CYH Announces First Quarter 2020 Results

COMMUNITY HEALTH SYSTEMS, INC. ANNOUNCES

FIRST QUARTER 2020 RESULTS

FRANKLIN, Tenn. (April 28, 2020) Community Health Systems, Inc. (NYSE: CYH) (the Company ) today announced

financial and operating results for the three months ended March 31, 2020.

The following highlights the financial and operating

results for the three months ended March 31, 2020.

Net operating revenues for the three months ended March 31, 2020, totaled $3.025 billion, a 10.4 percent decrease,

compared with $3.376 billion for the same period in 2019.

Net income attributable to Community Health Systems, Inc. common

stockholders was $18 million, or $0.15 per share (diluted), for the three months ended March 31, 2020, compared with net loss of $(118) million, or $(1.04) per share (diluted), for the same period in 2019. Excluding the adjusting items as

presented in the table in footnote (e) on page 13, net loss attributable to Community Health Systems, Inc. common stockholders was $(1.59) per share (diluted), for the three months ended March 31, 2020, compared to $(0.53) per share

(diluted) for the same period in 2019. The change in tax valuation allowance (which was one of the adjusting items referenced above) had a positive impact of $240 million, or $2.10 per share (diluted), on net income attributable to Community

Health Systems, Inc. common stockholders, and arose from the discrete tax benefits 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. Weighted-average shares outstanding (diluted) were

114 million for the three months ended March 31, 2020, and 113 million for the three months ended March 31, 2019.

Adjusted EBITDA for the three months ended March 31, 2020, was $309 million compared with $391 million for the same period in

2019, representing a 21.0 percent decrease.

CYH Announces First Quarter 2020 Results

The consolidated operating results for the three months ended March 31, 2020, reflect a

13.3 percent decrease in admissions and a 12.8 percent decrease in adjusted admissions, compared with the same period in 2019. On a same-store basis, admissions decreased 5.2 percent and adjusted admissions decreased 4.8 percent

for the three months ended March 31, 2020, compared with the same period in 2019. On a same-store basis, net operating revenues decreased 3.5 percent for the three months ended March 31, 2020, compared with the same period in 2019.

Commenting on the results, Wayne T. Smith, chairman and chief executive officer of Community Health Systems, Inc., said, We are all

grateful for the courage and commitment of our nation s healthcare workers as they put the care of their patients above all else in confronting COVID-19. Across our hospitals, physicians, nurses, and everyone else on the front lines have

helped to save lives. Our organization has leveraged its resources to provide a rapid, coordinated and effective response to the pandemic. Now, we are also focused on reopening services where we can, especially for patients who have deferred

important surgeries, procedures and other appointments. As we continue to manage our operations through the COVID-19 pandemic, our organization is doing everything possible to limit the spread of COVID-19 and to ensure our communities continue to

have access to safe, quality healthcare.

Due to the decline in patient volumes as a result of the COVID-19 pandemic beginning during the second

half of March, the impact from the COVID-19 pandemic on the Company s operations and financial results for the three months ended March 31, 2020 included decreases in net operating revenues and

increases in expenses related to supply chain and other expenditures.

As previously announced in a Current Report on Form 8-K filed by the Company on April 6, 2020 (the April 6 Form 8-K ), the Company is not able to fully quantify the impact that COVID-19 will have on its financial results during 2020, but expects developments related to COVID-19 to materially affect the Company s financial performance in 2020.

Moreover, as a result of the continuously changing and unpredictable environment related to COVID-19, as disclosed in the April 6 Form 8-K, the Company withdrew its

2020 financial guidance previously issued in its earnings release dated February 19, 2020 and is not providing further guidance in this earnings release.

Federal and state governments have passed legislation, promulgated regulations, and taken other administrative actions intended to assist

healthcare providers in providing care to COVID-19 and other patients during the public health emergency. Sources of relief include the CARES Act, which was enacted on March 27, 2020, and the Paycheck

Protection Program and Health Care Enhancement Act (the PPPHCE Act ), which was enacted on April 24, 2020. The CARES Act includes $100 billion in funding to be distributed to eligible providers through the Public Health and

Social Services Emergency Fund (the PHSSEF ) as well as an expansion of the Medicare Accelerated and Advance Payment Program. The PPPHCE Act includes additional emergency appropriations for COVID-19

response, including $75 billion to be distributed to eligible providers through the PHSSEF.

In April 2020, the Company received

approximately $245 million in payments through the PHSSEF and received accelerated Medicare payments of approximately $1.2 billion via the Medicare Accelerated and Advance Payment Program. These payments did not qualify for recognition in

the three months ended March 31, 2020. PHSSEF payments (both under the CARES Act and the PPPHCE Act) 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 that recipients attest to and comply with certain terms and conditions, including (in the case of payments under the CARES Act) limitations on balance

billing and not using funds received from the PHSSEF to reimburse expenses or losses that other sources are obligated to reimburse (terms and conditions with respect to payments under the PPPHCE Act have not been finalized). In contrast, the

payments under the Medicare Accelerated and Advance Payment Program are advances that providers must repay. The accelerated Medicare payments are interest free for up to 12 months and the program currently requires that CMS recoup the accelerated

payments beginning 120 days after receipt by the provider, by withholding future Medicare fee-for-service payments for claims until such time as the full accelerated

payment has been recouped. The program currently requires that any outstanding balance remaining after 12 months must be repaid by the provider or be subjected to a 10.25% interest rate.

CYH Announces First Quarter 2020 Results

The PHSSEF payments and accelerated payments received to date and which the Company may

receive in the future under the CARES Act and the PPPHCE Act as noted above, or other legislation, will be beneficial in addressing the impact of the COVID-19 pandemic on its results of operations and

financial position. However, the Company is unable to assess the extent to which anticipated negative impacts on the Company arising from the COVID-19 pandemic will be offset by amounts and benefits received,

and which the Company may receive in the future, under the CARES Act, the PPPHCE Act or other legislation.

On January 1, 2020, the

Company completed the divestiture of three hospitals (in respect of which the Company received proceeds at a preliminary closing on December 31, 2019). In addition, since January 1, 2020 the Company has entered into several definitive

agreements to sell a total of seven hospitals, for which the Company expects to receive aggregate proceeds of approximately $400 million. These divestitures, which are expected to be completed at various times during the second and third quarters of

2020, will mark the end of the formal portfolio rationalization strategy, which commenced in 2017. There can be no assurance that these potential divestitures subject to definitive agreements will be completed, or if they are completed, the ultimate

timing of the completion of these divestitures. The Company continues to receive interest from potential acquirers for certain of its hospitals, and may, from time to time, consider selling additional hospitals following the completion of the

Company s formal portfolio rationalization strategy.

Financial and statistical data for 2019 and 2020 presented in this press

release includes the operating results of divested hospitals through the effective closing date of each respective divestiture. Same-store operating results exclude the results of a hospital acquired in 2019 and the hospitals divested in 2019 and

Information About Non-GAAP Financial Measures

This earnings release presents Adjusted EBITDA, a non-GAAP financial measure, which is EBITDA adjusted

to add back net income attributable to noncontrolling interests and to exclude loss (gain) from early extinguishment of debt, impairment and loss on sale of businesses, expense related to government and other legal settlements and related costs,

expense related to employee termination benefits and other restructuring charges, expense from settlement and fair value adjustments on the CVR agreement liability related to the Health Management Associates, Inc. ( HMA ) legal proceedings

and related legal expenses, the impact of changes in estimate to increase the professional liability claims accrual recorded during the second quarter of 2019 (which estimate was further revised in the third quarter of 2019 based on updated

actuarial analysis) with respect to claims incurred in 2016 and prior years and expense related to the valuation allowance recorded in the second quarter of 2019 to reserve the outstanding balance of a promissory note received from the buyer in

connection with the sale of two of the Company s hospitals in 2017, as well as income from a reduction of the valuation allowance on the outstanding balance of a promissory note from the buyer of another hospital. For information regarding why

the Company believes Adjusted EBITDA provides useful information to investors, and for a reconciliation of Adjusted EBITDA to net income (loss) attributable to Community Health Systems, Inc. stockholders, see footnote (c) to the Financial

Highlights, Financial Statements and Selected Operating Data below.

Additionally, this earnings release presents adjusted net income

(loss) attributable to Community Health Systems, Inc. common stockholders per share (diluted), a non-GAAP financial measure, to reflect the impact on net income (loss) attributable to Community Health Systems,

Inc. common stockholders per share (diluted) from the selected items used in the calculation of Adjusted EBITDA. For information regarding why the Company believes this non-GAAP financial measure provides

useful information to investors, and for a reconciliation of this non-GAAP financial measure to net income (loss) attributable to Community Health Systems, Inc. common stockholders per share (diluted), see

footnote (e) to the Financial Highlights, Financial Statements and Selected Operating Data below.

Community Health Systems, Inc. is

one of the largest publicly traded hospital companies in the United States and a leading operator of general acute care hospitals in communities across the country. The Company, through its subsidiaries, owns, leases or operates 99 affiliated

hospitals in 17 states with an aggregate of approximately 16,000 licensed beds.

CYH Announces First Quarter 2020 Results

The Company s headquarters are located in Franklin, Tennessee, a suburb south of

Nashville. Shares in Community Health Systems, Inc. are traded on the New York Stock Exchange under the symbol CYH. More information about the Company can be found on its website at www.chs.net.

Community Health Systems, Inc. will hold a conference call on Wednesday, April 29, 2020, at 10:00 a.m. Central, 11:00 a.m. Eastern, to

review financial and operating results for the first quarter ended March 31, 2020. Investors will have the opportunity to listen to a live internet broadcast of the conference call by clicking on the Investor Relations link of the

Company s website at www.chs.net. To listen to the live call, please go to the website at least fifteen minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a

replay will be available shortly after the call and will continue to be available for approximately 30 days. Copies of this press release and conference call slide show, as well as the Company s Current Report on Form 8-K (including this press release), will be available on the Company s website at www.chs.net.

CYH Announces First Quarter 2020 Results

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

Financial Highlights (a)(b)

(In millions, except per share amounts)

footnotes, see pages 11, 12 and 13.

CYH Announces First Quarter 2020 Results

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income (Loss) (a)(b)

(In millions, except per share amounts)

footnotes, see pages 11, 12 and 13.

CYH Announces First Quarter 2020 Results

COMMUNITY HEALTH SYSTEMS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income (Loss)

footnotes, see pages 11, 12 and 13.

CYH Announces First Quarter 2020 Results