Tenet Sells Its Last 3 Chicagoland Hospitals

The divestitures leave Tenet, one of the nation's largest for-profit hospital chains, with no hospitals in Illinois, although it continues to operate four surgery centers in the Chicago area.

Tenet Healthcare Corp. this week finalized its previously announced sale of its three acute-care hospitals in Chicagoland.

Dallas-based Tenet, which lost $9 million and saw revenues drop 2.7% in the third quarter of 2018, said in July that it would sell its Chicago-area acute care hospitals to Pipeline Health LLC, a hospital management company based in Los Angeles.

The three hospitals included in the sale are: 236-bed Louis A. Weiss Memorial Hospital on Chicago's Northside; 230-bed Westlake Hospital in Melrose Park; and 234-bed West Suburban Medical Center in Oak Park. Financial terms were not disclosed.

The divestitures leave Tenet, one of the nation's largest for-profit hospital chains, with no hospitals in Illinois, although it continues to operate four outpatient surgery centers in the Chicago area.

Ambulatory care remains one of Tenet's strong suits, generating about $502 million in net operating revenues.

The deal marks Pipeline Health's first foray into the Chicago Market.

"Pipeline Health has a proven model for saving and sustaining smaller hospitals that are cornerstones of the communities we serve," Pipeline Health CEO Jim Edwards said in a media release.     

The divestiture comes as Tenet attempts a turnaround after reporting $9 million in losses in Q3. That loss was down from the $24 million in net income during Q2 but still an improvement compared to the $366 million net loss in Q3 2017. 

The Q3 performance prompted Tenet CEO Ronald Rittenmeyer to complain that "our hospitals did not meet our expectations and we are focusing on specific areas to address those gaps."

Tenet's fourth-quarter results are expected to be released by the end of February.