What You Should Know
- The Deal: Tenet Healthcare and CommonSpirit Health are unwinding their partnership regarding Conifer Health Solutions. CommonSpirit will pay Tenet approximately $1.9 billion over three years, while Conifer will redeem CommonSpirit’s 23.8% equity stake for $540M.
- The Shift: CommonSpirit has decided to insource its revenue cycle operations starting in 2027. Conifer will continue to provide services through the end of 2026 to ensure a smooth transition.
- The Forecast: Alongside the deal, Tenet announced that its 2025 Adjusted EBITDA will hit the “upper end” of its guidance ($4.57 billion), driven by strong same-store revenue growth and cost discipline.
The Financial Mechanics
The deal is complex, involving capital flows in both directions, but the net result is a massive infusion of cash and equity control for Tenet.
- Inflow: CommonSpirit will pay Tenet approximately $1.9 billion in installments over the next three years.
- Outflow: Conifer will pay CommonSpirit roughly $540M to redeem its equity stake.
- Impact: The move reduces Tenet’s liabilities by $885M and allows Tenet to claim 100% of Conifer’s earnings starting retroactively from January 1, 2026.
The “Insourcing” Trend
The headline for CIOs and CFOs is CommonSpirit’s decision to take its RCM operations in-house.
“CommonSpirit came together with Conifer… to support our multiyear system integration strategy,” said Michael Browning, CFO of CommonSpirit. Having achieved its cash collection goals, the health system now views insourcing as the next logical step in its evolution.
This move mirrors a broader debate in the industry: Do you outsource to a specialist like Conifer or R1 RCM, or do you build a proprietary “digital front door” to control the patient financial experience end-to-end? CommonSpirit has chosen the latter.
Tenet’s Pivot: AI and Automation
For Tenet, the loss of a massive anchor client in 2027 is offset by the immediate financial windfall and the freedom of full ownership. CEO Saum Sutaria, M.D., framed this as an opportunity to modernize Conifer’s tech stack without the constraints of a joint venture.
“This milestone gives Tenet greater flexibility to support Conifer’s long-term potential,” the company stated. Tenet plans to accelerate investments in artificial intelligence, automation, and global operating capabilities, aiming to reposition Conifer as a tech-forward leader rather than just a staffing augment.
