-looking factors, where present, for each population identified. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of the grant. The pre-vesting forfeiture rate is based on historical rates and forward-looking factors for each population identified. The Company adjusts the estimated forfeiture rate to its actual experience. Options outstanding and exercisable under the 2000 Plan and the 2009 Plan as of March 31, 2020, and changes during the three-month period following December 31, 2019, was as follows (in millions, except share and per share data): Weighted- Aggregate Average Intrinsic Weighted- Remaining Value as of Average Contractual March 31, Shares Exercise Price Term 2020 Outstanding at December 31, 2019 1,110,134 $ 16.90 5.6 years Granted 946,500 4.93 Exercised - - Forfeited and cancelled (159,938) 33.90 Outstanding at March 31, 2020 1,896,696 $ 9.50 8.1 years $ - Exercisable at March 31, 2020 530,192 $ 21.27 4.2 years $ - The weighted-average grant date fair value of stock options granted during the three months ended March 31, 2020 and 2019 was $3.17 and $3.08 , respectively. The aggregate intrinsic value (calculated as the number of in-the-money stock options multiplied by the difference between the Company’s closing stock price on the last trading day of the reporting period ( $3.34 ) and the exercise price of the respective stock options) in the table above represents the amount that would have been received by the option holders had all option holders exercised their options on March 31, 2020. This amount changes based on the market value of the Company’s common stock. There were no options exercised during the three months ended March 31, 2020 and 2019. The aggregate intrinsic value of options vested and expected to vest approximates that of the outstanding options. The Company has also awarded restricted stock under the 2009 Plan to employees of certain subsidiaries. With respect to time-based vesting restricted stock that has been awarded under the 2009 Plan, the restrictions on these shares have generally lapsed in one-third increments on each of the first three anniversaries of the award date . In addition, certain of the restricted stock awards granted to the Company’s senior executives have contained performance objectives required to be met in addition to any time-based vesting requirements. If the applicable performance objectives are not attained, these awards will be forfeited in their entirety. For performance-based awards granted on or after March 1, 2017, the performance objectives have been measured cumulatively over a three -year period. With respect to performance-based awards granted on or after March 1, 2017, if the applicable target performance objective is met at the end of the three-year period, then the restricted stock award subject to such performance objective will vest in full on the third anniversary of the award date. Additionally, for these performance-based awards, based on the level of achievement for the applicable performance objective within the parameters specified in the award agreement, the number of shares to be issued in connection with the vesting of the award may be adjusted to decrease or increase the number of shares specified in the original award. Notwithstanding the above-mentioned performance objectives and vesting requirements, the restrictions with respect to restricted stock granted under the 2009 Plan may lapse earlier in the event of death, disability or termination of employment by the Company for any reason other than for cause of the holder of the restricted stock, or change in control of the Company. The entire restricted stock awards subject to performance objectives granted on March 1, 2017 were forfeited during the three months ended March 31, 2020 as a result of the minimum level of the applicable cumulative performance objectives for the 2017-2019 performance period not having been met. Restricted stock awards subject to performance objectives that have not yet been satisfied are not considered outstanding for purposes of determining earnings per share until the performance objectives have been satisfied. Restricted stock outstanding under the 2009 Plan as of March 31, 2020, and changes during the three-month period following December 31, 2019, was as follows: Weighted- Average Grant Shares Date Fair Value Unvested at December 31, 2019 3,857,402 $ 5.47 Granted 2,197,500 4.90 Vested (988,650) 5.77 Forfeited (328,500) 9.19 Unvested at March 31, 2020 4,737,752 4.89 Restricted stock units (“RSUs”) have been granted to the Company’s outside directors under the 2009 Plan. Each of the Company’s then serving outside directors received grants under the 2009 Plan of 34,068 RSUs and 34,483 RSUs on March 1, 2019 and 2020, respectively. Each of the 2019 and 2020 grants had a grant date fair value of approximately $170,000 . Vesting of these RSUs occurs in one-third increments on each of the first three anniversaries of the award date or upon the director’s earlier cessation of service on the board, other than for cause. Beginning with the 2020 grant, the director may elect, prior to the beginning of the calendar year in which the award is granted, to defer the receipt of shares of the Company’s common stock issuable upon vesting until either his or her (i) separation from service with the Company or (ii) attainment of an age specified in advance by the non-management director. RSUs outstanding under the 2009 Plan as of March 31, 2020, and changes during the three-month period following December 31, 2019, was as follows: Weighted- Average Grant Shares Date Fair Value Unvested at December 31, 2019 541,576 $ 5.13 Granted 310,347 4.93 Vested (238,184) 5.47 Forfeited - - Unvested at March 31, 2020 613,739 4.89 |
Acquisitions and Divestitures
Acquisitions and Divestitures | 3 Months Ended |
Mar. 31, 2020 | |
Acquisitions and Divestitures [Abstract] | |
Acquisitions and Divestitures Disclosure | 3. ACQUISITIONS AND DIVESTITURES Acquisitions The Company accounts for all transactions that represent business combinations using the acquisition method of accounting, where the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity are recognized and measured at their fair values on the date the Company obtains control in the acquiree. Such fair values that are not finalized for reporting periods following the acquisition date are estimated and recorded as provisional amounts. Adjustments to these provisional amounts during the measurement period (defined as the date through which all information required to identify and measure the consideration transferred, the assets acquired, the liabilities assumed and any noncontrolling interests has been obtained, limited to one year from the acquisition date) are recorded when identified. Goodwill is determined as the excess of the fair value of the consideration conveyed in the acquisition over the fair value of the net assets acquired. Acquisition and integration expenses related to prospective and closed acquisitions included in other operating expenses on the condensed consolidated statements of income (loss) were less than $1 million for the three months ended March 31, 2020 and were approximately $1 million for the three months ended March 31, 2019. During the three months ended March 31, 2020, one or more subsidiaries of the Company paid less than $1 million to acquire the operating assets and related businesses of certain physician practices, clinics and other ancillary businesses that operate within the communities served by the Company’s affiliated hospitals. The Company allocated the purchase price to property and equipment, working capital and goodwill. Divestitures The following table provides a summary of hospitals that the Company divested during the three months ended March 31, 2020 and the year ended December 31, 2019: Licensed Hospital Buyer City, State Beds Effective Date 2020 Divestitures: Southside Regional Medical Center Bon Secours Mercy Health System Petersburg, VA 300 January 1, 2020 Southampton Memorial Hospital Bon Secours Mercy Health System Franklin, VA 105 January 1, 2020 Southern Virginia Regional Medical Center Bon Secours Mercy Health System Emporia, VA 80 January 1, 2020 2019 Divestitures: Bluefield Regional Medical Center Princeton Community Hospital Association Bluefield, WV 92 October 1, 2019 Lake Wales Medical Center Adventist Health System Lake Wales, FL 160 September 1, 2019 Heart of Florida Regional Medical Center Adventist Health System Davenport, FL 193 September 1, 2019 College Station Medical Center St. Joseph Regional Health Center College Station, TX 167 August 1, 2019 Tennova Healthcare - Lebanon Vanderbilt University Medical Center Lebanon, TN 245 August 1, 2019 Chester Regional Medical Center Medical University Hospital Authority Chester, SC 82 March 1, 2019 Carolinas Hospital System - Florence Medical University Hospital Authority Florence, SC 396 March 1, 2019 Springs Memorial Hospital Medical University Hospital Authority Lancaster, SC 225 March 1, 2019 Carolinas Hospital System - Marion Medical University Hospital Authority Mullins, SC 124 March 1, 2019 Memorial Hospital of Salem County Community Healthcare Associates, LLC Salem, NJ 126 January 31, 2019 Mary Black Health System - Spartanburg Spartanburg Regional Healthcare System Spartanburg, SC 207 January 1, 2019 Mary Black Health System - Gaffney Spartanburg Regional Healthcare System Gaffney, SC 125 January 1, 2019 On January 30, 2020, one or more affiliates of the Company entered into definitive agreements for the sale of substantially all of the assets of each of Shands Live Oak Regional Medical Center ( 25 licensed beds) in Live Oak, Florida and Shands Starke Regional Medical Center ( 49 licensed beds) in Starke, Florida to affiliates of HCA Healthcare, Inc. On March 18, 2020, one or more affiliates of the Company entered into a definitive agreement for the sale of substantially all of the assets of Northern Louisiana Medical Center ( 130 licensed beds) in Ruston, Louisiana to affiliates of Allegiance Health Management, Inc. The following table discloses amounts included in the condensed consolidated balance sheet s for the hospitals classified as held for sale as of March 31, 2020 and December 31, 2019 (in millions). No divestitures or potential divestitures meet the criteria for report ing as a discontinued operation . March 31, 2020 December 31, 2019 Other current assets $ 20 $ 25 Other assets, net 286 262 Accrued liabilities 25 43 Other Hospital Closures During the three months ended December 31, 2018, the Company completed the planned closure of Tennova – Physicians Regional Medical Center in Knoxville, Tennessee and Tennova – Lakeway Regional Medical Center in Morristown, Tennessee. The Company recorded an impairment charge of $27 million during the three months ended December 31, 2018, to adjust the fair value of the supplies, inventory and long-lived assets of these hospitals, including property and equipment and capitalized software costs, based on their estimated fair value and future utilization. During 2019, the Company recorded an impairment charge of approximately $9 million to further adjust the fair value of the supplies, inventory and long-lived assets of these hospitals, including property and equipment and capitalized software costs, based on the Company’s updated evaluation of their estimated fair value and future utilization and consideration of costs to dispose of such assets. There were no hospital closures during the three months ended March 31, 2020. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets Disclosure | 4. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill The changes in the carrying amount of goodwill for the three months ended March 31, 2020 are as follows (in millions): Balance, as of December 31, 2019 Goodwill $ 7,142 Accumulated impairment losses (2,814) 4,328 Goodwill allocated to hospitals held for sale (6) Balance, as of March 31, 2020 Goodwill 7,136 Accumulated impairment losses (2,814) $ 4,322 Goodwill is allocated to each identified reporting unit, which is defined as an operating segment or one level below the operating segment (referred to as a component of the entity). Management has determined that the Company’s operating segment meets the criteria to be classified as a reporting unit. At March 31, 2020, after giving effect to 2020 divestiture activity, the Company had approximately $4.3 billion of goodwill recorded. Goodwill is evaluated for impairment annually and when an event occurs or circumstances change that, more likely than not, reduce the fair value of the reporting unit below its carrying value. The Company performed its last annual goodwill impairment evaluation during the fourth quarter of 2019 using an October 31, 2019 measurement date, which indicated no impairment. The Company estimates the fair value of the reporting unit using both a discounted cash flow model as well as a market multiple model. The cash flow forecasts are adjusted by an appropriate discount rate based on the Company’s estimate of a market participant’s weighted-average cost of capital. These models are both based on the Company’s best estimate of future revenues and operating costs and are reconciled to the Company’s consolidated market capitalization, with consideration of the amount a potential acquirer would be required to pay, in the form of a control premium, in order to gain sufficient ownership to set policies, direct operations and control management decisions. While no impairment was indicated in the Company’s annual goodwill evaluation as of the October 31, 2019 measurement date, the reduction in the Company’s fair value and the resulting goodwill impairment charges recorded in 2016 and 2017 reduced the carrying value of the Company’s hospital operations reporting unit to an amount equal to its estimated fair value as of such prior year measurement dates. This increases the risk that future declines in fair value could result in goodwill impairment. The determination of fair value in the Company’s goodwill impairment analysis is based on an estimate of fair value for each reporting unit utilizing known and estimated inputs at the evaluation date. Some of those inputs include, but are not limited to, the most recent price of the Company’s common stock and fair value of long-term debt, estimates of future revenue and expense growth, estimated market multiples, expected capital expenditures, income tax rates, and costs of invested capital. A detailed evaluation of potential impairment indicators was performed as of March 31, 2020, which specifically considered the decline in the fair market value of the Company’s outstanding senior secured and unsecured notes and common stock during the first quarter as a result of the COVID-19 pandemic. Volatility was ob served in the prices of the Company’s outstanding debt securities and common stock and the decline in patient volumes following the emergence of COVID-19 was also considered. On the basis of available evidence as of March 31, 2020, no indicators of impairment were identified. Future estimates of fair value could be adversely affected if the actual outcome of one or more of the assumptions described above changes materially in the future, including a decline in the Company’s stock price and the fair value of its long-term debt, lower than expected hospital volumes, higher market interest rates or increased operating costs. Such changes impacting the calculation of fair value, the risks of which are amplified by the COVID-19 pandemic, could result in a material impairment charge in the future. The determination of fair value of the Company’s hospital operations reporting unit as part of its goodwill impairment measurement represents a Level 3 fair value measurement in the fair value hierarchy due to its use of internal projections and unobservable measurement inputs. Intangible Assets No intangible assets other than goodwill were acquired during the three months ended March 31, 2020. The gross carrying amount of the Company’s other intangible assets subject to amortization was $1 million at both March 31, 2020 and December 31, 2019, and the net carrying amount was less than $ 1 million at both March 31, 2020 and December 31, 2019. The carrying amount of the Company’s other intangible assets not subject to amortization was $60 million and $63 million at March 31, 2020 and December 31, 2019, respectively. Other intangible assets are included in other assets, net on the Company’s condensed consolidated balance sheets. Substantially all of the Company’s intangible assets are contract-based intangible assets related to operating licenses, management contracts, or non-compete agreements entered into in connection with prior acquisitions. The gross carrying amount of capitalized software for internal use was approximatel y $1.1 billion at both March 31, 2020 and December 31, 2019, and the net carrying amount was approximately $ 301 million and $ 321 million at March 31, 2020 and December 31, 2019, respectively. The estimated amortization period for capitalized internal-use software is generally three years, except for capitalized costs related to significant system conversions, which is generally eight to ten years. There is no expected residual value for capitalized internal-use software. At March 31, 2020, there was approximately $39 million of capitalized costs for internal-use software that is currently in the development stage and will begin amortization once the software project is complete and ready for its intended use. Amortization expense on capitalized internal-use software was $32 million and $30 million during the three months ended March 31, 2020 and 2019, respectively. Amortization expense on capitalized internal-use software is estimated to be $94 million for the remainder of 2020, $108 million in 2021, $52 million in 2022, $24 million in 2023, $12 million in 2024, $6 million in 2025 and $5 million thereafter. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Taxes [Abstract] | |
Income Taxes Disclosure | 5. INCOME TAXES The total amount of unrecognized benefit that would affect the effective tax rate, if recognized, was approximately $1 million as of March 31, 2020. A total of approximately $1 million of interest and penalties is included in the amount of the liability for uncertain tax positions at March 31, 2020. It is the Company’s policy to recognize interest and penalties related to unrecognized benefits in its condensed consolidated statements of income (loss) as income tax expense. It is possible the amount of unrecognized tax benefit could change in the next 12 months as a result of a lapse of the statute of limitations and settlements with taxing authorities; however, the Company does not anticipate the change will have a material impact on the Company’s condensed consolidated results of operations or financial position. The Company’s federal income tax returns for the 2009 and 2010 tax years have been settled with the Internal Revenue Service. The results of these examinations were not material to the Company’s consolidated results of operations or financial position. The Company’s federal income tax returns for the 2014 and 2015 tax years remain under examination by the Internal Revenue Service. The Company believes the results of these examinations will not be material to its condensed consolidated results of operations or financial position. The Company has extended the federal statute of limitations through December 31, 2020 for Community Health Systems, Inc. for the tax periods ended December 31, 2014 and 2015. The Company’s federal income tax return for the 2018 tax year is under examination by the Internal Revenue Service. The Company’s effective tax rates were 122.8% and (7.4)% for the three months ended March 31, 2020 and 2019, respectively. The difference in the Company’s effective tax rate for the three months ended March 31, 2020, when compared to the three months ended March 31, 2019, was primarily due to discrete tax benefits of approximately $240 million related to the release of federal and state valuation allowances on IRC Section 163(j) interest carryforwards as a result of an increase to the deductible interest expense allowed for 2019 and 2020 under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) that was enacted during the three months ended March 31, 2020 . Cash paid for income taxes, net of refunds received, resulted in a net refund of approximately $ 2 million and less than $ 1 million during the three months ended March 31, 2020 and 2019, respectively. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2020 | |
Long-term Debt [Abstract] | |
Long-Term Debt Disclosure | 6. LONG-TERM DEBT Long-term debt, net of unamortized debt issuance costs and discounts or premiums, consists of the following (in millions): March 31, December 31, 2020 2019 5⅛% Senior Secured Notes due 2021 $ - $ 1,000 6⅞% Senior Notes due 2022 231 231 6¼% Senior Secured Notes due 2023 2,675 3,100 8⅝% Senior Secured Notes due 2024 1,033 1,033 6⅝% Senior Secured Notes due 2025 1,462 - 8% Senior Secured Notes due 2026 2,101 2,101 8% Senior Secured Notes due 2027 700 700 6⅞% Senior Notes due 2028 1,700 1,700 9⅞% Junior-Priority Secured Notes due 2023 1,770 1,770 8⅛% Junior-Priority Secured Notes due 2024 1,355 1,355 ABL Facility 380 273 Finance lease and financing obligations 290 272 Other 25 17 Less: Unamortized deferred debt issuance costs and note premium (167) (147) Total debt 13,555 13,405 Less: Current maturities (30) (20) Total long-term debt $ 13,525 $ 13,385 On February 6, 2020 , CHS /Community Health Systems, Inc. (“CHS”) completed a private offering of $1.462 billion aggregate principal amount of 6⅝% Senior Secured Notes due February 15, 2025 (the “6⅝% Senior Secured Notes due 2025”). CHS used the net proceeds of the offering of the 6⅝% Senior Secured Notes due 2025 to (i) purchase any and all of its 5⅛% Senior Secured Notes due 2021 validly tendered and not validly withdrawn in the cash tender offer announced on January 23, 2020, (ii) redeem all of the 5⅛% Senior Secured Notes due 2021 that were not purchased pursuant to such tender offer, (iii) purchase in one or more privately negotiated transactions approximately $426 million aggregate principal amount of its 6¼% Senior Secured Notes due 2023 and (iv) pay related fees and expenses. The 6⅝% Senior Secured Notes due 2025 bear interest at a rate of 6.625% per annum, payable semi-annually in arrears on February 15 and August 15 of each year, commencing on August 15, 2020. The 6⅝% Senior Secured Notes are scheduled to mature on February 15, 2025. The 6⅝% Senior Secured Notes due 2025 are unconditionally guaranteed on a senior-priority secured basis by the Company and each of the CHS current and future domestic subsidiaries that provide guarantees under the revolving asset-based loan facility (the “ABL Facility”), any capital market debt securities of CHS (including CHS’ outstanding senior notes) and certain other long-term debt of CHS. The 6⅝% Senior Secured Notes due 2025 and the related guarantees are secured by shared (i) first-priority liens on the Non-ABL Priority Collateral and (ii) second-priority liens on the ABL Priority Collateral that secures on a first-priority basis the ABL Facility, in each case subject to permitted liens described in the indenture governing the 6⅝% Senior Secured Notes due 2025. At any time prior to February 15, 2022, CHS may redeem some or all of the 6⅝% Senior Secured Notes due 2025 at a price equal to 100% of their principal amount plus accrued and unpaid interest, if any, to, but excluding the applicable redemption date plus a make-whole premium as defined in the indenture agreement dated February 6, 2020. After February 15, 2022, CHS is entitled, at its option, to redeem some or all of the 6⅝% Senior Secured Notes at a redemption price equal to the percentage of principal amount below plus accrued and unpaid interest, if any, to, but excluding the applicable redemption date, if redeemed during the twelve-month period beginning on February 15 of the years set forth below: Period Redemption Price February 15, 2022 to February 14, 2023 103.313 % February 15, 2023 to February 14, 2024 101.656 % February 15, 2024 to February 14, 2025 100.000 % The financing and repayment transactions discussed above resulted in a pre-tax and after-tax loss from early extinguishment of debt of $4 million and $3 million, respectively, for the three months ended March 31, 2020. At March 31, 2020, the available borrowing base under the ABL Facility was $769 million, of which the Company had outstanding borrowings of $380 million and letters of credit issued of $150 million. The issued letters of credit were primarily in support of potential insurance-related claims and certain bonds. The ABL Facility contains customary representations and warranties, subject to limitations and exceptions, and customary covenants restricting the Company’s ability, subject to certain exceptions, to, among other things (1) declare dividends, make distributions or redeem or repurchase capital stock, (2) prepay, redeem or repurchase other debt, (3) incur liens or grant negative pledges, (4) make loans and investments and enter into acquisitions and joint ventures, (5) incur additional indebtedness or provide certain guarantees, (6) engage in mergers, acquisitions and asset sales, (7) conduct transactions with affiliates, (8) alter the nature of the Company’s, CHS’ or the guarantors’ businesses, (9) grant certain guarantees with respect to physician practices, (10) engage in sale and leaseback transactions or (11) change the Company’s fiscal year. The Company is also required to comply with a consolidated fixed coverage ratio, upon certain triggering events described below, and various affirmative covenants. The consolidated fixed coverage ratio is calculated as the ratio of (x) consolidated EBITDA (as defined in the ABL Facility) less capital expenditures to (y) the sum of consolidated interest expense (as defined in the ABL Facility), scheduled principal payments, income taxes and restricted payments made in cash or in permitted investments. For purposes of calculating the consolidated fixed charge coverage ratio, the calculation of consolidated EBITDA as defined in the ABL Facility is a trailing 12-month calculation that begins with the Company’s consolidated net income, with certain adjustments for interest, taxes, depreciation and amortization, net income attributable to noncontrolling interests, stock compensation expense, restructuring costs, and the financial impact of other non-cash or non-recurring items recorded during any such 12-month period. The consolidated fixed charge coverage ratio is a required covenant only in periods where the total borrowings outstanding under the ABL Facility reduce the amount available in the facility to less than the greater of (i) $95 million or (ii) 10% of the calculated borrowing base. As a result, in the event the Company has less than $95 million available under the ABL Facility, the Company would need to comply with the consolidated fixed charge coverage ratio. At March 31, 2020, the Company is not subject to the consolidated fixed charge coverage ratio as such triggering event had not occurred during the last twelve months ended March 31, 2020. To limit the effect of changes in interest rates on a portion of the Company’s long-term borrowings, the Company is a party to one interest swap agreement with a notional amount of approximately $300 million as of March 31, 2020. The Company receives a variable rate of interest on this swap based on the three-month LIBOR in exchange for the payment of a fixed rate of interest. See Note 7 for additional information regarding this swap. The Company paid interest of $264 million and $189 million on borrowings during the three months ended March 31, 2020 and 2019, respectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value of Financial Instruments [Abstract] | |
Fair Value of Financial Instruments Disclosure | 7. FAIR VALUE OF FINANCIAL INSTRUMENTS The fair value of financial instruments has been estimated by the Company using available market information as of March 31, 2020 and December 31, 2019, and valuation methodologies considered appropriate. The estimates presented in the table below are not necessarily indicative of amounts the Company could realize in a current market exchange (in millions): March 31, 2020 December 31, 2019 Carrying Estimated Fair Carrying Estimated Fair Amount Value Amount Value Assets: Cash and cash equivalents $ 246 $ 246 $ 216 $ 216 Investments in equity securities 114 114 141 141 Available-for-sale debt securities 103 103 101 101 Trading securities 12 12 12 12 Liabilities: 5⅛% Senior Secured Notes due 2021 - - 990 1,003 6⅞% Senior Notes due 2022 229 173 229 188 6¼% Senior Secured Notes due 2023 2,654 2,560 3,074 3,148 8⅝% Senior Secured Notes due 2024 1,024 1,028 1,023 1,099 6⅝% Senior Secured Notes due 2025 1,421 1,379 - - 8% Senior Secured Notes due 2026 2,071 2,004 2,070 2,182 8% Senior Secured Notes due 2027 691 602 691 700 6⅞% Senior Notes due 2028 1,678 516 1,678 1,700 9 ⅞% Junior-Priority Secured Notes due 2023 1,755 1,419 1,754 1,539 8⅛% Junior-Priority Secured Notes due 2024 1,341 936 1,340 1,113 ABL Facility and other debt 401 401 285 285 The carrying value of the Company’s long-term debt in the above table is presented net of unamortized deferred debt issuance costs. The estimated fair value is determined using the methodologies discussed below in accordance with accounting standards related to the determination of fair value based on the U.S. GAAP fair value hierarchy as discussed in Note 8 . The estimated fair value for financial instruments with a fair value that does not equal its carrying value is considered a Level 1 valuation. The Company utilizes the market approach and obtains indicative pricing through publicly available subscription services such as Bloomberg to determine fair values where relevant. Cash and cash equivalents. The carrying amount approximates fair value due to the short-term maturity of these instruments (less than three months). Investments in equity securities. Estimated fair value is based on closing price as quoted in public markets. Available-for-sale debt securities. Estimated fair value is based on closing price as quoted in public markets or other various valuation techniques. Trading securities. Estimated fair value is based on closing price as quoted in public markets. 5⅛% Senior Secured Notes due 2021. Estimated fair value is based on the closing market price for these notes. 6⅞% Senior Notes due 2022. Estimated fair value is based on the closing market price for these notes. 6¼% Senior Secured Notes due 2023. Estimated fair value is based on the closing market price for these notes. 8⅝% Senior Secured Notes due 2024. Estimated fair value is based on the closing market price for these notes. 6 ⅝ % Senior Secured Notes due 202 5 . Estimated fair value is based on the closing market price for these notes. 8% Senior Secured Notes due 2026. Estimated fair value is based on the closing market price for these notes. 8% Senior Secured Notes due 2027. Estimated fair value is based on the closing market price for these notes. 6⅞% Senior Secured Notes due 2028. Estimated fair value is based on the closing market price for these notes. 9⅞% Junior-Priority Secured Notes due 2023 . Estimated fair value is based on the closing market price for these notes. 8⅛% Junior-Priority Secured Notes due 2024. Estimated fair value is based on the closing market price for these notes. ABL Facility and other debt. The carrying amount of the ABL Facility and all other debt approximates fair value due to the nature of these obligations. Interest rate swaps. The fair value of the interest rate swap agreement is the amount at which it could be settled, based on estimates calculated by the Company using a discounted cash flow analysis based on observable market inputs and validated by comparison to estimates obtained from the counterparty. The Company incorporates credit valuation adjustments (“CVAs”) to appropriately reflect both its own nonperformance or credit risk and the respective counterparty’s nonperformance or credit risk in the fair value measurements. In adjusting the fair value of it s interest rate swap agreement for the effect of nonperformance or credit risk, the Company has considered the impact of any netting fea tures included in the agreement . At March 31, 2020, the Company had one interest rate swap with a notional amount of approximately $300 million, a fixed interest rate of 2.892% , a termination date of August 30, 2020 , and a fair value of approximately $2 million. The counterparty to the interest rate swap agreement exposes the Company to credit risk in the event of nonperformance by such counterparty. However, at March 31, 2020, the Company does not anticipate nonperformance by the counterparty. The Company does not hold or issue derivative financial instruments for trading purposes. The Company is exposed to certain risks relating to its ongoing business operations. The risk managed by using derivative instruments is interest rate risk. Companies are required to recognize all derivative instruments as either assets or liabilities at fair value in the condensed consolidated statement of financial position. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income (“OCI”) and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. Gains and losses on the derivative representing either ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. Assuming no change in interest rates in effect as of March 31, 2020, less than $1 million of interest income resulting from the spread between the fixed and floating rates defined in the interest rate swap agreement will be recognized through its termination date of August 30, 2020. The following tabular disclosure provides the amount of pre-tax loss recognized as a component of OCI during the three months ended March 31, 2020 and 2019 (in millions): Amount of Pre-Tax Loss Recognized in OCI (Effective Portion) Three Months Ended March 31, Derivatives in Cash Flow Hedging Relationships 2020 2019 Interest rate swaps $ (1) $ (2) The following tabular disclosure provides the location of the effective portion of the pre-tax loss (gain) reclassified from accumulated other comprehensive loss (“AOCL”) into interest expense on the condensed consolidated statements of income (loss) during the three months ended March 31, 2020 and 2019 (in millions): Amount of Pre-Tax Loss (Gain) Reclassified from AOCL into Income (Effective Portion) Location of Loss (Gain) Reclassified from Three Months Ended March 31, AOCL into Income (Effective Portion) 2020 2019 Interest expense, net $ 1 $ (1) The fair values of derivative instruments in the condensed consolidated balance sheets as of March 31, 2020 and December 31, 2019 were as follows (in millions): Asset Derivatives Liability Derivatives March 31, 2020 December 31, 2019 March 31, 2020 December 31, 2019 Balance Balance Balance Balance Sheet Sheet Sheet Sheet Location Fair Value Location Fair Value Location Fair Value Location Fair Value Derivatives designated as Other Other Other Other hedging assets, assets, long-term long-term instruments net $ - net $ - liabilities $ 2 liabilities $ 2 |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value [Abstract] | |
Fair Value Disclosure | 8. FAIR VALUE Fair Value Hierarchy Fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the Company utilizes the U.S. GAAP fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumption about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The inputs used to measure fair value are classified into the following fair value hierarchy: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Level 3 includes values determined using pricing models, discounted cash flow methodologies, or similar techniques reflecting the Company’s own assumptions. In instances where the determination of the fair value hierarchy measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment of factors specific to the asset or liability. Transfers between levels within the fair value hierarchy are recognized by the Company on the date of the change in circumstances that requires such transfer. There were no transfers between levels during the three-month periods ended March 31, 2020 or March 31, 2019. The following table sets forth, by level within the fair value hierarchy, the financial assets and liabilities recorded at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 (in millions): March 31, 2020 Level 1 Level 2 Level 3 Investments in equity securities $ 114 $ 114 $ - $ - Available-for-sale debt securities 103 - 103 - Trading securities 12 - 12 - Total assets $ 229 $ 114 $ 115 $ - Fair value of interest rate swap agreement $ 2 $ - $ 2 $ - Total liabilities $ 2 $ - $ 2 $ - December 31, 2019 Level 1 Level 2 Level 3 Investments in equity securities $ 141 $ 141 $ - $ - Available-for-sale debt securities 101 - 101 - Trading securities 12 - 12 - Total assets $ 254 $ 141 $ 113 $ - Fair value of interest rate swap agreement $ 2 $ - $ 2 $ - Total liabilities $ 2 $ - $ 2 $ - Investments in Equity Securities, Available-for-Sale Debt Securities and Trading Securities Investments in equity securities and trading securities classified as Level 1 are measured using quoted market prices. Level 2 available-for-sale debt securities and trading securities primarily consisted of bonds and notes issued by the United States government and its agencies and domestic and foreign corporations. The estimated fair values of these securities are determined using various valuation techniques, including a multi-dimensional relational model that incorporates standard observable inputs and assumptions such as benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids/offers and other pertinent reference data. As of March 31, 2020 and December 31, 2019, available-for-sale debt securities with aggregate estimated fair values of approximately $35 million and $51 million, respectively, generated gross unrealized losses of $2 million and $1 million, respectively. A by-security impairment assessment was performed as of March 31, 2020 wherein it was determined that COVID-19 related changes in interest rates and market liquidity resulted in incremental unrealized losses compared to December 31, 2019. No material impairment resulted from credit loss or other factors. Fair Value of Interest Rate Swap Agreement The valuation of the Company’s interest rate swap agreement is determined using market valuation techniques, including discounted cash flow analysis on the expected cash flows of each agreement. This analysis reflects the contractual terms of the agreement, including the period to maturity, and uses observable market-based inputs, including forward interest rate curves. The fair value of interest rate swap agreement is determined by netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on the expectation of future interest rates based on observable market forward interest rate curves and the notional amount being hedged. The Company incorporates CVAs to appropriately reflect both its own nonperformance or credit risk and the respective counterparty’s nonperformance or credit risk in the fair value measurement. In adjusting the fair value of its interest rate swap agreements for the effect of nonperformance or credit risk, the Company has considered the impact of any netting features included in the agreement. The CVA on the Company’s interest rate swap agreement had an immaterial effect on the fair value of the related liability at March 31, 2020 and December 31, 2019. The majority of the inputs used to value the Company’s interest rate swap agreement, including the forward interest rate curves and market perceptions of the Company’s credit risk used in the CVAs, are observable inputs available to a market participant. As a result, the Company has determined that the interest rate swap valuation is classified in Level 2 of the fair value hierarchy. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases Disclosure | 9 . LEASES The Company utilizes operating and finance leases for the use of certain hospitals, medical office buildings, and medical equipment. The Company has elected to account for COVID-19 related concessions as though the enforceable rights and obligations for those concessions are explicit within the underlying contract. During the three months ended March 31, 2020, there were no material price concessions or other incentives received or granted by the Company. The components of lease cost and rent expense for the three months ended March 31, 2020 and 2019 are as follows (in millions): Three Months Ended March 31, Lease Cost 2020 2019 Operating lease cost: Operating lease cost $ 51 $ 48 Short-term rent expense 26 30 Variable lease cost 5 3 Sublease income (1) (1) Total operating lease cost $ 81 $ 80 Finance lease cost: Amortization of right-of-use assets $ 3 $ 3 Interest on finance lease liabilities 2 2 Total finance lease cost $ 5 $ 5 Supplemental balance sheet information related to leases was as follows (in millions): Balance Sheet Classification March 31, 2020 December 31, 2019 Operating Leases: Operating Lease ROU Assets Other assets, net $ 634 $ 607 Finance Leases: Finance Lease ROU Assets Property and equipment Land and improvements $ 8 $ 8 Buildings and improvements 168 154 Equipment and fixtures 11 11 Property and equipment 187 173 Less accumulated depreciation and amortization (58) (56) Property and equipment, net $ 129 $ 117 Current finance lease liabilities Current maturities of long-term debt $ 6 $ 6 Long-term finance lease liabilities Long-term debt 122 107 Supplemental cash flow information related to leases for the three months ended March 31, 2020 and 2019 are as follows ( in millions): Three Months Ended March 31, Cash flow information 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (1) $ 47 $ 35 Operating cash flows from finance leases 2 2 Financing cash flows from finance leases 1 3 Right-of-use assets obtained in exchange for new finance lease liabilities 17 1 Right-of-use assets obtained in exchange for new operating lease liabilities 35 15 __________ (1) Included in the change in other operating assets and liabilities in the condensed consolidated statement of cash flows. |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2020 | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans Disclosure | 10 . EMPLOYEE BENEFIT PLANS The Company provides an unfunded Supplemental Executive Retirement Plan (“SERP”) for certain members of its executive management. The Company uses a December 31 measurement date for the benefit obligations and a January 1 measurement date for its net periodic costs for the SERP. Variances from actuarially assumed rates will result in increases or decreases in benefit obligations and net periodic cost in future periods. Benefits expense under the SERP was $2 million for both of the three-month periods ended March 31, 2020 and 2019, respectively . The accrued benefit liability for the SERP totaled $74 million and $72 million at March 31, 2020 and December 31, 2019, respectively, and is included in other long-term liabilities on the condensed consolidated balance sheets. The weighted-average assumptions used in determining net periodic cost for the three months ended March 31, 2020 and March 31, 2019 were a discount rate of 3.1% and 4.2% , respectively, and an annual salary increase of 3.0% . The Company had equity investment securities in a rabbi trust generally designated to pay benefits of the SERP in the amounts of $78 million and $84 million at March 31, 2020 and December 31, 2019, respectively. These amounts are included in other assets, net on the condensed consolidated balance sheets. |
Stockholders' Deficit
Stockholders' Deficit | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Deficit [Abstract] | |
Stockholders' Deficit Disclosure | 11 . STOCKHOLDERS’ DEFICIT Authorized capital shares of the Company include 400,000,000 shares of capital stock consisting of 300,000,000 shares of common stock and 100,000,000 shares of preferred stock. Each of the aforementioned classes of capital stock has a par value of $0.01 per share . Shares of preferred stock, none of which were outstanding as of March 31, 2020, may be issued in one or more series having such rights, preferences and other provisions as determined by the Board of Directors without approval by the holders of common stock. The Company is a holding company which operates through its subsidiaries. The Company’s ABL Facility and the indentures governing each series of the Company’s outstanding notes contain various covenants under which the assets of the subsidiaries of the Company are subject to certain restrictions relating to, among other matters, dividends and distributions, as referenced in the paragraph below. The ABL Facility and the indentures governing each series of the Company’s outstanding notes restrict the Company’s subsidiaries from, among other matters, paying dividends and making distributions to the Company, which thereby limits the Company’s ability to pay dividends and/or repurchase stock. As of March 31, 2020, under the most restrictive test in these agreements (and subject to certain exceptions), the Company has approximately $200 million of capacity to pay permitted dividends and/or repurchase shares of stock or make other restricted payments. The following schedule presents the reconciliation of the carrying amount of total equity, equity attributable to the Company, and equity attributable to the noncontrolling interests as of March 31, 2020, and during the three-month period following December 31, 2019 (in millions ): Community Health Systems, Inc. Stockholders Redeemable Noncontrolling Interest Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss (Income) Accumulated Deficit Noncontrolling Interest Total Stockholders’ Deficit Balance, December 31, 2019 $ 502 $ 1 $ 2,008 $ (9) $ (4,218) $ 77 $ (2,141) Comprehensive income 8 - - 2 18 8 28 Distributions to noncontrolling interests (22) - - - - (8) (8) Purchase of subsidiary shares from noncontrolling interests (1) - (1) - - - (1) Other reclassifications of noncontrolling interests 8 - - - - (8) (8) Adjustment to redemption value of redeemable noncontrolling interests 7 - (7) - - - (7) Cancellation of restricted stock for tax withholdings on vested shares - - (1) - - - (1) Share-based compensation - - 2 - - - 2 Balance, March 31, 2020 $ 502 $ 1 $ 2,001 $ (7) $ (4,200) $ 69 $ (2,136) The following schedule presents the reconciliation of the carrying amount of total equity, equity attributable to the Company, and equity attributable to the noncontrolling interests as of March 31, 2019, and during the three-month period following December 31, 2018 (in millions): Community Health Systems, Inc. Stockholders Redeemable Noncontrolling Interest Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Accumulated Deficit Noncontrolling Interest Total Stockholders’ Deficit Balance, December 31, 2018 $ 504 $ 1 $ 2,017 $ (10) $ (3,543) $ 72 $ (1,463) Comprehensive income (loss) 9 - - - (118) 8 (110) Contributions from noncontrolling interests 1 - - - - - - Distributions to noncontrolling interests (19) - - - - (8) (8) Purchase of subsidiary shares from noncontrolling interests (1) - - - - - - Other reclassifications of noncontrolling interests (1) - - - - 1 1 Adjustment to redemption value of redeemable noncontrolling interests 12 - (12) - - - (12) Cancellation of restricted stock for tax withholdings on vested shares - - (1) - - - (1) Share-based compensation - - 3 - - - 3 Balance, March 31, 2019 $ 505 $ 1 $ 2,007 $ (10) $ (3,661) $ 73 $ (1,590) The following schedule discloses the effects of changes in the Company’s ownership interest in its less-than-wholly-owned subsidiaries on Community Health Systems, Inc. stockholders’ deficit (in millions): Three Months Ended March 31, 2020 2019 Net income (loss) attributable to Community Health Systems, Inc. stockholders $ 18 $ (118) Transfers to the noncontrolling interests: Net decrease in Community Health Systems, Inc. paid-in-capital for purchase of subsidiary partnership interests (1) - Net transfers to the noncontrolling interests (1) - Change to Community Health Systems, Inc. stockholders’ deficit from net income (loss) attributable to Community Health Systems, Inc. stockholders and transfers to noncontrolling interests $ 17 $ (118) |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share Disclosure | 12 . EARNINGS PER SHARE The following table sets forth the components of the denominator for the computation of basic and diluted earnings per share for net income (loss) attributable to Community Health Systems, Inc. common stockholders: Three Months Ended March 31, 2020 2019 Weighted-average number of shares outstanding — basic 114,301,519 113,257,608 Effect of dilutive securities: Restricted stock awards 77,336 - Employee stock options 476 - Other equity-based awards - - Weighted-average number of shares outstanding — diluted 114,379,331 113,257,608 The Company generated a loss attributable to Community Health Systems, Inc. common stockholders for the three month s ended March 31, 2019, so the effect of dilutive securities is not considered because their effect would be antidilutive. If the Company had generated income during the three months ended March 31, 2019, the effect of restricted stock awards, employee stock options, and other equity-based awards on the diluted shares calculation would have been an increase in shares of 59,261 . Three Months Ended March 31, 2020 2019 Dilutive securities outstanding not included in the computation of earnings per share because their effect is antidilutive: Employee stock options and restricted stock awards 4,851,171 3,273,866 |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Contingencies [Abstract] | |
Contingencies Disclosure | 13. CO NTINGENCIES The Company is a party to various legal, regulatory and governmental proceedings incidental to its business. Based on current knowledge, management does not believe that loss contingencies arising from pending legal, regulatory and governmental matters, including the matters described herein, will have a material adverse effect on the condensed consolidated financial position or liquidity of the Company. However, in light of the inherent uncertainties involved in pending legal, regulatory and governmental matters, some of which are beyond the Company’s control, and the very large or indeterminate damages sought in some of these matters, an adverse outcome in one or more of these matters could be material to the Company’s results of operations or cash flows for any particular reporting period. With respect to all legal, regulatory and governmental proceedings, the Company considers the likelihood of a negative outcome. If the Company determines the likelihood of a negative outcome with respect to any such matter is probable and the amount of the loss can be reasonably estimated, the Company records an accrual for the estimated loss for the expected outcome of the matter. If the likelihood of a negative outcome with respect to material matters is reasonably possible and the Company is able to determine an estimate of the possible loss or a range of loss, whether in excess of a related accrued liability or where there is no accrued liability, the Company discloses the estimate of the possible loss or range of loss. However, the Company is unable to estimate a possible loss or range of loss in some instances based on the significant uncertainties involved in, and/or the preliminary nature of, certain legal, regulatory and governmental matters. In connection with the spin-off of Quorum Health Corporation (“QHC”), the Company agreed to indemnify QHC for certain liabilities relating to outcomes or events occurring prior to April 29, 2016, the closing date of the spin-off, including (i) certain claims and proceedings that were known to be outstanding at or prior to the consummation of the spin-off and involved multiple facilities and (ii) certain claims, proceedings and investigations by governmental authorities or private plaintiffs related to activities occurring at or related to QHC’s healthcare facilities prior to the closing date of the spin-off, but only to the extent, in the case of clause (ii), that such claims are covered by insurance policies maintained by the Company, including professional liability and employer practices. Notwithstanding the foregoing, the Company is not required to indemnify QHC in respect of any claims or proceedings arising out of or related to the business operations of Quorum Health Resources, LLC at any time or QHC’s compliance with the corporate integrity agreement. Subsequent to the spin-off of QHC, the Office of the Inspector General provided the Company with written assurance that it would look solely at QHC for compliance for its facilities under the Company’s Corporate Integrity Agreement; however, the Office of the Inspector General declined to enter into a separate corporate integrity agreement with QHC. Probable Contingencies Becker v. Community Health Systems, Inc. d/b/a Community Health Systems Professional Services Corporation d/b/a Community Health Systems d/b/a Community Health Systems PSC, Inc. d/b/a Rockwood Clinic P.S. and Rockwood Clinic, P.S. (Superior Court, Spokane, Washington). This suit was filed on February 29, 2012, by a former chief financial officer at Rockwood Clinic in Spokane, Washington. Becker claims he was wrongfully terminated for allegedly refusing to certify a budget for Rockwood Clinic in 2012. On February 29, 2012, he also filed an administrative complaint with the Department of Labor, Occupational Safety and Health Administration alleging that he is a whistleblower under Sarbanes-Oxley, which was dismissed by the agency and was appealed to an administrative law judge for a hearing that occurred on January 19-26, 2016. In a decision dated November 9, 2016, the law judge awarded Becker approximately $1.9 million for front pay, back pay and emotional damages with attorney fees to be later determined. The Company has appealed the award to the Administrative Review Board and is awaiting its decision. At a hearing on July 27, 2012, the trial court dismissed Community Health Systems, Inc. from the state case and subsequently certified the state case for an interlocutory appeal of the denial to dismiss his employer and the management company. The appellate court accepted the interlocutory appeal, and it was argued on April 30, 2014. On August 14, 2014, the court denied the Company’s appeal. On October 20, 2014, the Company filed a petition to review the denial with the Washington Supreme Court. The appeal was accepted and oral argument was heard on June 9, 2015. On September 15, 2015, the court denied the Company’s appeal and remanded to the trial court; a previous trial setting of September 12, 2016 has been vacated and not reset. On October 15, 2019, the Administrative Review Board released an order to show cause requiring Becker to file a brief to show cause why the Administrative Review Board should not remand the previous administrative decision for a new hearing before a new law judge. The parties have settled this case for an immaterial amount and both the administrative action and the Superior Court case have been dismissed. 2011 Class Action Shareholder Federal Securities Cases . Three purported class action cases have been filed in the United States District Court for the Middle District of Tennessee; namely, Norfolk County Retirement System v. Community Health Systems, Inc., et al., filed May 9, 2011; De Zheng v. Community Health Systems, Inc., et al., filed May 12, 2011; and Minneapolis Firefighters Relief Association v. Community Health Systems, Inc., et al., filed June 21, 2011. All three seek class certification on behalf of purchasers of the Company’s common stock between July 27, 2006 and April 11, 2011 and allege that misleading statements resulted in artificially inflated prices for the Company’s common stock. In December 2011, the cases were consolidated for pretrial purposes and NYC Funds and its counsel were selected as lead plaintiffs/lead plaintiffs’ counsel. In lieu of ruling on the Company’s motion to dismiss, the court permitted the plaintiffs to file a first amended consolidated class action complaint, which was filed on October 5, 2015. The Company’s motion to dismiss was filed on November 4, 2015 and oral argument was held on April 11, 2016. The Company’s motion to dismiss was granted on June 16, 2016 and on June 27, 2016, the plaintiffs filed a notice of appeal to the Sixth Circuit Court of Appeals. The matter was heard on May 3, 2017. On December 13, 2017, the Sixth Circuit reversed the trial court’s dismissal of the case and remanded it to the District Court. The Company filed a renewed partial motion to dismiss on February 9, 2018, which was denied by the District Court on September 24, 2018. The Company also filed a petition for a writ of certiorari to the United States Supreme Court on April 18, 2018 seeking review of the Sixth Circuit’s decision. The United States Supreme Court denied the petition for a writ of certiorari on October 1, 2018. The District Court granted the Plaintiff’s motion for class certification on July 26, 2019. The Company filed a petition for permission to appeal the District Court’s class certification order in the Sixth Circuit Court of Appeals on August 9, 2019, and that petition was denied on October 23, 2019. Trial for this matter is set for December 1, 2020. On January 21, 2020, the Company and the Plaintiff filed a stipulation of settlement indicating to the District Court that the parties had reached agreement on the principal terms of a settlement for $53 million. The settlement received preliminary approval from the District Court on January 30, 2020. Objections to the settlement are due May 18, 2020, and the hearing for final approval of the settlement is set for June 19, 2020. The Company’s $53 million reserve for this matter, which was recorded during the three months ended December 31, 2019, remains as of March 31, 2020, pending final approval of the settlement. The proposed settlement amount has been funded by the Company and is held in escrow as of March 31, 2020. Such amount is recorded in other current assets in the condensed consolidated balance sheet. The table below presents a reconciliation of the beginning and ending liability balances (in millions) during the three months ended March 31, 2020, with respect to the Company’s determination of the contingencies of the Company in respect of which an accrual has been recorded. Summary of Recorded Amounts Probable Contingencies Balance as of December 31, 2019 $ 68 Expense - Reserve for insured claim 7 Cash payments (7) Balance as of March 31, 2020 $ 68 In accordance with applicable accounting guidance, the Company establishes a liability for litigation, regulatory and governmental matters for which, based on information currently available, the Company believes that a negative outcome is known or is probable and the amount of the loss is reasonably estimable. For all such matters (whether or not discussed in this contingencies footnote), such amounts have been recorded in other accrued liabilities on the condensed consolidated balance sheet and are included in the table above. Due to the uncertainties and difficulty in predicting the ultimate resolution of these contingencies, the actual amount could differ from the estimated amount reflected as a liability on the condensed consolidated balance sheet. In the aggregate, attorneys’ fees and other costs incurred but not included in the table above related to probable contingencies, and Contingent Value Right-related contingencies accounted for at fair value totaled $2 million and less than $1 million for the three month ended March 31, 2020 and 2019, respectively, and are included in other operating expenses in the accompanying condensed consolidated statements of income (loss). Matters for which an Outcome Cannot be Assessed For the following legal matter, due to the uncertainties surrounding the ultimate outcome of the case, the Company cannot at this time assess what the outcome may be and is further unable to reasonably estimate any loss or range of loss. Steadfast Insurance Company, et al v. Community Health Systems, Inc., CHS/Community Health Systems, Inc., CHSPSC, LLC and Pecos Valley of New Mexico, LLC; Community Health Systems, Inc., et al v. Steadfast Insurance Company, et al. These cases are filed in the Superior Court for the State of Delaware and the Chancery Court for the State of Delaware, respectively, and involve insurance coverage disputes related to a $73 million judgment rendered against Pecos Valley of New Mexico, LLC in Anne Sperling, et al v. Pecos Valley of New Mexico, LLC . The first case was brought by Steadfast Insurance Company in Delaware Superior Court seeking a declaration that the Sperling judgment is not a covered loss as defined by the insurance policies that are the subject of the case. The second case, filed by the Company in Delaware Chancery Court, seeks reformation of the subject policies. The Steadfast complaint was served on November 30, 2018. On December 13, 2018, Admiral Insurance Company, Endurance Specialty Insurance Ltd, and Illinois Union Insurance Company moved to intervene in the suit as petitioners. The Company has initiated counterclaims against each insurer in that case, including for bad faith against Steadfast. The Company filed the Community Health Systems complaint on January 22, 2020.The Sperling judgment against Pecos Valley of New Mexico, LLC, which is the subject of this litigation and which was rendered on September 5, 2018, in First Judicial Court of the State of New Mexico, is currently on appeal to the Court of Appeals of New Mexico. Trial of the Steadfast matter is set for December 7, 2020. The Company believes the insurers’ claims in the Steadfast litigation are without merit and will vigorously defend the case. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events Disclosure | 14. SUBSEQUENT EVENTS On April 20, 2020, one or more affiliates of the Company entered into a definitive agreement for the sale of substantially all of the assets of San Angelo Community Medical Center ( 171 licensed beds) in San Angelo, Texas to affiliates of Shannon Health System. On April 27, 2020, one or more affiliates of the Company entered into a definitive agreement for the sale of substantially all of the assets of each of Abilene Regional Medical Center ( 231 licensed beds) in Abilene, Texas and Brownwood Regional Medical Center ( 188 licensed beds) in Brownwood, Texas to subsidiaries of Hendrick Health System. On April 27, 2020, one or more affiliates of the Company entered into a definitive agreement for the sale of the majority ownership interest in St. Cloud Regional Medical Center ( 84 licensed beds) in St. Cloud, Florida to affiliates of Orlando Health, Inc., who already hold the minority ownership interest. The CARES Act, which was enacted on March 27, 2020, authorizes $100 billion in funding to hospitals and other healthcare providers to be distributed through the Public Health and Social Services Emergency Fund (the “PHSSEF”). Payments from the PHSSEF are intended to compensate healthcare providers for lost revenues and incremental expenses incurred in response to the COVID-19 pandemic and are not required to be repaid provided the recipients attest to and comply with certain terms and conditions, including limitations on balance billing and not using PHSSEF funds to reimburse expenses or losses that other sources are obligated to reimburse. The U.S. Department of Health and Human Services (the “HHS”) initially distributed $30 billion of this funding based on each provider’s share of total Medicare fee-for-service reimbursement in 2019 , but has announced that $50 billion in CARES Act funding (including the $30 billion already distributed) will be allocated proportional to providers’ share of 2018 net patient revenue. HHS has indicated that distributions of the remaining $50 billion will be targeted primarily to hospitals in COVID-19 high impact areas, to rural providers, and to reimburse providers for COVID-19-related treatment of uninsured patients . In April 2020, the Company received approximately $245 million in payments from the initial PHSSEF payments, which did not qualify for recognition during the three months ended March 31, 2020 . An additional $75 billion in emergency appropriations for COVID-19 response will be available to eligible providers under the Paycheck Protection Program and Health Care Enhancement Act (“PPPHCE Act”), which was enacted on April 24, 2020. These funds will also be distributed through the PHSSEF. Recipients will not be required to repay the amounts received, provided they comply with terms and conditions, which have not yet been finalized. As a way to increase cash flow to Medicare providers impacted by the COVID-19 pandemic, the CARES Act expanded the Medicare Accelerated and Advance Payment Program. Inpatient acute care hospitals may request accelerated payments of up to 100% of the Medicare payment amount for a six-month period (not including Medicare Advantage payments) , although CMS is now reevaluating pending and new applications in light of direct payments made available through PHSSEF. CMS will base payment amounts for inpatient acute care hospitals on the provider’s Medicare fee-for-service reimburse ments in the last six months of 2019. Such accelerated payments are interest free for inpatient acute care hospitals for 12 months , and the program currently requires CMS to recoup the payments beginning 120 days after receipt by the provider, by withholding future Medicare fee-for-service payments for claims until the full accelerated payment has been recouped. The program currently requires any outstanding balance remaining after 12 months to be repaid by the provider or be subject to an interest rate currently set at 10.25%. In April 2020, the Company received approximately $1.2 billion of accelerated payments, which did not qualify for recognition during the three months ended March 31, 2020. Lastly, the CARES Act provides for deferred payment of the employer portion of social security taxes between March 27, 2020 and December 31, 2020, with 50% of the deferred amount due December 31, 2021 and the remaining 50% due December 31, 2022. The Company began deferring the employer portion of social security taxes in mid-April 2020. |
Summarized Financial Informatio
Summarized Financial Information | 3 Months Ended |
Mar. 31, 2020 | |
Summarized Financial Information [Abstract] | |
Summarized Financial Information | 15. SUMMARIZED FINANCIAL INFORMATION The 6⅞% Senior Notes due 2022, which are senior unsecured obligations of CHS, and the 6¼% Senior Secured Notes due 2023, which are senior secured obligations of CHS (collectively, “the Notes”) are guaranteed on a senior basis by the Company and by certain of its existing and subsequently acquired or organized 100% owned domestic subsidiaries (collectively, the “subsidiary guarantors”). In addition, equity interests held by the Company in non-guarantor subsidiaries have been pledged as collateral under the Notes, except for equity interests held in three hospitals owned jointly with a non-profit, health organization. The Notes are fully and unconditionally guaranteed on a joint and several basis, with exceptions considered customary for such guarantees, limited to the release of the guarantee when a subsidiary guarantor’s capital stock is sold, or a sale of all of the subsidiary guarantor’s assets used in operations. There are no significant restrictions on the ability of the subsidiary guarantors to make distributions to the issuer. Summarized financial information is provided for Community Health Systems, Inc. (parent guarantor), CHS (issuer) and the subsidiary guarantors on a combined basis in accordance with SEC Regulation S-X Rules 3-10 and 13-01. The accounting policies used in the preparation of this summarized financial information are consistent with those elsewhere in the condensed consolidated financial statements of the Company, except that intercompany transactions and balances of the parent, issuer and subsidiary guarantor entities with non-guarantors entities have not been eliminated. Equity in earnings from investments in non-guarantors entities has not been presented. From time to time, subsidiaries of the Company sell and/or repurchase noncontrolling interests in consolidated subsidiaries, which may change subsidiaries between guarantors and non-guarantors. Amounts for prior periods have been revised to reflect the status of guarantors and non-guarantors as of March 31, 2020. Summarized statements of income (loss) (in millions): Three Months Ended March 31, 2020 Net operating revenues $ 1,996 Income from operations 249 Net income 86 Net income attributable to Community Health Systems, Inc. Stockholders 86 S Summarized balance sheets (in millions): March 31, 2020 December 31, 2019 Current assets $ 2,469 $ 2,464 Noncurrent assets (a) 14,450 14,596 Current liabilities 1,413 1,472 Noncurrent liabilities (b) 17,330 15,800 (a) Includes amounts due from non-guarantor subsidiaries of $6.5 billion at both March 31, 2020 and December 31, 2019. (b) Includes amounts due to non-guarantor subsidiaries of $3.0 billion and $1.4 billion as of March 31, 2020 and December 31, 2019 , respectively. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policy) | 3 Months Ended |
Mar. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies [Abstract] | |
Basis of Accounting, Policy | The unaudited condensed consolidated financial statements of Community Health Systems, Inc. (the “Parent” or “Parent Company”) and its subsidiaries (the “Company”) as of March 31, 2020 and December 31, 2019 and for the three-month periods ended March 31, 2020 and 2019, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such periods. All intercompany transactions and balances have been eliminated. The results of operations for the three months ended March 31, 2020, are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2020. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements. Actual results could differ from these estimates under different assumptions or conditions. Where applicable, the impact, if any, resulting from the emergence of a novel coronavirus (“COVID-19”) during the three months ended March 31, 2020, has been considered. Certain information and disclosures normally included in the notes to the consolidated financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission (the “SEC”). The Company believes the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2019, contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 20, 2020 (“2019 Form 10-K”). Certain prior period amounts have been reclassified to conform to the current period presentation within the condensed consolidated statements of cash flows. During the first quarter of 2020, the Company early adopted the SEC’s Financial Disclosures About Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize a Registrant’s Securities rules, which simplify the disclosure requirements related to the Company’s registered debt securities under Rule 3-10 of Regulation S-X (see Note 15). |
Consolidation, Policy | Noncontrolling interests in less-than-wholly-owned consolidated subsidiaries of the Parent are presented as a component of total equity on the condensed consolidated balance sheets to distinguish between the interests of the Parent Company and the interests of the noncontrolling owners. Noncontrolling interests that are redeemable or may become redeemable at a fixed or determinable price at the option of the holder or upon the occurrence of an event outside of the control of the Company are presented in mezzanine equity on the condensed consolidated balance sheets. Substantially all of the Company’s operating costs and expenses are “cost of revenue” items. Operating costs that could be classified as general and administrative by the Company include the Company’s corporate office costs at its Franklin, Tennessee office, which were $37 million and $43 million for the three months ended March 31, 2020 and 2019, respectively. Included in these corporate office costs is stock-based compensation of $2 million and $3 million for the three months ended March 31, 2020 and 2019, respectively. Throughout these notes to the condensed consolidated financial statements, Community Health Systems, Inc., and its consolidated subsidiaries are referred to on a collective basis as the “Company.” This drafting style is not meant to indicate that the publicly traded Parent or any particular subsidiary of the Parent owns or operates any asset, business, or property. The hospitals, operations and businesses described in this filing are owned and operated by distinct and indirect subsidiaries of Community Health Systems, Inc. |
Revenue Recognition, Policy | Revenue Recognition. Net Operating Revenues Net operating revenues are recorded at the transaction price estimated by the Company to reflect the total consideration due from patients and third-party payors in exchange for providing goods and services in patient care. These services are considered to be a single performance obligation and have a duration of less than one year. Revenues are recorded as these goods and services are provided. The transaction price, which involves significant estimates, is determined based on the Company’s standard charges for the goods and services provided, with a reduction recorded for price concessions related to third party contractual arrangements as well as patient discounts and other patient price concessions. During both of the three month periods ended March 31, 2020 and March 31, 2019, the impact of changes to the inputs used to determine the transaction price was considered immaterial. Currently, several states utilize supplemental reimbursement programs for the purpose of providing reimbursement to providers that is not specifically tied to an individual’s care, some of which offsets a portion of the cost of providing care to Medicaid and indigent patients. These programs are designed with input from the Centers for Medicare & Medicaid Services (“CMS”) and are funded with a combination of state and federal resources, including, in certain instances, fees or taxes levied on the providers. Under these supplemental programs, the Company recognizes revenue and related expenses in the period in which amounts are estimable and collection is reasonably assured. Reimbursement under these programs is reflected in net operating revenues and fees, taxes or other program-related costs are reflected in other operating expenses. The Company’s net operating revenues during the three months ended March 31, 2020 and 2019 have been presented in the following table based on an allocation of the estimated transaction price with the patient between the primary patient classification of insurance coverage (in millions): |
Patient Accounts Receivable. Policy | Patient Accounts Receivable Patient accounts receivable are recorded at net realizable value based on certain assumptions determined by each payor. For third-party payors including Medicare, Medicaid, and Managed Care, the net realizable value is based on the estimated contractual reimbursement percentage, which is based on current contract prices or historical paid claims data by payor. For self-pay accounts receivable, which includes patients who are uninsured and the patient responsibility portion for patients with insurance, the net realizable value is determined using estimates of historical collection experience without regard to aging category. These estimates are adjusted for estimated conversions of patient responsibility portions, expected recoveries and any anticipated changes in trends. Patient accounts receivable can be impacted by the effectiveness of the Company’s collection efforts. Additionally, significant changes in payor mix, business office operations, economic conditions or trends in federal and state governmental healthcare coverage could affect the net realizable value of accounts receivable. The Company also continually reviews the net realizable value of accounts receivable by monitoring historical cash collections as a percentage of trailing net operating revenues, as well as by analyzing current period net revenue and admissions by payor classification, aged accounts receivable by payor, days revenue outstanding, the composition of self-pay receivables between pure self-pay patients and the patient responsibility portion of third-party insured receivables and the impact of recent acquisitions and dispositions. Final settlements for some payors and programs are subject to adjustment based on administrative review and audit by third parties. As a result of these final settlements, the Company has recorded amounts due to third-party payors of $87 million and $83 million as of March 31, 2020 and December 31, 2019, respectively, and these amounts are included in accrued liabilities-other in the accompanying condensed consolidated balance sheets. Amounts due from third-party payors were $131 million and $137 million as of March 31, 2020 and December 31, 2019, respectively, and are included in other current assets in the accompanying condensed consolidated balance sheets. Substantially all Medicare and Medicaid cost reports are final settled through 2016. |
Charity Care, Policy | Charity Care In the ordinary course of business, the Company renders services to patients who are financially unable to pay for hospital care. The Company’s policy is to not pursue collections for such amounts; therefore, the related charges for those patients who are financially unable to pay and that otherwise do not qualify for reimbursement from a governmental program are not reported in net operating revenues, and are thus classified as charity care. The Company determines amounts that qualify for charity care primarily based on the patient’s household income relative to the federal poverty level guidelines, as established by the federal government. These charity care services are estimated to be $166 million and $141 million for the three months ended March 31, 2020 and 2019, respectively, representing the value (at the Company’s standard charges) of these charity care services that are excluded from net operating revenues. The estimated cost incurred by the Company to provide these charity care services to patients who are unable to pay was approximately $ 19 million and $ 15 million during the three months ended March 31, 2020 and 2019, respectively. The estimated cost of these charity care services was determined using a ratio of cost to gross charges and applying that ratio to the gross charges associated with providing care to charity patients for the period. |
Accounting for the Impairment or Disposal of Long-Lived Assets, Policy | Accounting for the Impairment or Disposal of Long-Lived Assets. During the three months ended March 31, 2020, the Company recorded a total combined net impairment charge and gain on disposal of approximately $45 million. An impairment charge of approximately $64 million was recorded primarily to ad just the carrying value of long-lived assets at several hospitals where the Company is in discussions with potential buyers for divestiture at a sales price that indicates a fair value below carrying value. Included in the carrying value of the hospital disposal groups at March 31, 2020 is a net allocation of approximately $6 million of goodwill allocated from the hospital op erations reporting unit based on a calculation of the disposal groups’ relative fair value compared to the total reporting unit. The impairment charge was partially offset by a gain of approximately $19 million related to three hospitals sold on January 1, 2020. The Company will continue to evaluate the potential for further impairment of the long-lived assets of underperforming hospitals as well as evaluate offers for potential sales. Based on such analysis, additional impairment charges may be recorded in the future. During the three months ended March 31, 2019, the Company recorded a total combined impairment charge and loss on disposal of approximately $38 million to reduce the carrying value of closed hospitals and certain hospitals that have been deemed held for sale based on the difference between the carrying value of the hospital disposal groups compared to the estimated fair value less costs to sell. |
New Accounting Pronouncements, Policy | New Accounting Pronouncements . In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020- 04, “Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” This ASU provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria that reference LIBOR or another rate that is expected to be discontinued. The amendments in the ASU are effective for all entities as of March 12, 2020 through December 31, 2022. The adoption of this guidance did not have a material impact on the Company’s condensed consolidated financial position or results of operations. The Company has evaluated all other recently issued, but not yet effective, ASUs and does not expect the eventual adoption of these ASUs to have a material impact on its condensed consolidated financial position or results of operations. |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Policy) | 3 Months Ended |
Mar. 31, 2020 | |
Acquisitions and Divestitures [Abstract] | |
Acquisitions Policy | Acquisitions The Company accounts for all transactions that represent business combinations using the acquisition method of accounting, where the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity are recognized and measured at their fair values on the date the Company obtains control in the acquiree. Such fair values that are not finalized for reporting periods following the acquisition date are estimated and recorded as provisional amounts. Adjustments to these provisional amounts during the measurement period (defined as the date through which all information required to identify and measure the consideration transferred, the assets acquired, the liabilities assumed and any noncontrolling interests has been obtained, limited to one year from the acquisition date) are recorded when identified. Goodwill is determined as the excess of the fair value of the consideration conveyed in the acquisition over the fair value of the net assets acquired. |
Fair Value (Policy)
Fair Value (Policy) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value [Abstract] | |
Fair Value, Policy | Fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the Company utilizes the U.S. GAAP fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumption about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The inputs used to measure fair value are classified into the following fair value hierarchy: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Level 3 includes values determined using pricing models, discounted cash flow methodologies, or similar techniques reflecting the Company’s own assumptions. In instances where the determination of the fair value hierarchy measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment of factors specific to the asset or liability. Transfers between levels within the fair value hierarchy are recognized by the Company on the date of the change in circumstances that requires such transfer. There were no transfers between levels during the three-month periods ended March 31, 2020 or March 31, 2019. |
Summarized Financial Informat_2
Summarized Financial Information (Policy) | 3 Months Ended |
Mar. 31, 2020 | |
Summarized Financial Information [Abstract] | |
Guarantor Financial Information Policy | The accounting policies used in the preparation of this summarized financial information are consistent with those elsewhere in the condensed consolidated financial statements of the Company, except that intercompany transactions and balances of the parent, issuer and subsidiary guarantor entities with non-guarantors entities have not been eliminated. Equity in earnings from investments in non-guarantors entities has not been presented. |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Basis of Presentation and Significant Accounting Policies [Abstract] | |
Schedule of Net Operating Revenues | Three Months Ended March 31, 2020 2019 Medicare $ 756 $ 889 Medicaid 407 428 Managed Care and other third-party payors 1,832 2,025 Self-pay 30 34 Total $ 3,025 $ 3,376 |
Accounting for Stock-Based Co_2
Accounting for Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting for Stock-Based Compensation [Abstract] | |
Schedule of Share-based Compensation Expense | Three Months Ended March 31, 2020 2019 Effect on loss before income taxes $ (2) $ (3) Effect on net income (loss) $ (1) $ (2) |
Schedule of Share-based Payment Awards, Stock Options, Valuation Assumptions | Three Months Ended March 31, 2020 2019 Expected volatility 73.5 % 66.6 % Expected dividends - - Expected term 6 years 6 years Risk-free interest rate 1.0 % 2.6 % |
Schedule of Share-based Compensation, Stock Options, Activity | Weighted- Aggregate Average Intrinsic Weighted- Remaining Value as of Average Contractual March 31, Shares Exercise Price Term 2020 Outstanding at December 31, 2019 1,110,134 $ 16.90 5.6 years Granted 946,500 4.93 Exercised - - Forfeited and cancelled (159,938) 33.90 Outstanding at March 31, 2020 1,896,696 $ 9.50 8.1 years $ - Exercisable at March 31, 2020 530,192 $ 21.27 4.2 years $ - |
Schedule of Share-based Compensation, Restricted Stock, Activity | Weighted- Average Grant Shares Date Fair Value Unvested at December 31, 2019 3,857,402 $ 5.47 Granted 2,197,500 4.90 Vested (988,650) 5.77 Forfeited (328,500) 9.19 Unvested at March 31, 2020 4,737,752 4.89 |
Schedule of Share-based Compensation, Restricted Stock Units, Activity | Weighted- Average Grant Shares Date Fair Value Unvested at December 31, 2019 541,576 $ 5.13 Granted 310,347 4.93 Vested (238,184) 5.47 Forfeited - - Unvested at March 31, 2020 613,739 4.89 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Acquisitions and Divestitures [Abstract] | |
Schedule of Divestitures | Licensed Hospital Buyer City, State Beds Effective Date 2020 Divestitures: Southside Regional Medical Center Bon Secours Mercy Health System Petersburg, VA 300 January 1, 2020 Southampton Memorial Hospital Bon Secours Mercy Health System Franklin, VA 105 January 1, 2020 Southern Virginia Regional Medical Center Bon Secours Mercy Health System Emporia, VA 80 January 1, 2020 2019 Divestitures: Bluefield Regional Medical Center Princeton Community Hospital Association Bluefield, WV 92 October 1, 2019 Lake Wales Medical Center Adventist Health System Lake Wales, FL 160 September 1, 2019 Heart of Florida Regional Medical Center Adventist Health System Davenport, FL 193 September 1, 2019 College Station Medical Center St. Joseph Regional Health Center College Station, TX 167 August 1, 2019 Tennova Healthcare - Lebanon Vanderbilt University Medical Center Lebanon, TN 245 August 1, 2019 Chester Regional Medical Center Medical University Hospital Authority Chester, SC 82 March 1, 2019 Carolinas Hospital System - Florence Medical University Hospital Authority Florence, SC 396 March 1, 2019 Springs Memorial Hospital Medical University Hospital Authority Lancaster, SC 225 March 1, 2019 Carolinas Hospital System - Marion Medical University Hospital Authority Mullins, SC 124 March 1, 2019 Memorial Hospital of Salem County Community Healthcare Associates, LLC Salem, NJ 126 January 31, 2019 Mary Black Health System - Spartanburg Spartanburg Regional Healthcare System Spartanburg, SC 207 January 1, 2019 Mary Black Health System - Gaffney Spartanburg Regional Healthcare System Gaffney, SC 125 January 1, 2019 |
Schedule of Balance Sheet Items Classified as Held for Sale | March 31, 2020 December 31, 2019 Other current assets $ 20 $ 25 Other assets, net 286 262 Accrued liabilities 25 43 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Other Intangible Assets [Abstract] | |
Schedule of Goodwill | Balance, as of December 31, 2019 Goodwill $ 7,142 Accumulated impairment losses (2,814) 4,328 Goodwill allocated to hospitals held for sale (6) Balance, as of March 31, 2020 Goodwill 7,136 Accumulated impairment losses (2,814) $ 4,322 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Long-term Debt [Abstract] | |
Schedule of Debt | March 31, December 31, 2020 2019 5⅛% Senior Secured Notes due 2021 $ - $ 1,000 6⅞% Senior Notes due 2022 231 231 6¼% Senior Secured Notes due 2023 2,675 3,100 8⅝% Senior Secured Notes due 2024 1,033 1,033 6⅝% Senior Secured Notes due 2025 1,462 - 8% Senior Secured Notes due 2026 2,101 2,101 8% Senior Secured Notes due 2027 700 700 6⅞% Senior Notes due 2028 1,700 1,700 9⅞% Junior-Priority Secured Notes due 2023 1,770 1,770 8⅛% Junior-Priority Secured Notes due 2024 1,355 1,355 ABL Facility 380 273 Finance lease and financing obligations 290 272 Other 25 17 Less: Unamortized deferred debt issuance costs and note premium (167) (147) Total debt 13,555 13,405 Less: Current maturities (30) (20) Total long-term debt $ 13,525 $ 13,385 |
Schedule of Early Redemption Prices on Notes | Period Redemption Price February 15, 2022 to February 14, 2023 103.313 % February 15, 2023 to February 14, 2024 101.656 % February 15, 2024 to February 14, 2025 100.000 % |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value of Financial Instruments [Abstract] | |
Schedule of Estimated Fair Value of Financial Instruments, by Balance Sheet Grouping | March 31, 2020 December 31, 2019 Carrying Estimated Fair Carrying Estimated Fair Amount Value Amount Value Assets: Cash and cash equivalents $ 246 $ 246 $ 216 $ 216 Investments in equity securities 114 114 141 141 Available-for-sale debt securities 103 103 101 101 Trading securities 12 12 12 12 Liabilities: 5⅛% Senior Secured Notes due 2021 - - 990 1,003 6⅞% Senior Notes due 2022 229 173 229 188 6¼% Senior Secured Notes due 2023 2,654 2,560 3,074 3,148 8⅝% Senior Secured Notes due 2024 1,024 1,028 1,023 1,099 6⅝% Senior Secured Notes due 2025 1,421 1,379 - - 8% Senior Secured Notes due 2026 2,071 2,004 2,070 2,182 8% Senior Secured Notes due 2027 691 602 691 700 6⅞% Senior Notes due 2028 1,678 516 1,678 1,700 9 ⅞% Junior-Priority Secured Notes due 2023 1,755 1,419 1,754 1,539 8⅛% Junior-Priority Secured Notes due 2024 1,341 936 1,340 1,113 ABL Facility and other debt 401 401 285 285 |
Schedule of Pre-tax Gain (Loss) Recognized as a Component of Other Comprehensive Income | Amount of Pre-Tax Loss Recognized in OCI (Effective Portion) Three Months Ended March 31, Derivatives in Cash Flow Hedging Relationships 2020 2019 Interest rate swaps $ (1) $ (2) |
Schedule of Effective Portion of the Pre-tax Loss (Gain) Reclassified from AOCL into Interest Expense on the Consolidated Statements of Income | Amount of Pre-Tax Loss (Gain) Reclassified from AOCL into Income (Effective Portion) Location of Loss (Gain) Reclassified from Three Months Ended March 31, AOCL into Income (Effective Portion) 2020 2019 Interest expense, net $ 1 $ (1) |
Schedule of the Fair Value of Derivative Instruments in the Consolidated Balance Sheet | Asset Derivatives Liability Derivatives March 31, 2020 December 31, 2019 March 31, 2020 December 31, 2019 Balance Balance Balance Balance Sheet Sheet Sheet Sheet Location Fair Value Location Fair Value Location Fair Value Location Fair Value Derivatives designated as Other Other Other Other hedging assets, assets, long-term long-term instruments net $ - net $ - liabilities $ 2 liabilities $ 2 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | March 31, 2020 Level 1 Level 2 Level 3 Investments in equity securities $ 114 $ 114 $ - $ - Available-for-sale debt securities 103 - 103 - Trading securities 12 - 12 - Total assets $ 229 $ 114 $ 115 $ - Fair value of interest rate swap agreement $ 2 $ - $ 2 $ - Total liabilities $ 2 $ - $ 2 $ - December 31, 2019 Level 1 Level 2 Level 3 Investments in equity securities $ 141 $ 141 $ - $ - Available-for-sale debt securities 101 - 101 - Trading securities 12 - 12 - Total assets $ 254 $ 141 $ 113 $ - Fair value of interest rate swap agreement $ 2 $ - $ 2 $ - Total liabilities $ 2 $ - $ 2 $ - |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Components of Lease Cost and Rent Expense | Three Months Ended March 31, Lease Cost 2020 2019 Operating lease cost: Operating lease cost $ 51 $ 48 Short-term rent expense 26 30 Variable lease cost 5 3 Sublease income (1) (1) Total operating lease cost $ 81 $ 80 Finance lease cost: Amortization of right-of-use assets $ 3 $ 3 Interest on finance lease liabilities 2 2 Total finance lease cost $ 5 $ 5 |
Supplemental Balance Sheet Information Related to Leases | Balance Sheet Classification March 31, 2020 December 31, 2019 Operating Leases: Operating Lease ROU Assets Other assets, net $ 634 $ 607 Finance Leases: Finance Lease ROU Assets Property and equipment Land and improvements $ 8 $ 8 Buildings and improvements 168 154 Equipment and fixtures 11 11 Property and equipment 187 173 Less accumulated depreciation and amortization (58) (56) Property and equipment, net $ 129 $ 117 Current finance lease liabilities Current maturities of long-term debt $ 6 $ 6 Long-term finance lease liabilities Long-term debt 122 107 |
Supplemental Cash Flow and Other Information Related to Leases | Three Months Ended March 31, Cash flow information 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (1) $ 47 $ 35 Operating cash flows from finance leases 2 2 Financing cash flows from finance leases 1 3 Right-of-use assets obtained in exchange for new finance lease liabilities 17 1 Right-of-use assets obtained in exchange for new operating lease liabilities 35 15 __________ (1) Included in the change in other operating assets and liabilities in the condensed consolidated statement of cash flows. |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Deficit [Abstract] | |
Schedule of Stockholders' Deficit | The following schedule presents the reconciliation of the carrying amount of total equity, equity attributable to the Company, and equity attributable to the noncontrolling interests as of March 31, 2020, and during the three-month period following December 31, 2019 (in millions ): Community Health Systems, Inc. Stockholders Redeemable Noncontrolling Interest Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss (Income) Accumulated Deficit Noncontrolling Interest Total Stockholders’ Deficit Balance, December 31, 2019 $ 502 $ 1 $ 2,008 $ (9) $ (4,218) $ 77 $ (2,141) Comprehensive income 8 - - 2 18 8 28 Distributions to noncontrolling interests (22) - - - - (8) (8) Purchase of subsidiary shares from noncontrolling interests (1) - (1) - - - (1) Other reclassifications of noncontrolling interests 8 - - - - (8) (8) Adjustment to redemption value of redeemable noncontrolling interests 7 - (7) - - - (7) Cancellation of restricted stock for tax withholdings on vested shares - - (1) - - - (1) Share-based compensation - - 2 - - - 2 Balance, March 31, 2020 $ 502 $ 1 $ 2,001 $ (7) $ (4,200) $ 69 $ (2,136) The following schedule presents the reconciliation of the carrying amount of total equity, equity attributable to the Company, and equity attributable to the noncontrolling interests as of March 31, 2019, and during the three-month period following December 31, 2018 (in millions): Community Health Systems, Inc. Stockholders Redeemable Noncontrolling Interest Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Accumulated Deficit Noncontrolling Interest Total Stockholders’ Deficit Balance, December 31, 2018 $ 504 $ 1 $ 2,017 $ (10) $ (3,543) $ 72 $ (1,463) Comprehensive income (loss) 9 - - - (118) 8 (110) Contributions from noncontrolling interests 1 - - - - - - Distributions to noncontrolling interests (19) - - - - (8) (8) Purchase of subsidiary shares from noncontrolling interests (1) - - - - - - Other reclassifications of noncontrolling interests (1) - - - - 1 1 Adjustment to redemption value of redeemable noncontrolling interests 12 - (12) - - - (12) Cancellation of restricted stock for tax withholdings on vested shares - - (1) - - - (1) Share-based compensation - - 3 - - - 3 Balance, March 31, 2019 $ 505 $ 1 $ 2,007 $ (10) $ (3,661) $ 73 $ (1,590) |
Schedule of Impact of Noncontrolling Interest to Stockholders' Deficit | Three Months Ended March 31, 2020 2019 Net income (loss) attributable to Community Health Systems, Inc. stockholders $ 18 $ (118) Transfers to the noncontrolling interests: Net decrease in Community Health Systems, Inc. paid-in-capital for purchase of subsidiary partnership interests (1) - Net transfers to the noncontrolling interests (1) - Change to Community Health Systems, Inc. stockholders’ deficit from net income (loss) attributable to Community Health Systems, Inc. stockholders and transfers to noncontrolling interests $ 17 $ (118) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Components of Denominator for Computation of Basic and Diluted Loss Per Share | Three Months Ended March 31, 2020 2019 Weighted-average number of shares outstanding — basic 114,301,519 113,257,608 Effect of dilutive securities: Restricted stock awards 77,336 - Employee stock options 476 - Other equity-based awards - - Weighted-average number of shares outstanding — diluted 114,379,331 113,257,608 |
Schedule of Antidilutive Securities | Three Months Ended March 31, 2020 2019 Dilutive securities outstanding not included in the computation of earnings per share because their effect is antidilutive: Employee stock options and restricted stock awards 4,851,171 3,273,866 |
Contingencies (Tables)
Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Contingencies [Abstract] | |
Schedule of Reconciliation of the Beginning and Ending Liability Balances in Connection with Probable Contingencies | Probable Contingencies Balance as of December 31, 2019 $ 68 Expense - Reserve for insured claim 7 Cash payments (7) Balance as of March 31, 2020 $ 68 |
Summarized Financial Informat_3
Summarized Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Summarized Financial Information [Abstract] | |
Summarized Statements of Income (Loss) | Three Months Ended March 31, 2020 Net operating revenues $ 1,996 Income from operations 249 Net income 86 Net income attributable to Community Health Systems, Inc. Stockholders 86 |
Summarized Balance Sheets | March 31, 2020 December 31, 2019 Current assets $ 2,469 $ 2,464 Noncurrent assets (a) 14,450 14,596 Current liabilities 1,413 1,472 Noncurrent liabilities (b) 17,330 15,800 (a) Includes amounts due from non-guarantor subsidiaries of $6.5 billion at both March 31, 2020 and December 31, 2019. (b) Includes amounts due to non-guarantor subsidiaries of $3.0 billion and $1.4 billion as of March 31, 2020 and December 31, 2019 , respectively. |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies (Narrative) (Details) $ in Millions | Jan. 01, 2020item | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) |
Net Operating Revenues, Policy [Abstract] | ||||
Value of charity care services at the Company's standard charges included in contractual allowances | $ 166 | $ 141 | ||
Estimated cost incurred by Company to provide charity care services | 19 | 15 | ||
Third-Party Reimbursement [Abstract] | ||||
Amounts due to third party payors | 87 | $ 83 | ||
Amounts due from third party payors | 131 | $ 137 | ||
Accounting for the Impairment or Disposal of Long-Lived Assets | ||||
Gain (loss) on disposition of business | 45 | |||
Impairment and gain (loss) on sale of businesses, net | 45 | 38 | ||
Goodwill allocated to hospital disposal group held for sale | 6 | |||
Cost of Revenue [Abstract] | ||||
Corporate office costs | 37 | 43 | ||
Stock-based compensation expense | 2 | 3 | ||
Hospitals Sold or Deemed Held for Sale [Member] | ||||
Accounting for the Impairment or Disposal of Long-Lived Assets | ||||
Gain (loss) on disposition of business | 19 | $ 38 | ||
Number of hospitals sold | item | 3 | |||
Adjustment for Carrying Value of Other Long-Lived Assets at Underperforming Hospitals [Member] | ||||
Accounting for the Impairment or Disposal of Long-Lived Assets | ||||
Impairment and gain (loss) on sale of businesses, net | $ 64 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies (Schedule of Net Operating Revenue) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Net operating revenues | $ 3,025 | $ 3,376 |
Medicare [Member] | ||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Net operating revenues | 756 | 889 |
Medicaid [Member] | ||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Net operating revenues | 407 | 428 |
Managed Care And Other Third Party Payors [Member] | ||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Net operating revenues | 1,832 | 2,025 |
Self-Pay [Member] | ||
Health Care Organization, Receivable and Revenue Disclosures [Line Items] | ||
Net operating revenues | $ 30 | $ 34 |
Accounting for Stock-Based Co_3
Accounting for Stock-Based Compensation (Narrative) (Details) | Mar. 01, 2020USD ($)shares | Mar. 01, 2019USD ($)shares | Mar. 31, 2020USD ($)item$ / sharesshares | Mar. 31, 2019USD ($)item$ / shares | May 12, 2020shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee service share-based compensation, unrecognized compensation costs on nonvested awards | $ | $ 25,000,000 | ||||
Employee service share-based compensation total compensation cost not yet recognized, period for recognition | 29 months | ||||
Employee service share-based compensation, nonvested awards, modifications to awards | item | 0 | 0 | |||
Aggregate intrinsic value of options exercised | $ | $ 0 | $ 0 | |||
Employee Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee service share-based compensation total compensation cost not yet recognized, period for recognition | 31 months | ||||
Employee service share-based compensation, unrecognized compensation costs on nonvested stock options | $ | $ 4,000,000 | ||||
Weighted-average grant date fair value of stock options | $ / shares | $ 3.17 | $ 3.08 | |||
Share Price | $ / shares | $ 3.34 | ||||
Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation, number of shares received by each director | 310,347 | ||||
Restricted Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation arrangement award vesting rights | one-third increments on each of the first three anniversaries of the award date | ||||
Share-based compensation, number of shares received by each director | 2,197,500 | ||||
Restricted Stock and Restricted Stock Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee service share-based compensation total compensation cost not yet recognized, period for recognition | 28 months | ||||
Employee service share-based compensation, unrecognized compensation costs on nonvested awards other than options | $ | $ 21,000,000 | ||||
Plan 2000 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation arrangement award vesting rights | one-third increments on each of the first three anniversaries of the award date | ||||
Unissued common stock reserved for grants | 0 | ||||
Plan 2009 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation arrangement award vesting rights | one-third increments on each of the first three anniversaries of the award date | ||||
Unissued common stock reserved for grants | 1,318,802 | ||||
Plan 2009 [Member] | Restricted Stock Units (RSUs) [Member] | Outside Directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Fair value of units granted | $ | $ 170,000 | $ 170,000 | |||
Share-based compensation, number of shares received by each director | 34,483 | 34,068 | |||
Amended 2009 Plan [Member] | Forecast [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unissued common stock reserved for grants | 9,000,000 | ||||
Contractual Term Of Option Granted Since 2008 [Member] | Plan 2000 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Contractual term of option granted | 10 years | ||||
Contractual Term of Option Granted in 2011 or Later [Member] | Plan 2009 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Contractual term of option granted | 10 years | ||||
Performance-Based Awards Granted On Or After March 1, 2017 [Member] | Restricted Stock, Performance-Based Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation arrangement by payment award, performance objective measurement period | 3 years |
Accounting for Stock-Based Co_4
Accounting for Stock-Based Compensation (Schedule of Share-based Compensation Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounting for Stock-Based Compensation [Abstract] | ||
Effect on loss before income taxes | $ (2) | $ (3) |
Effect on net income (loss) | $ (1) | $ (2) |
Accounting for Stock-Based Co_5
Accounting for Stock-Based Compensation (Schedule of Share-based Payment Awards, Stock Options, Valuation Assumptions) (Details) - Employee Stock Option [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 73.50% | 66.60% |
Expected dividends | ||
Expected term | 6 years | 6 years |
Risk-free interest rate | 1.00% | 2.60% |
Accounting for Stock-Based Co_6
Accounting for Stock-Based Compensation (Schedule of Share-based Compensation, Stock Options, Activity) (Details) - Employee Stock Option [Member] - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Beginning Balance, Shares | 1,110,134 | |
Granted, Shares | 946,500 | |
Forfeited and cancelled, Shares | (159,938) | |
Ending Balance, Shares | 1,896,696 | 1,110,134 |
Beginning of Period, Weighted Average Exercise Price | $ 16.90 | |
Granted, Weighted Average Exercise Price | 4.93 | |
Forfeited and Cancelled, Weighted Average Exercise Price | 33.90 | |
End of Period, Weighted Average Exercise Price | $ 9.50 | $ 16.90 |
Weighted Average Remaining Contractual Term | 8 years 1 month 6 days | 5 years 7 months 6 days |
Exercisable, Shares | 530,192 | |
Exercisable, Weighted Average Exercise Price | $ 21.27 | |
Exercisable, Weighted Average Remaining Contractual Term | 4 years 2 months 12 days |
Accounting for Stock-Based Co_7
Accounting for Stock-Based Compensation (Schedule of Share-based Compensation, Restricted Stock, Activity) (Details) - Restricted Stock [Member] | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Beginning Balance, Unvested Shares | shares | 3,857,402 |
Granted, Shares | shares | 2,197,500 |
Vested, Shares | shares | (988,650) |
Forfeited, Shares | shares | (328,500) |
Ending Balance, Unvested Shares | shares | 4,737,752 |
Beginning of Period, Weighted Average Grant Date Fair Value | $ / shares | $ 5.47 |
Granted, Weighted Average Grant Date Fair Value | $ / shares | 4.90 |
Vested, Weighted Average Grant Date Fair Value | $ / shares | 5.77 |
Forfeited, Weighted Average Grant Date Fair Value | $ / shares | 9.19 |
End of Period, Weighted Average Grant Date Fair Value | $ / shares | $ 4.89 |
Accounting for Stock-Based Co_8
Accounting for Stock-Based Compensation (Schedule of Share-based Compensation, Restricted Stock Units, Activity) (Details) - Restricted Stock Units (RSUs) [Member] | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Beginning Balance, Unvested Shares | shares | 541,576 |
Granted, Shares | shares | 310,347 |
Vested, Shares | shares | (238,184) |
Forfeited, Shares | shares | |
Ending Balance, Unvested Shares | shares | 613,739 |
Beginning of Period, Weighted Average Grant Date Fair Value | $ / shares | $ 5.13 |
Granted, Weighted Average Grant Date Fair Value | $ / shares | 4.93 |
Vested, Weighted Average Grant Date Fair Value | $ / shares | 5.47 |
Forfeited, Weighted Average Grant Date Fair Value | $ / shares | |
End of Period, Weighted Average Grant Date Fair Value | $ / shares | $ 4.89 |
Acquisitions and Divestitures_3
Acquisitions and Divestitures (Acquisitions Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Acquisitions and Divestitures [Line Items] | ||
Acquisition and integration expenses related to prospective and closed acquisitions | $ 1 | |
Maximum [Member] | ||
Acquisitions and Divestitures [Line Items] | ||
Acquisition and integration expenses related to prospective and closed acquisitions | $ 1 | |
Physician Practices Clinics and Other Ancillary Businesses [Member] | Maximum [Member] | ||
Acquisitions and Divestitures [Line Items] | ||
Business acquisition, cost of acquired entity, purchase price | $ 1 |
Acquisitions and Divestitures_4
Acquisitions and Divestitures (Divestitures Narrative) (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2020item | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Mar. 18, 2020item | Jan. 30, 2020item | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of hospital closures | 0 | ||||
Shands Live Oak Regional Medical Center [Member] | Live Oak, Florida [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of licensed beds | 25 | ||||
Shands Starke Regional Medical Center [Member] | Starke, Florida [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of licensed beds | 49 | ||||
Northern Louisiana Medical Center [Member] | Ruston, Louisiana [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of licensed beds | 130 | ||||
Tennova Healthcare [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Impairment charge recorded on the sale or closure of hospitals | $ | $ 27 | $ 9 |
Acquisitions and Divestitures_5
Acquisitions and Divestitures (Schedule of Divestitures) (Details) | 3 Months Ended |
Mar. 31, 2020item | |
Southside Regional Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 300 |
Effective Date | Jan. 1, 2020 |
Southampton Memorial Hospital [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 105 |
Effective Date | Jan. 1, 2020 |
Southern Virginia Regional Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 80 |
Effective Date | Jan. 1, 2020 |
Bluefield Regional Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 92 |
Effective Date | Oct. 1, 2019 |
Lake Wales Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 160 |
Effective Date | Sep. 1, 2019 |
Heart of Florida Regional Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 193 |
Effective Date | Sep. 1, 2019 |
College Station Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 167 |
Effective Date | Aug. 1, 2019 |
Tennova Healthcare Lebanon [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 245 |
Effective Date | Aug. 1, 2019 |
Chester Regional Medical Center [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 82 |
Effective Date | Mar. 1, 2019 |
Carolinas Hospital System - Florence [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 396 |
Effective Date | Mar. 1, 2019 |
Springs Memorial Hospital [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 225 |
Effective Date | Mar. 1, 2019 |
Carolinas Hospital System - Marion [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 124 |
Effective Date | Mar. 1, 2019 |
Memorial Hospital of Salem County [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 126 |
Effective Date | Jan. 31, 2019 |
Mary Black Health System - Spartanburg [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 207 |
Effective Date | Jan. 1, 2019 |
Mary Black Health System - Gaffney [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Number of licensed beds | 125 |
Effective Date | Jan. 1, 2019 |
Acquisitions and Divestitures_6
Acquisitions and Divestitures (Schedule of Balance Sheet Items Classified as Held for Sale) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Acquisitions and Divestitures [Abstract] | ||
Other current assets | $ 20 | $ 25 |
Other assets, net | 286 | 262 |
Accrued liabilities | $ 25 | $ 43 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Schedule of Goodwill) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Goodwill Gross, Balance, beginning period | $ 7,142 |
Accumulated impairment losses, Balance, beginning of period | (2,814) |
Goodwill, Balance, beginning of period | 4,328 |
Goodwill allocated to hospitals held for sale | (6) |
Goodwill allocated to hospitals held for sale | (6) |
Goodwill Gross, Balance, end of period | 7,136 |
Accumulated impairment losses, Balance, end of period | (2,814) |
Goodwill, Balance, end of year | $ 4,322 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Intangible Assets Narrative) (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets acquired during the year | $ 0 | ||
Finite-lived intangible assets, gross | 1,000,000 | $ 1,000,000 | |
Net, intangible asset not subject to amortization | 60,000,000 | 63,000,000 | |
Gross carrying amount of capitalized software | 1,100,000,000 | 1,100,000,000 | |
Capitalized computer software, net | 301,000,000 | 321,000,000 | |
Capitalized computer software, development stage costs | 39,000,000 | ||
Capitalized Internal Use Software [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Acquired finite-lived intangible asset, residual value | 0 | ||
Amortization expense | 32,000,000 | $ 30,000,000 | |
Amortization expense for remainder 2020 | 94,000,000 | ||
Amortization expense for 2021 | 108,000,000 | ||
Amortization expense for 2022 | 52,000,000 | ||
Amortization expense for 2023 | 24,000,000 | ||
Amortization expense for 2024 | 12,000,000 | ||
Amortization expense for 2025 | 6,000,000 | ||
Amortization expense thereafter | $ 5,000,000 | ||
Capitalized Internal Use Software, Except Significant System Conversions [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted-average amortization period | 3 years | ||
Minimum [Member] | Capitalized Internal Use Software, Significant System Conversions [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted-average amortization period | 8 years | ||
Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived intangible assets, net | $ 1,000,000 | $ 1,000,000 | |
Maximum [Member] | Capitalized Internal Use Software, Significant System Conversions [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted-average amortization period | 10 years |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Contingency [Abstract] | ||
Unrecognized benefit that would affect the effective tax rate | $ 1 | |
Amount of interest and penalties included in liabilities for uncertain tax positions | $ 1 | |
Effective income tax rate | 122.80% | (7.40%) |
Federal [Member] | Tax Year 2014 [Member] | ||
Income Tax Contingency [Abstract] | ||
Open tax year | 2014 | |
Federal [Member] | Tax Year 2015 [Member] | ||
Income Tax Contingency [Abstract] | ||
Open tax year | 2015 | |
CARES Act [Member] | ||
Income Tax Contingency [Abstract] | ||
Discrete net tax benefit | $ 240 | |
Maximum [Member] | ||
Income Tax Contingency [Abstract] | ||
Income tax refund | $ 2 | $ 1 |
Long-Term Debt (Schedule of Deb
Long-Term Debt (Schedule of Debt) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Debt and lease obligations | $ 13,555 | $ 13,405 |
Less: Unamortized deferred debt issuance costs and note premium | (167) | (147) |
Less: Current maturities | (30) | (20) |
Total long-term debt | 13,525 | 13,385 |
ABL Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 380 | 273 |
Senior Notes [Member] | Senior Notes at 6.875%, Due 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 231 | 231 |
Senior Notes [Member] | Senior Notes At 6.875% Due 2028 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 1,700 | 1,700 |
Senior Secured Notes [Member] | Senior Secured Notes at 5.125%, Due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 1,000 | |
Senior Secured Notes [Member] | Senior Secured Notes at 6.25%, Due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 2,675 | 3,100 |
Senior Secured Notes [Member] | Senior Secured Notes at 8.625%, Due 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 1,033 | 1,033 |
Senior Secured Notes [Member] | Senior Secured Notes at 6.625% Due 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 1,462 | |
Senior Secured Notes [Member] | Senior Secured Notes at 8%, Due 2026 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 2,101 | 2,101 |
Senior Secured Notes [Member] | Senior Secured Notes At 8% Due 2027 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 700 | 700 |
Junior-Priority Secured Notes [Member] | Junior-Priority Secured Notes At 9.875% Due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 1,770 | 1,770 |
Junior-Priority Secured Notes [Member] | Junior-Priority Secured Notes at 8.125% Due 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 1,355 | 1,355 |
Finance Lease And Financing Obligations [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | 290 | 272 |
Other [Member] | ||
Debt Instrument [Line Items] | ||
Debt and lease obligations | $ 25 | $ 17 |
Long-Term Debt (6.625% Senior S
Long-Term Debt (6.625% Senior Secured Notes, Due 2025 Narrative) (Details) - USD ($) | Feb. 06, 2020 | Mar. 31, 2020 | Mar. 31, 2019 |
Debt Instrument [Line Items] | |||
Pre-tax loss from extinguishment of debt | $ (4,000,000) | $ (31,000,000) | |
Senior Secured Notes at 6.25%, Due 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Extinguishment of debt amount | $ 426,000,000 | ||
Senior Secured Notes [Member] | Senior Secured Notes at 6.625% Due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument, offering date | Feb. 6, 2020 | ||
Debt instrument aggregate principal amount | $ 1,462,000,000 | ||
Debt instrument stated interest rate | 6.625% | ||
Debt instrument, maturity date | Feb. 15, 2025 | ||
Debt instrument redemption price percentage | 100.00% | ||
Pre-tax loss from extinguishment of debt | $ (4,000,000) | ||
After-tax loss from extinguishment of debt | $ (3,000,000) |
Long-Term Debt (Schedule of Ear
Long-Term Debt (Schedule of Early Redemption Prices on 6.625% Senior Secured Notes due 2025) (Details) - Senior Secured Notes at 6.625% Due 2025 [Member] - Senior Secured Notes [Member] | 3 Months Ended |
Mar. 31, 2020 | |
Debt Instrument, Redemption [Line Items] | |
Debt Instrument Redemption Price Percentage | 100.00% |
Debt Instrument, Redemption, Period One [Member] | |
Debt Instrument, Redemption [Line Items] | |
Debt Instrument Redemption Price Percentage | 103.313% |
Debt Instrument, Redemption Period, Start Date | Feb. 15, 2022 |
Debt Instrument, Redemption Period, End Date | Feb. 14, 2023 |
Debt Instrument, Redemption, Period Two [Member] | |
Debt Instrument, Redemption [Line Items] | |
Debt Instrument Redemption Price Percentage | 101.656% |
Debt Instrument, Redemption Period, Start Date | Feb. 15, 2023 |
Debt Instrument, Redemption Period, End Date | Feb. 14, 2024 |
Debt Instrument, Redemption, Period Three [Member] | |
Debt Instrument, Redemption [Line Items] | |
Debt Instrument Redemption Price Percentage | 100.00% |
Debt Instrument, Redemption Period, Start Date | Feb. 15, 2024 |
Debt Instrument, Redemption Period, End Date | Feb. 14, 2025 |
Long-Term Debt (Other Debt Narr
Long-Term Debt (Other Debt Narrative) (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)agreement | Mar. 31, 2019USD ($) | |
Debt Instrument [Line Items] | ||
Interest paid on borrowings | $ 264 | $ 189 |
Interest Rate Swap [Member] | ||
Debt Instrument [Line Items] | ||
Number of interest rate swaps | agreement | 1 | |
Aggregate notional amount | $ 300 | |
Interest Rate Swap, Currently Effective [Member] | ||
Debt Instrument [Line Items] | ||
Aggregate notional amount | 300 | |
ABL Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument available borrowing base | 769 | |
Outstanding borrowings | 380 | |
ABL Facility [Member] | ABL Facility Customary Covenants [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument available borrowing base | $ 95 | |
Debt instrument variable interest rate | 10.00% | |
ABL Facility [Member] | Letter of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 150 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Schedule of Estimated Fair Value of Financial Instruments, by Balance Sheet Grouping) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Investments in equity securities | $ 114 | $ 141 |
Available-for-sale debt securities | 103 | 101 |
Trading securities | 12 | 12 |
Carrying Amount [Member] | ||
Assets: | ||
Cash and cash equivalents | 246 | 216 |
Investments in equity securities | 114 | 141 |
Available-for-sale debt securities | 103 | 101 |
Trading securities | 12 | 12 |
Carrying Amount [Member] | Senior Notes [Member] | Senior Notes at 6.875%, Due 2022 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 229 | 229 |
Carrying Amount [Member] | Senior Notes [Member] | Senior Secured Notes at 6.625% Due 2025 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,421 | |
Carrying Amount [Member] | Senior Notes [Member] | Senior Secured Notes At 8% Due 2027 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 691 | 691 |
Carrying Amount [Member] | Senior Notes [Member] | Senior Notes At 6.875 Percent Due 2028 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,678 | 1,678 |
Carrying Amount [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 5.125%, Due 2021 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 990 | |
Carrying Amount [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 6.25%, Due 2023 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 2,654 | 3,074 |
Carrying Amount [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 8.625%, Due 2024 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,024 | 1,023 |
Carrying Amount [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 8%, Due 2026 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 2,071 | 2,070 |
Carrying Amount [Member] | Junior-Priority Secured Notes [Member] | Junior-Priority Secured Notes At 9.875% Due 2023 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,755 | 1,754 |
Carrying Amount [Member] | Junior-Priority Secured Notes [Member] | Junior-Priority Secured Notes at 8.125% Due 2024 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,341 | 1,340 |
Carrying Amount [Member] | Receivables Facility and Other Debt, Type [Member] | ABL Facility and Other Debt [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 401 | 285 |
Estimated Fair Value [Member] | ||
Assets: | ||
Cash and cash equivalents | 246 | 216 |
Investments in equity securities | 114 | 141 |
Available-for-sale debt securities | 103 | 101 |
Trading securities | 12 | 12 |
Estimated Fair Value [Member] | Senior Notes [Member] | Senior Notes at 6.875%, Due 2022 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 173 | 188 |
Estimated Fair Value [Member] | Senior Notes [Member] | Senior Secured Notes at 6.625% Due 2025 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,379 | |
Estimated Fair Value [Member] | Senior Notes [Member] | Senior Secured Notes At 8% Due 2027 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 602 | 700 |
Estimated Fair Value [Member] | Senior Notes [Member] | Senior Notes At 6.875 Percent Due 2028 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 516 | 1,700 |
Estimated Fair Value [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 5.125%, Due 2021 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,003 | |
Estimated Fair Value [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 6.25%, Due 2023 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 2,560 | 3,148 |
Estimated Fair Value [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 8.625%, Due 2024 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,028 | 1,099 |
Estimated Fair Value [Member] | Senior Secured Notes [Member] | Senior Secured Notes at 8%, Due 2026 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 2,004 | 2,182 |
Estimated Fair Value [Member] | Junior-Priority Secured Notes [Member] | Junior-Priority Secured Notes At 9.875% Due 2023 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 1,419 | 1,539 |
Estimated Fair Value [Member] | Junior-Priority Secured Notes [Member] | Junior-Priority Secured Notes at 8.125% Due 2024 [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | 936 | 1,113 |
Estimated Fair Value [Member] | Receivables Facility and Other Debt, Type [Member] | ABL Facility and Other Debt [Member] | ||
Liabilities: | ||
Notes Payable, Fair Value Disclosure | $ 401 | $ 285 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments (Narrative) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)agreement | |
Maximum [Member] | |
Derivative [Line Items] | |
Interest income arising from spread in fixed and floating rates of interest rate swap agreements that will be recognized in next 12 months | $ 1 |
Interest Rate Swap [Member] | |
Derivative [Line Items] | |
Number of interest rate swaps | agreement | 1 |
Aggregate notional amount | $ 300 |
Derivative fixed interest rate | 2.892% |
Derivative termination date | Aug. 30, 2020 |
Derivative liability fair value | $ 2 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments (Schedule of Pre-tax Gain (Loss) Recognized as a Component of Other Comprehensive Income) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Pre-Tax Loss Recognized in OCI (Effective Portion) | $ (1) | $ (2) |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments (Schedule of Effective Portion of the Pre-tax Loss (Gain) Reclassified from AOCL into Interest Expense on the Consolidated Statements of Income) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Interest Expense [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Pre-Tax Loss (Gain) Reclassified from AOCL into Income (Effective Portion) | $ 1 | $ (1) |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments (Schedule of the Fair Value of Derivative Instruments in the Consolidated Balance Sheet) (Details) - Designated as Hedging Instrument [Member] - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Other Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Asset derivatives designated as hedging instruments | ||
Other Long-term Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Liability derivatives designated as hedging instruments | $ 2 | $ 2 |
Fair Value (Narrative) (Details
Fair Value (Narrative) (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 |
Fair Value Disclosures [Line Items] | |||
Fair value, assets, level 1 to level 2 transfers, amount | $ 0 | $ 0 | |
Fair value, assets, level 2 to level 1 transfers, amount | 0 | 0 | |
Fair value, liabilities, level 1 to level 2 transfers, amount | 0 | 0 | |
Fair value, liabilities, level 2 to level 1 transfers, amount | 0 | 0 | |
Available-for-sale debt securities | 103,000,000 | $ 101,000,000 | |
Gross unrealized losses on available-for-sale debt securities | 2,000,000 | $ 1,000,000 | |
Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member] | Available-for-sale Securities [Member] | |||
Fair Value Disclosures [Line Items] | |||
Available-for-sale debt securities | $ 35,000,000 | $ 51,000,000 |
Fair Value (Schedule of Fair Va
Fair Value (Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in equity securities | $ 114 | $ 141 |
Available-for-sale debt securities | 103 | 101 |
Trading securities | 12 | 12 |
Total assets | 229 | 254 |
Fair value of interest rate swap agreement | 2 | 2 |
Total liabilities | 2 | 2 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in equity securities | 114 | 141 |
Total assets | 114 | 141 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale debt securities | 103 | 101 |
Trading securities | 12 | 12 |
Total assets | 115 | 113 |
Fair value of interest rate swap agreement | 2 | 2 |
Total liabilities | $ 2 | $ 2 |
Leases (Components of Lease Cos
Leases (Components of Lease Cost and Rent Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 51 | $ 48 |
Short-term rent expense | 26 | 30 |
Variable lease cost | 5 | 3 |
Sublease Income | (1) | (1) |
Total operating lease cost | 81 | 80 |
Finance lease cost: | ||
Amortization of right-of-use assets | 3 | 3 |
Interest on finance lease liabilities | 2 | 2 |
Total finance lease cost | $ 5 | $ 5 |
Leases (Supplemental Balance Sh
Leases (Supplemental Balance Sheet Information Related to Leases) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Operating Leases: | ||
Operating Lease ROU Assets | $ 634 | $ 607 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssetsNoncurrent | us-gaap:OtherAssetsNoncurrent |
Finance Leases: | ||
Property and equipment | $ 9,618 | $ 9,653 |
Less accumulated depreciation and amortization | (4,096) | (4,045) |
Property and equipment, net | 5,522 | 5,608 |
Current finance lease liabilities | $ 6 | $ 6 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:LongTermDebtAndCapitalLeaseObligationsCurrent | us-gaap:LongTermDebtAndCapitalLeaseObligationsCurrent |
Long-term finance lease liabilities | $ 122 | $ 107 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:LongTermDebtNoncurrent | us-gaap:LongTermDebtNoncurrent |
Finance Lease ROU Assets [Member] | ||
Finance Leases: | ||
Property and equipment | $ 187 | $ 173 |
Less accumulated depreciation and amortization | (58) | (56) |
Property and equipment, net | 129 | 117 |
Finance Lease ROU Assets [Member] | Land and Improvements [Member] | ||
Finance Leases: | ||
Property and equipment | 8 | 8 |
Finance Lease ROU Assets [Member] | Building and Building Improvements [Member] | ||
Finance Leases: | ||
Property and equipment | 168 | 154 |
Finance Lease ROU Assets [Member] | Equipment and Fixtures [Member] | ||
Finance Leases: | ||
Property and equipment | $ 11 | $ 11 |
Leases (Supplemental Cash Flow
Leases (Supplemental Cash Flow and Other Information Related to Leases) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases | $ 47 | $ 35 |
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases | 2 | 2 |
Cash paid for amounts included in the measurement of lease liabilities: Financing cash flows from finance leases | 1 | 3 |
Right-of-use assets obtained in exchange for new finance lease liabilities | 17 | 1 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 35 | $ 15 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) - Supplemental Employee Retirement Plans, Defined Benefit [Member] - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Net periodic benefit cost | $ 2 | $ 2 | |
Accrued benefits liabilities | $ 74 | $ 72 | |
Defined benefit plans and other post-retirement plans, weighted-average assumptions to determine net periodic cost, discount rate | 3.10% | 4.20% | |
Defined benefit plans and other post-retirement plans, weighted-average assumptions to determine net periodic cost, rate of compensation increase | 3.00% | 3.00% | |
Assets in a rabbi trust generally designated to pay benefits of the SERP | $ 78 | $ 84 |
Stockholders' Deficit (Narrativ
Stockholders' Deficit (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Stockholders' Deficit [Abstract] | ||
Total capital stock, shares authorized | 400,000,000 | |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, par value per share | $ 0.01 | $ 0.01 |
Preferred stock, par value per share | $ 0.01 | $ 0.01 |
Preferred stock, shares outstanding | 0 | |
Amount available for dividend payments, stock repurchases at period end | $ 200 |
Stockholders' Deficit (Schedule
Stockholders' Deficit (Schedule of Stockholders' Deficit) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity, beginning balance | $ (2,141) | $ (1,463) |
Redeemable Noncontrolling Interests, beginning balance | 502 | |
Comprehensive income (loss) | 28 | (110) |
Distributions to noncontrolling interests | (8) | (8) |
Purchase of subsidiary shares from noncontrolling interests | (1) | |
Other reclassifications of noncontrolling interests | (8) | 1 |
Adjustment to redemption value of redeemable noncontrolling interests | (7) | (12) |
Cancellation of restricted stock for tax withholdings on vested shares | (1) | (1) |
Share-based compensation | 2 | 3 |
Equity, ending balance | (2,136) | (1,590) |
Redeemable Noncontrolling Interests, ending balance | 502 | |
Redeemable Noncontrolling Interests (Non- Equity) [Member] | ||
Redeemable Noncontrolling Interests, beginning balance | 502 | 504 |
Comprehensive income (loss) attributable to redeemable noncontrolling interest | 8 | 9 |
Contributions from redeemable noncontrolling interests | 1 | |
Distributions to redeemable noncontrolling interests | (22) | (19) |
Purchase of subsidiary shares from noncontrolling interests | (1) | (1) |
Other reclassifications of redeemable noncontrolling interests | 8 | (1) |
Adjustment to redemption value of redeemable noncontrolling interests | 7 | 12 |
Redeemable Noncontrolling Interests, ending balance | 502 | 505 |
Common Stock [Member] | ||
Equity, beginning balance | 1 | 1 |
Equity, ending balance | 1 | 1 |
Additional Paid-in Capital [Member] | ||
Equity, beginning balance | 2,008 | 2,017 |
Purchase of subsidiary shares from noncontrolling interests | (1) | |
Adjustment to redemption value of redeemable noncontrolling interests | (7) | (12) |
Cancellation of restricted stock for tax withholdings on vested shares | (1) | (1) |
Share-based compensation | 2 | 3 |
Equity, ending balance | 2,001 | 2,007 |
Accumulated Other Comprehensive Income (Loss) [Member] | ||
Equity, beginning balance | (9) | (10) |
Comprehensive income (loss) | 2 | |
Equity, ending balance | (7) | (10) |
Accumulated Deficit [Member] | ||
Equity, beginning balance | (4,218) | (3,543) |
Comprehensive income (loss) | 18 | (118) |
Equity, ending balance | (4,200) | (3,661) |
Noncontrolling Interest [Member] | ||
Equity, beginning balance | 77 | 72 |
Comprehensive income (loss) | 8 | 8 |
Distributions to noncontrolling interests | (8) | (8) |
Other reclassifications of noncontrolling interests | (8) | 1 |
Equity, ending balance | $ 69 | $ 73 |
Stockholders' Deficit (Schedu_2
Stockholders' Deficit (Schedule of Impact of Noncontrolling Interest to Stockholders' Deficit) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Stockholders' Deficit [Abstract] | ||
Net income (loss) attributable to Community Health Systems, Inc. stockholders | $ 18 | $ (118) |
Net decrease in Community Health Systems, Inc. paid-in-capital for purchase of subsidiary partnership interests | (1) | |
Net transfers to the noncontrolling interests | (1) | |
Change to Community Health Systems, Inc. stockholders' deficit from net income (loss) attributable to Community Health Systems, Inc. stockholders and transfers to noncontrolling interests | $ 17 | $ (118) |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) | 3 Months Ended |
Mar. 31, 2019shares | |
Earnings Per Share [Abstract] | |
Increase in number of shares to diluted shares calculation if income would have been generated | 59,261 |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of Components of Denominator for Computation of Basic and Diluted Loss Per Share) (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Effect of dilutive securities: | ||
Weighted-average number of shares outstanding - basic | 114,301,519 | 113,257,608 |
Restricted stock awards | 77,336 | |
Employee stock options | 476 | |
Weighted-average number of shares outstanding - diluted | 114,379,331 | 113,257,608 |
Earnings Per Share (Schedule _2
Earnings Per Share (Schedule of Antidilutive Securities) (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Employee stock options and restricted stock awards excluded from computation of earnings per share amount | 4,851,171 | 3,273,866 |
Contingencies (Narrative) (Deta
Contingencies (Narrative) (Details) - USD ($) $ in Millions | Jan. 21, 2020 | Nov. 30, 2018 | Nov. 09, 2016 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 |
Pending Litigation [Member] | Litigation Matters Where Negative Outcome Is Reasonably Possible [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Attorneys' fees and other costs incurred | $ 2 | |||||
Pending Litigation [Member] | Maximum [Member] | Litigation Matters Where Negative Outcome Is Reasonably Possible [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Attorneys' fees and other costs incurred | $ 1 | |||||
U.S. ex re. Baker vs. Community Health Systems, Inc. [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Judgment awarded | $ 1.9 | |||||
Class Action Shareholder Federal Securities Cases [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Judgment awarded | $ 53 | |||||
Liability based on the proposed settlement agreement | $ 53 | |||||
Steadfast Insurance Company, et al v. Community Health Systems, Inc. [Member] | Pending Litigation [Member] | Litigation Matters For Which An Outcome Cannot Be Assessed [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency damages sought value | $ 73 |
Contingencies (Schedule of Reco
Contingencies (Schedule of Reconciliation of the Beginning and Ending Liability Balances in Connection with Probable Contingencies) (Details) - Pending Litigation [Member] - Other Probable Contingencies [Member] $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Loss Contingency Accrual [Roll Forward] | |
Beginning Balance | $ 68 |
Expense | |
Reserve for insured claim | 7 |
Cash payments | (7) |
Ending Balance | $ 68 |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) - Subsequent Event [Member] $ in Millions | 1 Months Ended | ||
Apr. 30, 2020USD ($) | Apr. 27, 2020item | Apr. 20, 2020item | |
CARES Act [Member] | |||
Subsequent Event [Line Items] | |||
Accelerated payments received under the Cares Act | $ | $ 1,200 | ||
CARES Act [Member] | Public Health and Social Services Emergency Fund (the "PHSSEF") [Member] | |||
Subsequent Event [Line Items] | |||
Proceeds received from government intended to compensate lost revenues and Incremental expenses incurred | $ | $ 245 | ||
San Angelo, Texas [Member] | San Angelo Community Medical Center [Member] | |||
Subsequent Event [Line Items] | |||
Number of licensed beds | 171 | ||
Abilene, Texas [Member] | Abilene Regional Medical Center [Member] | |||
Subsequent Event [Line Items] | |||
Number of licensed beds | 231 | ||
Brownwood, Texas [Member] | Brownwood Regional Medical Center [Member] | |||
Subsequent Event [Line Items] | |||
Number of licensed beds | 188 | ||
St. Cloud, Florida [Member] | St. Cloud Regional Medical Center [Member] | |||
Subsequent Event [Line Items] | |||
Number of licensed beds | 84 |
Summarized Financial Informat_4
Summarized Financial Information (Narrative) (Details) | 3 Months Ended |
Mar. 31, 2020item | |
Summarized Financial Information [Abstract] | |
Percentage of owned domestic subsidiaries which guaranteed senior notes | 100.00% |
Number of hospitals jointly owned with non-profit health organizations | 3 |
Summarized Financial Informat_5
Summarized Financial Information (Summarized Statements of Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | $ 3,025 | $ 3,376 |
Income from operations | 110 | 189 |
Net income | 34 | (101) |
Net income attributable to Community Health Systems, Inc. Stockholders | 18 | $ (118) |
Parent Company, Subsidiary Issuer And Guarantor Subsidiaries [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net operating revenues | 1,996 | |
Income from operations | 249 | |
Net income | 86 | |
Net income attributable to Community Health Systems, Inc. Stockholders | $ 86 |
Summarized Financial Informat_6
Summarized Financial Information (Summarized Balance Sheets) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | |||
Current assets | $ 3,360 | $ 3,427 | |
Current liabilities | 2,165 | 2,282 | |
Parent Company, Subsidiary Issuer And Guarantor Subsidiaries [Member] | |||
Condensed Financial Statements, Captions [Line Items] | |||
Current assets | 2,469 | 2,464 | |
Noncurrent assets | [1] | 14,450 | 14,596 |
Current liabilities | 1,413 | 1,472 | |
Noncurrent liabilities | [2] | 17,330 | 15,800 |
Non-Guarantor Subsidiaries [Member] | |||
Condensed Financial Statements, Captions [Line Items] | |||
Noncurrent assets | 6,500 | 6,500 | |
Noncurrent liabilities | $ 3,000 | $ 1,400 | |
[1] | Includes amounts due from non-guarantor subsidiaries of $6.5 billion at both March 31, 2020 and December 31, 2019. | ||
[2] | Includes amounts due to non-guarantor subsidiaries of $3.0 billion and $1.4 billion as of March 31, 2020 and December 31, 2019 |