Tenet Healthcare (THC) investor relations material

High acuity and ambulatory strategy

• Focus on expanding high acuity procedures in ambulatory surgery centers (ASCs), especially bone and joint, spine, and robotics, with significant investments in physician training and technology partnerships.

• Revenue growth is driven by increasing case acuity, diversified service mix, and maintaining strong margins through scale and efficiency.

• Inorganic growth through acquisitions and de novo strategies with new partnerships remains a priority, supported by a stable deal environment and strong operational reputation.

• Policy tailwinds, such as the phase-out of the inpatient-only list, are expected to accelerate volume transitions to outpatient settings, particularly in musculoskeletal and cardiovascular services.

• Asset utilization and disciplined cost management, including leveraging shared services and revenue cycle capabilities, are key to further margin improvement.

Hospital investment and portfolio management

• Increased capital expenditures, now at 5% of revenue, have enabled new hospital builds and service line expansions, especially in high acuity areas like trauma, cardiovascular, and neurosurgery.

• Investments target indispensable, less elastic services such as emergency, neonatal, and complex specialty care to drive stable revenue and margin growth.

• Outpatient access points are being expanded to facilitate patient flow between ambulatory and inpatient settings, adapting to post-COVID market dynamics.

• The hospital portfolio is considered stable and investable, with ongoing opportunities for selective refinement.

Revenue cycle and Conifer transformation

• Conifer is undergoing a major transition with the CommonSpirit Health contract, focusing on efficiency, automation, and AI to improve cost to collect and market competitiveness.

• The transition is expected to be completed by year-end, after which new market opportunities will be pursued.

• Structural cost improvements are being driven by automation, offshore capabilities, and AI, aiming to reduce waste in claims adjudication for both providers and payers.