Tenet Healthcare CEO Ron Rittenmeyer to step down in September

Photo: John Fedele/Getty Images

Tenet Healthcare has announced that CEO Ron Rittenmeyer is stepping down in September.

Dr. Saum Sutaria, president and chief operating officer of Tenet, will become CEO, effective Sept. 1. Sutaria will continue to report to Rittenmeyer, who will remain as executive chairman of the company, through 2022. 

Rittenmeyer said his leaving is part of a succession plan he developed four years ago when he became CEO.

"This change follows a well-thought-out and planned transition led by Ron and the board," said former Sen. Bob Kerrey, lead director of the board. 

"When I joined Tenet as executive chairman and CEO almost four years ago, I had two major objectives," Rittenmeyer said. "First was the transformation of the business in terms of improving quality of care and service to build long-term, financial stability. Second was to develop and execute a succession plan through the organization, enhancing our leadership at every level and identifying my replacement."

He and Sutaria have worked closely together over the past several years, Rittenmeyer said. 

"Saum and I have worked closely together through extraordinary times including COVID, and at each step, he has continued to demonstrate excellent leadership in framing the right strategic and tactical pathway," he said. "Saum is always present for today but thinking about tomorrow, as evidenced by his impeccable track record in helping to deliver consistent and sustainable results. He has long been a leader in healthcare, and he also knows Tenet extremely well after nearly three years in top management roles."

"Having a deep internal bench is a cornerstone of thoughtful succession planning and something Ron addressed immediately when stepping into the CEO role in late 2017," Kerrey said. "When Ron became CEO, he dug very deep to transform and drive the company toward a healthier future. The Tenet of today is an entirely different organization with strong performance and a better business mix that speaks to all the changes in quality, talent and operations brought during the last four years."

Sutaria joined Tenet in January 2019 as COO, was promoted to president later that year and appointed to the board in 2020. Prior to joining Tenet, Sutaria worked for McKinsey & Company for 18 years in the healthcare and private equity practices, serving clients on strategic, operational and financial issues. 

WHY THIS MATTERS

The change in leadership is occurring when second-quarter earnings promise better financial performance for the Dallas-based health system.

The company increased its FY2021 outlook in light of continued growth and operational improvements as well as grant income, according to Q2 results.

Adjusted earnings outlook ranges now from $3.150 billion to $3.250 billion (previously $3 billion to $3.2 billion), which excludes the projected gain on the sale of the Miami-area hospitals, the company said.

THE LARGER TREND

The for-profit hospital company includes United Surgical Partners International and operates 60 hospitals and more than 460 other healthcare facilities, including surgical hospitals, ambulatory surgery centers, imaging centers, and other care sites and clinics. It also operates Conifer Health Solutions, which provides revenue cycle management and value-based care services.

On Aug. 2, Tenet announced it had completed the sale of its five hospitals and related operations in Florida's Miami-Dade and Southern Broward counties to Steward Health Care for a reported $1.1 billion. The transaction includes Coral Gables Hospital, Florida Medical Center, Hialeah Hospital, North Shore Medical Center and Palmetto General Hospital, as well as associated physician practices and other entities. 

Tenet's ambulatory facilities operated by United Surgical Partners International in these markets will remain with Tenet and were not included in the transaction.

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com