Tenet Healthcare Reports Sixth Consecutive Quarterly Loss; CFO Announces Plans To Resign
Officials for Santa Barbara-based Tenet Healthcare on Tuesday announced a second-quarter loss of $426 million, or 91 cents per share, more than double the loss from the previous quarter and the sixth consecutive quarterly loss posted by the company, Bloomberg/Philadelphia Inquirer reports (Ryerson-Cruz, Bloomberg/Philadelphia Inquirer, 8/4). The results included one-time charges to write down expenses from patients without health insurance that totaled $543 million, or 78 cents per share, which included a noncash charge of $254 million, or 34 cents per share (Gellene, Los Angeles Times, 8/4). For the second quarter, Tenet reported a 5% increase in the number of patients without health insurance that company hospitals treat in their emergency departments. Tenet posted second-quarter revenue of $2.57 billion, compared with $2.66 billion a year earlier (Bloomberg/Philadelphia Inquirer, 8/4).
Tenet also announced that the Securities Exchange Commission has filed subpoenas related to physician relationships and financial arrangements at three company hospitals. Tenet officials said that the company has cooperated with the SEC investigation, which they said is part of a broader investigation into physician-hospital relationships nationwide (Los Angeles Times, 8/4). In addition, Tenet hopes to settle a series of civil and criminal investigations into company business practices and patient care (California Healthline, 5/5).
Tenet CEO Trevor Fetter said that Tenet made "tangible progress" toward second-quarter goals. Tenet officials said that the company plans to charge lower prices for uninsured patients "in an attempt to increase the amount actually recovered," the AP/Los Angeles Daily News reports (Gentile, AP/Los Angeles Daily News, 8/4). Fetter added that "compared to volumes in 2002, we are achieving growth more consistent with others in the industry."
In a separate statement, Tenet Chief Financial Officer Stephen Farber announced plans to resign to "pursue other opportunities," the Dallas Morning News reports (Yu, Dallas Morning News, 8/3). Farber said that he will remain with Tenet for a few months and he plans to return to Wall Street (Bloomberg/Philadelphia Inquirer, 8/4). Farber said, "As this company continues to stabilize, the CFO's focus at Tenet will be more on day-to-day operations and less on transactions and restructuring, on which I thrive" (Dallas Morning News, 8/3).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.