Dallas-based Tenet Healthcare started 2024 with a flurry of hospital sales, selling nine hospitals to three health systems and netting nearly $4 billion in gross proceeds.
The for-profit system on Feb. 1 completed its $2.4 billion sale of three South Carolina hospitals to Winston-Salem, N.C.-based Novant Health. Also that day, Tenet reached a definitive agreement to sell four Southern California hospitals and associated outpatient locations to Orange, Calif.-based UCI Health for $975 million. That deal was completed March 26.
On Feb. 29, Tenet signed a definitive agreement to sell two California hospitals to Roseville, Calif.-based Adventist Health in a $550 million deal that closed March 29.
"The transactions that we have executed on have established the dawn of a new era for Tenet," CEO Saum Sutaria, MD, said on the health system's April 30 earnings call.
Dr. Sutaria added during that call that within those deals Tenet "maintained, and in most cases, enhanced a commercial service provision relationship with the buyer."
"We expect these relationships will be an attractive contributor to earnings for years to come," he said.
All three transactions involved agreements for Tenet's Conifer Health Solutions subsidiary to provide revenue cycle management services.
That all three of those deals closed in the first quarter was "a bit of happenstance," Dr. Sutaria said on May 14 at the Bank of America Securities 2024 Health Care Conference.
"We were pleased to get them done and get them done in the right way," he said.
After a quieter second quarter, Tenet announced on Aug. 5 that it agreed to sell its 70% majority ownership interest in Birmingham, Ala.-based Brookwood Baptist Health to Orlando (Fla.) Health.
The proposed five-hospital deal is valued at approximately $910 million in cash with after-tax proceeds of approximately $790 million, according to Tenet. Under the proposed agreement, Conifer will enter into a 10-year contract to provide services for the Alabama hospitals and related operations. The deal is expected to close in the fall.