Tenet Raises Outlook for 2009

Tenet Healthcare Corporation (NYSE: THC) today announced revisions to its outlook for 2009 Adjusted EBITDA to a new range of $900 million to $950 million. The prior outlook range was $810 million to $875 million. This new range corresponds to an outlook for net income attributable to shareholders in a range of $76 million to $141 million. Adjusted EBITDA is a non-GAAP term defined and reconciled to GAAP net income below.

"Our third quarter results through August were stronger than anticipated and extended the improving trend evident in our second quarter,” said Trevor Fetter, president and chief executive officer. "Since the summer months typically represent a seasonal slowdown in our business, this strength warrants raising our outlook for the balance of the year. In the last few months we have seen trends in payer and patient mix, bad debt expense, and volume growth that are favorable relative to our prior expectations. Our pricing trends remain positive and consistent with prior expectations.”

Adjusted EBITDA in the third and fourth quarters of 2009 is expected to be approximately equal. The Company’s revised 2009 outlook continues to make allowances for potential deterioration in bad debt expense and adverse trends in business mix in the remaining months of 2009. Additional details on revised 2009 outlook assumptions are provided in Table #1 below.

The Company also provided interim admissions statistics for the period July 1 to September 8, a time period which represents the first complete 10 weeks, or 70 days, of the third quarter. Comparing volumes in 2009 to the same 70-day period of 2008: admissions grew by 0.2 percent, paying admissions were flat, and commercial managed care admissions declined by 4.1 percent. Charity and uninsured admissions grew by 3.5 percent.

For the period July 1 to August 31, total same-hospital outpatient visits grew by 3.8 percent, paying outpatient visits grew by 4.4 percent, and commercial managed care outpatient visits increased by 0.8 percent. Charity and uninsured outpatient visits declined by 1.0 percent. The July 1 to August 31 time period included 44 weekdays and 18 weekend days in both 2008 and 2009. The reporting period for outpatient visits differs from the time period for inpatient data due to the complexity of assembling interim outpatient volume data related to our various non-hospital outpatient businesses.

The Company expects Adjusted Free Cash Flow from Continuing Operations to be in the range of negative $45 million to positive $40 million and Adjusted Net Cash Provided by Operating Activities from Continuing Operations of $380 million to $440 million for the full year 2009. The Company’s year end cash balance is expected to be in the range of $500 million to $635 million. Adjusted Free Cash Flow from Continuing Operations and Adjusted Net Cash Provided by Operating Activities from Continuing Operations are non-GAAP terms defined and reconciled to GAAP net cash provided by operating activities in Table # 7 below.

Tenet Healthcare Corporation, through its subsidiaries, owns and operates acute care hospitals and related ancillary health care businesses, which include ambulatory surgery centers and diagnostic imaging centers. Tenet’s hospitals and related health care facilities are committed to providing high quality care to patients in the communities we serve. For more information, please visit www.tenethealth.com.

Some of the statements in this release may constitute forward-looking statements. Such statements are based on our current expectations and could be affected by numerous factors and are subject to various risks and uncertainties discussed in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended Dec. 31, 2008, our quarterly reports on Form 10-Q and periodic reports on Form 8-K. Do not rely on any forward-looking statement, as we cannot predict or control many of the factors that ultimately may affect our ability to achieve the results estimated. We make no promise to update any forward-looking statement, whether as a result of changes in underlying factors, new information, future events or otherwise.

TABLES and EXHIBITS

Exhibit 1: Non-GAAP Measures

The following provides definitions of the non-GAAP measures used in this press release and the reconciliation to the most closely related GAAP measures.

Adjusted EBITDA

Adjusted EBITDA, a non-GAAP term, is defined by the Company as net income (loss) attributable to Tenet Healthcare Corporation shareholders before (1) cumulative effect of change in accounting principle, net of tax, (2) net income attributable to noncontrolling interests, (3) income (loss) from discontinued operations, net of tax, (4) income tax (expense) benefit, (5) net gains (losses) on sales of investments, (6) investment earnings (loss), (7) gain (loss) from early extinguishment of debt, (8) interest expense, (9) litigation and investigation (costs) benefit, net of insurance recoveries, (10) hurricane insurance recoveries, net of costs, (11) impairment of long-lived assets and goodwill and restructuring charges, net of insurance recoveries, (12) amortization, and (13) depreciation. The Company’s Adjusted EBITDA may not be comparable to EBITDA reported by other companies.

The reconciliation of net income (loss) attributable to shareholders, the most comparable GAAP term, to Adjusted EBITDA, is set forth in Table #5 below:

The Company provides this information as a supplement to GAAP information to assist itself and investors in understanding the impact of various items on its financial statements, some of which are recurring or involve cash payments. The Company uses this information in its analysis of the performance of its business excluding items that it does not consider as relevant in the performance of its hospitals in continuing operations. Adjusted EBITDA is not a measure of liquidity, but is a measure of operating performance that management uses in its business as an alternative to net income (loss) attributable to Tenet Healthcare Corporation shareholders. Because Adjusted EBITDA excludes many items that are included in our financial statements, it does not provide a complete measure of our operating performance. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company’s financial performance.

Adjusted Free Cash Flow from Continuing Operations

Adjusted Free Cash Flow from Continuing Operations, a non-GAAP term, is defined by the Company as cash provided by (used in) operating activities less income tax refunds (payments), payments against reserves for restructuring charges and litigation costs and settlements, net cash provided by (used in) operating activities from discontinued operations, capital expenditures in continuing operations, and new and replacement hospital construction expenditures. The Company believes the use of Adjusted Free Cash Flow from Continuing Operations is meaningful as the use of this financial measure provides the Company and the users of its financial statements with supplemental information about the impact on the Company’s cash flows from the items specified above. The Company provides this information as a supplement to GAAP information to assist itself and investors in understanding the impact of various items on its cash flows, some of which are recurring. The Company uses this information in its analysis of its cash flows excluding items that it does not consider relevant to the liquidity of its hospitals in continuing operations. Adjusted Free Cash Flow from Continuing Operations is a measure of liquidity that management uses in its business as an alternative to net cash provided by (used in) operating activities. Because Adjusted Free Cash Flow from Continuing Operations excludes many items that are included in our financial statements, it does not provide a complete measure of our liquidity. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company’s financial performance or liquidity. The reconciliation of net cash provided by (used in) operating activities, the most comparable GAAP term, to Adjusted Free Cash Flow from Continuing Operations is set forth in Table #7 below.