Tenet Healthcare eliminates regional management layers; impact on DMC unclear

Over the past year, Evans has been looking to reduce costs and improve corporate and hospital efficiencies.

Nationwide, Tenet has been cutting costs and selling assets the past two years in an attempt to increase its stock price, which is around $15, down from about $60 several years ago.

Trever Fetter, its longtime CEO, has announced he will step down next year as part of an agreement with the board, which has been increasingly impatient with the turnaround effort.

While its outpatient and data consulting subsidiaries are profitable, hospital operations have dragged down Tenet’s operating margins below that of any other large investor-owned chain, analysts have told Crain’s.

Over the past three years, DMC has laid off or not filled more than 325 positions as part of cost-cutting moves. Along with Tenet’s South Florida hospitals, DMC hospitals are Tenet’s most profitable.

Over the summer, DMC laid off or left unfilled 22 positions, including 14 employed nurse practitioners. Last fall, DMC laid off 60 staffers and decided not to fill another 40 positions. Another 30 employees were reassigned to other positions. The moves, DMC said, cut about 1 percent of its workforce and reduced expenses by about $17 million.

The two previous Decembers, DMC laid off a total of about 300 employees. Decisions ranged from rightsizing staff, closing its DMC Surgery Hospital in Madison Heights after a flash flood and outsourcing its linen services to an out-of-state vendor.

Earlier this year, Karen Fordham, president of DMC Huron Valley Sinai Hospital in Commerce Township, unexpectedly resigned. Fordham, a Crain’s 40 under 40 honoree in 2014, is now CEO at Topside Strategies Consulting LLC in Commerce Township. Paula Autry, CEO of Sinai-Grace Hospital, also resigned. Autry was recently appointed CEO of Lutheran Hospital in Fort Wayne, Ind.

DMC has nearly completed its five-year, $850 million major construction building project that has transformed its downtown Detroit campus. As the state’s largest provider of Medicaid and indigent care, DMC has been improving profitability the past five years, aided greatly by management efficiencies, volume growth and the Affordable Care Act.

Editor’s note: This story has been corrected to reflect that the company spokesman confirmed the elimination of regional management layers, not regional management offices.

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Tenet Healthcare eliminates regional management layers; impact on DMC unclear

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