Tenet acquired Baylor's 5% stake in USPI for $406M 1 year ago — what's happened since?

At the end of the second quarter in 2022, Dallas-based Tenet paid $406 million to acquire Dallas-based Baylor Scott & White Health's 5 percent equity position in USPI. 

With the move, Tenet now owns 100 percent of United Surgical Partners International's voting shares. 

The health system's ASC portfolio includes more than 445 centers and 24 surgical hospitals — with 7.3 percent of total market share. USPI is the largest ASC chain in the country and employs more than 11,000 physicians, including 6,000 physician partners.

The ASC market is expected to be Tenet's primary growth driver in the coming years. Tenet plans to pump $250 million into ASC mergers and acquisitions. USPI added three ASCs in the first quarter and completed two post-transaction buy-ups. 

"The continued migration of procedural services into the ambulatory setting is a sustained and significant tailwind for our business," Tenet CEO Saum Sutaria, MD, said in an earnings call in April. "... Our USPI development pipeline remains active and healthy."

The company is also seeing physicians coming to USPI "wanting to initiate their first orthopedics de novo work in our centers either through new center development or joining existing centers," Dr. Sutaria said, indicating demand for ASC-based orthopedics. 

In the first quarter of this year, the company saw 7.8 percent growth in same-facility volume, which is attributed to higher acuity service line expansion and growth in the company's physician population. 

In November 2021, The company announced it would acquire SurgCenter Development and its more than 90 ASCs for approximately $1.2 billion, and while the company is still acquiring the ASCs, the process has slowed. The acquisition includes ownership interest in 92 ASCs and the formation of a five-year development agreement to provide continuity for SurgCenter Development's facilities and physician partners. 

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