Tenet Healthcare Corporation · NYSE:THC
Tenet Healthcare — Q4 2013 Earnings Presentation
10 slides from Tenet Healthcare's earnings presentation, Feb 24, 2014
Slide 1: Q4'13 Review & 2014 Outlook
Q4’13 Review & 2014 Outlook February 24, 2014
Slide 2: Disclosures / Forward-Looking Statements
Disclosures / Forward-Looking Statements This presentation includes “forward-looking statements.” Forward-looking statements are based on current expectations and involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from those
Slide 3: Q4'13 Provides a Strong Finish to 2013
Q4’13 Provides a Strong Finish to 2013 EBITDA Toward High End o $444mm in Q4’13 Adjusted EBITDA of Our Outlook Range o $1.342 b in 2013 Adjusted EBITDA o 50 basis point decline in adjusted admissions (same-hospital) Inpatient Volumes o 2.3% decline in admissions (same-hospital) Sequentially Strength
Slide 4: Selected Items Impacting 2014 Adjusted EBITDA Outlook of $1.8 – 1.9 Billion
Selected Items Impacting 2014 Adjusted EBITDA Outlook of $1.8 – 1.9 Billion ($mm) 2014 (1) Vanguard Synergies 50 - 100 California Provider Fee Program ($140mm in 2014 compared to $115mm in 2013) 25 HIT Incentives, net of program costs (2013 HIT incentives were $96mm, expect (20) $105mm in 2014) Perf
Slide 5: Key Assumptions for 2014 ACA Impact
Key Assumptions for 2014 ACA Impact • 10% to Medicaid Uninsured Conversions • 5% to Exchanges • CBO estimates a 23% reduction in uninsured nationwide Utilization • Zero incremental utilization for newly insured populations Change in Employer- • 5% of existing Commercial Managed Care volume converts
Slide 6: 2014 Outlook Assumptions
2014 Outlook Assumptions Same-Hospital Pro Forma: 2014 Admissions Growth (%) (Assumes zero contribution from newly insured populations) (2.0) - 0.0 Adjusted Admissions Growth (%) (Assumes zero contribution from newly insured populations) (1.0) - 1.0 Pricing - Commercial Managed Care Increase (%) App
Slide 7: Selected Items Impacting Q1'14 Adjusted EBITDA Outlook of $350 – $400 million
Selected Items Impacting Q1’14 Adjusted EBITDA Outlook of $350 – $400 million Assumed Q1’14 Sequential Q1’14 EBITDA Impact Change over Q4’13 Vanguard Synergies and ACA Impact Insignificant Insignificant California Provider Fee Program Zero $(19)mm HIT Incentives $10mm $(38)mm Impact of Interest Rate
Slide 8: Seizing the ACA Opportunity
Seizing the ACA Opportunity Expect ACA-related 2014 EBITDA growth of $50-100mm(1) Create Strong • 100% of hospitals participating in at least one plan at each level Exchange • 97% of hospitals in at least one of the two lowest-cost silver plans Position • Strong pricing based on commercial rates • B
Slide 9: Strategically Positioned Relative to Significant Industry Trends
Strategically Positioned Relative to Significant Industry Trends • Early adopter of strategies to improve clinical quality • Early to implement advanced clinical systems • Early creator of Accountable Care Organizations (ACOs) in key markets • Conifer manages value-based care arrangements covering 4
Slide 10: Summary
Summary Beyond 2014 2014 Continued growth from ACA 2013 Capture additional Capitalize on: Vanguard synergies - ACA coverage expansion Value-creation through Strong accomplishments portfolio management - Vanguard synergies despite challenging industry environment - Organic growth including Grow Conif