The ink is dry on the Medical University of South Carolina's agreement to buy four rural hospitals around the state, a first-of-its-kind deal for the Charleston-based health system.
The acquisitions were valued Friday at $176 million, including $39 million in leases MUSC is taking over. The $137 million balance is being financed with borrowings from a U.S. Department of Housing and Urban Development program.
The purchases expands MUSC's reach to one hospital each in Chester, Marion, Lancaster and Florence counties. They are to be renamed to reflect the ownership change.
“As we welcome our new colleagues to the MUSC family, I am deeply grateful for the hard work and determination that moved this transaction forward,” Dr. David Cole, president of MUSC, said in a written statement. “The commitment and enthusiasm has been exceptional.”
MUSC noted that about 60 percent of its revenue comes from patients who live outside of the tri-county area.
The seller was Community Health Systems, which exited the South Carolina market with Friday's finalized sales agreement. CEO Wayne Smith, told investors during a recent call that the proceeds from sales of dozens of community hospitals across the country are being used to reduce debt and other purposes.
Leaders from the four counties have said they are hopeful that MUSC improve health care services, but they also were concerned abut the millions of dollars in tax revenue they will lose in taxes now that their hospitals are owned by a state agency.
Friday's acquisition is the larger of two rural expansion initiatives by MUSC, which announced last week that it plans to invest $50 million to replace two struggling hospitals in Lake City and Kingstree.
The exact site of the proposed 25-bed critical access medical center has not been determined, but it will be built in that section of the Pee Dee region. Once it opens, around late 2022, the existing Lake City Community Hospital and Williamsburg Regional Hospital will be closed.