Tenet Reports Results for the Second Quarter Ended

Tenet Reports Results for the Second Quarter Ended June 30, 2016

DALLAS August 1, 2016 Tenet Healthcare

Corporation (NYSE:THC) reported a net loss from continuing operations of $44 million in the second quarter of 2016, a $16 million improvement when compared to a $60 million net loss from continuing operations in the second quarter of 2015. Adjusted

EBITDA was $617 million in the second quarter of 2016, an increase of $49 million, or 8.6 percent, compared to $568 million in the second quarter of 2015.

Our strategic investments in high-acuity service lines helped us to grow same-hospital patient revenue and revenue per adjusted admission, said

Trevor Fetter, chairman and chief executive officer. Our Conifer Health and USPI subsidiaries performed well and both achieved double-digit revenue growth. We are pleased with the progress we are making on our core strategies across

all three business segments and remain on track to meet our Adjusted EBITDA Outlook for the year.

Hospital Operations and Other Segment

Net operating revenue in the hospital operations and other segment increased to $4.202 billion, up 0.6 percent from $4.175 billion in the second quarter of

2015. On a same-hospital basis, patient revenue increased to $3.743 billion, up 4.4 percent from $3.586 billion in the second quarter of 2015. The increase was driven by a 0.5 percent increase in adjusted patient admissions and a 3.9 percent

increase in net patient revenue per adjusted admission.

Adjusted EBITDA in Tenet s hospital segment was $415 million, representing a decline of 9.6

percent as compared to $459 million in the second quarter of 2015. The decline was primarily driven by divestitures and a decline in electronic health record incentives, and was partially offset by acquisitions.

Total hospital segment selected operating expenses, defined as the sum of salaries, wages and benefits, supplies and other operating expenses, increased 3.4

percent per adjusted admission in the quarter. Approximately half of the 3.4 percent increase was attributable to a $47 million increase in expense at Tenet s health plan business, which was substantially offset by higher plan premium revenues,

and incremental expense related to our discounted malpractice liabilities as a result of the decline in Treasury rates.

Tenet s same-hospital exchange admissions were 5,478 in the second quarter of 2016, up 14.9 percent from the second quarter of 2015. Same-hospital

exchange outpatient visits were 52,020, up 30.5 percent from the second quarter of 2015.

Tenet s provision for doubtful accounts was $352 million in the second quarter of 2016, representing a ratio of 6.7 percent of revenues before bad debt,

as compared to $352 million in the second quarter of 2015, or 7.3 percent of revenues before bad debt. Tenet s uncompensated care cost, defined as the sum of the provision for doubtful accounts, charity care write-offs and uninsured discounts,

was $1.210 billion and $1.226 billion in the second quarters of 2016 and 2015, respectively, including $858 million and $874 million, respectively, of charity care write-offs and uninsured discounts that were offered through Tenet s Compact

with Uninsured Patients. Uncompensated care represented 19.9 percent of revenue before bad debts, uninsured discounts and charity care write-offs in the second quarter of 2016, down from 21.4 percent in the second quarter of 2015. Nearly all of

Tenet s uncompensated care is associated with the Hospital Operations and other segment.

Uninsured plus charity admissions increased by 688

admissions, or 7.9 percent on a same-hospital basis in the second quarter of 2016 compared to the second quarter of 2015. Uninsured plus charity outpatient visits decreased by 692 visits, or 0.6 percent, on a same-hospital basis.

Ambulatory Care Segment

The results of many of the facilities in which the Ambulatory Care segment has an investment are not consolidated by Tenet. To help analyze the segment s

results of operations, management uses system-wide measures which include revenues and cases of both consolidated and unconsolidated facilities. Tenet s acquisition of a majority interest in USPI and all of Aspen on June 16, 2015 makes the

year-over-year comparisons less meaningful since they were not owned for the entire year. In order to improve comparability, Tenet is presenting the results for the Ambulatory Care segment on a pro forma basis, including the results of USPI and

Aspen in each comparable period.

During the second quarter of 2016, the Ambulatory segment produced net operating revenue of $442 million, representing

an increase of 37.3 percent as compared to $322 million in the second quarter of 2015 on a pro forma basis. On a pro forma same-facility system-wide basis, revenue in the Ambulatory segment increased 11.7 percent, with cases increasing 5.2 percent

and revenue per case increasing 6.1 percent.

Tenet s Ambulatory segment generated Adjusted EBITDA of $139 million in the second quarter of 2016, up

20.9 percent from $115 million in the second quarter of 2015 on a pro forma basis.

During the second quarter of 2016, Conifer s revenue increased 13.5 percent to $386 million, up from $340 million in the second quarter of 2015, and

Conifer s revenue from third party customers increased by 28.0 percent to $224 million. Conifer generated $63 million of Adjusted EBITDA in the second quarter of 2016, up 5.0 percent from $60 million in the second quarter of 2015.

Net Income and Earnings Per Share

Tenet reported a net

loss from continuing operations of $44 million, or $0.44 per share, in the second quarter of 2016 compared to a net loss of $60 million, or $0.60 per share, in the second quarter of 2015.

After adjusting for certain items which are listed on Table #2, Tenet generated Adjusted net income from continuing operations of $38 million, or $0.38 per

diluted share, during the second quarter of 2016. During the second quarter of 2015, the Company generated Adjusted net income from continuing operations of $76 million, or $0.75 per diluted share.

A reconciliation of GAAP net income available (loss attributable) to Tenet Healthcare Corporation common shareholders to Adjusted net income from continuing

operations and Adjusted diluted earnings per share from continuing operations is contained in Table #2 at the end of this release.

Cash Flow and Liquidity

Cash and cash equivalents were $656 million at June 30, 2016 compared to $728 million at March 31, 2016. The Company had no outstanding borrowings on

its $1 billion credit line as of June 30, 2016. Accounts receivable days outstanding were 51.1 at June 30, 2016 compared to 50.6 at March 31, 2016 and 49.5 at December 31, 2015. The increase in accounts receivable days

outstanding was primarily attributable to receivables that were retained from divested hospitals, including the sale of the Company s hospitals in the Atlanta area and North Carolina.

Net cash provided by operating activities in the six months ended June 30, 2016 was $582 million, representing a $229 million improvement compared to

$353 million in the comparable period in 2015. After subtracting $413 million and $359 million of capital expenditures in the six months ended June 30, 2016 and June 30, 2015, respectively, Free Cash Flow was $169 million in the six months

ended June 30, 2016, representing a $175 million improvement compared to a $6 million outflow in the comparable period in 2015. Adjusted Free Cash Flow was $268 million in the six months ended June 30, 2016, representing a $180 million

improvement from $88 million in the comparable period in 2015.

Net cash provided by investing activities was $54 million in the six months ended

June 30, 2016 compared to $985 million of net cash used in investing activities in the comparable period in 2015. Net cash used in financing activities was $336 million in the six months ended June 30, 2016 compared to $738 million of net

cash provided by financing activities in the comparable period in 2015.

Reconciliations of net cash provided by (used in) operating activities to both

Free Cash Flow and Adjusted Free Cash Flow are contained in Table #3 at the end of this release.

Clinica de la Mama Update

The Company believes that it has reached an agreement in principle with the government to resolve the Clinica de la Mama criminal investigation and civil

litigation for $514 million. Based on the agreement in principle, we have increased our reserve from $407 million to $516 million to reflect the monetary components of the agreement in principle and certain other costs. This amount is reflected in

Tenet s consolidated balance sheet as of June 30, 2016 as accrued legal settlement costs. The increase in reserve lowered net income by approximately $67 million or $0.67 per share during the second quarter of 2016. Tenet expects the

payment to be made as early as the third quarter of 2016, and to be funded through general corporate sources of liquidity, including cash on the balance sheet and borrowings under the Company s revolving credit facility.

In addition to the monetary component, the agreement in principle includes the following non-monetary terms: (i) the execution of a Non-Prosecution

Agreement, which includes the appointment of a corporate monitor for a period of three years; (ii) the agreement of the two indirect, wholly owned subsidiaries that previously operated Atlanta Medical Center and North

Fulton Hospital, and which currently have no operating assets, to each plead guilty to a single-count indictment; and (iii) the execution of a corporate integrity agreement. The final

resolution is subject to the negotiation and execution of definitive agreements. For additional information regarding these and other terms of the agreement in principle, see Note 10 to the Consolidated Financial Statements included in the

Company s Form 10-Q for the three months ended June 30, 2016.

The Company s Outlook for 2016 includes:

The Outlook for calendar

year 2016 assumes equity in earnings of unconsolidated affiliates of $110 million to $130 million, electronic health record incentives of $25 million to $35 million, net income attributable to noncontrolling interests of $330 million to $350 million

(excluding the additional $18 million of noncontrolling interests recorded by USPI in the first quarter of 2016, as discussed in our first quarter earnings release) and an average diluted share count of 102 million.

The Company s Outlook for the third quarter of 2016 includes:

The Outlook for the third

quarter assumes equity in earnings of unconsolidated affiliates of approximately $25 million, electronic health record incentives of less than $5 million, net income attributable to noncontrolling interests of $80 million to $90 million and an

average diluted share count of 102 million.

Additional details on Tenet s Outlook for both the third quarter and calendar year 2016 are available in

Tables 4 and 5 at the end of this press release and in an accompanying slide presentation that is accessible through the Company s website at www.tenethealth.com/investors.

Management s Webcast Discussion of Second Quarter Results

Tenet management will discuss the Company s second quarter 2016 results on a webcast scheduled for 10:00 a.m. EDT (9:00 a.m. CDT) on August 2, 2016.

Investors can access the webcast through Tenet s website at www.tenethealth.com/investors. A set of slides, which will be referred to on the conference call, is available on the Quarterly Results section of the Company s website.

Additional information regarding Tenet s quarterly results of operations is contained in its Form 10-Q report for the three months ended

June 30, 2016, which will be filed with the Securities and Exchange Commission and posted on the Tenet website before the webcast. This press release includes certain non-GAAP measures, such as Adjusted EBITDA, Adjusted net income from

continuing operations, Adjusted diluted earnings per share from continuing operations, Free Cash Flow and Adjusted Free Cash Flow. Reconciliations of these measures to the most comparable GAAP measure are contained in the tables at the end of this

Tenet Healthcare Corporation is a diversified healthcare services company with 130,000 employees united around a common mission: to help people

live happier, healthier lives. Through its subsidiaries, partnerships and joint ventures, including United Surgical Partners International, the Company operates 79 general acute care hospitals, 20 short-stay surgical hospitals and over 470

outpatient centers in the United States, as well as nine facilities in the United Kingdom. Tenet s Conifer Health Solutions subsidiary provides technology-enabled performance improvement and health management solutions to hospitals, health

systems, integrated delivery networks, physician groups, self-insured organizations and health plans. For more information, please visit www.tenethealth.com.

The terms THC , Tenet Healthcare Corporation , the Company , we , us or our refer to Tenet

Healthcare Corporation or one or more of its subsidiaries or affiliates as applicable.

This release contains forward-looking statements that is, statements that relate to future, not past,

events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as expect, assume, anticipate,

intend, plan, believe, seek, see, or will. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that

could cause our actual results to be materially different than those expressed in our forward-looking statements include, but are not limited to, the factors disclosed

under Forward-Looking Statements and Risk Factors in our Form 10-K for the year ended

December 31, 2015 and other filings with the Securities and Exchange Commission. Among other things, these factors include adverse regulatory developments, government investigations or litigation, including the payment of civil and criminal

monetary penalties and other conditions required in connection with the proposed settlement and resolution of the Clinica de la Mama civil litigation and criminal investigation described in Note 10 to the Consolidated Financial Statements included

in our Form 10-Q for the three months ended June 30, 2016. The settlement and resolution of the Clinica de la Mama matters is subject to the execution of definitive documents and court acceptance. Although the Company believes it will

reach a final resolution of the Clinica de la Mama matters, there can be no assurance that such a resolution will be reached or that judicial acceptance of the resolution terms will be received. If a resolution is not reached or accepted, or if the

terms of the final resolution are materially different than the agreement in principle, the eventual loss related to these matters could materially exceed the amount reserved and could have a material adverse effect on our business, financial

condition, results of operations or cash flows.