Dallas-based Tenet Healthcare reported a strong finish and $444 million EBITDA for Q4 2013 as compared to $336 million in Q4 2012—a 32.1 percent increase over the year, officials said on quarterly earnings call Wednesday morning.
The year-end success is credited to an improving sequential-quarter volume trend, solid revenue growth, and a few areas of new business, namely the Conifer Health Solutions subsidiary and Tenet’s October 2013 acquisition of Vanguard Health Systems, said Tenet president and CEO Trevor Fetter. Fetter is confident about Tenet’s market positions in 2014, especially in North Texas thanks to Frisco-based Conifer.
“Conifer alone is now running, based on annualizing the fourth quarter, at a rate of revenues in excess of $1 billion,” Fetter said in an interview after Tenet’s earnings webcast. “That’s a business we just created in 2008, so it’s a very significant business for us. Conifer’s revenue growth was 75 percent year over year.”
Additionally, Fetter believes 2014 will be the year during which Tenet will see the long-awaited fruition of the Affordable Care Act, as unprecedented numbers of Americans are enrolling in health insurance plans for the first time.
“We’ve got a lot of momentum, and we’ve been waiting for 2014 for a very long time because this is the year when the coverage parts of the ACA kick in,” Fetter said. “Up until now, it’s been nothing but cuts.”
And though Texas’ legislature has refused federal Medicaid expansion dollars, Fetter says Tenet still stands to profit.
“It’s interesting that with all the publicity that’s around this issue, we are finding that people who would’ve qualified prior for Medicaid are coming out of the woodwork, so to speak, and qualifying even though the state has not expanded the Medicaid program,” he said. “Not in large numbers, and certainly not in the kind of numbers that we would’ve seen had the state decided to expand its Medicaid program, but it’s still encouraging.”