Tenet Healthcare Case Questions:
- What are the economic drivers for revenue and profitability of a hospital, and what are potential strategies to maximize profits and return on investment? From a hospital’s perspective, what type of patients do you want to attract and what services do you want to provide? Where do you want to locate hospitals? Is it best to be independent or part of a hospital group?
- Consider Tenet and Intermountain Health as examples of for-profit and nonprofit hospital and health care systems. What are the benefits of for-profit hospitals compared to nonprofit hospitals? What are the major risks associated with for-profit hospitals? Consider from the perspective of a CEO of a hospital company (or nonprofit), a patient, a payor (government or private), and society more broadly.
- What are trends and changes in the environment in which Tenet operates―customer, demographic, reimbursement, structural, technological, financing, and regulatory―and how do these positively and negatively affect Tenet’s business? What steps can Tenet take in order to take advantage of these changes?
- Should Tenet have made the Vanguard acquisition? Why or why not?
- What would you recommend Tenet do with its four main businesses―acute-care hospitals, outpatient facilities, health plans, and Conifer? For each, should Tenet seek to grow the business, shrink it, or keep it about the same size? Should Tenet divest any of the businesses? Please be prepared to discuss the rationale for each of your recommendations.