Company: THC
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0000070318-25-000009
Chunk: 189

Company: TENET HEALTHCARE CORP
Filing Date: 2025-02-18
Form: 10-K
Item: Item 1A
Chunk 189
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 terms of our contracts, the payments we receive for our services may be reduced. Also, we are increasingly experiencing payment denials from and other administrative challenges with managed care payers, both prospectively and retroactively.

We currently have thousands of managed care contracts with various HMOs and PPOs; however, our top 10 managed care payers generated 71% of our managed care net patient service revenues for the year ended December 31, 2024. Because of this concentration, we may experience a short‑ or long‑term adverse effect on our net operating revenues if we cannot renew, replace or otherwise mitigate the impact of expired contracts with significant payers. Furthermore, material payment delays and disputes between us and significant managed care payers could have a material adverse effect on our financial condition, results of operations or cash flows. At December 31, 2024, 68% of our Hospital Operations segment’s net accounts receivable was due from managed care payers.

In addition, managed care payers continue to seek to control healthcare costs by encouraging patients to use certain facilities in exchange for discounts from the facilities’ established charges, and through increased utilization reviews and greater enrollment in HMOs and PPOs. Any negotiated discount programs we agree to generally limit our ability to increase reimbursement rates to offset increasing costs. In addition, enrollment of individuals in high-deductible health plans has increased over the last decade. In comparison to traditional health plans, these plans have higher co-pays and deductibles due from patients, which subjects us to increased collection risk.

Our relationships with payers, and reimbursement for the care we provide, may be further impacted by clinical and price transparency initiatives and out‑of‑network billing restrictions, including those in the No Surprises Act. In general, any material reductions in the contracted or out-of-network rates we receive for our services or any significant difficulties in collecting receivables from managed care payers could have a material adverse effect on our financial condition, results of operations or cash flows.

Changes in healthcare laws, regulations and policies could have an adverse effect on our business.

Over the past several years, various laws and regulations lengthened the enrollment period, expanded income eligibility, and reduced premium caps for subsidies for individuals purchasing Affordable Care Act coverage through state and federal marketplaces. Certain of these provisions are set to expire at the end of 2025; if they are not extended, it could result in significant increases in premiums, potentially leading to decreased enrollment and a corresponding rise in the uninsured or a