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Income Taxes
 6 Months Ended
Jun. 30, 2025
Income Tax Disclosure [Abstract]  
INCOME TAXES

5. INCOME TAXES

The total amount of unrecognized benefit that would affect the effective tax rate, if recognized, was $44 million at June 30, 2025. A total of $7 million of interest and penalties is included in the amount of the liability for uncertain tax positions at June 30, 2025. 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 income tax returns for the 2021 and 2022 tax years are under examination by the Internal Revenue Service. The Company believes the result of this examination will not be material to its consolidated results of operations or consolidated financial position. The Company has extended the federal statute of limitations through December 31, 2026 for Community Health Systems, Inc. for the tax periods ended December 31, 2021 and 2022.

The Company’s provision for income taxes was $118 million and $24 million for the three months ended June 30, 2025 and 2024, respectively, and $160 million and $52 million for the six months ended June 30, 2025 and 2024, respectively. The Company’s effective tax rates were 26.9% and 48.0% for the three months ended June 30, 2025 and 2024, respectively, and 31.7% and 72.2% for the six months ended June 30, 2025 and 2024, respectively. The increase in the provision for income taxes and the difference in the Company’s effective tax rate for the three and six months ended June 30, 2025, compared to the same period in 2024 was primarily due to an increase in non-deductible goodwill related to divested hospitals.

A federal budget reconciliation bill was enacted on July 4, 2025, which includes federal income tax provisions related to interest deductibility and bonus depreciation, among other provisions. Because the bill was enacted after June 30, 2025, the tax effects of such bill have not been reflected in these condensed consolidated financial statements. The Company is currently evaluating the potential impact of this legislation; however, due to the legislation’s complexity and the proximity of enactment of such legislation to the balance sheet date (June 30, 2025), an estimate of the financial effects of such legislation is not currently determinable.

Cash paid for income taxes, net of refunds received, resulted in a net payment of $181 million and $84 million during the three months ended June 30, 2025 and 2024, respectively, and $101 million and $84 million during the six months ended June 30, 2025 and 2024, respectively. During the three months ended June 30, 2025, approximately $74 million of cash paid for taxes related to gains on divested hospitals for which proceeds were received during the three months ended March 31, 2025.