Tenet Health(US:THC)2025-10-28 20:06Operations Overview - As of September 30, 2025, the company operated 50 hospitals and 135 outpatient facilities, serving urban and suburban communities across eight states[95]. - Total admissions decreased by 6.3% to 118,852 in Q3 2025 compared to Q3 2024, while adjusted admissions fell by 6.5% to 215,460[114]. - The Ambulatory Care segment reported a 6.2% increase in total consolidated cases, reaching 491,782 in Q3 2025, driven by recent acquisitions and same-facility growth[116]. - Emergency department visits decreased by 7.6% to 531,585 in Q3 2025 compared to the same period in 2024[115]. - The average length of stay for patients decreased by 3.4% to 4.79 days in Q3 2025[114]. - Utilization of licensed beds increased to 49.7% in Q3 2025, up from 48.3% in Q3 2024[114]. - The company opened the Florida Coast Medical Center in September 2025, a 54-bed acute care hospital offering specialized services[107]. Financial Performance - Consolidated net operating revenues increased by $163 million, or 3.2%, to $5.289 billion for the three months ended September 30, 2025, compared to $5.126 billion in the same period in 2024[117]. - Hospital Operations segment revenues rose by $27 million, or 0.7%, to $4.014 billion, driven by a favorable payer mix and increased same-hospital admissions[117]. - Ambulatory Care segment revenues increased by $136 million, or 11.9%, to $1.275 billion, primarily due to recently acquired ASCs and higher case volumes[119]. - Total operating expenses for Hospital Operations decreased by $141 million, or 1.2%, to $3.408 billion, with salaries, wages, and benefits decreasing by $20 million, or 1.0%[120]. - Consolidated net operating revenues increased by $181 million, or 1.2%, for the nine months ended September 30, 2025, compared to the same period in 2024[158]. - Operating income for Q3 2025 was $889 million, a decrease from $1.089 billion in Q3 2024, and $2.655 billion for the nine months ended September 30, 2025, compared to $5.135 billion in the same period of 2024[153]. Cash Flow and Liquidity - Cash and cash equivalents were $2.975 billion at September 30, 2025, up from $2.625 billion at June 30, 2025[125]. - Net cash provided by operating activities was $2.809 billion for the nine months ended September 30, 2025, compared to $2.378 billion in the same period in 2024[125]. - Long-term debt outstanding as of September 30, 2025, was $12.662 billion, with no cash borrowings under the Credit Agreement and compliance with all covenants[205][203]. - Long-term liquidity for debt service is dependent on cash from operating activities and future borrowings, with potential impacts from acquisitions and regulatory commitments[209]. - The company does not rely on commercial paper or short-term financing, maintaining fixed rates on long-term indebtedness[210]. Payer Mix and Revenue Sources - Medicare accounted for 14.8% of net patient service revenues, while Medicaid increased to 11.7% for the three months ended September 30, 2025[131]. - The payer mix for admissions showed an increase in managed care to 70.3% for the three months ended September 30, 2025, compared to 69.3% in 2024[132]. - Total net patient service revenues from Original Medicare Plan for Q3 2025 were $512 million, compared to $504 million in Q3 2024, and $1.590 billion for the nine months ended September 30, 2025, compared to $1.632 billion in the same period of 2024[144]. - Revenue from Medicaid programs for Q3 2025 was $346 million, up from $268 million in Q3 2024, and $1.023 billion for the nine months ended September 30, 2025, compared to $893 million in the same period of 2024[145]. - Managed care net patient service revenues for Q3 2025 were $2.374 billion, down from $2.425 billion in Q3 2024, and $7.197 billion for the nine months ended September 30, 2025, compared to $7.464 billion in the same period of 2024[151]. Future Outlook and Risks - Future healthcare policy changes may impact patient volumes and revenues, particularly if provisions of the Affordable Care Act are not extended beyond 2025[136]. - The OBBBA is expected to lead to millions losing health insurance by 2034, primarily due to Medicaid policy changes[138]. - Future federal and state healthcare funding policy changes may adversely affect patient volumes, case mix, and revenue mix[143]. - Liquidity could be adversely affected by operational performance and various risks, including changes in healthcare regulations[209]. Operational Efficiency and Technology - The company continues to focus on expanding its Ambulatory Care segment through acquisitions and organic growth, emphasizing outpatient services which historically yield higher margins[105]. - The company is leveraging advancements in technology, including AI, to enhance operational efficiency and improve patient care delivery[109]. Expenses and Charges - Estimated costs for uninsured patients in Q3 2025 were $99 million, down from $135 million in Q3 2024, and $317 million for the nine months ended September 30, 2025, compared to $406 million in the same period of 2024[152]. - Same-hospital salaries, wages, and benefits expense increased by $79 million, or 4.4%, for the three months ended September 30, 2025, with the expense as a percentage of net operating revenues decreasing by 110 basis points to 47.1%[165]. - Same-hospital supplies expense increased by $41 million, or 7.5%, for the three months ended September 30, 2025, remaining consistent as a percentage of net operating revenues[169]. - Other operating expenses increased by $53 million, or 6.2%, for the three months ended September 30, 2025, with the expense as a percentage of net operating revenues decreasing by 10 basis points to 23.0%[170]. - Impairment charges for Q3 2025 totaled $10 million, compared to $0 in Q3 2024, while nine-month impairment charges were $13 million versus $2 million in the prior year[183]. - Restructuring charges for Q3 2025 were $8 million, down from $10 million in Q3 2024, with nine-month charges at $33 million compared to $42 million in 2024[183]. - Acquisition-related costs for Q3 2025 were $5 million, down from $9 million in Q3 2024, with nine-month costs at $20 million versus $31 million in the prior year[183].