Tenet Healthcare

By Robert Chess, Ryan Kissick
2015 | Case No. E534 | Length 27 pgs.

This case focuses on major strategic challenges faced by Tenet Healthcare (Tenet), a U.S.-based health care provider, in 2014.  It discusses major changes to the health care provider industry over the previous decade―customer, demographic, reimbursement, structural, technological, financing, and regulatory―and raises questions related to the strategic direction Tenet should pursue in response to these changes.  The case emphasizes two primary decisions to be taken by Tenet: 1) the acquisition of Vanguard Health Systems (Vanguard), another U.S.-based health care provider, in 2012; 2) portfolio management for Tenet’s primary business units (acute-care hospitals, outpatient facilities, health plans, and Conifer Health Solutions) in 2014.

Learning Objective

The primary learning objectives for students are: 1) to understand the economic drivers of a hospital (and hospital systems), including the decisions an operator can make to increase revenue and profitability; 2) to understand the major trends impacting U.S. health care providers, including those that are beneficial to providers as well as those detrimental to providers; 3) to determine the best strategic decisions for Tenet in 2014 given industry changes and company objectives.
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