Business

Tenet expects at best to break even this year

The for-profit hospital chain is still wincing from legal and financial woes.

By Katherine Vogt — Posted Jan. 3, 2005

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

Tenet Healthcare Corp. has warned investors that it won't likely do better than break even in 2005, a sign that the for-profit hospital chain is still feeling the effects of a series of legal and financial troubles that spawned a major restructuring effort and management overhaul.

In a statement released Dec. 13, 2004, Tenet said that it did not expect results from continuing operations to exceed break-even in 2005 even though several cost-cutting measures will be phased in throughout the year.

The company also said that it expected to post a loss in the fourth quarter partly due to charges that could total more than $1 billion. Tenet posted a net loss of $70 million in the third quarter, which ended Sept. 30.

In a conference call with investors on Dec. 15, Tenet Chief Executive Trevor Fetter said the company had worked hard to improve itself in the wake of several major setbacks, including a failed pricing strategy, a settlement over alleged unnecessary cardiac procedures at a hospital in Redding, Calif., and a government investigation of its outlier payments.

"No company in this industry had ever faced these kinds of issues, so there was no clear roadmap for undoing the damage. The two years since then have been very difficult for the company," Fetter said.

"As a team, we've already made tremendous progress. Unfortunately, all of our progress has been offset from adverse changes in volumes, pricing and bad debt expense."

Tenet has made several significant changes in the wake of its problems, including a management overhaul that replaced several top executives and board members. It also launched two major divestiture initiatives to reduce its catalog of hospitals by nearly 40% so it can focus on a core group of 69 facilities.

Fetter said Tenet is building a solid foundation for the future. But, he said, "we're fighting some strong headwinds as we work to return to an acceptable level of profitability."

Tenet, which had been based in Santa Barbara, Calif., also said it was officially transferring its headquarters to Dallas on Jan. 3. The intention to move was announced last summer.

Back to top


ADVERTISEMENT

ADVERTISE HERE


Featured
Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story


Read story

Goodbye

American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story


Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story


Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story


Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story


Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story


Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story


Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story

  • Stay informed
  • Twitter
  • Facebook
  • RSS
  • LinkedIn