Dive Brief:
- Intermountain Health is exiting Kansas, offloading the last three clinics it operates in the state, collectively called the Caritas Clinics, the system said April 19.
- The Salt Lake City-based nonprofit health system will transfer ownership of Marian Dental Clinic and St. Vincent Clinic, a primary care facility, to Atchison Community Health Clinic by June 30, according an announcement. Terms of the deal were not disclosed.
- Intermountain will close its Kansas City-based Duchesne Clinic on June 1. Some Duchesne employees may transfer to Atchison, while others will receive financial support and help finding employment.
Dive Insight:
Intermountain, which will operate 33 hospitals across six states after this deal, called its decision to exit Kansas “strategic.”
The health system acquired the Caritas Clinics during its 2022 merger with Broomfield, Colorado-based SCL Health. The clinics are "safety-net" facilities, which provide services to low-income patients.
While some health systems, including Community Health Systems and Tenet Healthcare, have recently made asset sales to service debt payments, Intermountain ended 2023 with a low long-term debt to capitalization ratio.
The healthcare operator carried 348 days of cash at the close of 2023 compared to 343 days in 2022 — put in context, KFF said any health system carrying more than 150 days of cash on hand in 2022 was considered to have “strong” reserves or better.
Credit reports from S&P Global and Moody’s Ratings in June rated Intermountain’s credit as high quality.
However, Intermountain was expected to cut back on capital spending in the near term and exercise strict financial discipline while operating margins recovered from the pandemic, according to Moody’s.
Intermountain, for example, sold the urgent care, surgical services and outpatient imaging businesses of its Idaho-based Saltzer medical group earlier this month and sought to re-lease other Saltzer clinics.
Prior to leaving the state, the health system said it is investing some money into Kansas, donating $4.2 million to fund future capital improvement at the facilities, according to the deal announcement.
