Tenet Healthcare posted its fifth straight quarter of losses in the fourth quarter of 2018 but beat expectations overall for the year, according to its earnings report released Monday.
The Dallas-based healthcare giant reported a $5 million net loss from operations in the fourth quarter of 2018, a substantial improvement compared to a net loss of $230 million in 2017. Tenet reported net operating income of $108 million in 2018, compared to a $704 million net loss from continuing operations in 2017.
"2018 was a year of significant change for the company," said Ronald A. Rittenmeyer, executive chairman and CEO, in a statement. "We meaningfully improved our financial results, and made significant progress to create a more efficient, agile enterprise with new leadership helping to reshape strategy and drive consistency in execution."
"We expect to make additional progress in each of our business segments in 2019 in line with our plan to deliver long-term sustainable growth," he said.
Tenet reported revenues of $3.84 billion in the fourth quarter, down 8.4% from the fourth quarter of 2017. Officials blamed the decline largely on hospital divestitures that were partially offset by same-hospital revenue growth.
They also pointed to a difficult comparison in the fourth quarter due to the California Provider Fee program. Passed in November 2016, the program assesses fees by the state on hospitals to draw down federal matching funds, which are then issued as supplemental payments to hospitals.
Tenet reported that in the fourth quarter of 2018, it recognized $64 million from the program compared to $267 million in the fourth quarter of the 2017 due to due to CMS’ approval of program in December 2017, which resulted in the full year 2017 revenues all being recognized in the fourth quarter of 2017.
Tenet reported revenue cycle management subsidiary Conifer Health Solutions' revenue declined by 5.6% to $372 million, primarily due to client attrition following divestitures by Tenet and other customers, down from $394 million in the fourth quarter of 2017.
Revenue from third-party customers declined 7.1% to $222 million in the fourth quarter of 2018.