Dallas-based Tenet has big plans to grow its ASC business, United Surgical Partners International, and it began the year by adding hundreds of physicians.
Tenet executives gathered April 21 on an earnings call to talk about the company's first-quarter performance and strategy for the rest of the year. Six takeaways about USPI from the call, as transcribed by Seeking Alpha:
1. USPI centers brought on 530 physicians during the first quarter through organic growth and acquisitions.
2. Tenet is transitioning USPI to focus only on surgical care, moving its 25 urgent care facilities to the hospital segment by the end of April. The change will shift $25 million of EBITDA from UPSI to the hospital segment, and Tenet reduced USPI's revenue guidance by $100 million as a result.
3. COVID-19 and winter storm Yuri had a negative effect on USPI's case volume. The storm caused centers in Texas and Oklahoma to shut down for up to a week. Ron Rittenmeyer, CEO and executive chair of Tenet, said the centers had a high rate of cancellations, but recaptured 90 percent of those cases.
4. The integration of 45 ASCs previously owned by Towson, Md.-based SurgCenter Development is on track and going well, said Mr. Rittenmeyer. "Our new employees appreciate the comprehensive onboarding process, along with the additional support and resources, and we've had positive feedback from our new physician partners," he said.
5. Sixteen USPI centers started new service lines during the first quarter, including total joints, spine and robotic surgeries. The company's total joint business grew 110 percent in the first quarter compared to the same period last year.
6. USPI executives are in the early stages of developing direct-to-employer, value-based contracts for its surgery center. "It brings USPI centers and doctors' patients from distant geographies based upon employers that are looking for high quality and high values," said Saum Sutaria, president and COO of Tenet.
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