Tenet Healthcare Corp. partly attributed their strong performance in the third quarter to a sharp increase in the number of high visual acuity surgeries, which are the main focus of the commercial hospital network.
Dr. Saum Sutaria, Tenet’s new CEO since September 1, told investors during a phone call on Thursday that cardiac interventions are recovering to 2019 levels.
The number of orthopedic cases at the company’s outpatient surgery centers grew 22% year-on-year, and the number of outpatient joint replacements more than doubled since 2020.
“We are encouraged by the fact that net revenues per case are almost 10% higher than in 2019, indicating that our more urgent care services are growing even faster,” he said.
Dallas-based Tenet is also expanding robotics for general surgery, cancer services, and bone and joint programs in more than 20 hospitals. The company has also expanded inpatient care for new services in several markets, including San Antonio and El Paso. It is expanding accreditation of injuries, the most recent of which was at a hospital in the Coachella Valley, Sutaria said.
Tenet generated approximately $ 450 million in net profit for shareholders in the third quarter ended September 30. This is compared to a net loss of nearly $ 200 million in the previous year. The company’s share price increased by more than 6% on Thursday.
The quarter gained momentum after the close of the deal to sell five hospitals in the Miami area to Steward Health Care, which generated a pre-tax profit of $ 409 million. The proceeds allowed Tenet to pay $ 1.1 billion in outstanding debt and reduce its annual interest payments by $ 50 million.
Tenet recently announced this plans to buy out the share of ownership and management at nine Compass Surgical Partners ambulatory surgery centers. The deal includes a partnership with 125 independent surgeons who perform predominantly high-precision procedures, including many spine and total joint surgeries, Sutaria said.
Tenet is adding doctors to its outpatient surgery segment called United Surgical Partners International. The company has added 1,700 new doctors from the beginning of the year to date, Sutaria said, including about 580 doctors in the third quarter.
“It is important to note that these are independent doctors who want to work in our facilities,” he said.
Hospital admissions in the Tenet hospital segment rose 2.6% year-on-year, while outpatient visits were up 15.3% over that time. Compared to the third quarter of 2020, the number of visits to emergency departments increased by 25%. Sutaria noted that some of the returning emergency care volume comes from low visual acuity visits, which declined in 2020. This is weighing on earnings given the high cost of emergency department personnel, he said.
In Tenet’s USPI division, single-site surgeries were up 6.8% year-over-year. Sutaria noted that USPI volumes are currently at 101% of the 2019 level, and, according to him, this figure is improving every quarter of 2021.
The number of COVID-19 hospitalizations in the third quarter was just under 10% of total hospitalizations, which Sutaria said is lower than during previous COVID outbreaks. He noted that Tenet was able to continue performing routine procedures at its hospitals during the quarter, despite the surge in COVID in its markets.