Tenet Healthcare Corp., Dallas, said rising bad-debt expense and lower admissions will contribute to a third-quarter loss of between $82 million and $92 million. Profits at four other publicly traded hospital chains have been hurt by bad debt in the quarter, while two for-profit chains have bucked the trend. Tenet, which will report earnings in full on Nov. 7, said uninsured patients made up 4.4% of total admissions in the quarter, up from 3.9% of admissions in the year-ago quarter. Bad-debt expense, excluding discounts for the uninsured, equaled 16.4% of the sum of revenue and uninsured discounts. Thats compared with 14.9% in the year-ago quarter. Tenet said volume at its continuing operations, consisting of 57 hospitals, declined 3.3%, compared with the year-ago quarter. Commercial managed-care admissions declined 6.3%. Tenet owns or operates 66 hospitals, including nine hospitals held for sale, in 12 states.
Meanwhile, Triad Hospitals, Plano, Texas, which previewed third-quarter earnings two weeks ago, said profits were down 14% to $39.8 million because of much higher bad debt, although same-hospital volume rose. Bad-debt expense equaled 11% of revenue, up from 7.3% in the year-ago quarter. The main factor in the increase was an accounting change triggered by a lower collection rate on self-pay accounts. Revenue was up 18.1% to $1.37 billion. Triad also said its board of directors will consider authorizing a $250 million stock-repurchase program at a Nov. 2 meeting. Triad owns or operates 51 hospitals and 12 ambulatory surgery centers in 16 states. -- by Vince Galloro