Long-troubled Tenet Healthcare is continuing to reshuffle its operations, with a particular focus on expanding its reach in outpatient care.
The Dallas-based hospital operator has revised its outlook for 2018, expecting revenue of $17.9 billion to $18.3 billion, according to its fourth-quarter 2017 earnings report.
“We are continuing to develop a network to be where the patient is,” Tenet Healthcare CEO Ronald Rittenmeyer said during an earnings call with analysts last week, Forbes reported.
The for-profit Tenet has sold underperfoming acute care facilities in the Philadelphia and Chicago markets and has raised $700 million in cash and has retired another $300 million in debt, according to the publication.
Tenet intends to use the proceeds to increase its stake in United Surgical Partners International, according to the article. USPI is the largest operator of outpatient ambulatory surgical centers, with more than 265 short-stay surgical facilities. The company currently owns an 80% stake in the venture.
Revenue from ambulatory operations grew nearly 7% while overall company revenue has been flat. During the call, Tenet noted it acquired seven surgery centers and built 11 new outpatient facilities last year. Same-hospital admissions were flat during the quarter, growing only 0.2% while outpatient visits at those hospitals grew 15.2%.
Tenet said it would also seek other opportunities in the outpatient space, although Forbes noted it faces stiff competition in the space from large pharmacy retailers including Walgreens and CVS Health, and would-be partners such as UnitedHealth Group and Aetna.
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In the meantime, the company continues to lose money. It reported a loss of $229 million in the fourth quarter, compared to a loss of $79 million for the fourth quarter of 2016. Revenue was just under $5 billion, compared to $4.9 billion for the year-ago quarter. For calendar 2017, Tenet lost $704 million on revenue of $19.2 billion. In 2016, it lost $192 million on revenue of $19.6 billion.
In January, the company embarked on job cuts totaling 2% of its workforce with an aim of reducing expenses by $250 million. It also said late last year that Conifer Health Solutions, its healthcare services division, may wind up on the sales block. Conifer’s revenues were down 2% during the fourth quarter of last year.
Tenet’s 2018 guidance forecasts 2018 revenue will shrink to a range of $17.9 to $18.3 billion, although the company is expected to return to profitability with net income $95 to $105 million.