Dallas-based Tenet Healthcare embarked on a new era five years ago by reducing its debt profile and redirecting focus to its ASC arm, United Surgical Partners International, CEO and Chair Saum Sutaria, MD, said.
"Of all the ASC platforms and [their] recovery … USPI … had the strongest recovery in 2023 from a volume perspective," Dr. Sutaria said Sept. 9 during the Wells Fargo Healthcare Conference. "But we look at that as a measure of strength and as a measure of preference of the USPI platform."
Tenet capitalized off outpatient migration by offloading some assets while investing in ASCs. The health system sold nine hospitals in California and South Carolina for a total of $3.9 billion and plans to sell its majority stake in five more Alabama hospitals for $910 million this fall.
Dr. Sutaria said Tenet is forgoing risky or turnaround hospitals and is instead focusing on buying high-quality assets with good margins.
While selling off hospitals, Tenet's ambulatory arm has seen immense growth. With 7.1% of the ASC market share, USPI is the largest ASC chain by number of physicians and centers, and has seen massive growth in the last few years. The company acquired 45 new centers in the first quarter and quietly purchased ASC chain Covenant Physician Partners.
"The value proposition of USPI hasn't changed," he said. "It's only strengthened, and the multiples at which we're acquiring and synergizing haven't changed. … We have developed a disciplined process around diligence and evaluation of deals we're going to do."