- Dallas-based Tenet Healthcare posted a $97 million profit for the first quarter of this year, up from $94 million during the same period last year, according to financial results released after the market closed Tuesday.
- Hospital volumes are still down, with admissions at 85% of where they were during the same period in 2019, outpatient visits at 83%, emergency room visits at 73% and hospital surgeries at 88%. Surgical cases in its ambulatory segment dipped slightly but were up year over year.
- A year after halting guidance forecasts at the start of the pandemic, Tenet increased its earnings outlook for the full year.
Tenet is the first major hospital operator to report its first-quarter results amid the swift vaccine rollout, but no improvement for volumes could mean patients are still hesitant to jump back into in-person care, as some analysts warned.
Even Tenet executives were hesitant about a speedy recovery after last year’s major fluctuations when asked whether forecasts were too conservative during last quarter’s earnings call. They were more encouraged with the prospects of outpatient business lines like ambulatory surgery centers as the pandemic seems likely to accelerate the movement of care away from inpatient settings.
But first-quarter financial results were still positive overall, as the chain beat Wall Street expectations on revenue with $4.78 billion, up 5.8% from $4.52 billion during the same quarter last year.
Hospital revenues in the first quarter were $3.9 billion, up from $3.8 billion during the same time last year, and revenues from its ambulatory segment were $646 million, up from $490 million during the same quarter in 2020.
Ambulatory revenues increased 31.8% year over year, which Tenet attributed to higher patient acuity and new service line growth.
Tenet currently operates 65 hospitals, though its ASC footprint is nearly five times larger following its latest acquisition in December with SurgCenter Development to acquire 45 ASCs in nine states.
The centers are operated by Tenet’s ambulatory surgery unit, USPI, which now has interests in 312 ambulatory surgery centers and 24 surgical hospitals in 30 states, according to its most recent filing.
Executives again seemed guarded on a swift recovery for volumes even with vaccines and pent-up demand for delayed care, especially for emergency department volumes, “I think that’s going to be a much longer ramp back to normal,” COO Saum Sutaria said during a call with investors Wednesday.
“We’re a believer that some of that business either won’t come back or will take a long time to come back from a low acuity standpoint,” Sutaria said.
“So more important is that we put our energy into building a business where we see the demand, growing market share in those areas, focusing on the high acuity and using that as a way to deliver on the earnings expectations that we have for ourselves and that investors have for us, rather than trying to do it by, attempting to mimic the 2019 volumes,” he said.