Tenet Healthcare Corp., Santa Barbara, Calif., announced more changes to its management structure last week with the regrouping of its hospitals into two divisions instead of three.
One of the three division heads, Neil Sorrentino, 56, will retire, Tenet officials said. Sorrentino is a 29-year veteran of Tenet and its predecessor company, National Medical Enter-prises. Sorrentino has been executive vice president of operations for the company's western division since 1999. He will remain with Tenet in a consulting role before retiring later this year.
Sorrentino's division of more than 40 hospitals included 188-bed Redding (Calif.) Medical Center, at which two doctors allegedly performed medically unnecessary procedures. Tenet spokesman Harry Anderson said the Redding probe had nothing to do with Sorrentino's retirement.
The other division heads-Reynold Jennings, 56, and W. Randolph Smith, 54-have been promoted to oversee the enlarged operating divisions. Their elevation to the senior management team and the reduction in divisions are the keys to the reorganization, Anderson said.
Anderson said Tenet's new senior management continues to scrutinize its operations and more announcements are likely to come, although he refused to offer any further details. He acknowledged Tenet has considered whether the entire senior management team should work in a common office, something that's "been considered almost continually since" NME bought American Medical International and renamed itself Tenet in March 1995.
"The fact is, we have 114 separate units (hospitals) spread out from Massachusetts to San Diego, and they all perform reporting responsibilities at various locations," Anderson said. "We're looking at organizational structure much more than real estate."
Jennings is president of the 59-hospital eastern division, which will remain based in the Atlanta area. He started his career with NME as chief executive officer of hospitals in Florida and Georgia and spent the early 1990s as senior vice president of operations in Dallas with NME. He left NME to work for a psychiatric chain and rejoined Tenet in 1997 as executive vice president of the former southeast division.
Smith is president of the 55-hospital western division; he will maintain his office in Tenet's operations center in Dallas. Smith had been at AMI, Dallas, for 16 years when AMI was acquired by Tenet in 1995. At AMI, Smith filled positions including executive vice president of operations, chief administrative officer and regional director.
Jennings and Smith will report to Tenet President Trevor Fetter. Fetter, a former Tenet chief financial officer, rejoined the company in the wake of the uproar over its high Medicare outlier payments (Nov. 11, 2002, p. 6). At the same time, CFO David Dennis resigned and Chief Operating Officer Thomas Mackey retired, further shaking Tenet as it reeled from the fallout of the outlier revelations, which triggered an audit by HHS' inspector general's office, and the Oct. 30, 2002, raid on the Redding hospital by federal agents.