Tenet Healthcare Corp., Santa Barbara, Calif., said physicians with admitting privileges at multiple hospitals are steering patients away from Tenet facilities because of negative publicity about the company.
Partly as a result of declining volumes, Tenet saw its losses in the third quarter and nine months ended Sept. 30 widen over losses in the comparable periods a year ago. Revenue also fell -- 3.2% for the quarter to $2.44 billion and 2.4% for the nine months to $7.54 billion. A new discount policy for uninsured patients was another contributor to the decline in revenue, Tenet said.
The company reported a net loss of $70 million, or 15 cents per share, for the third quarter and a net loss of $618 million, or $1.33 per share, for the nine months. In the respective year-ago periods, Tenet lost $31 million and $246 million before huge one-time charges for a legal judgment and a writedown of managed-care receivables.
With those charges, Tenet had a net loss of $308 million, or 66 cents per share, for the 2003 quarter and a net loss of $523 million, or $1.12 per share, for the nine months.
Tenet said declining volume and growing bad debt obscured some gains made in controlling costs. For the 68 hospitals Tenet has operated for more than 12 months and intends to keep, admissions fell 2.9% for the quarter and 1.4% for the nine months; outpatient visits for the same periods were down 11.3% and 4.6%, respectively.
About half of the loss of outpatient visits came from the sale or closure of 13 outpatient units, Tenet said. After adjusting for its uninsured discount policy, Tenet said its bad-debt expense was 13.8% of adjusted net revenue, up from an adjusted figure of 12.4% for the second quarter. An adjusted figure for the year-ago quarter was not available.
More uninsured patients and disputes with managed-care payers both played a role in the increase, the company said. When Tenet has completed its divestiture program, it will own and operate 69 hospitals.