JPM20: Tenet Outlines Plans to ‘Aggressively’ Scale Outpatient Surgery Unit

Tenet outlined its long-term strategy to investors Tuesday during the annual J.P. Morgan Healthcare Conference in San Francisco, with plans to aggressively expand its outpatient surgery unit by allocating at least $175 million each year to buy ambulatory surgery centers throughout the country. United Surgical Partners International “is tightly tied to our overall strategy,” Tenet CEO Ron Rittenmeyer told investors. “We are committed to thoughtfully and aggressively [scaling] this aspect of our business.” The market is highly fragmented, he said, noting a robust pipeline of opportunities. About 60% of the nation’s surgery centers are operated independently. Tenet through USPI controls 5% and the rest are run by other national players, hospitals and smaller chains, he said. Tenet’s long-term vision comes as hospital operators attempt to adapt to shifting demographics and demand at the same time payers and regulators are looking to change reimbursement to pay for quality.

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