Tenet’s bet on high-acuity surgeries like joint replacements fueled a strong Q3, helping the health system amid an ACA subsidy fallout and other pressures.

Other for-profit hospital chains have called out declining surgeries in the third quarter, driven by patients forgoing procedures in both inpatient and outpatient settings due to cost. The decrease is dinging hospital operators’ finances, who increasingly rely on the lucrative procedures to pad their earnings results.

Tenet also saw a decline in surgeries in the third quarter. Surgeries in its outpatient ambulatory and hospital units declined 1.5% and 1.1% from the prior year, respectively.

But while other operators took an earnings hit from the declines, Tenet grew earnings and margins in both its hospital and ambulatory units.

Executives said this was due to Tenet’s long-term strategy of bringing in more high-acuity procedures — like joint replacements, advanced spinal fusions and robotic-assisted urological procedures — which can bring in enough money to help the health system weather other headwinds.

United Surgical Partners, Tenet’s ambulatory surgery arm, has been pivotal to that strategy. The unit, which Tenet acquired in 2022, is the largest ambulatory network in the country with 535 ASCs and 25 surgical hospitals across 37 states.

8% more total joint replacements than the prior year, according to CEO Saum Sutaria. 1% in the quarter to $537 million.

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