Tenet Healthcare completes sale of six California hospitals
Four are being sold to UCI Health for about $975 million, while two have been sold to Adventist Health for an undisclosed amount.
Photo: Franco Vogt/Getty Images
Dallas-based Tenet Healthcare Corporation has completed the sale of six hospitals in California, the organization said this week.
Four of Tenet's Orange County and Los Angeles County hospitals, and their related operations, have been sold to UCI Health for about $975 million, consistent with the approval of the University of California Board of Regents. The completed transaction includes Fountain Valley Regional Hospital, Lakewood Regional Medical Center, Los Alamitos Medical Center and Placentia-Linda Hospital.
Its two San Luis Obispo hospitals – Sierra Vista Regional Medical Center and Twin Cities Community Hospital – have been sold to Adventist Health for an undisclosed sum.
WHAT'S THE IMPACT?
The health system has been unloading hospitals in recent months. In February Tenet completed the sale of its three South Carolina hospitals and related operations to Novant for approximately $2.4 billion in cash (after-tax proceeds of approximately $1.750 billion).
The hospitals include Coastal Carolina Hospital, Hilton Head Hospital, East Cooper Medical Center, affiliated physician practices and other related hospital operations. Tenet's Conifer Health Solutions subsidiary has entered an expanded 15-year contract to provide comprehensive revenue cycle management services for these operations.
At the time Tenet said it expected to exceed the high end of its latest FY23 Adjusted EBITDA Outlook range. The results are driven, among other factors, by strong surgical growth at United Surgical Partners International.
Tenet, headquartered in Dallas, operates 58 acute care and specialty hospitals.
THE LARGER TREND
Tenet has undergone a number of leadership changes in recent months. Former executive vice president and chief financial officer Daniel Cancelmi retired at the end of last year, as did Brett Brodnax, former president and CEO of United Surgical Partners International, which is owned by Tenet.
In late 2021, Tenet and subsidiary USPI announced they were expanding their ownership of ambulatory surgery centers, buying 92 from SurgCenter Development.
The $1.2 billion deal expanded USPI's reach into high-growth regions in Arizona, Florida and Texas and included a mix of service lines, including musculoskeletal care for total joint and spine procedures.
Jeff Lagasse is editor of Healthcare Finance News.
Email: jlagasse@himss.org
Healthcare Finance News is a HIMSS Media publication.
