Tenet Healthcare is exploring the potential sale of its business services subsidiary Conifer and will expand its cost reduction program by $100 million, the company announced Tuesday.
It is also planning on divesting its nine facilities in the United Kingdom, the system said.
Tenet said there is no guarantee a sale of Conifer would happen, saying a decision regarding a potential sale should be made during the first half of 2018.
The company made the announcements in conjunction with the release of its outlook for 2018. Goldman, Sachs & Co. has been brought on as a financial advisor and Kirkland & Ellis will provide legal counsel.
Conifer provides healthcare business process services focused on hospital and physician revenue cycle management, and value-based care solutions.
Additionally, Tenet is boosting the expansion of its cost reduction program by $100 million. The program is now expected to net $250 million in savings by the end of 2018.
Changes with Tenet's Board of Directors will continue, and will add a "quality and patient experience gatekeeper" to its annual incentive plan for 2018 as well. The gatekeeper will require certain improvement and performance levels across all key quality and patient experience measures, and failure to achieve those benchmarks could mean exclusion from eligibility for a 2018 AIP award.
"The company is making this change as it believes improved quality and patient satisfaction is a critical driver of overall performance," Tenet said.
In terms of performance, Tenet's 2018 outlook forecasts net operating revenue between $17.8 billion and $18.2 billion and adjusted diluted earnings per share from continuing operations attributable to shareholders of $1.07 to $1.36, Tenet said.
The outlook did not incorporate potential impact from a sale of Conifer.
The announcement about Conifer's potential divestiture comes a little less than two months after the system revealed it would cut about 1,300 jobs and reported a $366 million operating loss in the third quarter. Tenet posted a $56 million operating loss in the second quarter.
In August, the company trimmed operations when they sold three acute care hospitals and one long-term acute care hospital to HCA Healthcare Gulf Coast Division.