1 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) SWOT Analysis Alexis Nolden Strategic Planning and Marketing in Healthcare MHA 626 Martha Plant Oct 17, 2016 2 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) Introduction Tenet Healthcare Corporation (THC) is a health care service organization operating hospitals, diagnostic imaging centers, ambulatory surgery centers, and similar health care services. THC is among the leading healthcare organizations in the United States, having a selfsufficient network. The corporation operates in both urban and rural areas in fourteen states through general hospitals, children's hospitals, specialty hospitals, academic medical centers and critical access hospital. This comprehensive SWOT profile of Tenet Healthcare Corporation will provides an in-depth strategic analysis of the company's businesses and operations. This analysis will help formulate strategies that augment business by enabling one understand its partners, customers and competitors better. The strengths and weaknesses refer to the internal analysis of the company while opportunities and threats refer to external areas of the organization (Stevens, R., & Silver, L. S., 2015). A SWOT analysis will provide them with the information on how to strengthen what is wrong and deal with any threats that could happen. A SWOT analysis is essential for any organization to be competitive and to be successful. Strengths The internal compliance structure: THC uses five core values to cultivate a safe and transparent environment: quality, integrity, service, innovation, and transparency. THC requires its entire staff to take personal responsibility for patient safety and life by its motto: "See it, say it, do it." Part of these safeguards includes an anonymous ethics hotline. This sort of internal policing is necessary to avoid costly lawsuits. THC's recent merger decision: In October 2013, THC acquired Vanguard Health Systems. (Jacobson, 2013). In Texas, THC has already doubled its revenue through the 3 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) acquisition. THC is keeping with the market trend of large healthcare corporations purchasing private physician practices, ambulatory care centers, and other hospitals. Its community involvement: THC gives back to many local public health related nonprofits that serve the community near its hospitals and ambulatory care centers. THC also has teams in its hospitals to help its charity patients acquire health insurance either through Medicaid or the new insurance exchange plans. This sort of goodwill is invaluable positive public image. Weaknesses Large company to manage: THC is a large healthcare and insurance provider. The organization operates over 80 hospitals and over 190 outpatients' ambulatory service centers and six insurance plans. Major problems that often affect large businesses include recognizing and retaining talent. Employees often get frustrated by the high bureaucracy and tend to shift to smaller organizations. Prevalence of internal corruption: putting the nature of business THC is running into consideration, they may run into a risk of getting involved with illegal or ethical violations such as understaffing which may result in patient harm, fraud in billing, patient privacy violation or even illegal deals with manufactures and illegal patient referrals. Low return on income: if compared to other companies in this industry and sector, THCs ROI is lower and it is below average. 4 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) Opportunities Reduced Medicare and Medicaid Reimbursements: Although the Federal government is insuring more people through Medicaid, the government is reducing both Medicaid and Medicare reimbursements to hospitals and providers. This results in significant reduced revenue for industry providers. Medical Tourism: Unfortunately, medical bills are the biggest cause of bankruptcy in the US. Even having health insurance is no protection against bills that can easily wipe out consumers' life savings. (Mangan, 2013). However, this is not the case in many other countries. Many other developed countries, such as Japan, Germany, France, and England (to name a few) offer the same procedures, at the same quality, for a fraction of the US price. Lack of Government Caps for Health Service Pricing: This allows THC and other healthcare provider to price services as they please without justification. Healthcare costs in the US are almost never advertised (with a few exceptions like cosmetic procedures that are not typically covered by insurance). With healthcare being a necessity for most consumers, they will make almost any sacrifice necessary to receive healthcare. This has resulted in very lucrative profits for hospital operators and providers. Marketing to Canadians: Some wealthy Canadian patients come to the US for healthcare procedures. (\"Medical Tourism Association,\" 2014). These patients are frustrated with long wait 5 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) times and would rather pay a flat rate to have the procedure done quickly in the US. THC could work with a medical tourism company, or use its own marketing department, to target Canadian healthcare consumers. Threats Medical Tourism: Unfortunately, medical bills are the biggest cause of bankruptcy in the US. Even having health insurance is no protection against bills that can easily wipe out consumers' life savings. (Mangan, 2013). However, this is not the case in many other countries. Many other developed countries, such as Japan, Germany, France, and England (to name a few) offer the same procedures, at the same quality, for a fraction of the US price. Uninsured Population Treated Under EMTALA: Federal law requires that hospitals receiving Medicare funds (that includes THC) must treat any patient requiring emergency treatment, regardless of their ability to pay. Often this results in long unpaid hospital stays (sometimes in the ICU). This results in significant loss of revenue for hospital operators, such as THC. My recommendation to the management is that he should take advantage of the opportunities that are open for his company's success. The opportunity for example in the Canadian market is so imminent that if the company intensifies its marketing plans there, the company will beat the competing companies like Denver, Colo.-based DaVita HealthCare Partners. On the weaknesses, the management should put more efforts to make sure that patient privacy policy is adhered to the later so as to avoid avoidable law suits. The management should ensure that company's resources are well managed for example using prudent accounting such as 6 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) managerial accounting concepts so as to improve efficiency and increase profitability. On time management, the company should maintain its ambulances on regular basis so as to improve on the response time. On the marketing efficiency, the company has to use the best medium and agents so as to reach a wider market sphere. 7 SWOT ANALYSIS OF TENET HEALTHCARE CORPORATION (THC) References Chance, J. (n.d.). Keys to a Strong Marketing Strategy. Retrieved from businessknowhow: http://www.businessknowhow.com/marketing/blocks.htm Jacobson, G. (2013). Tenet Completes $4.3 Billion Acquisition of Vanguard Health Systems. Dallas News. Retrieved from http://www.dallasnews.com/business/health-care/20131001-tenetcompletes-4.3-billion-acquisition-of-vanguard-health-systems.ece. Medical Tourism Association. (2014). Retrieved on October 2nd, 2014 from http://www.medicaltourismassociation.com/en/index.html Tenet Healthcare Corporation. (2014). Retrieved from http://csimarket.com/stocks/THCReturn on-Investment-ROI.html