CHS Completes $194M Sale of Outpatient Lab Assets to Labcorp

The deal, first announced in July, covers outreach lab assets across 13 states, including patient service centers and in-office phlebotomy sites.

Community Health Systems (CHS) has finalized the sale of its ambulatory outpatient laboratory services to Labcorp for approximately $194 million in cash, marking a significant shift in both companies’ operational strategies.

The deal, first announced in July, covers outreach lab assets across 13 states, including patient service centers and in-office phlebotomy sites.

CHS will retain and continue operating its inpatient and emergency department laboratories, along with hospital-based services such as imaging-related diagnostics, pre-admission testing and other in-house clinical lab operations.

According to CHS, the asset transfer will allow the organization to streamline operations and prioritize hospital-centric services. Kevin Hammons, CHS president and interim CEO, said the completion of the transaction allows the health system to refocus on core offerings while maintaining service access for patients.

Labcorp, meanwhile, will integrate the newly acquired operations into its national network. With the addition of CHS’s outreach labs, patients across the covered states will gain expanded access to Labcorp’s specialty testing capabilities, data analytics tools and digital platforms.

The move aligns with CHS’s long-running portfolio realignment. The for-profit operator has been divesting non-core and lower-margin assets, including the sale of multiple acute care hospitals in North Carolina and Mississippi. CHS is currently in the process of closing transactions involving three hospitals in Pennsylvania and another facility in Tennessee, reflecting its continued shift toward revenue-generating outpatient and essential hospital services.

For Labcorp, the CHS deal adds to a series of recent acquisitions aimed at strengthening its national footprint. Last year, the company spent about $839 million on clinical and outreach business purchases involving Baystate Medical Center, Providence Medical Foundation, Westpac Labs, Invitae and BioReference Health. In 2023, Labcorp recorded approximately $671.5 million in acquisition spending.

Stay tuned for more such updates on Digital Health News