Tenet Healthcare is continuing to expand its investment and spending in its ASC division, Dallas-based United Surgical Partners International.
"We continue to believe accelerating spend at USPI is the single most accretive thing to bring value within the company," Tenet CEO Saum Sutaria, MD, said in an Oct. 29 third quarter earnings call.
According to Dr. Sutaria, USPI has nearly 20 centers in syndication and has opened six new ASCs, including a deal with Synergy Orthopedics to develop San Diego's largest dedicated musculoskeletal ASC.
The company acquired 45 new centers in the first quarter, eight in the second quarter and purchased ASC chain Covenant Physician Partners.
With a 7.1% share of the ASC market, USPI is the largest ASC chain by number of physicians and centers. In 2023, the company initially planned to invest $250 million in ASC mergers and acquisitions, but Dr. Sutaria said that they have surpassed this target.
The focus on ASCs comes as Tenet reorganizes its overall portfolio, selling off hospitals to reduce debt. This year alone, Tenet has sold 14 hospitals for over $4.8 billion, according to the call.
"All of the sales that we have executed on have been at high multiples to reflect the operational improvements that we have made to each of these facilities over the last several years," Dr. Sutaria said. "As a result of these sales, our current hospital portfolio has an enhanced return profile, more attractive geographies for us and our business model, and higher expected returns … should result."
This investment strategy in ASCs will remain a priority for Tenet moving forward.
"We will continue to deploy capital to enhance growth in our industry, leading ambulatory surgical business through [mergers and acquisitions] and de novo development and increase capital spending to fuel organic growth and return excess capital to shareholders via share repurchase," Dr. Sutaria said.