Wall Street pigeonholing Tenet Healthcare 'mostly as a hospital company': chair

 On a Tuesday morning earnings call, Tenet Healthcare executives painted the picture of a healthcare enterprise with multiple sources of consistent revenue, free cash flow and growing profits. 

The company has spent the last couple of years trimming the fat in its hospital business, bolstering the margins of its revenue cycle solutions business and, notably, dropping billions in cash to become one of the largest providers of ambulatory surgery services in the country. 

Now with Tenet expecting half of its earnings to come from United Surgical Partners International (USPI), its ambulatory surgery subsidiary, by the end of 2023, Executive Chairman and former CEO Ron Rittenmeyer questioned why the market is still primarily treating his company as a chain of acute care hospitals. 

"The recognition of USPI’s growing contribution and [revenue cycle subsidiary] Conifer’s cash flow generation, for some reason, seems lost in the broader question of Tenet being recognized as more than a hospital company," Rittenmeyer said during Tuesday's investor call. "With corresponding dialogues and our multiples remaining caught in this time-lapse, it appears that the transition of what Tenet has become and the deleveraging we’ve accomplished are not fully recognized in the valuation of the company. We believe it’s a point of view worthy of consideration.”

Rittenmeyer said that Tenet has already proven to investors that its restructure is yielding strong results on par with surgery center companies "valued at unbelievable high numbers."

"Our numbers don't reflect any of that. It just makes no sense," he said. 

The executive chairman's frustration comes as Tenet posted a quarterly profit of $250 million ($2.30 per share), steady volumes and promises of continued recovery across its 2022 projections.

The net income is a drop from the $414 million posted by the company during last year’s fourth quarter, which had been buoyed by $325 million in COVID-related stimulus grant income. Removing the stimulus funds, Tenet increased its fourth-quarter net income from $89 million to $153 million year-over-year.

Although Tenet beat out Wall Street’s earnings estimate of $1.49 per share, the 60-hospital chain's $4.86 billion in quarterly net operating revenue fell below the expected $5 billion. The company's stock opened Tuesday's trading session flat but has risen roughly 5% over the course of the morning. 

For the year, Tenet recorded $915 million in profit ($8.43 per share) and net operating revenues of $19.49 billion. The company had brought in a $399 million profit and $17.64 billion in revenue during 2020.

“Our strong performance throughout 2021 continued in the fourth quarter finishing the year with adjusted EBITDA of approximately $3.5 billion,” Rittenmeyer said in a prepared statement. “This was well in excess of our guidance from a year ago of $3 billion, and we also generated significant cash flow. Our results demonstrate that Tenet is focused on continued shareholder value enhancement through the delivery of top-quality medical care and services.”

Tenet’s hospital business segment claimed $3.91 billion in net operating revenue and, after adjustment, saw “consistent” volumes compared to last year, the company wrote.

Total admissions dropped 3.9% year over year, while outpatient visits and emergency room visits increased 8.8% and 16.3%, respectively. Same-hospital net patient services revenue grew 1.7% year over year before and after adjustment for admissions, “primarily reflecting higher patient acuity, favorable payer mix and pricing yield,” the company wrote.

USPI saw net operating revenues swell from $649 million to $742 million year-over-year. Same-facility system-wide surgical case volume increased 4.4% over the prior year’s fourth quarter.

Additionally, the quarter saw the close of Tenet’s SurgCenter Development acquisition, adding 86 ambulatory surgical centers and other ambulatory support services to its collection.

“Continued solid quarterly performance exemplifies the company’s dedication to operational excellence,” Saum Sutaria, M.D., Tenet Healthcare CEO, said in a statement. “With our ongoing expansion of USPI, we have become much more than a hospital company—acquiring ownership in or opening approximately 160 high-quality ambulatory facilities in the past year alone. Coupled with our solid performance across our hospitals as well as Conifer, and our commitment to high-quality care across all business units, we expect our performance trajectory to continue.”

Tenet is expecting that promising performance trajectory to land in the ballpark of $502 million to $677 million in profit ($4.56 to $6.16 per share) throughout 2022. The company is also projecting $19.5 billion to $19.9 billion in full-year revenue.

Tenet said that it “anticipates continuing recovery from the pandemic” and expects COVID-19 admissions to comprise less than 5% of total volumes across 2023. The company also noted that it has just over $1 billion in Medicare Advance Payments and payroll tax deferrals from fiscal year 2020 slated for the coming 12 months.

https://www.fiercehealthcare.com/hospitals/tenet-healthcare-beats-profits-dips-revenue-q4-2022

Amazon expanding healthcare service to 20 more cities

 Amazon has signed on three more companies for its virtual and in-person healthcare services as it continues to target the employer market.

The online retailer has inked deals to provide healthcare services to Silicon Labs, TrueBlue and Whole Foods Market, the company announced Tuesday. These companies join Precor, a Washington-based fitness equipment company that was acquired by Peloton, and Hilton as clients Amazon has publicly disclosed.

Amazon bought Whole Foods Market in 2017, and the company has about 86,000 employees. TrueBlue, a staffing and recruiting firm, has about 6,200 employees, according to Fortune. Hilton is by far Amazon's biggest client with 141,000 employees globally, with the majority of its locations in the U.S.

Eligible employees who live in cities where Amazon Care has in-person care services available have access to both virtual and in-person care services, an Amazon spokesperson said. In-person care is currently available in Seattle, Baltimore, Boston, Dallas, Austin, Los Angeles, Washington, D.C., and Arlington, Virginia.

Amazon Care also is on track to rapidly expand its hybrid care model to more than 20 additional cities in 2022, including major metropolitan areas like San Francisco, Miami, Chicago and New York City, the company announced Tuesday.

The online retail giant also announced that its virtual health services are now available nationwide, just two and a half years since its launched the service as a pilot program in Seattle.

In June, Amazon Care executive Babak Parviz said the tech giant was committed to eventually expanding the full Amazon Care service, including in-person services, to all 50 states.

Amazon did not disclose the financial terms of the deal with its three newest clients. In a press release, Amazon executives said the companies called out three key differentiators that stood out about Amazon Care's services—on-demand access to high-quality clinicians through Care Medical, Amazon Care’s clinical services provider and a seamless patient experience.

Amazon Care has a patient satisfaction rating of 4.7 out of 5, according to the company.

"Patients are tired of a health care system that doesn't put them first. Our patient-centric service is changing that, one visit at a time,” said Kristen Helton, director of Amazon Care, in a statement. “We’ve brought our on-demand urgent and primary care services to patients nationwide. As we grow the service, we’ll continue to work with our customers to address their needs."

Amazon piloted its healthcare business in 2019 to provide virtual urgent care services to its employees and their families in the Seattle region.

In March, Amazon Care announced it would begin serving other Washington-based businesses. The company also added in-person care and prescription delivery to its virtual services. The company then opened up the medical business to employers around the country this summer by offering its virtual care service to companies and Amazon employees in all 50 states.

Amazon partners with Care Medical, which provides medical services for the app-based Amazon Care.

Services include video care, in-app text chat with clinicians, mobile care visits, prescription delivery from a care courier and in-person care, where Amazon Care can dispatch a medical professional to a patient’s home for services ranging from routine blood draws to listening to a patient’s lungs.

Amazon Care offers access to urgent and primary care services, including COVID-19 and flu testing, vaccinations, treatment of illnesses and injuries, preventive care, sexual health and prescription requests and refills. 

The COVID-19 pandemic has led to an increased demand to bring care to patients’ homes—whether that be virtually or through in-home care services, according to Amazon executives.

During the HLTH 2021 conference in October, Helton was pressed about competition in the virtual care market from big players like Teladoc and Amwell and said Amazon Care stands out for its "patient-centered focus."

"It's just inherent in how we as Amazon approach and deliver a service and design it. That’s at the heart of everything that we do—making experiences easy, friction-free and super convenient for our patients," she said.

https://www.fiercehealthcare.com/health-tech/amazon-expands-virtual-care-service-nationwide-lands-silicon-labs-whole-foods-market

Anthem rolling out virtual primary care to plans in 11 states

 Anthem will make virtual primary care available to eligible members of its commercial health plans in 11 states, the insurer announced Tuesday.

The expansion will roll out the offering to fully insured plans and select large group administrative services clients in Colorado, Connecticut, Georgia, Indiana, Kentucky, Missouri, Nevada, New York, Ohio, Virginia and Wisconsin, the company said. Eligible members can access a virtual care team that will conduct an initial health check-in and then craft a personalized care plan.

The insurer is expecting a significant number of its administrative services clients to adopt the platform over the course of this year.

The care team will offer the member services aimed at improving their health and wellbeing at little or no cost, Anthem said. The virtual primary care options will be available through Anthem's Sydney Health app.

"This virtual primary care offering is part of our ongoing efforts to redefine the future of healthcare—giving members more ways to connect with their doctors; integrating digital, virtual and in-person care," said Beth Keyser, president of Anthem Blue Cross and Blue Shield in Indiana, in a statement.

"Consumers are adopting digital technologies at an accelerating pace," Keyser added. "To meet this demand, we continually introduce innovative services that make healthcare more convenient, fit into members' increasingly busy schedules and align with the more consumer-centric experiences they have in other areas of their lives."

Through Sydney, members can connect with providers 24/7 via a secure text chat for urgent care needs as well as to schedule appointments and followups. The initial check-in visit will be conducted via video, and members can also access other services including prescription refills, referrals and preventative screenings.

Artificial intelligence-backed modeling and data analytics will be key to building out the member's personalized care plan, Anthem said. Data from the patient's initial check-in will be provided to the virtual primary care physician.

Anthem said the virtual primary care platform can be used to manage chronic conditions, address urgent care needs and make it easier to access tests and other routine services. These virtual options are designed to complement and supplement in-person primary care.

Anthem is the latest insurer to expand or launch such a platform. Virtual primary care and virtual-first health plans have been a trend in the industry following an explosion in telehealth and virtual care use under the COVID-19 pandemic.

https://www.fiercehealthcare.com/payers/anthem-rolling-out-virtual-primary-care-plans-11-states

UnitedHealth rolls out new virtual options for dental care

 UnitedHealthcare Dental is launching multiple digital resources aimed at making it more convenient for members to manage their oral health, the insurer announced this week.

UHC will enhance its 24/7 virtual dental benefit to provide two free virtual visits with a dentist per year, an upgrade that will be made available to fully insured employer plans. During these visits, members can seek advice telephonically or via video about acute oral health needs, as well as find guidance on where to access care in-person if needed.

UnitedHealth notes in the announcement that oral health needs are among the most frequent conditions causing avoidable emergency room visits. The virtual option aims to make it easier for members to find care in the most appropriate setting.

“As more and more Americans adopt a digital-first mindset, these new resources are designed to help our members improve and maintain their dental health, which may contribute to overall well-being and help reduce the risk of certain chronic health conditions,” said Colleen Van Ham, CEO of UnitedHealthcare Dental, in a statement.

“These new initiatives advance UnitedHealthcare’s approach of using technology to improve access to quality, cost-effective medical and dental care while empowering people with personalized information," she said.

In addition, UnitedHealthcare Dental will offer 30% discounts on quip smart toothbrushes to eligible members, according to the announcement. These toothbrushes sync with an app via Bluetooth to track brush duration, tooth and gum coverage and other information.

UHC is also offering a plan to select employers with between 100 and 2,000 employees in Illinois, Maryland, Virginia and the District of Columbia that will provide the toothbrush at no cost. Eligible members in these plans can also earn up to $600 in financial incentives for meeting certain daily brushing goals.

UnitedHealthcare Dental will additionally launch a new treatment plan calculator, which aims to enable members and dental care providers to make more informed decisions. The tool will offer cost estimates based on the member's plan and applicable contract rates.

UnitedHealth said in the announcement that it will generally honor the tool's estimate, even if the actual cost of care ends up being higher, to avoid surprise bills for the member.

https://www.fiercehealthcare.com/payers/unitedhealth-rolls-out-new-virtual-options-dental-care

AHIP urges clarification on CMS' Aduhelm decision, Medicare Advantage

 The insurance lobbying group AHIP lauding the Biden administration’s decision to have Medicare only cover the Alzheimer’s Disease drug Aduhelm for beneficiaries in clinical trials, but wants more guidance on how it will affect Medicare Advantage plans.

AHIP and other groups commented on the proposed national coverage determination for drugs that treat amyloid plaques in the brain in the hopes of combating mild cognitive decline caused by Alzheimer’s Disease. The comments come as insurers have been reluctant to cover the first of this class of drugs—Biogen’s Aduhelm—due to questions over its efficacy and the high price tag.

 AHIP commented that CMS was right to call for more evidence on Aduhelm and the class of drugs.

“We commend CMS for its comprehensive, thoughtful and objective analysis of the clinical evidence, benefits and potential side effects of this class of therapies,” AHIP said in comments.

The Food and Drug Administration approved Aduhelm last year despite objections from agency advisors questioning the benefits of the disease.

CMS proposed last month for Medicare to cover the drug but only if a beneficiary is in a qualifying clinical trial in a hospital outpatient setting.

The clinical trials will help “ensure that clinicians with experience in caring for patients with [Alzheimer’s Disease] will be involved in the administration of this class of medication and allow for closer monitoring and management of adverse events,” AHIP said.

The insurance lobbying group said that it supported the agency’s coverage determination be extended to the entire class of drugs that treat amyloid products and not just Aduhelm. While Biogen’s drug is the only one approved to treat amyloid plaques in the brain, there are three other treatments approaching late-stage clinical trials.

“CMS has the flexibility to revisit this [national coverage determination] and reassess coverage policies for the Medicare program as the evidence evolves,” the group added.

But AHIP also asked for more information from CMS on key parts of the coverage proposal, chief among them guidance on the coverage obligations for Medicare Advantage plans.

“Key issues that should be addressed include CMS maintaining an updated list of all clinical trials that meet the proposed requirements under the [coverage determination] pathway and making it publicly available to all MA plans and other stakeholders,” AHIP said.

CMS also needs to clarify coverage for people on Medicare who already are getting Aduhelm by participation in phase 3 and 4 clinical trials.

Other groups supported CMS’ coverage decision. The Academy of Managed Care Pharmacy commented though that it has concerns about the impact of the drug on state Medicaid programs.

“Under current rules, for the dual-eligible population, Medicare is typically the primary payer and Medicaid assists by covering an individual’s cost-sharing (in the case of Part B, 20%),” the group said. “As a consequence of the … policy, Medicaid will now become the primary payer for this significant population.”

The group asked CMS to use “available and appropriate” resources to reduce the burden.

On the other hand, Biogen and several patient advocacy groups slammed the decision as directly contradicting the FDA’s finding that the drug is safe and effective.

The advocacy group Us Against Alzheimer’s wrote in a letter to HHS Secretary Xavier Becerra that the decision would “set up CMS as the final arbiters of whether Americans can access an Alzheimer’s therapeutic drug, a role they have no history of playing.”

Biogen commented that initiating studies to meet CMS’ requirement “could take years.”

Such delays could cause “serious and irreparable harm,” the company added.

The comments are the latest blowback CMS has faced on the proposal. More than 70 House Republicans wrote to Becerra earlier this week calling for the coverage determination to be withdrawn.

CMS is expected to issue a final decision on coverage by April 11.

https://www.fiercehealthcare.com/payers/ahip-presses-clarification-cms-aduhelm-decision-medicare-advantage-plans

Y-mAbs Therapeutics Shares Rise 28% After FDA Meeting

Y-mAbs Therapeutics Inc. shares were up 28% to $8.38 Friday after the company said it recently completed a pre-biologics license application meeting with the U.S. Food and Drug Administration regarding a potential pathway for FDA approval of omburtamab for the treatment of patients with CNS/leptomeningeal metastases from neuroblastoma.

The stock hit its 52-week low of $6.50 on Thursday, and finished that session down 7%.

The biopharmaceutical company said it expects to resubmit the biologics license application for omburtamab by the end of the first quarter 2022.

A data readout from a single-center clinical study showed that patients had a median survival of 50 months, with the final median not yet being reached. The company said it intends to submit the complete clinical data package in the BLA and announce the data later this year.

https://www.marketscreener.com/quote/stock/Y-MABS-THERAPEUTICS-INC-46288936/news/Y-mAbs-Therapeutics-Shares-Rise-28-After-FDA-Meeting-37876713/

Despite Turmoil, Stocks Seeing Largest Ever Inflows In 2022

 Something odd is happening in the market: while stocks are tumbling, pushing most tech names into a deep bear market amid the worst turmoil for markets in years, inflows into stocks - both institutional and retail - are soaring. According to EPFR data compiled by Bank of America, cumulative equity flows YTD in 2021 have hit a record $153bn, exceeding the pace of early-2021 (when the year started with $151bn in inflows, ahead of a record year of more than $1tn inflows).

How can this be? Well, the catalyst behind this unprecedented scramble for risk is that despite falling prices, investors are bailing on other even more impacted securities, and with a record outflows from money markets/cash as well as huge capital flight out of bond funds, this money has to go somewhere, and that "somewhere" is stocks for now, even though if the Fed is indeed set to hike 7 times this year and drain $2+ trillion from its balance sheet, the pain for stocks is only just starting.

Here are the weekly fund flow details:

• Huge $46.6bn inflow to global equities, $0.3bn into gold, $10.5bn from bonds, $47.5bn outflow from cash.
• largest 4-week outflow from cash/MMF ever (-$35.2bn, Chart 3) – this despite soon-to-be-inverted yield curve encouraging reallocation from long-end to short-end;
• largest 4-week outflow from corporate bonds since Apr’20 (-$8.6bn Chart 4);

Largest inflow into US large cap equity funds ever ($34.1bn);

• In summary: as noted above, cumulative equity inflows YTD $153bn exceed the record pace of early-2021 ($151bn in '21, record year of $1tn inflows); this despite bullish “sentiment” as measured by AAII falling to lowest level since Aug’20 (Chart 5); and despite big reversal in credit flows -$32bn in ’22 vs $58bn inflows in '21 (Chart 6).

Drilling further down into the source of inflows, earlier this week Bank of America's Jill Carey Hall reported that last week, during which the S&P 500 was +1.5%, clients were big net buyers of US equities for the second week - the $5.2BN in inflows was the 9th-largest weekly flow in BofA's post-08 data history, with clients buying equities across all thee size segments (small/mid/large).

It wasn't just institutions, as retail clients led the buying after also leading in Jan. (typical Jan. seasonality following tax loss selling by the group in Dec., vs. earlier tax loss selling by mutual funds in Oct.). But institutional clients and hedge funds were also buyers (for the second week and first time in four weeks, respectively).

And speaking of retail, JPMorgan writes that during Thursday's post-CPI/ Bullard rout, retail investors bought $1.7bn, second highest amount on record ($1.95bn on Feb 1).

In short, even though the Fed is now openly asking for a significant deflationary market correction, it has instilled such an unprecedented BTFD Pavlovian instinct across all investor groups - including retail - that not even a crash may be sufficient to get them to pull their money out of the rigged casino.

https://www.zerohedge.com/markets/despite-turmoil-stocks-seeing-largest-ever-inflows-2022