Tenet Healthcare Corp., Santa Barbara, Calif., this morning announced the resignation of CEO Jeffrey Barbakow, effective immediately. Barbakow, 59, has been at the helm of Tenet and its predecessor company, National Medical Enterprises, since 1993. Tenet President Trevor Fetter, 43, was named acting CEO, the company said, adding that Fetter and outside candidates will be considered as the board looks to hire a replacement CEO. Barbakow will remain chairman until he steps down from that role, as previously announced, just prior to the company's annual meeting, set for July 23. "As Tenet begins a new chapter in its history, I consider this step a part of my personal commitment to do anything I can to restore Tenet to its rightful place of leadership in our industry," Barbakow said in a company news release.
Barbakow has come under harsh criticism from shareholders since the furor broke over the high level of Medicare outlier payments the company was receiving. Particularly damaging to Barbakow was his acknowledgement that he wasn't aware that Tenet's strategy of sharply increasing gross charges was driving the company's Medicare outlier payments. "It's the right time for Tenet to have new top leadership with a demonstrated ability to address issues facing the company and restore the confidence of our investors," Edward Kangas, a recent addition to Tenet's board, said in Tenet's release. In the same release, Sanford Cloud Jr., a Tenet director since 1998, said of Barbakow, "Under his leadership, Tenet built itself into an important part of our nation's healthcare delivery system, and that will remain a tribute to Jeff's accomplishments." -- by Vince Galloro