Dive Brief:
- Tenet Healthcare Corp. and Humana Inc. announced signing a new multi-year contract extension that the companies said will provide Humana's commercial members with continued in-network access to Tenet’s 79 hospitals, 193 outpatient centers and 1,800-plus employed physicians.
- Under the contract, for the first time patients enrolled in Humana’s exchange plans in Atlanta, Birmingham, Houston, Memphis and San Antonio will have access to Tenet's provider network. Humana's exchange members in Chicago, Detroit and Phoenix will continue to have in-network access.
- The agreement also includes an accountable care organization (ACO) arrangement with Tenet for Humana’s Medicare Advantage members in Atlanta. Humana's MA members already have in-network access to Tenet facilities under an existing agreement.
Dive Insight:
Tenet has been busy lately. In May, Tenet had announced signing a similar multi-year national contract with Cigna Corp. Since early June, Tenet has set up an ACO agreement with Florida Blue; acquired a majority interest in Texas Regional Medical Center; signed a multi-year agreement with Blue Cross and Blue Shield of Texas; opened a new hospital in New Braunfels, Texas; announced a partnership with TriWest Healthcare Alliance to expand veterans' access to care; and completed a private offering of $500 million in senior notes. The company will report second-quarter results Aug. 4.
A market analyst said the new contract with Humana will drive Tenet's growth, helping Tenet "achieve its target of maximizing its healthcare coverage across the major states," and enabling the company to "expand its clientele in high-demand regions" with its participation in Humana's exchange networks. The analyst asserted that the new deal will allow Tenet to capitalize on Humana's "extensive resources in high-quality patient care" and enhance Tenet's operating leverage going forward.
The market analyst noted that Tenet recently said it intends to acquire hospitals in various states. This, along with the latest contract extension with Humana, shows that Tenet "is gearing up to realize its expansion goals," the market analyst said.