Tenet Healthcare
Annual Report 2015

Plain-text annual report

Morningstar® Document Research℠ FORM 10-KTENET HEALTHCARE CORP - THCFiled: February 22, 2016 (period: December 31, 2015)Annual report with a comprehensive overview of the companyThe information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The userassumes all risks for any damages or losses arising from any use of this information, except to the extent such damages or losses cannot belimited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549 Form 10-K ☒☒Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2015 OR ☐☐Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to Commission File Number 1-7293 TENET HEALTHCARE CORPORATION(Exact name of Registrant as specified in its charter) Nevada 95-2557091(State of Incorporation) (IRS Employer Identification No.) 1445 Ross Avenue, Suite 1400Dallas, TX 75202(Address of principal executive offices, including zip code) (469) 893-2200(Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registeredCommon stock, $0.05 par value New York Stock Exchange6⅞% Senior Notes due 2031 New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐ Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒ Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate website every Interactive Data File required to besubmitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months. Yes ☒ No ☐ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to thebest of the Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment tothis Form 10-K. ☒ Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company (asdefined in Exchange Act Rule 12b-2). Large accelerated filer ☒Accelerated filer ☐Non-accelerated filer ☐Smaller reporting company ☐ Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes ☐ No ☒ As of June 30, 2015, the aggregate market value of the shares of common stock held by non-affiliates of the Registrant (treating directors, executive officerswho were SEC reporting persons, and holders of 10% or more of the common stock outstanding as of that date, for this purpose, as affiliates) was approximately$4.8 billion based on the closing price of the Registrant’s shares on the New York Stock Exchange on that day. As of January 29, 2016, there were 98,529,352shares of common stock outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrant’s definitive proxy statement for the 2016 annual meeting of shareholders are incorporated by reference into Part III of thisForm 10-K. Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents TABLE OF CONTENTS Page PART I Item 1. Business 1 Item 1A. Risk Factors 30 Item 1B. Unresolved Staff Comments 43 Item 2. Properties 43 Item 3. Legal Proceedings 43 Item 4. Mine Safety Disclosures 43 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 44 Item 6. Selected Financial Data 46 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 48 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 106 Item 8. Financial Statements and Supplementary Data 107 Consolidated Financial Statements 110 Notes to Consolidated Financial Statements 115 Supplemental Financial Information 158 Item 9. Changes in and Disagreements with Accountants on Accounting and FinancialDisclosure 159 Item 9A. Controls and Procedures 159 Item 9B. Other Information 159 PART III Item 10. Directors, Executive Officers and Corporate Governance 160 Item 11. Executive Compensation 160 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 160 Item 13. Certain Relationships and Related Transactions, and Director Independence 160 Item 14. Principal Accounting Fees and Services 160 PART IV Item 15. Exhibits and Financial Statement Schedules 161 i Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPART I. ITEM 1. BUSINESS OVERVIEW Tenet Healthcare Corporation (together with our subsidiaries, referred to herein as “Tenet,” “we” or “us”) is adiversified healthcare services company. We operate regionally focused, integrated healthcare delivery networks, primarilyin large urban and suburban markets in the United States. At the core of our networks are acute care and specialty hospitalsthat, together with our strategically aligned outpatient facilities and related businesses, allow us to provide a comprehensiverange of healthcare services in the communities we serve. At December 31, 2015, we operated 86 hospitals, 20 short-staysurgical hospitals, over 475 outpatient centers, nine facilities in the United Kingdom and six health plans through oursubsidiaries, partnerships and joint ventures. In addition, our Conifer Holdings, Inc. (“Conifer”) subsidiary provideshealthcare business process services in the areas of revenue cycle management and technology-enabled performanceimprovement and health management solutions to health systems, as well as individual hospitals, physician practices, self-insured organizations and health plans. With respect to our hospitals and outpatient businesses, we seek to offer superior quality and patient services tomeet community needs, to make capital and other investments in our facilities and technology, to recruit and retainphysicians, and to negotiate competitive contracts with managed care and other private payers. With respect to businessprocess services, we provide comprehensive operational management for revenue cycle functions, including patient access,health information management, revenue integrity and patient financial services. We also offer communication andengagement solutions to optimize the relationship between providers and patients. In addition, Conifer operates amanagement services business that supports value-based performance through clinical integration, financial riskmanagement and population health management. For financial reporting purposes, our business lines are classified into threeseparate reportable operating segments – Hospital Operations and other, Ambulatory Care and Conifer. Additionalinformation about our business segments is provided below, and financial and statistical data for the segments can be foundin Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of Part II of this report. In general, we seek to operate our hospitals, ambulatory care and other outpatient centers, and Conifer in a mannerthat positions them to compete effectively in an evolving healthcare environment. From time to time, we build new hospitalsand outpatient centers, and make strategic acquisitions of hospitals, outpatient businesses, physician practices, and otherhealthcare assets and companies – in each case in markets where we believe our operating strategies can improveperformance and create shareholder value. Moreover, we continually evaluate joint venture opportunities with otherhealthcare providers in our markets to maximize effectiveness, reduce costs and build clinically integrated networks thatprovide quality services across the care continuum. In furtherance of the foregoing, during the year endedDecember 31, 2015: ·We combined our freestanding ambulatory surgery and imaging center assets with the short-stay surgical facilityassets of United Surgical Partners International, Inc. (“USPI”) into a new joint venture (“USPI joint venture”). Wehave a 50.1% ownership interest in the USPI joint venture, while Welsh, Carson, Anderson & Stowe, a private equityfirm that specializes in healthcare investments, owns approximately 47% and Baylor University Medical Center(“Baylor”) owns approximately 3% of the joint venture. We significantly increased the number of our not-for-profitpartners through USPI and now have relationships with more than 50 leading healthcare systems across the country.Moreover, on December 31, 2015, USPI acquired CareSpot Express Healthcare, which added 35 urgent care centersin Florida and Tennessee to its portfolio of outpatient centers. ·We formed a new joint venture with Baptist Health System, Inc. to own and operate a healthcare network servingBirmingham and central Alabama. We have a 60% ownership interest in the joint venture, and we manage thenetwork’s operations. Baptist Health System contributed four hospitals to the joint venture, and we contributed onehospital. The new network, which also includes each contributed hospital’s related businesses, has more than 1,700licensed beds, nine outpatient centers, 68 physician clinics delivering primary and specialty care, more than 7,000employees, and approximately 1,500 affiliated physicians. 1 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents·We entered into definitive agreements to form two joint ventures with Baylor Scott & White Health (“BSW”)involving five North Texas hospitals. Effective January 1, 2016, one of the joint ventures owns or leases andoperates Centennial Medical Center, Doctors Hospital at White Rock Lake, Lake Pointe Medical Center and TexasRegional Medical Center at Sunnyvale, all of which were previously owned or leased and operated by certain of oursubsidiaries, and the other joint venture owns and operates Baylor Medical Center at Garland, which previouslybelonged to BSW. The two joint ventures will focus on delivering integrated, value-based care primarily to selectcommunities in Rockwall, Collin and Dallas counties. BSW holds a 75% majority ownership interest in the jointventure that involves our legacy facilities and a 50.1% majority ownership interest in the joint venture that relates tothe legacy BSW facility. We own the remaining minority interest in each joint venture and will continue to managethe operations of our legacy facilities. All five hospitals will operate under the BSW brand. ·We formed a new joint venture with Dignity Health and Ascension Arizona to own and operate Carondelet HealthNetwork. We have a 60% ownership interest in the joint venture, and we manage the operations of the network’sthree hospitals with over 900 licensed beds, related physician practices, ambulatory surgery, imaging and urgentcare centers, and other affiliated businesses in Tucson and Nogales, Arizona. ·We acquired European Surgical Partners Ltd. (“Aspen Healthcare” or “Aspen”) in the United Kingdom. Although theU.K. provides government-funded healthcare to all of its residents through the National Health Service, the demandfor healthcare services exceeds the public system’s capacity. Aspen’s four acute care hospitals, one cancer center andfour outpatient facilities offer patients a complete range of private healthcare and clinical services in a growingmarket. ·We began operating Hi-Desert Medical Center and its related healthcare facilities under an arrangement structured asa long-term lease agreement with Hi-Desert Memorial Health Care District. We now manage the operations of the 59-bed acute care hospital, as well as a 120-bed skilled nursing facility, an ambulatory surgery center and an imagingcenter on the hospital’s campus in Joshua Tree, California. ·We opened 16 new outpatient facilities, and we acquired 12 other outpatient businesses outside of the corporatedevelopment activities described above, as well as various physician practice entities. ·Conifer announced a 10-year extension and expansion of its agreement with Catholic Health Initiatives (“CHI”) toprovide patient access, revenue integrity and patient financial services to 92 CHI hospitals through 2032. At thattime, CHI increased its minority ownership position in Conifer’s revenue cycle solutions subsidiary, Conifer HealthSolutions, LLC, to approximately 23.8%. From time to time, we decide to sell, consolidate or close certain facilities to eliminate duplicate services or excesscapacity or because of changing market conditions or other factors. During the year ended December 31, 2015, we completedthe sale of Saint Louis University Hospital (“SLUH”) to Saint Louis University, and we agreed to sell our two North Carolinahospitals – Central Carolina Hospital and Frye Regional Medical Center – and related operations to Duke LifePointHealthcare (which sale was effective January 1, 2016). In addition, in December 2015, we entered into a definitive agreementfor the sale and management of our Atlanta-area hospitals, as well as 26 physician clinics, to WellStar Health System. Thetransaction is subject to customary regulatory approvals and other closing conditions and is expected to be completed asearly as the end of the first quarter of 2016. We also sold or closed nine outpatient centers in the year ended December 31,2015. We are committed to providing the communities we serve with high quality, cost-effective healthcare while growingour business, increasing our profitability and creating long-term value for our shareholders. We believe that our success inincreasing our profitability depends in part on our success in executing the strategies and managing the trends discussed indetail in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of Part II of thisreport. In general, we anticipate the continued influence of major industry trends we have seen emerge over the last severalyears, and our strategies reflect the belief that: (1) consumers will increasingly select services and providers based on qualityand cost; (2) physicians will seek strategic partners with whom they can align clinically; (3) more procedures will shift fromthe inpatient to the outpatient setting; (4) demand will grow as a result of a strengthening2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentseconomy, shifting demographics and the expansion of coverage under the Patient Protection and Affordable Care Act, asamended by the Health Care and Education Reconciliation Act of 2010 (the “Affordable Care Act” or “ACA”); and (5) payerreimbursements will be constrained and further shift to being more closely tied to performance on quality and service metrics.We believe that our strategies will allow us to achieve our operational and financial targets; however, our ability to executeon these strategies and manage these trends is subject to a number of risks and uncertainties that may cause actual results tobe materially different from expectations. Information about risks and uncertainties that could affect our results of operationscan be found in “Forward-Looking Statements” below and in Item 1A, Risk Factors, of Part I of this report. OPERATIONS HOSPITAL OPERATIONS AND OTHER SEGMENT Hospitals, Ancillary Outpatient Facilities and Related Businesses—At December 31, 2015, our subsidiariesoperated 86 hospitals, including three academic medical centers, two children’s hospitals, two specialty hospitals andtwo critical access hospitals, with a total of 22,525 licensed beds, serving primarily urban and suburban communities in14 states. Our subsidiaries owned 67 of those hospitals, 12 were owned by entities that are, in turn, jointly owned by aTenet subsidiary and a strategic partner or group of physicians, and seven were owned by third parties and leased by oursubsidiaries. In addition, at December 31, 2015, our subsidiaries operated a long-term acute care hospital and a skillednursing facility and owned or leased and operated a number of medical office buildings, all of which were located on, ornearby, our hospital campuses. At December 31, 2015, our Hospital Operations and other segment also included:174 outpatient centers, the majority of which are provider-based diagnostic imaging centers, freestanding urgent care centers,satellite emergency departments and provider-based ambulatory surgery centers; approximately 700 physician practices; andsix health plans. Our hospitals classified in continuing operations for financial reporting purposes generated in excess of 83% of ournet operating revenues before provision for doubtful accounts for all periods presented in our Consolidated FinancialStatements. Factors that affect patient volumes and, thereby, the results of operations at our hospitals and related healthcarefacilities include, but are not limited to: (1) the business environment, economic conditions and demographics of localcommunities in which we operate; (2) the number of uninsured and underinsured individuals in local communities treated atour hospitals; (3) seasonal cycles of illness; (4) climate and weather conditions; (5) physician recruitment, retention andattrition; (6) advances in technology and treatments that reduce length of stay; (7) local healthcare competitors; (8) managedcare contract negotiations or terminations; (9) the number of patients with high-deductible health insurance plans; (10) anyunfavorable publicity about us, which impacts our relationships with physicians and patients; (11) changes in healthcareregulations and the participation of individual states in federal programs; and (12) the timing of elective procedures. Each of our general hospitals offers acute care services, operating and recovery rooms, radiology services,respiratory therapy services, clinical laboratories and pharmacies; in addition, most have intensive care, critical care and/orcoronary care units, physical therapy, and orthopedic, oncology and outpatient services. Many of our hospitals providetertiary care services, such as open-heart surgery, neonatal intensive care and neurosciences, and some also offer quaternarycare in areas such as heart, liver, kidney and bone marrow transplants. Our children’s hospitals provide tertiary andquaternary pediatric services, including bone marrow and kidney transplants, as well as burn services. Moreover, a number ofour hospitals offer advanced treatment options for patients, including gamma-knife brain surgery and cyberknife radiationtherapy for tumors and lesions in the brain, lung, neck, spine and elsewhere that may previously have been consideredinoperable or inaccessible by traditional radiation therapy. Many of our hospitals and physician practices also offer a widerange of clinical research studies, giving patients access to innovative care. We are dedicated to helping our hospitals andphysicians participate in medical research that is consistent with state and federal regulations and complies with clinicalpractice guidelines. Clinical research programs relate to a wide array of ailments, including cardiovascular disease,pulmonary disease, musculoskeletal disorders, neurological disorders, genitourinary disease and various cancers, as well asexperimental drug and medical device studies. By supporting clinical research, our hospitals are actively involved inmedical advancements that can lead to improvements in patient safety and clinical care. 3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsExcept as set forth in the table below, each of our acute care hospitals is accredited by The Joint Commission. Withsuch accreditation, our hospitals are deemed to meet the Medicare Conditions of Participation and are eligible to participatein government-sponsored provider programs, such as the Medicare and Medicaid programs. The following table lists, by state, the hospitals wholly owned, owned as part of a joint venture or leased andoperated by our subsidiaries at December 31, 2015: Licensed Hospital Location Beds Status Alabama Baptist Medical Center – Princeton Birmingham 505 JV Brookwood Medical Center Birmingham 607 JV Citizens Baptist Medical Center Talladega 122 JV Shelby Baptist Medical Center Alabaster 252 JV Walker Baptist Medical Center Jasper 267 JV Arizona Abrazo Arizona Heart Hospital Phoenix 59 Owned Abrazo Arrowhead Campus Glendale 217 Owned Abrazo Central Campus Phoenix 221 Owned Abrazo Maryvale Campus Phoenix 232 Owned Abrazo Scottsdale Campus Phoenix 136 Owned Abrazo West Campus Goodyear 188 Owned Holy Cross Hospital Nogales 25 JV St. Joseph's Hospital Tucson 486 JV St. Mary's Hospital Tucson 400 JV California Desert Regional Medical Center Palm Springs 385 Leased Doctors Hospital of Manteca Manteca 73 Owned Doctors Medical Center of Modesto Modesto 461 Owned Emanuel Medical Center Turlock 209 Owned Fountain Valley Regional Hospital & Medical Center Fountain Valley 400 Owned Hi-Desert Medical Center Joshua Tree 179 Leased John F. Kennedy Memorial Hospital Indio 145 Owned Lakewood Regional Medical Center Lakewood 172 Owned Los Alamitos Medical Center Los Alamitos 167 Owned Placentia Linda Hospital Placentia 114 Owned San Ramon Regional Medical Center San Ramon 123 JV Sierra Vista Regional Medical Center San Luis Obispo 164 Owned Twin Cities Community Hospital Templeton 122 Owned Florida Coral Gables Hospital Coral Gables 245 Owned Delray Medical Center Delray Beach 493 Owned Florida Medical Center - a campus of North Shore Lauderdale Lakes 459 Owned Good Samaritan Medical Center West Palm Beach 333 Owned Hialeah Hospital Hialeah 378 Owned North Shore Medical Center Miami 357 Owned Palm Beach Gardens Medical Center Palm Beach Gardens 199 Leased Palmetto General Hospital Hialeah 360 Owned St. Mary’s Medical Center West Palm Beach 464 Owned West Boca Medical Center Boca Raton 195 Owned 4 (1)(1)(1)(1)(1)(2)(3), (4)(3)(3)(5)(6)(7)(8)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Licensed Hospital Location Beds Status Georgia Atlanta Medical Center Atlanta 762 Owned Atlanta Medical Center – South Campus East Point — Owned North Fulton Hospital Roswell 202 Leased Spalding Regional Hospital Griffin 160 Owned Sylvan Grove Hospital Jackson 25 Leased Illinois Louis A. Weiss Memorial Hospital Chicago 236 Owned MacNeal Hospital Berwyn 368 Owned West Suburban Medical Center Oak Park 234 Owned Westlake Hospital Melrose Park 230 Owned Massachusetts MetroWest Medical Center – Framingham Union Campus Framingham 147 Owned MetroWest Medical Center – Leonard Morse Campus Natick 152 Owned Saint Vincent Hospital Worcester 283 Owned Michigan Children’s Hospital of Michigan Detroit 228 Owned Detroit Receiving Hospital Detroit 273 Owned Harper University Hospital Detroit 584 Owned Huron Valley-Sinai Hospital Commerce Township 158 Owned Hutzel Women’s Hospital Detroit — Owned Rehabilitation Institute of Michigan Detroit 97 Owned Sinai-Grace Hospital Detroit 404 Owned Missouri Des Peres Hospital St. Louis 143 Owned North Carolina Central Carolina Hospital Sanford 137 Owned Frye Regional Medical Center Hickory 355 Leased Pennsylvania Hahnemann University Hospital Philadelphia 496 Owned St. Christopher’s Hospital for Children Philadelphia 189 Owned South Carolina Coastal Carolina Hospital Hardeeville 41 Owned East Cooper Medical Center Mount Pleasant 140 Owned Hilton Head Hospital Hilton Head 93 Owned Piedmont Medical Center Rock Hill 288 Owned Tennessee Saint Francis Hospital Memphis 519 Owned Saint Francis Hospital – Bartlett Bartlett 196 Owned 5 (9)(9), (10)(9), (11)(9)(9), (12)(13)(2)(14)(14), (15)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Licensed Hospital Location Beds Status Texas Baptist Medical Center San Antonio 623 Owned Centennial Medical Center Frisco 118 Owned Cypress Fairbanks Medical Center Houston 181 Owned Doctors Hospital at White Rock Lake Dallas 218 Owned The Hospitals of Providence East Campus El Paso 182 Owned The Hospitals of Providence Memorial Campus El Paso 480 Owned The Hospitals of Providence Sierra Campus El Paso 323 Owned Houston Northwest Medical Center Houston 423 JV Lake Pointe Medical Center Rowlett 112 JV Mission Trail Baptist Hospital San Antonio 110 Owned Nacogdoches Medical Center Nacogdoches 153 Owned North Central Baptist Hospital San Antonio 387 Owned Northeast Baptist Hospital San Antonio 371 Owned Park Plaza Hospital Houston 444 Owned Resolute Health Hospital New Braunfels 128 Owned St. Luke’s Baptist Hospital San Antonio 282 Owned Texas Regional Medical Center at Sunnyvale Sunnyvale 70 JV/Leased Valley Baptist Medical Center Harlingen 586 Owned Valley Baptist Medical Center – Brownsville Brownsville 280 Owned Total Licensed Beds 22,525 (1)Owned by a limited liability company formed as part of a joint venture with Baptist Health System, Inc., a not-for-profit, faith-basedintegrated system of doctors, hospitals and other healthcare services in Alabama; a Tenet subsidiary owned a 60% interest in the limitedliability company at December 31, 2015, and Baptist Health System, Inc. owned a 40% interest.(2)Specialty hospital.(3)Owned by a limited liability company formed as part of a joint venture with Dignity Health and Ascension Arizona, each of which is a not-for-profit, faith-based health system; a Tenet subsidiary owned a 60% interest in the limited liability company at December 31, 2015,Dignity Health owned a 22.5% interest and Ascension Arizona owned a 17.5% interest.(4)Designated by the Centers for Medicare and Medicaid Services (“CMS”) as a critical access hospital.(5)Lease expires in May 2027.(6)Lease expires in July 2045.(7)Owned by a limited liability company formed as part of a joint venture with John Muir Health, a not-for-profit integrated system of doctors,hospitals and other healthcare services in the San Francisco Bay area; a Tenet subsidiary owned a 51% interest in the limited liabilitycompany at December 31, 2015, and John Muir Health owned a 49% interest.(8)Lease expires in February 2017, but may be renewed through at least February 2037, subject to certain conditions contained in the lease.(9)Subject of a definitive sales agreement with WellStar Health System.(10)Licensed beds for Atlanta Medical Center – South Campus are presented on a combined basis with Atlanta Medical Center.(11)Lease expires in February 2020, but may be renewed through at least February 2040, subject to certain conditions contained in the lease.(12)Designated by CMS as a critical access hospital. Although it has not sought to be accredited, the hospital participates in the Medicare andMedicaid programs by otherwise meeting the Medicare Conditions of Participation. The current lease term for this facility expires inDecember 2016, but may be renewed through December 2046, subject to certain conditions contained in the lease.(13)Licensed beds for Hutzel Women’s Hospital are presented on a combined basis with Harper University Hospital.(14)Sold effective January 1, 2016 to Duke LifePoint Healthcare.(15)Lease expires in February 2022, but may be renewed through at least February 2042, subject to certain conditions contained in the lease.(16)As of January 1, 2016, managed by a Tenet subsidiary and owned by a limited partnership that is owned by a limited liability partnership(the “JV LLP”) formed as part of a joint venture with Baylor Scott & White Health, a not-for-profit healthcare system; a Tenet subsidiaryowns a 25% interest in the JV LLP, and BSW owns a 75% interest.(17)As of January 1, 2016, managed by a Tenet subsidiary and owned by the JV LLP.(18)Owned by a limited liability company in which a Tenet subsidiary owned an 87.48% interest at December 31, 2015 and is the managingmember.(19)At December 31, 2015, owned by a limited liability company in which a Tenet subsidiary owned a 94.67% interest and was the managingmember. As of January 1, 2016, managed by a Tenet subsidiary and owned by a limited liability company in which the JV LLP indirectlyowns the 94.67% interest.(20)At December 31, 2015, leased by a limited liability company in which a Tenet subsidiary owned a 55% interest and was the managingmember. As of January 1, 2016, managed by a Tenet subsidiary and leased by a limited liability company in which the JV LLP indirectlyowns the 55% interest. The current lease term for this hospital expires in November 2029, but may be renewed through at leastNovember 2049, subject to certain conditions contained in the lease.(21)At December 31, 2014, Valley Baptist Medical Center and Valley Baptist Medical Center – Brownsville were indirectly owned by a limitedliability company formed as part of a joint venture with VB Medical Holdings, a Texas non-profit corporation (“VBMH”); a Tenetsubsidiary owned a 51% interest in the limited liability company and was the managing member, and VBMH owned a 49% interest. Wesubsequently acquired VBMH’s 49% interest in the limited liability company pursuant to the terms of the operating agreement governingthe joint venture. As a result, we own 100% of both hospitals as of February 11, 2015.6 (16)(17)(18)(19)(20)(21)(21)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsInformation regarding the total number of hospitals operated by our subsidiaries, the collective number of licensedbeds at those facilities, the utilization of licensed beds and other operating statistics at December 31, 2015, 2014 and 2013can be found in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of Part IIof this report. At December 31, 2015, our Hospital Operations and other segment also included 69 diagnostic imaging centers, 14satellite emergency departments, 13 ambulatory surgery centers and seven urgent care centers operated as departments of ourhospitals and under the same license, as well as 71 separately licensed, freestanding outpatient centers – typically atlocations complementary to our hospitals – consisting of eight diagnostic imaging centers, five emergency departments,three ambulatory surgery centers and 55 urgent care centers, the majority of which are operated under our national MedPostbrand. Our subsidiaries wholly own and operate most of the freestanding outpatient centers in our Hospital Operations andother segment. Over 50% of the outpatient centers in our Hospital Operations and other segment at December 31, 2015 werein California, Florida and Texas, the same states where we had the largest concentrations of licensed hospital beds. Strongconcentrations of hospital beds and outpatient centers within market areas help us contract more successfully with managedcare payers, reduce management, marketing and other expenses, and more efficiently utilize resources. However, theseconcentrations increase the risk that, should any adverse economic, regulatory, environmental or other condition occur inthese areas, our overall business, financial condition, results of operations or cash flows could be materially adverselyaffected. Health Plans and Accountable Care Networks—During the year ended December 31, 2015, we operated six healthplans with approximately 139,000 members: ·VHS Phoenix Health Plan, Inc. (formerly known as VHS Phoenix Health Plan, LLC), a Medicaid-managedhealth plan operating as Phoenix Health Plan (“PHP”) in Arizona; ·Phoenix Health Plans, Inc. (formerly known as Abrazo Advantage Health Plan, Inc.), a Medicare, Medicaid dual-eligible and public health insurance exchange managed health plan operating in Arizona; ·Golden State Medicare Health Plan, a health maintenance organization (“HMO”) that specializes in the care ofseniors in Southern California who are eligible for benefits under the Medicare Advantage program; ·Chicago Health System, Inc. (“CHS”), a contracting entity formed to establish a preferred provider network forinpatient and outpatient services provided by MacNeal Hospital, Louis A. Weiss Memorial Hospital andparticipating physicians in the Chicago area; ·Harbor Health Plan, Inc. (formerly known as ProCare Health Plan, Inc.), a Medicaid-managed, MedicareAdvantage and public health insurance exchange health plan operating in Michigan; and ·Allegian Insurance Company (formerly known as Valley Baptist Insurance Company), doing business asAllegian Health Plan, which offers HMO, preferred provider organization (“PPO”), and self-funded products toits members in the form of large group, small group and individual product offerings in south Texas, as well as aMedicare Advantage and public health insurance exchange health plan. We believe these health plans complement and enhance our market position. Specifically, PHP provides us withinsights into state initiatives to manage the Arizona Medicaid population, which is valuable in light of the expansion ofhealth coverage to previously uninsured individuals in the state pursuant to the Affordable Care Act and various otherhealthcare reform laws. In addition, through CHS, our Chicago-based preferred provider network, we manage capitatedcontracts covering inpatient, outpatient and physician services. We believe our ownership of CHS allows us to gainadditional experience with risk-bearing contracts and delivery of care in low-cost settings, including our network of healthcenters. We also own, control or operate 14 accountable care networks – in Alabama, California, Florida, Georgia, Illinois,Michigan, Missouri, Pennsylvania and Texas – and participate in three additional accountable care networks with otherhealthcare providers in our markets in Arizona, California and Massachusetts. These networks operate using a7 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsrange of payment and delivery models that seek to align provider reimbursement in a way that encourages improved qualitymetrics and efficiencies in the total cost of care for an assigned population of patients through cooperation of the providers.We believe that our experience operating health plans and accountable care networks gives us a solid framework upon whichto build and expand our population health strategies. AMBULATORY CARE SEGMENT On June 16, 2015, we completed the transaction that combined our freestanding ambulatory surgery and imagingcenter assets with the short-stay surgical facility assets of United Surgical Partners International, Inc. into our new USPI jointventure. We have a 50.1% ownership interest in the USPI joint venture, while Welsh, Carson, Anderson & Stowe, a privateequity firm that specializes in healthcare investments, owns approximately 47% and Baylor University Medical Center ownsapproximately 3% of the joint venture. In addition, we completed the acquisition of Aspen Healthcare in the UnitedKingdom on June 16, 2015. In the three months ended June 30, 2015, we began reporting Ambulatory Care as a separatereportable business segment. Our Ambulatory Care segment is comprised of the operations of our USPI joint venture and ourAspen facilities. Our interests in the 49 ambulatory surgery centers and 20 imaging centers we contributed to the USPI jointventure had previously been included in our Hospital Operations and other segment. USPI’s Business—Our USPI joint venture acquires and develops its facilities primarily through the formation ofstrategic relationships with physicians and health system partners. Subsidiaries of the USPI joint venture hold ownershipinterests in the facilities directly or indirectly and operate the facilities on a day-to-day basis through management servicescontracts. We believe that this acquisition and development strategy and operating model will enable our USPI joint ventureto continue to grow because of several previously noted industry trends we have seen emerge over the last several years,namely that: (1) consumers will increasingly select services and providers based on quality and cost; (2) physicians will seekstrategic partners with whom they can align clinically; (3) more procedures will shift from the inpatient to the outpatientsetting; (4) demand will grow as a result of a strengthening economy, shifting demographics and the expansion of coverageunder the Affordable Care Act; and (5) payer reimbursements will be constrained and further shift to being more closely tiedto performance on quality and service metrics. The facilities in our USPI joint venture primarily specialize in non-emergency surgical cases and are licensed asambulatory surgery centers, specialty hospitals or hospitals. We believe surgery centers and surgical hospitals offer manyadvantages to patients and physicians, including predictability and convenience. Medical emergencies at acute carehospitals often demand the unplanned use of operating rooms and result in the postponement or delay of scheduled surgeries,disrupting physicians’ practices and inconveniencing patients. Outpatient facilities generally provide physicians withgreater scheduling flexibility, more consistent nurse staffing and faster turnaround time between cases. In addition, manyphysicians choose to perform surgery in outpatient facilities because their patients prefer the comfort of a less institutionalatmosphere and the convenience of simplified admissions and discharge procedures. New surgical techniques and technology, as well as advances in anesthesia, have significantly expanded the typesof surgical procedures that are being performed in surgery centers and have helped drive the growth in outpatient surgery.Improved anesthesia has shortened recovery time by minimizing post-operative side effects, such as nausea and drowsiness,thereby avoiding the need for overnight hospitalization in many cases. Furthermore, some states permit surgery centers tokeep a patient for up to 23 hours, which allows for more complex surgeries, previously performed only in an inpatient setting,to be performed in a surgery center. In addition to these technological and other clinical advancements, a changing payer environment has contributedto the growth of outpatient surgery relative to all surgery performed. Government programs, private insurance companies,managed care organizations and self-insured employers have implemented cost-containment measures to limit increases inhealthcare expenditures, including procedure reimbursement. Furthermore, as self-funded employers are looking to curbannual increases in premiums, they continue to shift additional financial responsibility to patients through higher co-pays,deductibles and premium contributions. These cost-containment measures have contributed to the shift in the delivery ofhealthcare services away from traditional inpatient hospitals to more cost-effective alternate sites, including short-staysurgical facilities. We believe that surgeries performed at short-stay surgical facilities are generally less expensive thanhospital-based outpatient surgeries because of lower facility development8 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentscosts, more efficient staffing and space utilization, and a specialized operating environment focused on quality of care andcost containment. We believe that our USPI joint venture’s facilities (1) enhance the quality of care and the healthcare experience ofpatients, (2) offer a strategic approach for physicians that provides them with significant administrative, clinical andeconomic benefits, (3) offer a strategic approach for our health system partners to diversify and expand capacity and accesswithin the markets they serve, and (4) offer an efficient and low-cost alternative for payers and employers. We operate ourfacilities, structure our strategic relationships, and adopt staffing, scheduling, and clinical systems and protocols with thegoal of increasing physician productivity. We believe that this focus on physician satisfaction, combined with providinghigh-quality healthcare in a friendly and convenient environment for patients, will continue to increase the number ofprocedures performed at our facilities each year. Our strategic relationships enable healthcare systems to offer patients,physicians and payers the cost advantages, convenience and other benefits of ambulatory care in a freestanding facility and,in certain markets, establish networks needed to manage the full continuum of care for a defined population. Further, theserelationships allow the healthcare systems to focus their attention and resources on their core business without the challengeof acquiring, developing and operating these facilities. At December 31, 2015, our USPI joint venture operated 249 ambulatory surgery centers, 20 short-stay surgicalhospitals, 20 imaging centers and 35 urgent care centers (acquired from CareSpot Express Healthcare on that date) in28 states. Of these 324 facilities, 181 are jointly owned with health system partners. Due in large part to these relationships,we do not consolidate the financial results of 139 of the facilities in which our USPI joint venture has an ownership interest,meaning that while we record a share of their net profit within our operating income as equity earnings of unconsolidatedaffiliates, we do not include their revenues and expenses in the consolidated revenue and expense line items of ourconsolidated financial statements. For additional information, see Note 1 to our Consolidated Financial Statements. Aspen’s Business—The United Kingdom provides government-funded healthcare to all of its residents through theNational Health Service; however, due to funding and capacity limitations, the demand for healthcare services exceeds thepublic system’s capacity. In response to these shortfalls, private healthcare networks and private insurance companies havedeveloped in the U.K. Aspen Healthcare’s nine facilities offer patients a complete range of private healthcare and clinicalservices as described below: ·Cancer Centre London in South West London provides advanced outpatient cancer treatment, includingradiotherapy and chemotherapy, as well as a number of related support services; inpatient cancer treatment isprovided at our nearby Parkside Hospital. ·The Chelmsford, a private day surgery hospital located northeast of London in Essex, specializes in outpatientand minimally invasive treatment and surgery. ·Claremont Private Hospital, a 41-bed acute care facility in Sheffield, offers an extensive range of inpatient andoutpatient services. ·The Edinburgh Clinic, a private surgical hospital in Scotland, offers outpatient procedures and on-sitediagnostic imaging. ·Highgate Private Hospital, located in North London, is a 43-bed facility providing a wide range of inpatient andoutpatient services. ·The Holly Private Hospital, a 55-bed facility located in Essex, is an acute care inpatient hospital that also offersnumerous outpatient services. ·Midland Eye, a private ambulatory surgery center located in West Midlands, provides specialist eye care andsurgery in a dedicated facility. 9 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents·Nova Healthcare, a private clinic housed within Leeds Cancer Centre, offers treatment to private patientsdiagnosed with cancer, blood disorders and a range of neurological diseases. ·Parkside Hospital, located in Wimbledon, a suburb southwest of London, has 69 registered acute care beds andan outpatient surgery unit. As with our USPI joint venture, a number of Aspen’s facilities are owned jointly with physicians and health system partners. CONIFER SEGMENT Our Conifer subsidiary provides a number of services primarily to healthcare providers to assist them in generatingsustainable improvements in their operating margins, while also enhancing patient, physician and employee satisfaction. AtDecember 31, 2015, Conifer provided one or more of the business process services described below from 20 service centers tomore than 800 Tenet and non-Tenet hospital and other clients in over 40 states. Revenue Cycle Management—Conifer provides comprehensive operational management for patient access,accounts receivable management, health information management, revenue integrity and patient financial services,including: ·centralized insurance and benefit verification, financial clearance, pre-certification, registration and check‑inservices; ·financial counseling services, including reviews of eligibility for government healthcare programs, for bothinsured and uninsured patients; ·productivity and quality improvement programs, revenue cycle assessments and optimizationrecommendations, and The Joint Commission and other preparedness services; ·coding and compliance support, billing assistance, auditing, training, and data management services at everystep in the revenue cycle process; ·accounts receivable management, third-party billing and collections; and ·ongoing measurement and monitoring of key revenue cycle metrics. These revenue cycle management solutions assist hospitals, physician practices and other healthcare organizations inimproving cash flow, increasing revenue, and advancing physician and patient satisfaction. Patient Communications and Engagement Services—Conifer offers customized communications and engagementsolutions to optimize the relationship between providers and patients. Conifer’s trained customer service representativesprovide direct, 24-hour, multilingual support for (1) physician referrals, calls regarding maternity services and other patientinquiries, (2) community education and outreach, (3) scheduling and appointment reminders, and (4) employee recruitment.Conifer also coordinates and implements mail-based marketing programs to keep patients informed of screenings, seminarsand other events and services, as well as conducts patient quality and satisfaction surveys to provide valuable feedback to itsclients. In addition, Conifer provides clinical admission reviews that are intended to provide evidence-based support forphysician decisions on patient status and reduce staffing costs. Management Services—Conifer also supports value-based performance through clinical integration, financial riskmanagement and population health management, all of which assist hospitals, physicians, accountable care organizations(“ACOs”), health plans, self-insured employers and government agencies in improving the cost and quality of healthcaredelivery, as well as patient outcomes. Conifer helps clients build clinically integrated networks that provide predictiveanalytics and quality measures across the care continuum. In addition, Conifer assists clients in improving both the cost andquality of care by aligning and managing financial incentives among healthcare10 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsstakeholders through risk modeling and management for various payment models. Furthermore, Conifer offers clients toolsand analytics to improve quality of care and provide care management support for patients with chronic diseases byidentifying high-risk patients and monitoring clinical outcomes. We intend to continue to market and expand Conifer’s revenue cycle management, patient communications andengagement services, and management services businesses. We believe that our success in growing Conifer and increasing itsprofitability depends in part on our success in executing the following strategies: (1) attracting as new clients hospitals andother healthcare providers who currently handle their revenue cycle management processes internally; (2) generating newclient relationships through opportunities from USPI and Tenet’s acute care hospital corporate development activities;(3) expanding revenue cycle management and value-based care service offerings through organic development and smallacquisitions; (4) leveraging data from tens of millions of patient interactions to capture new opportunities and service thevalue-based care environment to drive competitive differentiation; and (5) developing services for our Ambulatory Caresegment, leveraging USPI’s capabilities. In May 2012, Conifer entered into a 10-year agreement with Catholic Health Initiatives to provide revenue cycleservices for 56 of CHI’s hospitals. As part of this initial relationship, CHI received a minority ownership interest in Conifer’srevenue cycle solutions subsidiary, Conifer Health Solutions, LLC. In January 2015, Conifer announced a 10‑year extensionand expansion of its agreement with CHI to provide patient access, revenue integrity and patient financial services to 92 CHIhospitals through 2032. As further described in Note 16 to our Consolidated Financial Statements, at that time, CHI increasedits minority ownership position in Conifer Health Solutions, LLC to approximately 23.8%. The loss of Conifer’s key customers, primarily Tenet and CHI, in the future could have a material adverse impact onthe segment; however, CHI is not a key customer to Tenet on a consolidated basis. Financial and other information about ourConifer operating segment is provided in the Consolidated Financial Statements included in this report. REAL PROPERTY The locations of our hospitals and the number of licensed beds at each hospital at December 31, 2015 are set forth inthe table beginning on page 4. We lease the majority of our outpatient facilities in both our Hospital Operations and othersegment and our Ambulatory Care segment. These leases typically have initial terms ranging from five to 20 years, and mostof the leases contain options to extend the lease period, in some cases for up to 10 additional years. Our subsidiaries alsooperate a number of medical office buildings, all of which are located on, or nearby, our hospital campuses. We own nearlyall of our medical office buildings; the remainder are owned by third parties and leased by our subsidiaries. Our corporate headquarters are located in Dallas, Texas. In addition, we maintain administrative and regional officesin markets where we operate hospitals and other businesses, including our USPI joint venture and Conifer. We typically leaseour office space under operating lease agreements. We believe that all of our properties are suitable for their respective usesand are, in general, adequate for our present needs. INTELLECTUAL PROPERTY We rely on a combination of trademark, copyright and trade secret laws, as well as contractual terms and conditions,to protect our rights in our intellectual property assets. However, third parties may develop intellectual property that issimilar or superior to ours. Conversely, although we do not believe the intellectual property we utilize infringes anyintellectual property right held by a third party, we could be prevented from utilizing such property and could be subject tosignificant damage awards if it is found to do so. We control access to and the use of our application capabilities through a combination of internal and externalcontrols. We also license some of our software through agreements that impose specific restrictions on customers’ ability touse the software, such as prohibiting reverse engineering and limiting the use of copies. 11 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsWe incorporate third-party commercial and, on occasion, open source software products into our technologyplatform. We employ third-party licensed software in order to simplify our development and maintenance efforts, support ourown technology infrastructure or test a new capability. PHYSICIANS AND EMPLOYEES Physicians—Our operations depend in significant part on the number, quality, specialties, and admitting andscheduling practices of the licensed physicians who have been admitted to the medical staffs of our hospitals and whoaffiliate with us and use our facilities as an extension of their practices. Under state laws and other licensing standards,medical staffs are generally self-governing organizations subject to ultimate oversight by the facility’s local governingboard. Members of the medical staffs of our hospitals also often serve on the medical staffs of facilities we do not operate, andthey are free to terminate their association with our hospitals or admit their patients to competing facilities at any time. AtDecember 31, 2015, we owned approximately 700 physician practices, and we employed (where permitted by state law) orotherwise affiliated with over 2,000 physicians; however, we have no contractual relationship with the overwhelmingmajority of the physicians who practice at our hospitals and outpatient centers. It is essential to our ongoing business that weattract an appropriate number of quality physicians in the specialties required to support our services and that we maintaingood relations with those physicians. In some of our markets, physician recruitment and retention are affected by a shortageof physicians in certain specialties and the difficulties that physicians can experience in obtaining affordable malpracticeinsurance or finding insurers willing to provide such insurance. Employees—At December 31, 2015, we employed over 130,000 people (of which 23% were part-time employees) inthe following categories: Hospital Operations and other 102,850 Administrative offices 2,100 Ambulatory Care 14,820 Conifer 14,860 Total 134,630 (1)Includes employees at (a) our general hospitals, specialty hospitals, critical access hospitals, long-term acute care hospital and skilled nursingfacility, (b) the ambulatory surgery centers, imaging centers, urgent care centers and satellite emergency departments in ourHospital Operations and other segment, (c) our physician practices, (d) our health plans and accountable care networks, and (e) and otherrelated healthcare operations.(2)Includes employees at (a) the short-stay surgical facilities, imaging centers and urgent care centers in our Ambulatory Care segment, and(b) Aspen’s four acute care hospitals, one cancer center and four outpatient facilities, as well as corporate and administrative employeessupporting those facilities. We are subject to federal minimum wage and hour laws and various state labor laws, and maintain a number of differentemployee benefit plans. In addition to physicians, the operations of our facilities are dependent on the efforts, abilities and experience of ourfacilities management and medical support employees, including nurses, therapists, pharmacists and lab technicians. Wecompete with other healthcare providers in recruiting and retaining qualified personnel responsible for the day-to-dayoperations of our facilities. In some markets, there is a limited availability of experienced medical support personnel, whichdrives up the local wages and benefits required to recruit and retain employees. In particular, like others in the healthcareindustry, we continue to experience a shortage of critical-care nurses in certain disciplines and geographic areas. Moreover,we hire many newly licensed nurses in addition to experienced nurses, requiring us to invest in their training. Union Activity and Labor Relations—At December 31, 2015, approximately 20% of the employees in our HospitalOperations and other segment were represented by labor unions. There were no unionized employees in our Ambulatory Caresegment, and less than 1% of Conifer’s employees belong to a union. Unionized employees – primarily registered nurses andservice and maintenance workers – are located at 37 of our hospitals, the majority of which are in California, Florida andMichigan. We currently have two expired contracts and are negotiating renewals under extension agreements. We are alsonegotiating first contracts at two of our hospitals where employees selected union representation. At this time, we are unableto predict the outcome of the negotiations, but increases in salaries,12 (1)(2)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentswages and benefits could result from these agreements. Furthermore, there is a possibility that strikes could occur during thenegotiation process, which could increase our labor costs and have an adverse effect on our patient admissions and netoperating revenues. Future organizing activities by labor unions could increase our level of union representation. Mandatory Nurse-Staffing Ratios—At this time, California is the only state in which we operate that requiresminimum nurse-to-patient staffing ratios to be maintained at all times in acute care hospitals. If other states in which weoperate adopt mandatory nurse-staffing ratios or if California reduces its minimum nurse-staffing ratios already in place, itcould have a significant effect on our labor costs and have an adverse impact on our net operating revenues if we are requiredto limit patient admissions in order to meet the required ratios. COMPETITION HEALTHCARE SERVICES Our hospitals, outpatient centers and other healthcare businesses operate in competitive environments, primarily atthe local level. Generally, other hospitals and outpatient centers in the local communities we serve provide services similar tothose we offer, and, in some cases, competing facilities are more established or newer than ours. Furthermore, competingfacilities (1) may offer a broader array of services to patients and physicians than ours, (2) may have larger or morespecialized medical staffs to admit and refer patients, (3) may have a better reputation in the community, (4) may be morecentrally located with better parking or closer proximity to public transportation or (5) may be able to negotiate morefavorable reimbursement rates that they may use to strengthen their competitive position. In the future, we expect toencounter increased competition from system-affiliated hospitals and healthcare companies in specific geographic markets. We also face competition from specialty hospitals (some of which are physician-owned) and unaffiliatedfreestanding outpatient centers for market share in high-margin services and for quality physicians and personnel.Furthermore, some of the hospitals that compete with our hospitals are owned by government agencies or not-for-profitorganizations. These tax-exempt competitors may have certain financial advantages not available to our facilities, such asendowments, charitable contributions, tax-exempt financing, and exemptions from sales, property and income taxes. Inaddition, in certain markets in which we operate, large teaching hospitals provide highly specialized facilities, equipmentand services that may not be available at our hospitals. Another major factor in the competitive position of a hospital or outpatient facility is the ability to negotiatecontracts with managed care plans. HMOs, PPOs, third-party administrators, and other third-party payers use managed carecontracts to encourage patients to use certain hospitals in exchange for discounts from the hospitals’ established charges. Ourfuture success depends, in part, on our ability to retain and renew our managed care contracts and enter into new managedcare contracts on competitive terms. Other healthcare providers may affect our ability to enter into acceptable managed carecontractual arrangements or negotiate increases in our reimbursement. For example, some of our competitors may negotiateexclusivity provisions with managed care plans or otherwise restrict the ability of managed care companies to contract withus. Furthermore, the trend toward consolidation among non-government payers tends to increase their bargaining power overfee structures. State laws that require findings of need for construction and expansion of healthcare facilities or services (asdescribed in “Healthcare Regulation and Licensing — Certificate of Need Requirements” below) may also have the effect ofrestricting competition. In addition, in those states that do not have certificate of need requirements or that do not requirereview of healthcare capital expenditure amounts below a relatively high threshold, competition in the form of new services,facilities and capital spending is more prevalent. Our strategies are designed to help our hospitals and outpatient facilities remain competitive. We believe targetedcapital spending on critical growth opportunities, emphasis on higher-demand clinical service lines (including outpatientlines), implementation of new payer contracting strategies, and improved quality metrics at our hospitals will improve ourpatient volumes. Furthermore, we have significantly expanded our outpatient business, and we have increased our focus onoperating our outpatient centers with improved accessibility and more convenient service for patients, increasedpredictability and efficiency for physicians, and lower costs for payers. We have also sought to include all of our hospitalsand other healthcare businesses in the related geographic area or nationally when negotiating13 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsnew managed care contracts, which may result in additional volumes at facilities that were not previously a part of suchmanaged care networks. We are continuing to make significant investments in equipment, technology, education and operational strategiesdesigned to improve clinical quality at all of our facilities. In addition, we continually collaborate with physicians toimplement the most current evidence-based medicine techniques to improve the way we provide care, while using labormanagement tools and supply chain initiatives to reduce variable costs. We believe the use of these practices will promotethe most effective and efficient utilization of resources and result in shorter lengths of stay, as well as reductions inreadmissions for hospitalized patients. In general, we believe that quality of care improvements may have the effects of: (1)reducing costs; (2) increasing payments from Medicare and certain managed care payers for our services as governmental andprivate payers move to pay-for-performance models, and the commercial market moves to more narrow networks and othermethods designed to encourage covered individuals to use certain facilities over others; and (3) increasing physician andpatient satisfaction, which may improve our volumes. In addition, in several markets, we have formed clinically integrated organizations, which are collaborations withindependent physicians and hospitals to develop ongoing clinical initiatives designed to control costs and improve thequality of care delivered to patients. Arrangements like these provide a foundation for negotiating with plans under an ACOstructure or other risk-sharing model. Further, each hospital has a local governing board, consisting primarily of community members and physicians, thatdevelops short-term and long-term plans for the hospital to foster a desirable medical environment. Each local governingboard also reviews and approves, as appropriate, actions of the medical staff, including staff appointments, credentialing,peer review and quality assurance. While physicians may terminate their association with our facilities at any time, webelieve that by striving to maintain and improve quality of care and by maintaining ethical and professional standards, wewill attract and retain qualified physicians with a variety of specialties. REVENUE CYCLE MANAGEMENT SOLUTIONS Our Conifer subsidiary faces competition from existing participants and new entrants to the revenue cyclemanagement market. In addition, the internal revenue cycle management staff of hospitals and other healthcare providers,who have historically performed many of the functions addressed by our services, in effect compete with us. Moreover,providers who have previously made investments in internally developed solutions sometimes choose to continue to rely ontheir own resources. We also currently compete with several categories of external participants in the revenue cycle market,most of which focus on small components of the hospital revenue cycle, including: ·software vendors and other technology-supported revenue cycle management business process outsourcingcompanies; ·traditional consultants, either specialized healthcare consulting firms or healthcare divisions of largeaccounting firms; and ·large, non-healthcare focused business process and information technology outsourcing firms. We believe that competition for the revenue cycle management and other services Conifer provides is basedprimarily on: (1) knowledge and understanding of the complex public and private healthcare payment and reimbursementsystems; (2) a track record of delivering revenue improvements and efficiency gains for hospitals and other healthcareproviders; (3) the ability to deliver solutions that are fully integrated along each step of the revenue cycle; (4) cost-effectiveness, including the breakdown between up-front costs and pay-for-performance incentive compensation;(5) reliability, simplicity and flexibility of the technology platform; (6) understanding of the healthcare industry’s regulatoryenvironment; (7) sufficient infrastructure; and (8) financial stability. To be successful, Conifer must respond more quickly and effectively than its competitors to new or changingopportunities, technologies, standards, regulations and customer requirements. Existing or new competitors may introducetechnologies or services that render Conifer’s technologies or services obsolete or less marketable. Even if Conifer’stechnologies and services are more effective than the offerings of its competitors, current or potential14 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentscustomers might prefer competitive technologies or services to Conifer’s technologies and services. Furthermore, increasedcompetition may result in pricing pressures, which could negatively impact Conifer’s margins, growth rate or market share. HEALTHCARE REGULATION AND LICENSING AFFORDABLE CARE ACT The Affordable Care Act has changed how healthcare services in the United States are covered, delivered andfinanced. The primary goal of this comprehensive legislation is to extend health coverage to millions of uninsured legalU.S. residents through a combination of private sector health insurance reforms and public program expansion. To fund theexpansion of insurance coverage, the legislation contains measures designed to promote quality and cost efficiency inhealthcare delivery and to generate budgetary savings in the Medicare and Medicaid programs. In addition, the ACAcontains provisions intended to strengthen fraud and abuse enforcement. Health Insurance Market Reforms—One key provision of the ACA is the “individual mandate,” which requires mostAmericans to maintain “minimum essential” health insurance coverage. Those who do not comply with the individualmandate must make a “shared responsibility payment” to the federal government in the form of a tax penalty. The penaltypercentage increases through 2016 and is adjusted for inflation beginning in 2017. For individuals who are not exempt fromthe individual mandate, and who do not receive health insurance through an employer or government program, the means ofsatisfying the requirement is to purchase insurance from a private company or a health insurance exchange. Health insuranceexchanges are government-regulated organizations that provide competitive markets for buying health insurance by offeringindividuals and small employers a choice of different health plans, certifying plans that participate, and providinginformation to help consumers better understand their options. Some states have elected to operate their own exchanges; inmost states, however, individuals must utilize the federal government’s health insurance exchange found online atHealthCare.gov. Beginning in 2014, individuals who are enrolled in a health benefits plan purchased through an exchangemay be eligible for a premium credit or cost-sharing subsidy. Following legal challenges seeking to limit the availability ofpremium credits and subsidies only to individuals enrolled in coverage through a state-based exchange, the U.S. SupremeCourt in June 2015 upheld U.S. Internal Revenue Service (“IRS”) regulations extending such subsidies to individuals whopurchase coverage through the federal government’s health insurance exchange. The “employer mandate” provision of the ACA requires the imposition of penalties on employers having 50 or moreemployees who do not offer affordable health insurance coverage to those working 30 or more hours per week. In February2014, the requirements of the employer mandate were partially delayed. Employers with 100 or more full time equivalentemployees were required to insure at least 70% of their employees beginning in 2015 and 95% of their employees by 2016;employers with 50-99 full time equivalent employees are required to start insuring their employees in 2016. We cannotpredict what action the federal government might take to lift or extend the delay or the impact of any such action oninsurance coverage. The Affordable Care Act also established a number of health insurance market reforms, including bans on lifetimelimits and pre-existing condition exclusions, new benefit mandates, and increased dependent coverage. Specifically, grouphealth plans and health insurance issuers offering group or individual coverage: ·may not establish lifetime or annual limits on the dollar value of benefits; ·may not rescind coverage of an enrollee, except in instances where the individual has performed an act orpractice that constitutes fraud or makes an intentional misrepresentation of material fact; ·must reimburse hospitals for emergency services provided to enrollees without prior authorization and withoutregard to whether a participating provider contract is in place; and ·must continue to make dependent coverage available to unmarried dependents until age 26 (coverage for thedependents of unmarried adult children is not required) effective for health plan policy years beginning on orafter September 23, 2010 (for plans that offer dependent coverage).15 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Public Program Reforms—Another key provision of the Affordable Care Act is the expansion of Medicaidcoverage. Prior to the passage of the ACA, the Medicaid program offered federal funding to states to assist only limitedcategories of low-income individuals (including children, pregnant women, the blind and the disabled) in obtaining medicalcare. The ACA expanded eligibility under existing Medicaid programs to virtually all individuals under 65 years old withincomes up to 138% of the federal poverty level beginning in 2014. Under the ACA, the federal government will pay 100%of the costs of Medicaid expansion in 2015 and 2016; federal funding will be reduced to 90% over the course of the four-year period from 2017 through 2020, and it will remain at 90% for 2021 and beyond. The expansion of the Medicaidprogram in each state is not mandatory — it requires state legislative or regulatory action and the approval by CMS of a stateMedicaid plan amendment. There is no deadline for a state to undertake expansion and qualify for the enhanced federalfunding available under the Affordable Care Act. At December 31, 2015, 31 states and the District of Columbia had takenaction to expand Medicaid, and one other was considering action to expand in the near future. We currently operate hospitalsin six of the states (Arizona, California, Illinois, Massachusetts, Michigan and Pennsylvania) that have expanded theirMedicaid programs. We cannot provide any assurances as to whether or when the other states in which we operate mightchoose to expand their Medicaid programs or whether those states that do expand their Medicaid programs will continue tooffer expanded eligibility in the future. Even though the ACA expanded Medicaid eligibility, the law also contains a number of provisions designed tosignificantly reduce Medicare and Medicaid program spending, including: ·negative adjustments to the annual input price index, or “market basket,” updates for Medicare’s inpatient,outpatient, long-term acute and inpatient rehabilitation prospective payment systems, which began in 2010, aswell as additional “productivity adjustments” that began in 2011; and ·reductions to Medicare and Medicaid disproportionate share hospital (“DSH”) payments, which began forMedicare payments in federal fiscal year (“FFY”) 2014 and will begin for Medicaid payments in FFY 2018, asthe number of uninsured individuals declines. The Affordable Care Act also contains a number of provisions intended to improve the quality and efficiency ofmedical care provided to Medicare and Medicaid beneficiaries. For example, the legislation expands payment penaltiesbased on a hospital’s rates of certain Medicare-designated hospital-acquired conditions (“HACs”). These HACs, which wouldnormally result in a higher payment for an inpatient hospital discharge, will instead be paid as though the HAC is notpresent. The ACA likewise prohibits the use of federal funds under the Medicaid program to reimburse providers for medicalassistance provided to treat HACs. Currently, hospitals with excessive readmissions for certain conditions receive reducedMedicare payments for all inpatient admissions. Beginning in FFY 2015, hospitals that fall into the top 25% of national risk-adjusted HAC rates for all hospitals in the previous year also receive a 1% reduction in Medicare payment rates. Separately,under a Medicare value-based purchasing program that was launched in FFY 2013, hospitals that satisfy certain performancestandards receive increased payments for discharges during the following fiscal year. These payments are funded bydecreases in payments to all hospitals for inpatient services. For discharges occurring during FFY 2014 and after, theperformance standards must assess hospital efficiency, including Medicare spending per beneficiary. In addition, theAffordable Care Act directed CMS to launch a national pilot program to study the use of bundled payments to hospitals,physicians and post-acute care providers relating to a single admission to promote collaboration and alignment on qualityand efficiency improvement; the pilot program is currently ongoing through the Center for Medicare and MedicaidInnovation within CMS, which has the authority to develop and test new payment methodologies designed to improvequality of care and lower costs. Furthermore, the Affordable Care Act contains provisions relating to recovery audit contractors (“RACs”), which arethird-party organizations under contract with CMS that identify underpayments and overpayments under the Medicareprogram and recoup any overpayments on behalf of the government. The ACA expanded the RAC program’s scope toinclude Medicaid claims and required all states to enter into contracts with RACs. Program Integrity and Fraud and Abuse—The Affordable Care Act also contains a number of provisions relating tothe Medicare and Medicaid anti-kickback and anti-fraud and abuse amendments, Section 1877 of the Social Security Act(commonly referred to as the “Stark” law), and qui tam or “whistleblower” actions, some of which are described in detailbelow. The ACA provides additional enforcement tools to the government, facilitates cooperation16 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsbetween agencies by establishing mechanisms for the sharing of information, and enhances criminal and administrativepenalties for non-compliance. For example, the ACA: (1) provides $350 million in increased federal funding over 10 years tofight healthcare fraud, waste and abuse; (2) authorizes the U.S. Department of Health and Human Services (“HHS”), inconsultation with the Office of Inspector General (“OIG”), to suspend Medicare and Medicaid payments to a provider ofservices or a supplier “pending an investigation of a credible allegation of fraud;” (3) provides Medicare contractors withadditional flexibility to conduct random prepayment reviews; and (4) strengthens the rules for returning overpayments madeby governmental health programs and expands liability under the federal False Claims Act (“FCA”) to include failure totimely repay identified overpayments. The Impact of Health Reform on Us—As further discussed in Item 7, Management’s Discussion and Analysis ofFinancial Condition and Results of Operations, of Part II of this report, the expansion of health insurance coverage under theACA has resulted in a material increase in the number of patients using our facilities who have either private or publicprogram coverage and a material decrease in uninsured and charity care admissions. Further, the ACA provides for a value-based purchasing program, the establishment of ACOs and bundled payment pilot programs, which created possibleadditional sources of revenue for our company. However, it remains difficult to predict the full impact of the Affordable CareAct on our future revenues and operations at this time due to uncertainty regarding a number of material factors, including: ·how many states will ultimately implement the Medicaid expansion provisions and under what terms (a numberof states in which we operate, including Florida and Texas, have chosen not to expand their Medicaid programsat this time); ·how many currently uninsured individuals will ultimately obtain and retain insurance coverage (either privatehealth insurance or Medicaid) as a result of the ACA; ·what percentage of our newly insured patients will be covered under the Medicaid program and what percentagewill be covered by private health insurers; ·the extent to which states will enroll new Medicaid participants in managed care programs; ·the pace at which insurance coverage expands, including the pace of different types of coverage expansion; ·future changes in the rates paid to hospitals by private payers for newly covered individuals, including thosecovered through health insurance exchanges and those who might be covered under the Medicaid programunder contracts with a state; ·future changes in the rates paid by state governments under the Medicaid program for newly coveredindividuals; ·the percentage of individuals in the exchanges who select the high-deductible plans, considering that healthinsurers offering those kinds of products have traditionally sought to pay lower rates to hospitals; ·the extent to which the enhanced program integrity and fraud and abuse provisions lead to a greater number ofcivil or criminal actions or impact Medicare and Medicaid payments to us; and ·the extent to which the provisions of the Affordable Care Act will put pressure on the profitability of healthinsurers, which in turn might cause them to seek to reduce payments to hospitals with respect to both newlyinsured individuals and their existing business. We also cannot predict the outcome of continuing legal challenges to certain provisions of the ACA or what action, if any,Congress might take with respect to the ACA. Any action that negatively impacts the number of individuals who have healthinsurance coverage could have a material adverse effect on our results of operations and cash flows. 17 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsFurthermore, the Affordable Care Act provides for significant reductions in the growth of Medicare spending,reductions in Medicare and Medicaid DSH payments, and the establishment of programs where reimbursement is tied toquality and clinical integration. Any reductions to our reimbursement under the Medicare and Medicaid programs couldadversely affect our business and results of operations to the extent such reductions are not offset by increased revenues fromproviding care to previously uninsured individuals. It is difficult to predict the future effect on our revenues resulting fromreductions to Medicare and Medicaid spending because of uncertainty regarding a number of material factors, including thefollowing: ·the amount of overall revenues we will generate from the Medicare and Medicaid programs when the reductionsare fully implemented; ·whether future reductions required by the ACA will be changed by statute prior to becoming effective; ·the size of the annual productivity adjustment to the market basket; ·the reductions to Medicaid DSH payments commencing in FFY 2018; ·what the losses in revenues, if any, will be from the ACA’s quality initiatives; ·how successful accountable care networks and other pilot programs in which we participate will be atcoordinating care and reducing costs or whether they will decrease reimbursement; and ·the scope and nature of potential changes to Medicare reimbursement methods, such as an emphasis onbundling payments or coordination of care programs. In addition, we may continue to experience a high level of bad debt expense and have to provide uninsured discounts andcharity care for undocumented immigrants who are not permitted to enroll in a health insurance exchange or governmenthealthcare insurance program. ANTI-KICKBACK AND SELF-REFERRAL REGULATIONS Anti-Kickback Statute—Medicare and Medicaid anti-kickback and anti-fraud and abuse amendments codifiedunder Section 1128B(b) of the Social Security Act (the “Anti-kickback Statute”) prohibit certain business practices andrelationships that might affect the provision and cost of healthcare services payable under the Medicare and Medicaidprograms and other government programs, including the payment or receipt of remuneration for the referral of patients whosecare will be paid for by such programs. Specifically, the law prohibits any person or entity from offering, paying, soliciting orreceiving anything of value, directly or indirectly, for the referral of patients covered by Medicare, Medicaid and otherfederal healthcare programs or the leasing, purchasing, ordering or arranging for or recommending the lease, purchase ororder of any item, good, facility or service covered by these programs. In addition to addressing other matters, as discussedbelow, the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) also amended Title XI (42 U.S.C. Section1301 et seq.) to broaden the scope of fraud and abuse laws to include all health plans, whether or not payments under suchhealth plans are made pursuant to a federal program. Moreover, the Affordable Care Act amended the Anti-kickback Statuteto provide that intent to violate the Anti-kickback Statute is not required; rather, intent to violate the law generally is all thatis required. Sanctions for violating the Anti-kickback Statute include criminal and civil penalties, as well as fines andmandatory exclusion from government programs, such as Medicare and Medicaid. In addition, under the Affordable CareAct, submission of a claim for services or items generated in violation of the Anti-kickback Statute constitutes a false orfraudulent claim and may be subject to additional penalties under the federal False Claims Act. Furthermore, it is a violationof the federal Civil Monetary Penalties Law to offer or transfer anything of value to Medicare or Medicaid beneficiaries thatis likely to influence their decision to obtain covered goods or services from one provider or service over another. Manystates have statutes similar to the federal Anti-kickback Statute, except that the state statutes usually apply to referrals forservices reimbursed by all third-party payers, not just federal programs. 18 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsThe federal government has also issued regulations that describe some of the conduct and business relationshipsthat are permissible under the Anti-kickback Statute. These regulations are often referred to as the “Safe Harbor” regulations.Currently, there are safe harbors for various activities, including the following: investment interests; space rental; equipmentrental; practitioner recruitment; personal services and management contracts; sales of practices; referral services; warranties;discounts; employees; group purchasing organizations; waivers of beneficiary coinsurance and deductible amounts;managed care arrangements; obstetrical malpractice insurance subsidies; investments in group practices; ambulatory surgerycenters; and referral agreements for specialty services. The fact that certain conduct or a given business arrangement does notmeet a Safe Harbor does not necessarily render the conduct or business arrangement illegal under the Anti-kickback Statute.Rather, such conduct and business arrangements may be subject to increased scrutiny by government enforcement authoritiesand should be reviewed on a case-by-case basis. Stark Law—The Stark law generally restricts referrals by physicians of Medicare or Medicaid patients to entitieswith which the physician or an immediate family member has a financial relationship, unless one of several exceptionsapplies. The referral prohibition applies to a number of statutorily defined “designated health services,” such as clinicallaboratory, physical therapy, radiology, and inpatient and outpatient hospital services; the prohibition does not apply tohealth services provided by an ambulatory surgery center if those services are included in the surgery center’s compositeMedicare payment rate. However, if the ambulatory surgery center is separately billing Medicare for designated healthservices that are not covered under the ambulatory surgery center’s composite Medicare payment rate, or if either theambulatory surgery center or an affiliated physician is performing (and billing Medicare) for procedures that involvedesignated health services that Medicare has not designated as an ambulatory surgery center service, the Stark law’s self-referral prohibition would apply and such services could implicate the Stark Law. Exceptions to the Stark law’s referralprohibition cover a broad range of common financial relationships. These statutory and the subsequent regulatory exceptionsare available to protect certain permitted employment relationships, relocation arrangements, leases, group practicearrangements, medical directorships, and other common relationships between physicians and providers of designated healthservices, such as hospitals. A violation of the Stark law may result in a denial of payment, required refunds to patients and theMedicare program, civil monetary penalties of up to $15,000 for each violation, civil monetary penalties of up to $100,000for “sham” arrangements, civil monetary penalties of up to $10,000 for each day that an entity fails to report requiredinformation, and exclusion from participation in the Medicare and Medicaid programs and other federal programs. Inaddition, the submission of a claim for services or items generated in violation of the Stark law may constitute a false orfraudulent claim, and thus be subject to additional penalties under the FCA. Many states have adopted self-referral statutessimilar to the Stark Law, some of which extend beyond the related state Medicaid program to prohibit the payment or receiptof remuneration for the referral of patients and physician self-referrals regardless of the source of the payment for the care. Ourparticipation in and development of joint ventures and other financial relationships with physicians could be adverselyaffected by the Stark law and similar state enactments. The Affordable Care Act also made changes to the “whole hospital” exception in the Stark law, effectivelypreventing new physician-owned hospitals after March 23, 2010 and limiting the capacity and amount of physicianownership in existing physician-owned hospitals. As revised, the Stark law prohibits physicians from referring Medicarepatients to a hospital in which they have an ownership or investment interest unless the hospital had physician ownershipand a Medicare provider agreement as of March 23, 2010 (or, for those hospitals under development at the time of the ACA’senactment, as of December 31, 2010). A physician-owned hospital that meets these requirements is still subject to restrictionsthat limit the hospital’s aggregate physician ownership percentage and, with certain narrow exceptions for hospitals with ahigh percentage of Medicaid patients, prohibit expansion of the number of operating rooms, procedure rooms or beds. Thelegislation also subjects a physician-owned hospital to reporting requirements and extensive disclosure requirements on thehospital’s website and in any public advertisements. Implications of Fraud and Abuse Laws—At December 31, 2015, three of our hospitals in our Hospital Operationsand other segment, and the majority of the facilities that operate as hospitals in our Ambulatory Care segment, are owned byjoint ventures that include some physician owners and are subject to the limitations and requirements in the Affordable CareAct on physician-owned hospitals. Furthermore, the majority of ambulatory surgery centers in our Ambulatory Care segment,which are owned by joint ventures that include some physician and health system partners, are subject to the Anti-kickbackStatute and, in certain circumstances, may be subject to the Stark law. In addition, we have contracts with physicians andnon-physician referral services providing for a variety of financial arrangements, including employment contracts, leases andprofessional service agreements, such as medical director19 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsagreements. We have also provided financial incentives to recruit physicians to relocate to communities served by ourhospitals, including income and collection guarantees and reimbursement of relocation costs, and will continue to providerecruitment packages in the future. Furthermore, new payment structures, such as ACOs and other arrangements involvingcombinations of hospitals, physicians and other providers who share payment savings, could potentially be seen asimplicating anti-kickback and self-referral provisions. Our operations could be adversely affected by the failure of our arrangements to comply with the Anti‑KickbackStatute, the Stark Law, billing laws and regulations, current state laws, or other legislation or regulations in these areasadopted in the future. We are unable to predict whether other legislation or regulations at the federal or state level in any ofthese areas will be adopted, what form such legislation or regulations may take or how they may impact our operations. Forexample, we cannot predict whether physicians may ultimately be restricted from holding ownership interests in hospitals orwhether the exception relating to services provided by ambulatory surgery centers could be eliminated. We are continuing toenter into new financial arrangements with physicians and other providers in a manner we believe complies in all materialrespects with applicable anti-kickback and anti-fraud and abuse laws. However, governmental officials responsible forenforcing these laws may nevertheless assert that we are in violation of these provisions. In addition, these statutes orregulations may be interpreted and enforced by the courts in a manner that is not consistent with our interpretation. In accordance with our ethics and compliance program, which is described in detail under “Compliance and Ethics”below, we have policies and procedures in place concerning compliance with the Anti-kickback Statute and the Stark law,among others. In addition, our ethics and compliance, law and audit services departments systematically review a substantialnumber of our arrangements with referral sources to determine the extent to which they comply with our policies andprocedures and with the Anti-kickback Statute, the Stark law and similar state statutes. On the one hand, we may be lesswilling than some of our competitors to take actions or enter into business arrangements that do not clearly satisfy the safeharbors and exceptions to the fraud and abuse laws described above; as a result, this unwillingness may put us at acompetitive disadvantage. On the other hand, we cannot assure you that the regulatory authorities that enforce these lawswill not determine that some of our arrangements violate the Anti-Kickback Statute, the Stark law or other applicableregulations. An adverse determination could subject us to liabilities under the Social Security Act, including criminalpenalties, civil monetary penalties and exclusion from participation in Medicare, Medicaid or other federal healthcareprograms, any of which could have a material adverse effect on our business, financial condition or results of operations. Inaddition, any determination by a federal or state agency or court that our USPI joint venture or its subsidiaries has violatedany of these laws could give certain of our health system partners a right to terminate their relationships with us; and anysimilar determination with respect to Conifer or any of its subsidiaries could give Conifer’s customers the right to terminatetheir services agreements with us. Moreover, any violations by and resulting penalties or exclusions imposed upon USPI’shealth system partners or Conifer’s customers could adversely affect their financial condition and, in turn, have a materialadverse effect on our business and results of operations. HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT Title II, Subtitle F of the Health Insurance Portability and Accountability Act mandates the adoption of specificstandards for electronic transactions and code sets that are used to transmit certain types of health information. HIPAA’sobjective is to encourage efficiency and reduce the cost of operations within the healthcare industry. To protect theinformation transmitted using the mandated standards and the patient information used in the daily operations of a coveredentity, HIPAA also sets forth federal rules protecting the privacy and security of protected health information (“PHI”). Theprivacy and security regulations address the use and disclosure of individually identifiable health information and the rightsof patients to understand and control how their information is used and disclosed. The law provides both criminal and civilfines and penalties for covered entities that fail to comply with HIPAA. To receive reimbursement from CMS for electronic claims, healthcare providers and health plans must use HIPAA’selectronic data transmission (transaction and code set) standards when transmitting certain healthcare informationelectronically. Effective October 1, 2015, CMS changed the formats used for certain electronic transactions and beganrequiring the use of updated standard code sets for certain diagnoses and procedures known as ICD-10 code sets. Althoughuse of the ICD-10 code sets required significant modifications to our payment systems and processes, we believe that the costof compliance with these regulations has not had and is not expected to have a material adverse20 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentseffect on our business, financial condition, results of operations or revenues. Furthermore, the Affordable Care Act requiredHHS to adopt standards for additional electronic transactions and to establish operating rules to promote uniformity in theimplementation of each standardized electronic transaction. Our electronic data transmissions are compliant with currentstandards. Under HIPAA, covered entities must establish administrative, physical and technical safeguards to protect theconfidentiality, integrity and availability of electronic PHI maintained or transmitted by them or by others on their behalf.The covered entities we operate are in material compliance with the privacy, security and National Provider Identifierrequirements of HIPAA. In addition, most of Conifer’s customers are covered entities, and Conifer is a business associate tomany of those customers under HIPAA as a result of its contractual obligations to perform certain functions on behalf of andprovide certain services to those customers. As a business associate, Conifer’s use and disclosure of PHI is restricted byHIPAA and the business associate agreements Conifer is required to enter into with its covered entity customers. In 2009, HIPAA was amended by the Health Information Technology for Economic and Clinical Health (“HITECH”)Act to impose certain of the HIPAA privacy and security requirements directly upon business associates of covered entitiesand significantly increase the monetary penalties for violations of HIPAA. Regulations that took effect in late 2009 alsorequire business associates such as Conifer to notify covered entities, who in turn must notify affected individuals andgovernment authorities, of data security breaches involving unsecured PHI. Since the passage of the HITECH Act,enforcement of HIPAA violations has increased. A knowing breach of the HIPAA privacy and security requirements madeapplicable to business associates by the HITECH Act could expose Conifer to criminal liability, and a breach of safeguardsand processes that is not due to reasonable cause or involves willful neglect could expose Conifer to significant civilpenalties and the possibility of civil litigation under HIPAA and applicable state law. In May 2011, the Office for Civil Rights of HHS proposed new regulations to implement changes to the HIPAArequirements set forth in the HITECH Act that state that covered entities and business associates must account for disclosuresof PHI to carry out treatment, payment and healthcare operations if such disclosures are through an electronic health record.The proposed regulations seek to expand the scope of the requirements under the HITECH Act and create a new patient rightto an “access report,” which would be required to list every person who has accessed, for any reason, PHI about the individualcontained in any electronic designated record set. Because our facilities currently utilize multiple, independent modules thatmay meet the definition of “electronic designated record set,” our ability to produce an access report that satisfies theproposed regulatory requirements would likely require new technology solutions to map across those multiple record sets. Itis our understanding that many providers have expressed significant concerns to CMS regarding the access reportrequirement created by the proposed rule. In January 2013, HHS issued final regulations modifying the requirements set forthin the HITECH Act. While we were in material compliance with the new regulations as of the compliance date ofSeptember 23, 2013, the new regulations did not address the proposed “access report” requirement. Because we cannotpredict the requirements of any future final rule regarding access reports, we are unable to estimate the costs of compliance, ifany, at this time. We have developed a comprehensive set of policies and procedures in our efforts to comply with HIPAA, and similarstate privacy laws, under the guidance of our ethics and compliance department. Our compliance officers and informationsecurity officers are responsible for implementing and monitoring compliance with our HIPAA privacy and security policiesand procedures throughout our company. We have also created an internal web-based HIPAA training program, which ismandatory for all U.S.-based employees. Based on existing regulations and our experience with HIPAA to this point, wecontinue to believe that the ongoing costs of complying with HIPAA will not have a material adverse effect on our business,financial condition, results of operations or cash flows. HEALTH PLAN REGULATORY MATTERS Our health plans are subject to numerous federal and state laws and regulations related to their business operations,including, but not limited to: the form and content of member contracts, including certain mandated benefits; premium ratesand medical loss ratios; the content of agreements with participating providers; claims processing and appeals; underwritingpractices; reinsurance arrangements; protecting the privacy and confidentiality of the information received from members;risk-sharing arrangements with providers; the quality of care provided to beneficiaries; reimbursement or payment levels forMedicare services; the provision of products or services to employer-sponsored21 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentshealth benefit plans; the expansion into new service areas; participation on the health insurance exchanges; the award,administration and performance of federal contracts; the administration of strategic alliances with competitors, includinginformation sharing; and advertising, marketing and sales activities. Each of our health plans must also be licensed by one or more agencies in the states in which they conduct businessand must submit periodic filings to and respond to inquiries from such agencies. State insurance regulators may requireexpanded governance practices, periodic risk and solvency assessment reports, and the establishment of minimum capital orcash reserve requirements. Some state insurance holding company laws and regulations require prior regulatory approval ofacquisitions and material intercompany transfers of assets, as well as transactions between the regulated companies and theirparent holding companies or affiliates. Furthermore, our health plan operations, accounts, and other books and records aresubject to examination at regular intervals by regulatory agencies, including CMS and state insurance and health and welfaredepartments, to assess their compliance with applicable laws and regulations. Although we have extensive policies andprocedures in place to facilitate compliance in all material respects with the laws, rules and regulations affecting our healthplans, if a determination is made that we were in violation of such laws, rules or regulations with respect to one or more of ourhealth plans, that aspect of our business could be materially adversely affected. GOVERNMENT ENFORCEMENT EFFORTS AND QUI TAM LAWSUITS Both federal and state government agencies continue heightened and coordinated civil and criminal enforcementefforts against the healthcare industry. The operational mission of the Office of Inspector General is to protect the integrity ofthe Medicare and Medicaid programs and the well-being of program beneficiaries by: detecting and preventing waste, fraudand abuse; identifying opportunities to improve program economy, efficiency and effectiveness; and holding accountablethose who do not meet program requirements or who violate federal laws. The OIG carries out its mission by conductingaudits, evaluations and investigations and, when appropriate, imposing civil monetary penalties, assessments andadministrative sanctions. Although we have extensive policies and procedures in place to facilitate compliance in allmaterial respects with the laws, rules and regulations affecting the healthcare industry, these policies and procedures may notbe effective. If we are alleged or found to have violated such laws, rules or regulations, our business, financial condition,results of operations or cash flows could be materially adversely affected. Healthcare providers are also subject to qui tam or “whistleblower” lawsuits under the federal False Claims Act,which allows private individuals to bring actions on behalf of the government, alleging that a hospital or healthcare providerhas defrauded a government program, such as Medicare or Medicaid. If the government intervenes in the action and prevails,the defendant may be required to pay three times the actual damages sustained by the government, plus mandatory civilpenalties for each false claim submitted to the government. As part of the resolution of a qui tam case, the party filing theinitial complaint may share in a portion of any settlement or judgment. If the government does not intervene in the action,the qui tam plaintiff may continue to pursue the action independently. There are many potential bases for liability under theFCA. Liability often arises when an entity knowingly submits a false claim for reimbursement to the federal government. TheFCA defines the term “knowingly” broadly. Though simple negligence will not give rise to liability under the FCA,submitting a claim with reckless disregard to its truth or falsity constitutes a “knowing” submission under the FCA and,therefore, will qualify for liability. The Fraud Enforcement and Recovery Act of 2009 expanded the scope of the FCA by,among other things, creating liability for knowingly and improperly avoiding repayment of an overpayment received fromthe government and broadening protections for whistleblowers. Under the Affordable Care Act, the knowing failure to reportand return an overpayment within 60 days of identifying the overpayment or by the date a corresponding cost report is due,whichever is later, constitutes a violation of the FCA. Further, the Affordable Care Act expands the scope of the FCA to coverpayments in connection with health insurance exchanges if those payments include any federal funds. Qui tam actions canalso be filed under certain state false claims laws if the fraud involves Medicaid funds or funding from state and localagencies. Like other companies in the healthcare industry, we are subject to qui tam actions from time to time. We are unableto predict the future impact of such actions on our business, financial condition, results of operations or cash flows. Forinformation regarding material pending legal proceedings in which we are involved, including qui tam actions, see Note 15to our Consolidated Financial Statements. 22 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsHEALTHCARE FACILITY LICENSING REQUIREMENTS The operation of healthcare facilities is subject to federal, state and local regulations relating to personnel, operatingpolicies and procedures, fire prevention, rate-setting, the adequacy of medical care, and compliance with building codes andenvironmental protection laws. Various licenses and permits also are required in order to dispense narcotics, operatepharmacies, handle radioactive materials and operate certain equipment. Our facilities are subject to periodic inspection bygovernmental and other authorities to assure continued compliance with the various standards necessary for licensing andaccreditation. We believe that all of our healthcare facilities hold all required governmental approvals, licenses and permitsmaterial to the operation of their business. UTILIZATION REVIEW COMPLIANCE AND HOSPITAL GOVERNANCE In addition to certain statutory coverage limits and exclusions, federal laws and regulations, specifically theMedicare Conditions of Participation, generally require healthcare providers, including hospitals that furnish or orderhealthcare services that may be paid for under the Medicare program or state healthcare programs, to ensure that claims forreimbursement are for services or items that are (1) provided economically and only when, and to the extent, they aremedically reasonable and necessary, (2) of a quality that meets professionally recognized standards of healthcare, and(3) supported by appropriate evidence of medical necessity and quality. The Social Security Act established the Utilizationand Quality Control Peer Review Organization program, now known as the Quality Improvement Organization (“QIO”)program, to promote the effectiveness, efficiency, economy and quality of services delivered to Medicare beneficiaries and toensure that those services are reasonable and necessary. CMS administers the program through a network of QIOs that workwith consumers, physicians, hospitals and other caregivers to refine care delivery systems to ensure patients receive theappropriate care at the appropriate time, particularly among underserved populations. The QIO program also safeguards theintegrity of the Medicare trust fund by reviewing Medicare patient admissions, treatments and discharges, and ensuringpayment is made only for medically necessary services, and investigates beneficiary complaints about quality of care. TheQIOs have the authority to deny payment for services provided and recommend to HHS that a provider that is in substantialnoncompliance with certain standards be excluded from participating in the Medicare program. There has been recent increased scrutiny of hospitals’ Medicare observation rates from outside auditors, governmentenforcement agencies and industry observers. The term “Medicare observation rate” is defined as total unique observationclaims divided by the sum of total unique observation claims and total inpatient short-stay acute care hospital claims. A lowrate may raise suspicions that a hospital is inappropriately admitting patients that could be cared for in an observationsetting. In our affiliated hospitals, we use the independent, evidence-based clinical criteria developed by McKessonCorporation, commonly known as InterQual Criteria, to determine whether a patient qualifies for inpatient admission. Theindustry anticipates increased scrutiny and litigation risk, including government investigations and qui tam suits, related toinpatient admission decisions and the Medicare observation rate. In addition, effective October 1, 2013, CMS established anew concept, referred to as the “two-midnight rule,” to guide practitioners admitting patients and contractors conductingpayment reviews on when it is appropriate to admit individuals as hospital inpatients. Under the two-midnight rule, CMS hasindicated that a Medicare patient should generally be admitted on an inpatient basis only when there is a reasonableexpectation that the patient’s care will cross two midnights, and, if not, then the patient generally should be treated as anoutpatient. Following a transition period, full implementation and enforcement of the two-midnight rule began on January1, 2016. We do not believe enforcement of the two-midnight rule will have a material impact on inpatient admission rates atour hospitals. Medical and surgical services and practices are extensively supervised by committees of staff doctors at each of ourhealthcare facilities, are overseen by each facility’s local governing board, the members of which primarily are communitymembers and physicians, and are reviewed by our clinical quality personnel. The local hospital governing board also helpsmaintain standards for quality care, develop short-term and long-range plans, and establish, review and enforce practices andprocedures, as well as approves the credentials, disciplining and, if necessary, the termination of privileges of medical staffmembers. 23 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCERTIFICATE OF NEED REQUIREMENTS Some states require state approval for construction, acquisition and closure of healthcare facilities, includingfindings of need for additional or expanded healthcare facilities or services. Certificates or determinations of need, which areissued by governmental agencies with jurisdiction over healthcare facilities, are at times required for capital expendituresexceeding a prescribed amount, changes in bed capacity or services, and certain other matters. Our subsidiaries operatehospitals in nine states that require a form of state approval under certificate of need programs applicable to those hospitals.The certificate of need programs in most of these states, along with several others, also apply to ambulatory surgery centers. Failure to obtain necessary state approval can result in the inability to expand facilities, add services, acquire afacility or change ownership. Further, violation of such laws may result in the imposition of civil sanctions or the revocationof a facility’s license. We are unable to predict whether we will be required or able to obtain any additional certificates ofneed in any jurisdiction where they are required, or if any jurisdiction will eliminate or alter its certificate of needrequirements in a manner that will increase competition and, thereby, affect our competitive position. In those states that donot have certificate of need requirements or that do not require review of healthcare capital expenditure amounts below arelatively high threshold, competition in the form of new services, facilities and capital spending is more prevalent. ENVIRONMENTAL MATTERS Our healthcare operations are subject to a number of federal, state and local environmental laws, rules andregulations that govern, among other things, our disposal of solid waste, as well as our use, storage, transportation anddisposal of hazardous and toxic materials (including radiological materials). Our operations also generate medical waste thatmust be disposed of in compliance with laws and regulations that vary from state to state. In addition, although we are notengaged in manufacturing or other activities that produce meaningful levels of greenhouse gas emissions, our operatingexpenses could be adversely affected if legal and regulatory developments related to climate change or other initiativesresult in increased energy or other costs. We could also be affected by climate change and other environmental issues to theextent such issues adversely affect the general economy or result in severe weather affecting the communities in which ourfacilities are located. At this time, based on current climate conditions and our assessment of existing and pendingenvironmental rules and regulations, as well as treaties and international accords relating to climate change, we do notbelieve that the costs of complying with environmental laws and regulations, including regulations relating to climatechange issues, will have a material adverse effect on our future capital expenditures, results of operations or cash flows. ANTITRUST LAWS The federal government and most states have enacted antitrust laws that prohibit specific types of anti-competitiveconduct, including price fixing, wage fixing, concerted refusals to deal, price discrimination and tying arrangements, as wellas monopolization and acquisitions of competitors that have, or may have, a substantial adverse effect on competition.Violations of federal or state antitrust laws can result in various sanctions, including criminal and civil penalties. Antitrust enforcement in the healthcare industry is currently a priority of the U.S. Federal Trade Commission(“FTC”). In recent years, the FTC has filed multiple administrative complaints challenging hospital transactions in severalstates. The FTC has focused its enforcement efforts on preventing hospital mergers that may, in the government’s view, leaveinsufficient local options for inpatient services. In addition to hospital merger enforcement, the FTC has given increasedattention to the effect of combinations involving other healthcare providers, including physician practices. The FTC has alsoentered into numerous consent decrees in the past several years settling allegations of price-fixing among providers. We believe we are in compliance with federal and state antitrust laws, but there can be no assurance that a review ofour practices by courts or regulatory authorities would not result in a determination that could adversely affect ouroperations. 24 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents REGULATIONS AFFECTING CONIFER’S OPERATIONS As described below, Conifer and certain of its subsidiaries are subject to laws, rules and regulations regarding theirconsumer finance, debt collection and credit reporting activities. DEBT COLLECTION ACTIVITIES The federal Fair Debt Collection Practices Act (“FDCPA”) regulates persons who regularly collect or attempt tocollect, directly or indirectly, consumer debts owed or asserted to be owed to another person. Certain of the accountsreceivable handled by Conifer’s debt collection agency subsidiary, Syndicated Office Systems, LLC (“SOS”), are subject tothe FDCPA, which establishes specific guidelines and procedures that debt collectors must follow in communicating withconsumer debtors, including the time, place and manner of such communications. The FDCPA also places restrictions oncommunications with individuals other than consumer debtors in connection with the collection of any consumer debt. Inaddition, the FDCPA contains various notice and disclosure requirements and imposes certain limitations on lawsuits tocollect debts against consumers. Debt collection activities are also regulated at the state level. Most states have lawsregulating debt collection activities in ways that are similar to, and in some cases more stringent than, the FDCPA. Many states also regulate the collection practices of creditors who collect their own debt. These state regulations areoften the same or similar to state regulations applicable to third-party collectors. Certain of the accounts receivable Conifermanages for its clients are subject to these state regulations. In certain situations, the activities of SOS are also subject to the Fair Credit Reporting Act (“FCRA”). The FCRAregulates the collection, dissemination and use of consumer information, including consumer credit information. State creditreporting laws, to the extent they are not preempted by the FCRA, may also apply to SOS. The federal Fair and Accurate Credit Transaction Act (“FACTA”) requires Conifer to adopt (1) written guidance andprocedures for detecting, preventing and responding appropriately to mitigate identity theft, and (2) coworker policies andprocedures (including training) that address the importance of protecting non-public personal information and aid Conifer indetecting and responding to suspicious activity, including suspicious activity that may suggest a possible identity theft redflag, as appropriate. Conifer and its subsidiaries are also subject to regulation by the Federal Trade Commission and the U.S. ConsumerFinancial Protection Bureau (“CFPB”). Both the FTC and the CFPB have the authority to investigate consumer complaintsrelating to laws such as the FDCPA, FCRA and FACTA, and to initiate enforcement actions, including actions to seekrestitution and monetary penalties from, or to require changes in business practices of, regulated entities. State officialstypically have authority to enforce corresponding state laws. In addition, affected consumers may bring suits, including classaction suits, to seek monetary remedies (including statutory damages) for violations of the federal and state provisionsdiscussed above. PAYMENT ACTIVITY RISKS Conifer accepts payments from patients of the facilities for which it provides services using a variety of methods,including credit card, debit card, direct debit from a customer’s bank account, and physical bank check. For certain paymentmethods, including credit and debit cards, Conifer pays interchange and other fees, which may increase over time, therebyraising operating costs. Conifer relies on third parties to provide payment processing services, including the processing ofcredit cards, debit cards and electronic checks, and it could disrupt Conifer’s business if these companies become unwillingor unable to provide these services. Conifer is also subject to payment card association operating rules, including datasecurity rules, certification requirements and rules governing electronic funds transfers, which could change or bereinterpreted to make it difficult or impossible for Conifer to comply. If Conifer fails to comply with these rules orrequirements, or if its data security systems are breached or compromised, Conifer may be liable for card issuing banks’ costs,be subject to fines and higher transaction fees, and lose its ability to accept credit and debit card payments from customers,process electronic funds transfers, or facilitate other types of online payments. 25 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCOMPLIANCE AND ETHICS General—Our ethics and compliance department maintains our multi-faceted, values-based ethics and complianceprogram, which is designed to (1) help staff in our corporate, USPI and Conifer offices, hospitals, outpatient centers, healthplan offices and physician practices meet or exceed applicable standards established by federal and state laws andregulations, as well as industry practice, and (2) monitor and raise awareness of ethical issues among employees and others,and stress the importance of understanding and complying with our Standards of Conduct. The ethics and compliancedepartment operates with independence — it has its own operating budget; it has the authority to hire outside counsel, accessany Tenet document and interview any of our personnel; and our chief compliance officer reports directly to the quality,compliance and ethics committee of our board of directors. Program Charter—Our Quality, Compliance and Ethics Program Charter is the governing document for our ethicsand compliance program. Our adherence to the charter is intended to: ·support and maintain our present and future responsibilities with regard to participation in federal healthcareprograms; and ·further our goals of operating an organization that (1) fosters and maintains the highest ethical standards amongall employees, officers and directors, physicians practicing at Tenet facilities and contractors that furnishhealthcare items or services, (2) values compliance with all state and federal laws and regulations as a foundationof its corporate philosophy, and (3) aligns its behaviors and decisions with Tenet’s core values of quality,integrity, service, innovation and transparency. The primary focus of our quality, compliance and ethics program is compliance with the requirements of Medicare, Medicaidand other federally funded healthcare programs. Pursuant to the terms of the charter, our ethics and compliance department isresponsible for the following activities: (1) annually assessing, critiquing and (as appropriate) drafting and distributingcompany policies and procedures; (2) developing, providing and tracking ethics training for all employees, directors and, asapplicable, contractors and agents; (3) developing, providing and tracking job-specific training to those who work in clinicalquality, coding, billing, cost reporting and referral source arrangements; (4) developing, providing and tracking annualtraining on ethics and clinical quality oversight to the members of each hospital governing board; (5) creating anddisseminating the company’s Standards of Conduct and obtaining certifications of adherence to the Standards of Conductas a condition of employment; (6) maintaining and promoting Tenet’s Ethics Action Line, which allows confidentialreporting of issues on an anonymous basis and emphasizes Tenet’s no retaliation policy; (7) responding to and resolving allcompliance-related issues that arise from the Ethics Action Line and compliance reports received from our facilities, hospitalcompliance officers or any other source; (8) ensuring that appropriate corrective and disciplinary actions are taken when non-compliant conduct or improper contractual relationships are identified; (9) monitoring and measuring adherence to allapplicable Tenet policies and legal and regulatory requirements related to federal healthcare programs; (10) directing anannual screening of individuals for exclusion from federal healthcare program participation as required by federalregulations; (11) maintaining a database of all arrangements involving the payment of anything of value between Tenet andany physician or other actual or potential source of healthcare business or referrals to or from Tenet; and (12) overseeingannual audits of clinical quality, referral source arrangements, outliers, charging, coding, billing and other compliance riskareas as may be identified from time to time. Standards of Conduct—All of our employees, including our chief executive officer, chief financial officer andprincipal accounting officer, are required to abide by our Standards of Conduct to advance our mission that our business beconducted in a legal and ethical manner. The members of our board of directors and many of our contractors are also requiredto abide by our Standards of Conduct. The standards reflect our basic values and form the foundation of a comprehensiveprocess that includes compliance with all corporate policies, procedures and practices. Our standards cover such areas asquality patient care, compliance with all applicable laws and regulations, appropriate use of our assets, protection of patientinformation and avoidance of conflicts of interest. As part of the program, we provide annual training sessions to every employee, as well as our board of directors andcertain physicians and contractors. All employees are required to report incidents that they believe in good faith may be inviolation of the Standards of Conduct, and are encouraged to contact our 24-hour toll-free Ethics Action Line when26 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsthey have questions about the standards or any ethics concerns. All reports to the Ethics Action Line are kept confidential tothe extent allowed by law, and employees have the option to remain anonymous. Incidents of alleged financial improprietiesreported to the Ethics Action Line or the ethics and compliance department are communicated to the audit committee of ourboard of directors. Reported cases that involve a possible violation of the law or regulatory policies and procedures arereferred to the ethics and compliance department for investigation. Retaliation against employees in connection withreporting ethical concerns is considered a serious violation of our Standards of Conduct, and, if it occurs, it will result indiscipline, up to and including termination of employment. Availability of Documents—The full text of our Quality, Compliance and Ethics Program Charter, our Standards ofConduct, and a number of our ethics and compliance policies and procedures are published on our website, atwww.tenethealth.com, under the “Ethics and Compliance” caption in the “About” section. A copy of our Standards ofConduct is also available upon written request to our corporate secretary. Information about how to contact our corporatesecretary is set forth under “Company Information” below. Amendments to the Standards of Conduct and any grant of awaiver from a provision of the Standards of Conduct requiring disclosure under applicable Securities and ExchangeCommission (“SEC”) rules will be disclosed at the same location as the Standards of Conduct on our website. INSURANCE Property Insurance—We have property, business interruption and related insurance coverage to mitigate thefinancial impact of catastrophic events or perils that is subject to deductible provisions based on the terms of the policies.These policies are on an occurrence basis. Professional and General Liability Insurance—As is typical in the healthcare industry, we are subject to claims andlawsuits in the ordinary course of business. The healthcare industry has seen significant increases in the cost of professionalliability insurance due to increased litigation. In response, we maintain captive insurance companies to self-insure asubstantial portion of our professional and general liability risk. We also own two captive insurance companies that writeprofessional liability insurance for a small number of physicians, including employed physicians, who are on the medicalstaffs of certain of our hospitals. Claims in excess of our self-insurance retentions are insured with commercial insurance companies. If the aggregatelimit of any of our professional and general liability policies is exhausted, in whole or in part, it could deplete or reduce thelimits available to pay any other material claims applicable to that policy period. Any losses not covered by or in excess ofthe amounts maintained under insurance policies will be funded from our working capital. In addition to the reserves recorded by our captive insurance subsidiaries, we maintain reserves, including reservesfor incurred but not reported claims, for our self-insured professional liability retentions and claims in excess of the policies’aggregate limits, based on modeled estimates of losses and related expenses. Also, we provide standby letters of credit tocertain of our insurers, which can be drawn upon under certain circumstances, to collateralize the deductible and self-insuredretentions under a selected number of our professional and general liability insurance programs. COMPANY INFORMATION Tenet Healthcare Corporation was incorporated in the State of Nevada in 1975. We file annual, quarterly and currentreports, proxy statements and other documents with the SEC under the Securities Exchange Act of 1934, as amended (the“Exchange Act”). Our reports, proxy statements and other documents filed electronically with the SEC are available at thewebsite maintained by the SEC at www.sec.gov. Our website, www.tenethealth.com, also offers, free of charge, access to our annual, quarterly and current reports (andamendments to such reports), and other filings made with, or furnished to, the SEC as soon as reasonably practicable aftersuch documents are submitted to the SEC. The information found on our website is not part of this or any other report we filewith or furnish to the SEC. Inquiries directed to our corporate secretary may be sent to Corporate Secretary, Tenet Healthcare Corporation, P.O.Box 139003, Dallas, Texas 75313-9003 or by e-mail at CorporateSecretary@tenethealth.com.27 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents EXECUTIVE OFFICERS Information about our executive officers, as of February 22, 2016, is as follows: Name Position AgeTrevor Fetter Chairman, President and Chief Executive Officer 56Daniel J. Cancelmi Chief Financial Officer 53Keith B. Pitts Vice Chairman 58Britt T. Reynolds President of Hospital Operations 50Audrey T. Andrews Senior Vice President and General Counsel 49 Mr. Fetter was named Tenet’s president in November 2002; he was appointed chief executive officer in September2003 and chairman in May 2015. From March 2000 to November 2002, Mr. Fetter was chairman and chief executive officerof Broadlane, Inc. From October 1995 to February 2000, he served in several senior management positions at Tenet,including chief financial officer. Mr. Fetter began his career with Merrill Lynch Capital Markets, where he concentrated oncorporate finance and advisory services for the entertainment and healthcare industries. In 1988, he joined Metro-Goldwyn-Mayer, Inc., where he had a broad range of corporate and operating responsibilities, rising to executive vice president andchief financial officer. Mr. Fetter holds a bachelor’s degree in economics from Stanford University and an M.B.A. fromHarvard Business School. He is a member of the board of directors of one other public company, The Hartford FinancialServices Group, Inc. Mr. Cancelmi was appointed Tenet’s chief financial officer in September 2012. He previously served as senior vicepresident from April 2009, principal accounting officer from April 2007 and controller from September 2004. Mr. Cancelmiwas a vice president and assistant controller at Tenet from September 1999 until his promotion to controller. He joined theCompany as chief financial officer of Hahnemann University Hospital. Prior to that, he held various positions atPricewaterhouseCoopers, including in the firm’s National Accounting and SEC office in New York City. Mr. Cancelmi is acertified public accountant who holds a bachelor’s degree in accounting from Duquesne University in Pittsburgh. He is also amember of the American Institute of Certified Public Accountants and the Florida and Pennsylvania Institutes of CertifiedPublic Accountants. Mr. Pitts was appointed vice chairman following Tenet’s acquisition of Vanguard Health Systems, Inc. (“Vanguard”)in October 2013. He was Vanguard’s vice chairman from May 2001 until the acquisition and an executive vice presidentfrom August 1999 until May 2001. Mr. Pitts also served as a director of Vanguard from August 1999 until September 2004.Before joining Vanguard, Mr. Pitts was the chairman and chief executive officer of Mariner Post-Acute Network and itspredecessor, Paragon Health Network, a nursing home management company, from November 1997 until June 1999. Heserved as the executive vice president and chief financial officer for OrNda HealthCorp, prior to its acquisition by Tenet, fromAugust 1992 to January 1997, and, before that, as a consultant to many healthcare organizations, including as a partner inErnst & Young’s healthcare consulting practice. Mr. Pitts is a certified public accountant who holds a bachelor’s degree inbusiness administration from the University of Florida. He is a member of the American Institute of Certified PublicAccountants and the Florida Institute of Certified Public Accountants. Mr. Pitts currently serves as chair of the Federation ofAmerican Hospitals, a position he also held from 2007 to 2008. Mr. Reynolds was appointed president of hospital operations in January 2012. From December 2008 throughDecember 2011, he served as senior vice president and division president of Health Management Associates, Inc. (HMA),overseeing HMA’s largest division, with 20 hospitals and related facilities in seven states. Prior to joining HMA, Mr.Reynolds served as a multi-facility divisional vice president of Community Health Systems, Inc. from December 2002 toDecember 2008, primarily in the northeast, midwest and southeast. Mr. Reynolds holds an M.B.A. from Baker University inBaldwin City, Kansas, and a bachelor’s degree in psychology from the University of Louisville. He is a Fellow of theAmerican College of Healthcare Executives. Ms. Andrews was appointed senior vice president and general counsel in January 2013. From July 2008 until thatappointment, she served as senior vice president and chief compliance officer and, prior to that, served as vice president andchief compliance officer from November 2006. She joined Tenet in 1998 as hospital operations counsel. Ms. Andrews holds aJ.D. and a bachelor’s degree in government, both from the University of Texas at Austin. She is a28 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsmember of the board of directors of the Federation of American Hospitals, and is also a member of the American and TexasBar Associations and the American Health Lawyers Association. FORWARD-LOOKING STATEMENTS This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933and Section 21E of the Exchange Act, each as amended. All statements, other than statements of historical or present facts,that address activities, events, outcomes, business strategies and other matters that we plan, expect, intend, assume, believe,budget, predict, forecast, project, estimate or anticipate (and other similar expressions) will, should or may occur in the futureare forward-looking statements. These forward-looking statements represent management’s current expectations, based oncurrently available information, as to the outcome and timing of future events. They involve known and unknown risks,uncertainties and other factors – many of which we are unable to predict or control – that may cause our actual results,performance or achievements, or healthcare industry results, to be materially different from those expressed or implied byforward-looking statements. Such factors include, but are not limited to, the following: ·The future impact of the Affordable Care Act on our business and the enactment of, or changes in, laws andregulations affecting the healthcare industry generally; ·The effect that adverse economic conditions have on our volumes and our ability to collect outstandingreceivables on a timely basis, among other things; ·Adverse regulatory developments, government investigations or litigation, including any significant monetaryresolution or other undesirable consequences of the Clinica de la Mama qui tam action and criminalinvestigation described in Note 15 to our Consolidated Financial Statements; ·Our ability to enter into managed care provider arrangements on acceptable terms; ·Cuts to Medicare and Medicaid payment rates or changes in reimbursement practices; ·Competition; ·Our success in implementing our business development plans and integrating newly acquired businesses,including our USPI joint venture; ·Our ability to hire and retain qualified personnel, especially healthcare professionals; ·The availability and terms of capital to fund the expansion of our business; ·Our ability to continue to expand and realize earnings contributions from Conifer’s revenue cycle management,healthcare information management, capitation management and patient communications services businesses; ·Our ability to identify and execute on measures designed to save or control costs or streamline operations; ·The impact of our significant indebtedness; ·Our success in completing recently announced corporate development transactions; ·Our success in operating our health plans and accountable care networks; and ·Other factors and risks referenced in this report and our other public filings. 29 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsAlso included among the foregoing factors are the positive and negative effects of health reform legislation onreimbursement and utilization, as well as the future design of provider networks and insurance plans, including pricing,provider participation, coverage, and co-pays and deductibles. When considering forward-looking statements, a reader should keep in mind the risk factors and other cautionarystatements in this report. Should one or more of the risks and uncertainties described in this report occur, or shouldunderlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in anyforward-looking statement. We specifically disclaim any obligation to update any information contained in a forward-looking statement or any forward-looking statement in its entirety and, therefore, disclaim any resulting liability forpotentially related damages. All forward-looking statements attributable to us are expressly qualified in their entirety by this cautionarystatement. ITEM 1A. RISK FACTORS Our business is subject to a number of risks and uncertainties – many of which are beyond our control – that maycause our actual operating results or financial performance to be materially different from our expectations. If one or more ofthe events discussed in this report were to occur, actual outcomes could differ materially from those expressed in or impliedby any forward-looking statements we make in this report or our other filings with the SEC, and our business, financialcondition, results of operations or liquidity could be materially adversely affected; furthermore, the trading price of ourcommon stock could decline and our shareholders could lose all or part of their investment. We cannot predict with certainty the ultimate net effect that the Affordable Care Act may have on our business,financial condition, results of operations or cash flows. The Affordable Care Act has changed how healthcare services in the United States are covered, delivered andfinanced. The expansion of health insurance coverage under the law has resulted in a material increase in the number ofpatients using our facilities who have either private or public program coverage and a material decrease in uninsured andcharity care admissions. However, it remains difficult to predict the full impact of the ACA on our future revenues andoperations at this time due to uncertainty regarding a number of material factors, including: ·how many states will ultimately implement the Medicaid expansion provisions and under what terms (a numberof states in which we operate, including Florida and Texas, have chosen not to expand their Medicaid programsat this time); ·how many currently uninsured individuals will ultimately obtain and retain insurance coverage (either privatehealth insurance or Medicaid) as a result of the ACA; ·what percentage of our newly insured patients will be covered under the Medicaid program and what percentagewill be covered by private health insurers; ·the extent to which states will enroll new Medicaid participants in managed care programs; ·the pace at which insurance coverage expands, including the pace of different types of coverage expansion; ·future changes in the rates paid to hospitals by private payers for newly covered individuals, including thosecovered through health insurance exchanges and those who might be covered under the Medicaid programunder contracts with a state; ·future changes in the rates paid by state governments under the Medicaid program for newly coveredindividuals; 30 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents·the percentage of individuals in the exchanges who select the high-deductible plans, considering that healthinsurers offering those kinds of products have traditionally sought to pay lower rates to hospitals; ·the extent to which the enhanced program integrity and fraud and abuse provisions lead to a greater number ofcivil or criminal actions or impact Medicare and Medicaid payments to us; and ·the extent to which the provisions of the Affordable Care Act will put pressure on the profitability of healthinsurers, which in turn might cause them to seek to reduce payments to hospitals with respect to both newlyinsured individuals and their existing business. Furthermore, the Affordable Care Act provides for significant reductions in the growth of Medicare spending,reductions in Medicare and Medicaid DSH payments, and the establishment of programs where reimbursement is tied toquality and clinical integration. A substantial portion of both our patient volumes and, as result, our revenues is derived fromgovernment healthcare programs, principally Medicare and Medicaid. Any reductions to our reimbursement under theMedicare and Medicaid programs could adversely affect our business and results of operations to the extent such reductionsare not offset by increased revenues from providing care to previously uninsured individuals. It is difficult to predict thefuture effect on our revenues resulting from reductions to Medicare and Medicaid spending because of uncertainty regardinga number of material factors, including the following: ·the amount of overall revenues we will generate from the Medicare and Medicaid programs when the reductionsare fully implemented; ·whether future reductions required by the ACA will be changed by statute prior to becoming effective; ·the size of the annual productivity adjustment to the market basket; ·the reductions to Medicaid DSH payments commencing in FFY 2018; ·what the losses in revenues, if any, will be from the ACA’s quality initiatives; ·how successful accountable care networks and other pilot programs in which we participate will be atcoordinating care and reducing costs or whether they will decrease reimbursement; and ·the scope and nature of potential changes to Medicare reimbursement methods, such as an emphasis onbundling payments or coordination of care programs. In addition, we may continue to experience a high level of bad debt expense and have to provide uninsured discounts andcharity care for undocumented immigrants who are not permitted to enroll in a health insurance exchange or governmenthealthcare insurance program. In general, there is still uncertainty with respect to the positive and negative effects the Affordable Care Act mayhave on reimbursement, utilization and the future design of provider networks and insurance plans (including pricing,provider participation, coverage, co-pays and deductibles), and the multiple models that attempt to forecast those effects maydiffer materially from our expectations. We are unable to predict the net effect of the ACA on our future revenues andoperations at this time due to uncertainty regarding the ultimate number of uninsured individuals who will obtain and retaininsurance coverage, uncertainty regarding future negotiations with payers, uncertainty regarding Medicaid expansion, andgradual and, in some cases, delayed implementation of certain provisions of the law. We also cannot predict the outcome ofcontinuing legal challenges to certain provisions of the ACA or what action, if any, Congress might take with respect to theACA. Any action that negatively impacts the number of individuals who have health insurance coverage could have amaterial adverse effect on our results of operations and cash flows. 31 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIf we are unable to enter into and maintain managed care contractual arrangements on acceptable terms, if weexperience material reductions in the contracted rates we receive from managed care payers or if we have difficultycollecting from managed care payers, our results of operations could be adversely affected. We currently have thousands of managed care contracts with various HMOs and PPOs. The amount of our managedcare net patient revenues during the year ended December 31, 2015 was $10.6 billion, which represented approximately 60%of our total net patient revenues before provision for doubtful accounts. Approximately 62% of our managed care net patientrevenues for the year ended December 31, 2015 was derived from our top ten managed care payers. In the year endedDecember 31, 2015, our commercial managed care net inpatient revenue per admission from our acute care hospitals wasapproximately 76% higher than our aggregate yield on a per admission basis from government payers, including managedMedicare and Medicaid insurance plans. In addition, at December 31, 2015, approximately 59% of our net accountsreceivable related to continuing operations were due from managed care payers. Our ability to negotiate favorable contracts with HMOs, insurers offering preferred provider arrangements and othermanaged care plans significantly affects the revenues and operating results of our hospitals. In addition, private payers areincreasingly attempting to control healthcare costs through direct contracting with hospitals to provide services on adiscounted basis, increased utilization reviews and greater enrollment in managed care programs, such as HMOs and PPOs.The trend toward consolidation among private managed care payers tends to increase their bargaining power over prices andfee structures. Our future success will depend, in part, on our ability to renew existing managed care contracts and enter intonew managed care contracts on competitive terms. Other healthcare companies, including some with greater financialresources, greater geographic coverage or a wider range of services, may compete with us for these opportunities. Forexample, some of our competitors may negotiate exclusivity provisions with managed care plans or otherwise restrict theability of managed care companies to contract with us. Any material reductions in the contracted rates we receive for ourservices or any significant difficulties in collecting receivables from managed care payers could have a material adverseeffect on our financial condition, results of operations or cash flows. Any material adverse effects resulting from futurereductions in payments from private payers could be exacerbated if we are not able to manage our operating costs effectively. Further changes in the Medicare and Medicaid programs or other government healthcare programs could havean adverse effect on our business. For the year ended December 31, 2015, approximately 20.4% of our net patient revenues before provision fordoubtful accounts for our Hospital Operations and other segment were related to the Medicare program, and approximately8.7% of our net patient revenues before provision for doubtful accounts for our Hospital Operations and other segment wererelated to various state Medicaid programs, in each case excluding Medicare and Medicaid managed care programs. Inaddition to the changes affected by the Affordable Care Act, the Medicare and Medicaid programs are subject to: otherstatutory and regulatory changes, administrative rulings, interpretations and determinations concerning patient eligibilityrequirements, funding levels and the method of calculating payments or reimbursements, among other things; requirementsfor utilization review; and federal and state funding restrictions, all of which could materially increase or decrease paymentsfrom these government programs in the future, as well as affect the cost of providing services to our patients and the timing ofpayments to our facilities, which could in turn adversely affect our overall business, financial condition, results of operationsor cash flows. Any material adverse effects resulting from future reductions in payments from government programs could beexacerbated if we are not able to manage our operating costs effectively. Several states in which we operate face budgetary challenges that have resulted, and likely will continue to result, inreduced Medicaid funding levels to hospitals and other providers. Because most states must operate with balanced budgets,and the Medicaid program is generally a significant portion of a state’s budget, states can be expected to adopt or consideradopting future legislation designed to reduce or not increase their Medicaid expenditures. In addition, some states delayissuing Medicaid payments to providers to manage state expenditures. As an alternative means of funding providerpayments, many of the states in which we operate have adopted provider fee programs or have received federal governmentwaivers allowing them to test new approaches and demonstration projects to improve care. Continuing pressure on statebudgets and other factors could result in future reductions to Medicaid payments, payment delays or additional taxes onhospitals. 32 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIn general, we are unable to predict the effect of future government healthcare funding policy changes on ouroperations. If the rates paid by governmental payers are reduced, if the scope of services covered by governmental payers islimited, or if we or one or more of our subsidiaries’ hospitals are excluded from participation in the Medicare or Medicaidprogram or any other government healthcare program, there could be a material adverse effect on our business, financialcondition, results of operations or cash flows. The industry trend toward value-based purchasing and alternative payment models may negatively impact ourrevenues. Value-based purchasing and alternative payment model initiatives of both governmental and private payers tyingfinancial incentives to quality and efficiency of care will increasingly affect the results of operations of our hospitals andother healthcare facilities, and may negatively impact our revenues if we are unable to meet expected quality standards. TheAffordable Care Act contains a number of provisions intended to promote value-based purchasing in federal healthcareprograms. Medicare now requires providers to report certain quality measures in order to receive full reimbursement increasesfor inpatient and outpatient procedures that were previously awarded automatically. In addition, hospitals that meet orexceed certain quality performance standards will receive increased reimbursement payments, and hospitals that have“excess readmissions” for specified conditions will receive reduced reimbursement. Furthermore, Medicare no longer payshospitals additional amounts for the treatment of certain hospital-acquired conditions, also known as HACs, unless theconditions were present at admission. Beginning in FFY 2015, hospitals that rank in the worst 25% of all hospitals nationallyfor HACs in the previous year receive reduced Medicare reimbursements. The ACA also prohibits the use of federal fundsunder the Medicaid program to reimburse providers for treating certain provider-preventable conditions. The Secretary of HHS also recently announced a goal of tying 30% of traditional Medicare payments to quality orvalue through alternative payment models or bundled payment arrangements by the end of 2016, and tying 50% of paymentsto these models by the end of 2018. In furtherance of this goal, in November 2015, CMS finalized a new five-yeardemonstration project, called the Comprehensive Care for Joint Replacement (“CJR”) model, set to begin on April 1, 2016,which will hold hospitals accountable for the quality of care they deliver to Medicare fee-for-service beneficiaries for hip andknee replacements (and other major leg procedures) from surgery through recovery. As a result, the hospital in which a lowerextremity joint replacement (“LEJR”) procedure takes place will be held financially accountable for quality and costs for theentire episode of care, from the date of surgery through 90 days post-discharge, including services not provided by thehospital, such as physician, inpatient rehabilitation, skilled nursing and home health services. Through the CJR paymentmodel, beginning in 2017, participating hospitals in 67 geographic areas across the country – including 20 of our acute carehospitals and four short-stay surgical facilities operated by our USPI joint venture – will be eligible to receive incentivepayments or will be subject to payment reductions within certain corridors based on their performance against quality andspending criteria. We anticipate that CMS will develop additional, similar, alternative payment models for other conditionsin the future. There is also a trend among private payers toward value-based purchasing and alternative payment models forhealthcare services. Many large commercial payers expect hospitals to report quality data, and several of these payers willnot reimburse hospitals for certain preventable adverse events. We expect value-based purchasing programs, includingprograms that condition reimbursement on patient outcome measures, to become more common and to involve a higherpercentage of reimbursement amounts. We are unable at this time to predict how this trend will affect our results of operations, but it could negativelyimpact our revenues, particularly if we are unable to meet the quality and cost standards established by both governmentaland private payers under new value-based purchasing and alternative payment models. Our hospitals, outpatient centers and other healthcare businesses operate in competitive environments, andcompetition in our markets can adversely affect patient volumes. The healthcare business is highly competitive, and competition among hospitals and other healthcare providers forpatients has intensified in recent years. Generally, other hospitals and outpatient centers in the local communities we serveprovide services similar to those we offer, and, in some cases, competing facilities (1) are more established or newer than ours,(2) may offer a broader array of services to patients and physicians than ours, and (3) may have larger33 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsor more specialized medical staffs to admit and refer patients, among other things. Furthermore, healthcare consumers are nowable to access hospital performance data on quality measures and patient satisfaction, as well as standard charges for services,to compare competing providers; if any of our hospitals achieve poor results (or results that are lower than our competitors)on quality measures or patient satisfaction surveys, or if our standard charges are higher than our competitors, we may attractfewer patients. Additional quality measures and future trends toward clinical transparency may have an unanticipated impacton our competitive position and patient volumes. In the future, we expect to encounter increased competition from system-affiliated hospitals and healthcarecompanies in specific geographic markets. We also face competition from specialty hospitals (some of which are physician-owned) and unaffiliated freestanding outpatient centers for market share in high margin services and for quality physiciansand personnel. Furthermore, some of the hospitals that compete with our hospitals are owned by government agencies or not-for-profit organizations supported by endowments and charitable contributions and can finance capital expenditures andoperations on a tax-exempt basis. As is the case with our hospitals, some of our health plan competitors are owned bygovernmental agencies or non-profit corporations that have greater financial resources than we do. If our competitors arebetter able to attract patients, recruit physicians, expand services or obtain favorable managed care contracts at their facilitiesthan we are, we may experience an overall decline in patient volumes. Our business and financial results could be harmed if we are alleged to have violated existing regulations or if wefail to comply with new or changed regulations. Our hospitals, outpatient centers and related healthcare businesses are subject to extensive federal, state and localregulation relating to, among other things, licensure, contractual arrangements, conduct of operations, privacy of patientinformation, ownership of facilities, physician relationships, addition of facilities and services, and reimbursement rates forservices. The laws, rules and regulations governing the healthcare industry are extremely complex and, in certain areas, theindustry has little or no regulatory or judicial interpretation for guidance. Moreover, pursuant to the Affordable Care Act, theOIG is permitted to suspend Medicare and Medicaid payments to a provider of services “pending an investigation of acredible allegation of fraud.” The potential consequences for violating such laws, rules or regulations include reimbursementof government program payments, the assessment of civil monetary penalties, including treble damages, fines, which couldbe significant, exclusion from participation in federal healthcare programs, or criminal sanctions against current or formeremployees, any of which could have a material adverse effect on our business, financial condition or cash flows. Even apublic announcement that we are being investigated for possible violations of law could have a material adverse effect on thevalue of our common stock and our business reputation could suffer. Furthermore, healthcare, as one of the largest industries in the United States, continues to attract much legislativeinterest and public attention. We are unable to predict the future course of federal, state and local healthcare regulation orlegislation, including Medicare and Medicaid statutes and regulations. Further changes in the regulatory frameworknegatively affecting healthcare providers could have a material adverse effect on our business, financial condition, results ofoperations or cash flows. We are also required to comply with various federal and state labor laws, rules and regulations governing a varietyof workplace wage and hour issues. From time to time, we have been and expect to continue to be subject to regulatoryproceedings and private litigation concerning our application of such laws, rules and regulations. We could be subject to substantial uninsured liabilities or increased insurance costs as a result of significant legalactions. We are subject to medical malpractice lawsuits, class action lawsuits and other legal actions in the ordinary courseof business. Some of these actions may involve large demands, as well as substantial defense costs. Even in states that haveimposed caps on damages, litigants are seeking recoveries under new theories of liability that might not be subject to suchcaps. Our professional and general liability insurance does not cover all claims against us, and it may not continue to beavailable at a reasonable cost for us to maintain at adequate levels, as the healthcare industry has seen significant increases inthe cost of such insurance due to increased litigation. We cannot predict the outcome of current or future legal actionsagainst us or the effect that judgments or settlements in such matters may have on us or on our insurance costs. Additionally,all professional and general liability insurance we purchase is subject to policy limitations.34 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIf the aggregate limit of any of our professional and general liability policies is exhausted, in whole or in part, it coulddeplete or reduce the limits available to pay any other material claims applicable to that policy period. Any losses notcovered by or in excess of the amounts maintained under insurance policies will be funded from our working capital.Furthermore, one or more of our insurance carriers could become insolvent and unable to fulfill its or their obligations todefend, pay or reimburse us when those obligations become due. In that case or if payments of claims exceed our estimates orare not covered by our insurance, it could have a material adverse effect on our business, financial condition, results ofoperations or cash flows. It is essential to our ongoing business that we attract an appropriate number of quality physicians in thespecialties required to support our services and that we maintain good relations with those physicians. The success of our business depends in significant part on the number, quality, specialties, and admitting andscheduling practices of the licensed physicians who have been admitted to the medical staffs of our hospitals and whoaffiliate with us and use our facilities as an extension of their practices. Although we operate physician practices and, wherepermitted by law, employ physicians, physicians are often not employees of the hospitals or surgery centers at which theypractice. Furthermore, members of the medical staffs of our hospitals also often serve on the medical staffs of hospitals we donot operate, and they are free to terminate their association with our hospitals or admit their patients to competing hospitalsat any time. In addition, although physicians who own interests in our facilities are generally subject to agreementsrestricting them from owning an interest in competitive facilities, we may not learn of, or be unsuccessful in preventing, ourphysician partners from acquiring interests in competitive facilities. In some of our markets, physician recruitment andretention are affected by a shortage of physicians in certain specialties and the difficulties that physicians can experience inobtaining affordable malpractice insurance or finding insurers willing to provide such insurance. If we are unable to attractand retain sufficient numbers of quality physicians by providing adequate support personnel, technologically advancedequipment, and facilities that meet the needs of those physicians and their patients, physicians may be discouraged fromreferring patients to our facilities, admissions and outpatient visits may decrease and our operating performance may decline. Our new USPI joint venture and our recent hospital-based joint ventures depend on existing relationships with keyhealth system partners. If we are not able to maintain historical relationships with these health system partners, or enterinto new relationships, we may be unable to implement our business strategies successfully. Our new USPI joint venture and our recent hospital-based joint ventures depend in part on the efforts, reputationsand success of health system partners and the strength of our relationships with those health systems. Our joint venturescould be adversely affected by any damage to those health systems’ reputations or to our relationships with them. In manycases, our joint venture agreements are structured to comply with current IRS revenue rulings, as well as case law, relevant tojoint ventures between for-profit and not-for-profit healthcare entities. Material changes in these authorities could adverselyaffect our relationships with health system partners. If we are unable to maintain existing arrangements on favorable terms orenter into relationships with additional health system partners, we may be unable to implement our business strategies for ourjoint ventures successfully. Our labor costs could be adversely affected by competition for staffing, the shortage of experienced nurses andlabor union activity. The operations of our facilities are dependent on the efforts, abilities and experience of our management andmedical support personnel, including nurses, therapists, pharmacists and lab technicians, as well as our employed physicians.We compete with other healthcare providers in recruiting and retaining employees, and, like others in the healthcareindustry, we continue to experience a shortage of critical-care nurses in certain disciplines and geographic areas. As a result,from time to time, we may be required to enhance wages and benefits to recruit and retain experienced employees, makegreater investments in education and training for newly licensed medical support personnel, or hire more expensivetemporary or contract employees. Furthermore, state-mandated nurse-staffing ratios in California affect not only our laborcosts, but, if we are unable to hire the necessary number of experienced nurses to meet the required ratios, they may alsocause us to limit patient admissions with a corresponding adverse effect on our net operating revenues. In general, our failureto recruit and retain qualified management, experienced nurses and other medical support personnel, or to control labor costs,could have a material adverse effect on our business, financial condition, results of operations or cash flows.35 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Increased labor union activity is another factor that could adversely affect our labor costs. At December 31, 2015,approximately 20% of the employees in our Hospital Operations and other segment were represented by labor unions. Therewere no unionized employees in our Ambulatory Care segment, and less than 1% of Conifer’s employees belong to a union.Unionized employees – primarily registered nurses and service and maintenance workers – are located at 37 of our hospitals,the majority of which are in California, Florida and Michigan. We currently have two expired contracts and are negotiatingrenewals under extension agreements. We are also negotiating first contracts at two of our hospitals where employeesselected union representation. At this time, we are unable to predict the outcome of the negotiations, but increases in salaries,wages and benefits could result from these agreements. Furthermore, there is a possibility that strikes could occur during thenegotiation process, which could increase our labor costs and have an adverse effect on our patient admissions and netoperating revenues. Future organizing activities by labor unions could increase our level of union representation; to theextent a greater portion of our employee base unionizes, it is possible our labor costs could increase materially. Conifer’s future success also depends in part on our ability to attract, hire, integrate and retain key personnel.Competition for the caliber and number of employees we require at Conifer is intense. We may face difficulty identifying andhiring qualified personnel at compensation levels consistent with our existing compensation and salary structure. Inaddition, we invest significant time and expense in training Conifer’s employees, which increases their value to competitorswho may seek to recruit them. If we fail to retain our Conifer employees, we could incur significant expenses in hiring,integrating and training their replacements, and the quality of Conifer’s services and its ability to serve its customers coulddiminish, resulting in a material adverse effect on that segment of our business. Our business and financial results could be harmed by a national or localized outbreak of a highly contagious orepidemic disease. If an outbreak of an infectious disease such as the Zika virus or the Ebola virus were to occur nationally or in one ofthe regions our hospitals serve, our business and financial results could be adversely effected. The treatment of a highlycontagious disease at one of our facilities may result in a temporary shutdown or diversion of patients. In addition, unaffectedindividuals may decide to defer elective procedures or otherwise avoid medical treatment, resulting in reduced patientvolumes and operating revenues. Furthermore, we cannot predict the costs associated with the potential treatment of aninfectious disease outbreak by our hospitals or preparation for such treatment. Conifer operates in a highly competitive industry, and its current or future competitors may be able to competemore effectively than Conifer does, which could have a material adverse effect on Conifer’s margins, growth rate andmarket share. We intend to continue to market and expand Conifer’s revenue cycle management, patient communications andengagement services, and management services businesses. However, the market for Conifer’s solutions is highlycompetitive, and we expect competition may intensify in the future. Conifer faces competition from existing participants andnew entrants to the revenue cycle management market (including software vendors and other technology-supported revenuecycle management outsourcing companies, traditional consultants and information technology outsourcing firms), as well asfrom the staffs of hospitals and other healthcare providers who handle these processes internally. To be successful, Conifermust respond more quickly and effectively than its competitors to new or changing opportunities, technologies, standards,regulations and customer requirements. Moreover, existing or new competitors may introduce technologies or services thatrender Conifer’s technologies or services obsolete or less marketable. Even if Conifer’s technologies and services are moreeffective than the offerings of its competitors, current or potential customers might prefer competitive technologies orservices to Conifer’s technologies and services. Furthermore, increased competition may result in pricing pressures, whichcould negatively impact Conifer’s margins, growth rate or market share. The failure to comply with consumer financial, debt collection and credit reporting laws and regulations couldsubject Conifer and its subsidiaries to fines and other liabilities, as well as harm Conifer’s business and reputation. Conifer and its subsidiaries are subject to numerous federal, state and local consumer financial, debt collection andcredit reporting laws, rules and regulations. Regulations governing debt collection are subject to changing36 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsinterpretations that may be inconsistent among different jurisdictions. In addition, a regulatory determination made by, or asettlement or consent decree entered into with, one regulatory agency, such as the Consumer Financial Protection Bureau,may not be binding upon, or preclude, investigations or regulatory actions by state or local agencies. Conifer’s failure tocomply with consumer financial, debt collection and credit reporting requirements could result in, among other things, theissuance of cease and desist orders (which can include orders for restitution or rescission of contracts, as well as other kinds ofaffirmative relief), the imposition of fines or refunds, and other civil and criminal penalties, some of which could besignificant in the case of knowing or reckless violations. In addition, Conifer’s failure to comply with the laws andregulations applicable to it could result in reduced demand for its services, invalidate all or portions of some of Conifer’sservices agreements with its customers, or give customers the right to terminate Conifer’s services agreements with them,among other things, any of which could have an adverse effect on Conifer’s business. Furthermore, if Conifer or itssubsidiaries become subject to fines or other penalties, it could harm Conifer’s reputation, thereby making it more difficultfor Conifer to retain existing customers or attract new customers Our business could be negatively affected by security threats, catastrophic events and other disruptions affectingour information technology and related systems. As a provider of healthcare services, information technology is a critical component of the day-to-day operation ofour business. We rely on our information technology to process, transmit and store sensitive and confidential data, includingprotected health information, personally identifiable information of our patients and employees, and our proprietary andconfidential business performance data. We utilize electronic health records and other health information technology, alongwith additional technology systems, in connection with our operations, including for, among other things, billing, supplychain and labor management. Our systems, in turn, interface with and rely on third-party systems. Although we monitor androutinely test our security systems and processes and have a diversified data network that provides redundancies as well asother measures designed to protect the security and availability of the data we process, transmit and store, our informationtechnology and infrastructure have been, and will likely continue to be, subject to computer viruses, attacks by hackers, orbreaches due to employee error or malfeasance. While we are not aware of having experienced a material breach ofcybersecurity, the preventive actions we take to reduce the risk of such incidents and protect our information technologymay not be sufficient in the future. As cybersecurity threats continue to evolve, we may not be able to anticipate certainattack methods in order to implement effective protective measures, and we may be required to expend significant additionalresources to continue to modify and strengthen our security measures, investigate and remediate any vulnerabilities in ourinformation systems and infrastructure, or invest in new technology designed to mitigate security risks. Third parties towhom we outsource certain of our functions, or with whom our systems interface, are also subject to the risks outlined aboveand may not have or use appropriate controls to protect confidential information. A breach or attack affecting one of ourthird-party service providers or partners could harm our business even if we do not control the service that is attacked.Further, successful cyber-attacks at other healthcare services companies, whether or not we are impacted, could lead to ageneral loss of customer confidence in our industry that could negatively affect us, including harming the market perceptionof the effectiveness of our security measures or of the healthcare industry in general, which could result in reduced use of ourservices. Though we have insurance against some cyber-risks and attacks, it may not be sufficient to offset the impact of amaterial loss event. Furthermore, our networks and technology systems are subject to disruption due to events such as a majorearthquake, fire, telecommunications failure, terrorist attack or other catastrophic event. Any such breach or systeminterruption could result in the unauthorized disclosure, misuse or loss of confidential, sensitive or proprietary information,could negatively impact our ability to conduct normal business operations (including the collection of revenues), and couldresult in potential liability under privacy, security, consumer protection or other applicable laws, regulatory penalties,negative publicity and damage to our reputation, any of which could have a material adverse effect on our business, financialposition, results of operations or cash flows. We cannot provide any assurances that our corporate development activities will achieve their business goals orthe cost and service synergies we expect. We have completed, or have announced plans to complete, a number of acquisitions, divestitures, joint ventures andstrategic alliances as part of our business strategy, and we expect to enter into similar transactions in the future. We cannotprovide any assurances that these transactions will achieve their business goals or the cost and service synergies we expect.In particular, our USPI joint venture represents an increased strategic focus on ambulatory and short-stay surgical37 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsfacilities, as well as related imaging services businesses, and we cannot provide any assurances that this strategy will besuccessful. Furthermore, with respect to acquisitions, we may not be able to identify suitable candidates, consummatetransactions on terms that are favorable to us, or achieve expected returns, synergies or other benefits in a timely manner or atall. With respect to proposed divestitures of assets or businesses, we may encounter difficulties in finding acquirers oralternative exit strategies on terms that are favorable to us, which could delay the accomplishment of our strategic objectives.In addition, our divestiture activities have required, and may in the future require, us to recognize impairment charges or toagree to contractual restrictions that limit our ability to reenter the applicable market, which may be material. Companies or operations acquired or joint ventures created may not be profitable or may not achieve theprofitability that justifies the investments made. Furthermore, the nature of a joint venture requires us to consult with andshare certain decision-making powers with unaffiliated third parties, some of which may be not-for-profit healthcare systems.If our joint venture partners do not fulfill their obligations, the affected joint venture may not be able to operate according toits business or strategic plans. In that case, our results could be adversely affected or we may be required to increase our levelof financial commitment to the joint venture. Moreover, differences in economic or business interests or goals among jointventure participants could result in delayed decisions, failures to agree on major issues and even litigation. If thesedifferences cause the joint ventures to deviate from their business or strategic plans, or if our joint venture partners takeactions contrary to our policies, objectives or the best interests of the joint venture, our results could be adversely affected. Inaddition, our relationships with not-for-profit healthcare systems and the joint venture agreements that govern theserelationships are intended to be structured to comply with current revenue rulings published by the IRS, as well as case lawrelevant to joint ventures between for-profit and not-for-profit healthcare entities. Material changes in these authorities couldadversely affect our relationships with not-for-profit healthcare systems and related joint venture arrangements. Our corporate development activities may present financial and operational risks, including diversion ofmanagement attention from existing core businesses and the integration or separation of personnel and financial and othersystems. Future acquisitions could also result in potentially dilutive issuances of equity securities, the incurrence ofadditional debt, contingent liabilities and amortization expenses related to certain intangible assets, and increased operatingexpenses, any of which could adversely affect our results of operations and financial condition. Our existing joint ventures may limit our flexibility with respect to such jointly owned investments and could,thereby, have a material adverse effect on our business, results of operations and financial condition, as well as our abilityto sell the underlying assets or ownership interests in the joint ventures. We have invested in a number of joint ventures with other entities when circumstances warranted the use of thesestructures, and we may form additional joint ventures in the future. Our participation in joint ventures is subject to the risksthat: ·We could experience an impasse on certain decisions because we do not have sole decision-making authority,which could require us to expend additional resources on resolving such impasses or potential disputes. ·We may not be able to maintain good relationships with our joint venture partners (including health systempartners), which could limit our future growth potential and could have an adverse effect our business strategies. ·Our joint venture partners could have investment or operational goals that are not consistent with our corporate-wide objectives, including the timing, terms and strategies for investments or future growth opportunities. ·Our joint venture partners might become bankrupt, fail to fund their share of required capital contributions orfail to fulfill their obligations as joint venture partners, which may require us to infuse our own capital into anysuch venture on behalf of the related joint venture partner or partners despite other competing uses for suchcapital. 38 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents·Many of our existing joint ventures require that one of our wholly owned affiliates provide a working capitalline of credit to the joint venture, which could require us to allocate substantial financial resources to thejoint venture potentially impacting our ability to fund our other short-term obligations. ·Some of our existing joint ventures require mandatory capital expenditures for the benefit of the applicablejoint venture, which could limit our ability to expend funds on other corporate opportunities. ·Our joint venture partners may have exit rights that would require us to purchase their interests upon theoccurrence of certain events, which could impact our financial condition by requiring us to incur additionalindebtedness in order to complete such transactions or, alternatively, in some cases we may have the option toissue shares of our common stock to our joint venture partners to satisfy such obligations, which would dilutethe ownership of our existing stockholders. ·Our joint venture partners may have competing interests in our markets that could create conflict of interestissues. ·Any sale or other disposition of our interest in a joint venture or underlying assets of the joint venture mayrequire consents from our joint venture partners, which we may not be able to obtain. ·Certain corporate-wide or strategic transactions may also trigger other contractual rights held by a joint venturepartner (including termination or liquidation rights) depending on how the transaction is structured, whichcould impact our ability to complete such transactions. The put/call arrangements set forth in the Put/Call Agreement (as defined below) may require us to utilize ourcash flow or incur additional indebtedness to satisfy the payment obligations in respect of such arrangements. On June 16, 2015, we entered into a Contribution and Purchase Agreement (the “Contribution and PurchaseAgreement”) with USPI Group Holdings, Inc. (“USPI Holdings”), Ulysses JV Holding I L.P. (“Ulysses Holding I”), Ulysses JVHolding II L.P. (“Ulysses Holding II” and, together with Ulysses Holding I, the “USPI LPs”), and the newly formed USPIHolding Company, Inc., our USPI joint venture. USPI Holdings is the parent company of United Surgical PartnersInternational, Inc. USPI Holdings, through USPI and its other subsidiaries, is engaged in the business of owning andmanaging ambulatory surgery centers, surgical hospitals and related businesses. Pursuant to the terms of the Contributionand Purchase Agreement, at the closing, the USPI LPs collectively sold and contributed 100% of the equity interests of USPIHoldings to the USPI joint venture in exchange for certain shares of common stock of the USPI joint venture (the “USPIContribution”), and we sold and contributed certain of our equity interests and other assets that comprised a portion of ourambulatory surgery center and imaging center business to the USPI joint venture (the “Tenet Contribution” and, togetherwith the USPI Contribution, the “Contributions”).We also purchased certain shares of the USPI joint venture (the “Purchase”and, together with the Contributions, the “Contribution and Purchase Transactions”) from the USPI LPs such that, aftergiving effect to the Contribution and Purchase Transactions, we owned 50.1% and the USPI LPs, in the aggregate, owned49.9% of the fully diluted equity interests of the USPI joint venture. In December 2015, the USPI LPs sold 3.01% of the fullydiluted equity interests of the USPI joint venture to Baylor University Medical Center. In connection with the Contribution and Purchase Agreement, we, the USPI LPs and the USPI joint venture enteredinto a stockholders agreement pursuant to which we and the USPI LPs agreed to certain rights and obligations with respect tothe governance of the USPI joint venture. In addition, we entered into a put/call agreement (the “Put/Call Agreement”) thatcontains put and call options with respect to the equity interests in the USPI joint venture held by the USPI LPs. Each yearstarting in 2016, the USPI LPs must put to us at least 12.5%, and may put up to 25%, of the USPI joint venture shares held bythem immediately after the closing of the Contribution and Purchase Agreement. In each year that the USPI LPs are to delivera put and do not put the full 25% of USPI joint venture shares allowable, we may call the difference between the number ofUSPI joint venture shares the USPI LPs put and the maximum number of USPI joint venture shares the USPI LPs could haveput that year. In addition, the Put/Call Agreement contains certain other call options pursuant to which we will have theability to acquire all of the ownership interests held by the USPI LPs by 2020. In the event of a put by the USPI LPs, we willhave the ability to choose whether to settle the purchase price in cash or shares39 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsof our common stock and, in the event of a call by us, the USPI LPs will have the ability to choose whether to settle thepurchase price in cash or shares of our common stock. We have also entered into a separate put/call agreement (the “Baylor Put/Call Agreement”) with Baylor thatcontains put and call options with respect to the equity interests in the USPI joint venture held by Baylor. Each year startingin 2021, Baylor may put up to 33.3% of their total shares in the USPI joint venture held as of January 1, 2017. In each yearthat Baylor does not put the full 33.3% of the USPI joint venture’s shares allowable, we may call the difference between thenumber of shares Baylor put and the maximum number of shares they could have put that year. In addition, the BaylorPut/Call Agreement contains a call option pursuant to which we have the ability to acquire all of Baylor’s ownership interestby 2024. We have the ability to choose whether to settle the purchase price for the Baylor put/call in cash or shares of ourcommon stock. The put and call arrangements described above, to the extent settled in cash, may require us to dedicate a substantialportion of our cash flow to satisfy our payment obligations in respect of such arrangements, which may reduce the amount offunds available for our operations, capital expenditures and corporate development activities. Similarly, we may be requiredto incur additional indebtedness to satisfy our payment obligations in respect of such arrangements, which could haveimportant consequences to our business and operations, as described more fully below under “—Our level of indebtednesscould, among other things, adversely affect our ability to raise additional capital to fund our operations, limit our ability toreact to changes in the economy or our industry, and prevent us from meeting our obligations under the agreements relatingto our indebtedness.” Economic factors have affected, and may continue to impact, our business, financial condition and results ofoperations. We believe broad economic factors – including high unemployment rates in some of the markets our facilities serveand instability in consumer spending – have affected our volumes and our ability to collect outstanding receivables. TheUnited States economy remains unpredictable. If industry trends (including reductions in commercial managed careenrollment and patient decisions to postpone or cancel elective and non-emergency healthcare procedures) or generaleconomic conditions worsen, we may not be able to sustain future profitability, and our liquidity and ability to repay ouroutstanding debt may be harmed. Furthermore, the availability of liquidity and credit to fund the continuation and expansion of many businessoperations worldwide has been limited in recent years. Our ability to access the capital markets on acceptable terms may beseverely restricted at a time when we would like, or need, to access those markets, which could have a negative impact on ourgrowth plans, our flexibility to react to changing economic and business conditions, and our ability to refinance existingdebt. An economic downturn or other economic conditions could also adversely affect the counterparties to our agreements,including the lenders under our credit facilities, causing them to fail to meet their obligations to us. Trends affecting our actual or anticipated results may require us to record charges that would negatively impactour results of operations. As a result of factors that have negatively affected our industry generally and our business specifically, we havebeen required to record various charges in our results of operations. Our impairment tests presume stable, improving or, insome cases, declining operating results in our hospitals, which are based on programs and initiatives being implemented thatare designed to achieve the hospitals’ most recent projections. If these projections are not met, or negative trends occur thatimpact our future outlook, future impairments of long-lived assets and goodwill may occur, and we may incur additionalrestructuring charges. Future restructuring of our operating structure that changes our goodwill reporting units could alsoresult in future impairments of our goodwill. Any such charges could negatively impact our results of operations. 40 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsOur level of indebtedness could, among other things, adversely affect our ability to raise additional capital to fundour operations, limit our ability to react to changes in the economy or our industry, and prevent us from meeting ourobligations under the agreements relating to our indebtedness. At December 31, 2015, we had approximately $14.4 billion of total long-term debt, as well as approximately$110 million in standby letters of credit outstanding in the aggregate, under our senior secured revolving credit facility(“Credit Agreement”) and our letter of credit facility agreement (“LC Facility”). Our Credit Agreement is collateralized bypatient accounts receivable of substantially all of our domestic wholly owned acute care and specialty hospitals, and ourLC Facility is guaranteed and secured by a first priority pledge of the capital stock and other ownership interests of certain ofour hospital subsidiaries on an equal ranking basis with our existing senior secured notes. From time to time, we expect toengage in additional capital market, bank credit and other financing activities, depending on our needs and financingalternatives available at that time. Our substantial indebtedness could have important consequences, including the following: ·Our substantial indebtedness may limit our ability to adjust to changing market conditions and place us at acompetitive disadvantage compared to our competitors that have less debt. ·We may be more vulnerable in the event of a deterioration in our business, in the healthcare industry or in theeconomy generally, or if federal or state governments substantially limit or reduce reimbursement under theMedicare or Medicaid programs. ·Our debt service obligations reduce the amount of funds available for our operations, capital expenditures andcorporate development activities, and may make it more difficult for us to satisfy our financial obligations. ·Our substantial indebtedness could limit our ability to obtain additional financing to fund future capitalexpenditures, working capital, acquisitions or other needs. ·Some of our borrowings accrue interest at variable rates, exposing us to the risk of increased interest rates. Furthermore, our Credit Agreement, LC Facility and the indentures governing our outstanding notes contain, andany future debt obligations may contain, covenants that, among other things, restrict our ability to pay dividends, incuradditional debt and sell assets. See —“Restrictive covenants in the agreements governing our indebtedness may adverselyaffect us.” We may not be able to generate sufficient cash to service all of our indebtedness, and we may be forced to takeother actions to satisfy our obligations under our indebtedness, which may not be successful. Our ability to make scheduled payments on or to refinance our indebtedness depends on our financial and operatingperformance, which is subject to prevailing economic and competitive conditions and to financial, business and other factorsbeyond our control. We cannot assure you that we will maintain a level of cash flows from operating activities sufficient topermit us to pay the principal, premium, if any, and interest on our indebtedness. In addition, our ability to meet our debt service obligations is dependent upon the operating results of oursubsidiaries and their ability to pay dividends or make other payments or advances to us. We hold most of our assets at, andconduct most of our operations through, direct and indirect subsidiaries. Moreover, we are dependent on dividends or otherintercompany transfers of funds from our subsidiaries to meet our debt service and other obligations, including payment onour outstanding debt. The ability of our subsidiaries to pay dividends or make other payments or advances to us will dependon their operating results and will be subject to applicable laws and restrictions contained in agreements governing the debtof such subsidiaries. Our less than wholly owned subsidiaries may also be subject to restrictions on their ability to distributecash to us in their financing or other agreements and, as a result, we may not be able to access their cash flows to service theirrespective debt obligations. 41 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIf our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced toreduce or delay capital expenditures, including those required for operating our existing hospitals, for integrating ourhistorical acquisitions or for future corporate development activities. We also may be forced to sell assets or operations, seekadditional capital, or restructure or refinance our indebtedness. We cannot assure you that we would be able to take any ofthese actions, that these actions would be successful and permit us to meet our scheduled debt service obligations, or thatthese actions would be permitted under the terms of our existing or future debt agreements, including our Credit Agreement,LC Facility and the indentures governing our outstanding notes. Restrictive covenants in the agreements governing our indebtedness may adversely affect us. Our Credit Agreement, LC Facility and the indentures governing our outstanding notes contain various covenantsthat, among other things, limit our ability and the ability of our subsidiaries to: ·incur, assume or guarantee additional indebtedness; ·incur liens; ·make certain investments; ·provide subsidiary guarantees; ·consummate asset sales; ·redeem debt that is subordinated in right of payment to outstanding indebtedness; ·enter into sale and lease-back transactions; ·enter into transactions with affiliates; and ·consolidate, merge or sell all or substantially all of our assets. These restrictions are subject to a number of important exceptions and qualifications. In addition, so long as any obligation or commitment is outstanding under our Credit Agreement and LC Facility,the terms of such facilities require us to maintain a financial ratio relating to our ability to satisfy certain fixed expenses,including interest payments. Our ability to meet these restrictive covenants and financial ratio may be affected by eventsbeyond our control, and we cannot assure you that we will meet those tests. These restrictions could limit our ability toobtain future financing, make acquisitions or needed capital expenditures, withstand economic downturns in our business orthe economy in general, conduct operations or otherwise take advantage of business opportunities that may arise. Inaddition, a breach of any of these covenants could cause an event of default, which, if not cured or waived, could require usto repay the indebtedness immediately. Under these conditions, we are not certain whether we would have, or be able toobtain, sufficient funds to make accelerated payments. Despite current indebtedness levels, we may be able to incur substantially more debt. This could furtherexacerbate the risks described above. We have the ability to incur additional indebtedness in the future, subject to the restrictions contained in ourCredit Agreement, LC Facility and the indentures governing our outstanding notes. We may decide to incur additionalsecured or unsecured debt in the future to finance our operations and any judgments or settlements or for other businesspurposes. Our Credit Agreement provides for revolving loans in an aggregate principal amount of up to $1 billion, with a$300 million subfacility for standby letters of credit. Based on our eligible receivables, approximately $995 million wasavailable for borrowing under the Credit Agreement at December 31, 2015. Our LC Facility provides for the issuance of42 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsstandby and documentary letters of credit in an aggregate principal amount of up to $180 million (subject to increase to upto $200 million). At December 31, 2015, we had approximately $105 million of standby letters of credit outstanding underthe LC Facility. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify. The utilization of our tax losses could be substantially limited if we experience an ownership change as defined inthe Internal Revenue Code. At December 31, 2015, we had federal net operating loss (“NOL”) carryforwards of approximately $1.8 billionpretax available to offset future taxable income. These NOL carryforwards will expire in the years 2024 to 2034. Section 382of the Internal Revenue Code imposes an annual limitation on the amount of a company’s taxable income that may be offsetby the NOL carryforwards if it experiences an “ownership change” as defined in Section 382 of the Code. An ownershipchange occurs when a company’s “five-percent shareholders” (as defined in Section 382 of the Code) collectively increasetheir ownership in the company by more than 50 percentage points (by value) over a rolling three-year period. (This isdifferent from a change in beneficial ownership under applicable securities laws.) These ownership changes includepurchases of common stock under share repurchase programs, a company’s offering of its stock, the purchase or sale ofcompany stock by five-percent shareholders, or the issuance or exercise of rights to acquire company stock. While we expectto be able to realize our total NOL carryforwards prior to their expiration, if an ownership change occurs, our ability to usethe NOL carryforwards to offset future taxable income will be subject to an annual limitation and will depend on the amountof taxable income we generate in future periods. There is no assurance that we will be able to fully utilize the NOLcarryforwards. Furthermore, we could be required to record a valuation allowance related to the amount of the NOLcarryforwards that may not be realized, which could adversely impact our results of operations. ITEM 1B. UNRESOLVED STAFF COMMENTS None. ITEM 2. PROPERTIES The disclosure required under this Item is included in Item 1, Business, of Part I of this report. ITEM 3. LEGAL PROCEEDINGS Because we provide healthcare services in a highly regulated industry, we have been and expect to continue to beparty to various lawsuits, claims and regulatory investigations from time to time. For information regarding material pendinglegal proceedings in which we are involved, see Note 15 to our Consolidated Financial Statements, which is incorporated byreference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 43 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPART II. ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS ANDISSUER PURCHASES OF EQUITY SECURITIES Common Stock. Our common stock is listed on the New York Stock Exchange (“NYSE”) under the symbol “THC.”The following table sets forth, for the periods indicated, the high and low sales prices per share of our common stock on theNYSE: High Low Year Ended December 31, 2015 First Quarter $52.69 $41.47 Second Quarter 59.21 46.33 Third Quarter 60.93 35.76 Fourth Quarter 39.75 26.60 Year Ended December 31, 2014 First Quarter $48.70 $38.40 Second Quarter 50.25 37.95 Third Quarter 63.61 44.20 Fourth Quarter 59.65 46.01 On February 12, 2016, the last reported sales price of our common stock on the NYSE composite tape was $24.00per share. As of that date, there were 4,414 holders of record of our common stock. Our transfer agent and registrar isComputershare. Shareholders with questions regarding their stock certificates, including inquiries related to exchanging orreplacing certificates or changing an address, should contact the transfer agent at (866) 229-8416. Cash Dividends on Common Stock. We have not paid cash dividends on our common stock since the first quarter offiscal 1994. We currently intend to retain future earnings, if any, for the operation and development of our business and,accordingly, do not currently intend to pay any cash dividends on our common stock. Our board of directors will evaluateour future earnings, results of operations, financial condition and capital requirements in determining whether to pay anycash dividends in the future. Our senior secured revolving credit agreement and our letter of credit facility agreement containprovisions that limit the payment of cash dividends on our common stock if we do not meet certain financial ratios. Equity Compensation. Refer to Item 12, Security Ownership of Certain Beneficial Owners and Management andRelated Stockholder Matters, of Part III of this report for information regarding securities authorized for issuance under ourequity compensation plans. Stock Performance Graph. The following graph shows the cumulative, five-year total return for our common stockcompared to three indices, each of which includes us. The Standard & Poor’s 500 Stock Index includes 500 companiesrepresenting all major industries. The Standard & Poor’s Health Care Composite Index is a group of 56 companies involvedin a variety of healthcare-related businesses. Because the Standard & Poor’s Health Care Composite Index is heavilyweighted by pharmaceutical and medical device companies, we believe that at times it may be less useful than the HospitalManagement Peer Group Index included below. We compiled this Peer Group Index by selecting publicly traded companiesthat have as their primary business the management of acute care hospitals and that have been in business for all five of theyears shown. These companies are: Community Health Systems, Inc. (CYH), Tenet Healthcare Corporation (THC) andUniversal Health Services, Inc. (UHS). 44 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPerformance data assumes that $100.00 was invested on December 31, 2010 in our common stock and each of theindices. The data assumes the reinvestment of all cash dividends and the cash value of other distributions. Stock priceperformance shown in the graph is not necessarily indicative of future stock price performance. COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN 12/10 12/11 12/12 12/13 12/14 12/15 Tenet Healthcare Corporation $100.00 $76.68 $121.34 $157.40 $189.35 $113.23 S&P 500 $100.00 $102.11 $118.45 $156.82 $178.29 $180.75 S&P Health Care $100.00 $112.73 $132.90 $188.00 $235.63 $251.87 Peer Group $100.00 $71.77 $105.66 $153.32 $203.42 $161.65 Repurchase of Common Stock. In November 2015, we announced that our board of directors had authorized therepurchase of up to $500 million of our common stock through a share repurchase program that expires inDecember 2016. Under the program, shares may be purchased in the open market or through privately negotiatedtransactions in a manner consistent with applicable securities laws and regulations. The program may be suspended forperiods or discontinued at any time. The timing and amount of repurchase transactions will be based on an evaluation ofmarket conditions, share purchase prices, the timing of divestiture proceeds and other factors. Purchases during the yearended December 31, 2015 are shown in the table in Note 2 to our Consolidated Financial Statements, which table isincorporated by reference.45 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents ITEM 6. SELECTED FINANCIAL DATA OPERATING RESULTS The following tables present selected consolidated financial data for Tenet Healthcare Corporation and its whollyowned and majority-owned subsidiaries for the years ended December 31, 2011 through 2015. Effective June 16, 2015, wecompleted the transaction that combined our freestanding ambulatory surgery and imaging center assets with the short-staysurgical facility assets of United Surgical Partners International, Inc. (“USPI”) into our new USPI joint venture. The tablebelow includes USPI results in the 2015 column for the post-acquisition period only. We acquired Vanguard Health Systems,Inc. (“Vanguard”) on October 1, 2013. The 2013 columns in the tables below include results of operations for Vanguard andits consolidated subsidiaries for the three months ended December 31 2013 only. All amounts related to shares, share pricesand earnings per share for periods ending prior to October 11, 2012 have been restated to give retrospective presentation forthe one-for-four reverse stock split we announced on October 1, 2012. The tables should be read in conjunction with Item 7,Management’s Discussion and Analysis of Financial Condition and Results of Operations, and our Consolidated FinancialStatements and notes thereto included in this report. Years Ended December 31, 2015 2014 2013 2012 2011 (In Millions, Except Per-Share Amounts) Net operating revenues: Net operating revenues before provision fordoubtful accounts $20,111 $17,908 $12,059 $9,896 $9,363 Less: Provision for doubtful accounts 1,477 1,305 972 785 717 Net operating revenues 18,634 16,603 11,087 9,111 8,646 Equity in earnings of unconsolidated affiliates 99 12 15 8 8 Operating expenses: Salaries, wages and benefits 9,011 8,023 5,371 4,257 4,015 Supplies 2,963 2,630 1,784 1,552 1,548 Other operating expenses, net 4,555 4,114 2,701 2,147 2,020 Electronic health record incentives (72) (104) (96) (40) (55) Depreciation and amortization 797 849 545 430 398 Impairment and restructuring charges, andacquisition-related costs 318 153 103 19 20 Litigation and investigation costs, net ofinsurance recoveries 291 25 31 5 55 Gains on sales, consolidation anddeconsolidation of facilities (186) — — — — Operating income 1,056 925 663 749 653 Interest expense (912) (754) (474) (412) (375) Loss from early extinguishment of debt (1) (24) (348) (4) (117) Investment earnings 1 — 1 1 3 Income (loss) from continuing operations,before income taxes 144 147 (158) 334 164 Income tax benefit (expense) (68) (49) 65 (125) (61) Income (loss) from continuing operations, beforediscontinued operations and cumulative effect ofchange in accounting principle $76 $98 $(93) $209 $103 Basic earnings (loss) per share attributable to TenetHealthcare Corporation common shareholdersfrom continuing operations $(1.43) $0.35 $(1.21) $1.77 $0.58 Diluted earnings (loss) per share attributable toTenet Healthcare Corporation commonshareholders from continuing operations $(1.43) $0.34 $(1.21) $1.70 $0.56 (1)Net income attributable to noncontrolling interest from continuing operations was $218 million, $64 million, $30 million, $13 million and$11 million for the years ended December 31, 2015, 2014, 2013, 2012 and 2011, respectively.46 (1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsThe operating results data presented above is not necessarily indicative of our future results of operations. Reasonsfor this include, but are not limited to: overall revenue and cost trends, particularly the timing and magnitude of pricechanges; fluctuations in contractual allowances and cost report settlements and valuation allowances; managed care contractnegotiations, settlements or terminations and payer consolidations; changes in Medicare and Medicaid regulations;Medicaid and other supplemental funding levels set by the states in which we operate; the timing of approval by the Centersfor Medicare and Medicaid Services (“CMS”) of Medicaid provider fee revenue programs; trends in patient accountsreceivable collectability and associated provisions for doubtful accounts; fluctuations in interest rates; levels of malpracticeinsurance expense and settlement trends; the number of covered lives managed by our health plans and the plans’ ability toeffectively manage medical costs; the timing of when we meet the criteria to recognize electronic health record incentives;impairment of long-lived assets and goodwill; restructuring charges; losses, costs and insurance recoveries related to naturaldisasters; litigation and investigation costs; acquisitions and dispositions of facilities and other assets; income tax rates anddeferred tax asset valuation allowance activity; changes in estimates of accruals for annual incentive compensation; thetiming and amounts of stock option and restricted stock unit grants to employees and directors; gains or losses from earlyextinguishment of debt; and changes in occupancy levels and patient volumes. Factors that affect patient volumes and,thereby, the results of operations at our hospitals and related healthcare facilities include, but are not limited to: the businessenvironment, economic conditions and demographics of local communities in which we operate; the number of uninsuredand underinsured individuals in local communities treated at our hospitals; seasonal cycles of illness; climate and weatherconditions; physician recruitment, retention and attrition; advances in technology and treatments that reduce length of stay;local healthcare competitors; managed care contract negotiations or terminations; the number of patients with high-deductible health insurance plans; any unfavorable publicity about us, which impacts our relationships with physicians andpatients; changes in healthcare regulations and the participation of individual states in federal programs; and the timing ofelective procedures. BALANCE SHEET DATA December 31, 2015 2014 2013 2012 2011 (In Millions) Working capital (current assets minus current liabilities) $863 $393 $599 $918 $542 Total assets 23,682 17,951 16,450 9,044 8,462 Long-term debt, net of current portion 14,383 11,505 10,696 5,158 4,294 Redeemable noncontrolling interest in equity of consolidatedsubsidiaries 2,266 401 340 16 16 Noncontrolling interests 267 134 123 75 69 Total equity 958 785 878 1,218 1,492 CASH FLOW DATA Years Ended December 31, 2015 2014 2013 2012 2011 (In Millions) Net cash provided by operating activities $1,026 $687 $589 $593 $497 Net cash used in investing activities (1,317) (1,322) (2,164) (662) (503) Net cash provided by (used in) financing activities 454 715 1,324 320 (286) 47 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS INTRODUCTION TO MANAGEMENT’S DISCUSSION AND ANALYSIS The purpose of this section, Management’s Discussion and Analysis of Financial Condition and Results ofOperations (“MD&A”), is to provide a narrative explanation of our financial statements that enables investors to betterunderstand our business, to enhance our overall financial disclosures, to provide the context within which our financialinformation may be analyzed, and to provide information about the quality of, and potential variability of, our financialcondition, results of operations and cash flows. Our core business is Hospital Operations and other, which is focused onoperating acute care hospitals, ancillary outpatient facilities, urgent care centers, freestanding emergency departments,physician practices and health plans. Our Ambulatory Care segment is comprised of the operations of our USPI HoldingCompany, Inc. (“USPI joint venture”), in which we acquired a majority interest on June 16, 2015, and European SurgicalPartners Ltd. (“Aspen”) facilities, which we also acquired on June 16, 2015. Our USPI joint venture has interests in249 ambulatory surgery centers, 20 short-stay surgical hospitals, 20 imaging centers and 35 urgent care centers in 28 states.Aspen includes nine private hospitals and clinics in the United Kingdom. We also operate revenue cycle management,patient communications and engagement services, and management services businesses through our Conifer Holdings, Inc.(“Conifer”) subsidiary, which is a separate reportable business segment. MD&A, which should be read in conjunction withthe accompanying Consolidated Financial Statements, includes the following sections: ·Management Overview·Sources of Revenue·Results of Operations·Liquidity and Capital Resources·Off-Balance Sheet Arrangements·Recently Issued Accounting Standards·Critical Accounting Estimates Unless otherwise indicated, all financial and statistical information included in MD&A relates to our continuingoperations, with dollar amounts expressed in millions (except per share, per admission, per adjusted admission, per patientday, per adjusted patient day, per visit and per case amounts). Continuing operations information includes the results of(i) our same 48 hospitals operated throughout the years ended December 31, 2015, 2014 and 2013, (ii) Vanguard and itsconsolidated subsidiaries, which we acquired effective October 1, 2013, but only for the period from the date of acquisitionthrough December 31, 2015 (iii) Texas Regional Medical Center at Sunnyvale (“TRMC”), in which we acquired a majorityinterest on June 3, 2014, (iv) Resolute Health Hospital, which we opened on June 24, 2014, (v) Emanuel Medical Center,which we acquired on August 1, 2014, (vi) our USPI joint venture, in which we acquired a majority interest on June 16, 2015,(vii) Aspen, which we also acquired on June 16, 2015, (viii) Hi-Desert Medical Center, which we began operating on July 15,2015, (ix) our Carondelet Heath Network joint venture, in which we acquired a majority interest on August 31, 2015, (x)Saint Louis University Hospital (“SLUH”), which we sold on August 31, 2015, (xi) our joint venture with Baptist HealthSystem, Inc., which we formed on October 2, 2015, and (xii) DMC Surgery Hospital, which we closed in October 2015, ineach case only for the period from acquisition, or commencement of operations of the facility, as the case may be, toDecember 31, 2015, 2014 and 2013, as applicable. Continuing operations information excludes the results of our hospitalsand other businesses that have been classified as discontinued operations for accounting purposes. Certain previouslyreported information, primarily related to our freestanding ambulatory surgery and imaging center assets that werecontributed to the USPI joint venture, has been reclassified to conform to the current-year presentation. These outpatientfacilities were formerly part of our Hospital Operations and other segment, but are now reported as part of our newAmbulatory Care segment. MANAGEMENT OVERVIEW RECENT DEVELOPMENTS Welsh Carson Put Notices—In January 2016, subsidiaries of Welsh, Carson, Anderson & Stowe delivered a putnotice for the minimum number of shares they are required to put to us in 2016 according to the Put/Call Agreement, asdefined in Note 16 to our Consolidated Financial Statements. The estimated amount we will pay to repurchase these shares is$127 million.48 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Joint Ventures with Baylor Scott & White Health—Effective January 1, 2016, we formed two joint ventures withBaylor Scott & White Health (“BSW”) involving the ownership and operation of Centennial Medical Center, DoctorsHospital at White Rock Lake, Lake Pointe Medical Center and Texas Regional Medical Center at Sunnyvale (collectively,“our North Texas hospitals”) – which were operated by certain of our subsidiaries – and Baylor Medical Center at Garland –which was owned and operated by BSW, which will hold a majority ownership interest in the joint ventures. The transactionsclosed on December 31, 2015 at a net transaction price of approximately $288 million, and we recorded a gain ondeconsolidation of these facilities of approximately $151 million. We also recorded an equity investment in the new jointventures of approximately $164 million, which included $11 million of cash contributed at closing. Sale of North Carolina Hospitals—Also effective January 1, 2016, we completed the sale of our 137-bed CentralCarolina Hospital in Sanford, North Carolina and our 355-bed Frye Regional Medical Center in Hickory, North Carolina, aswell as 19 physician practices, at a transaction price of approximately $191 million, excluding working capital and subjectto customary purchase price adjustments. As a result of this transaction, we recorded a gain on sale of approximately $3million at December 31, 2015, the date the transaction closed. Definitive Agreement to Sell Atlanta-Area Hospitals and Related Operations—In December 2015, we announced adefinitive agreement for the sale and management of our Atlanta-area hospitals – Atlanta Medical Center and its SouthCampus, North Fulton Hospital, Spalding Regional Hospital and Sylvan Grove Hospital – as well as 26 physician clinics.This sale, which is subject to customary closing conditions, including regulatory approvals, is expected to be completed asearly as the end of the first quarter of 2016. STRATEGIES AND TRENDS We are committed to providing the communities we serve with high quality, cost-effective healthcare while growingour business, increasing our profitability and creating long-term value for our shareholders. We believe that our success inincreasing our profitability depends in part on our success in executing the strategies and managing the trends discussedbelow. Core Business Strategy—We are focused on providing high quality care to patients through our hospitals andoutpatient centers, and offering an array of business process solutions primarily to healthcare providers through Conifer.With respect to our hospitals, ambulatory care centers and other outpatient businesses, we seek to offer superior quality andpatient services to meet community needs, to make capital and other investments in our facilities and technology, to recruitand retain physicians, and to negotiate competitive contracts with managed care and other private payers. With respect tobusiness process services, we provide comprehensive operational management for revenue cycle functions, including patientaccess, health information management, revenue integrity and patient financial services. We also offer communication andengagement solutions to optimize the relationship between providers and patients. In addition, Conifer operates amanagement services business that supports value-based performance through clinical integration, financial riskmanagement and population health management. Commitment to Quality—We are continuing to make significant investments in equipment, technology, educationand operational strategies designed to improve clinical quality at all of our facilities. In addition, we continually collaboratewith physicians to implement the most current evidence-based medicine techniques to improve the way we provide care,while using labor management tools and supply chain initiatives to reduce variable costs. We believe the use of thesepractices will promote the most effective and efficient utilization of resources and result in shorter lengths of stay andreductions in readmissions for hospitalized patients. Development Strategies—We remain focused on opportunities to increase our hospital and outpatient revenues, andto expand our Conifer services business, through organic growth, corporate development activities and strategic partnerships. From time to time, we build new facilities, make acquisitions of healthcare assets and companies, and enter intojoint venture arrangements or affiliations with healthcare businesses in markets where we believe our operating strategies canimprove performance and create shareholder value. In June 2015, we completed the transaction that combined our49 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsfreestanding ambulatory surgery and imaging center assets with USPI’s short-stay surgical facility assets into a new jointventure owned by us and Welsh, Carson, Anderson & Stowe, a private equity firm that specializes in healthcare investments.At December 31, 2015, the joint venture had interests in 249 ambulatory surgery centers, 20 short-stay surgical hospitals,20 imaging centers and 35 urgent care centers in 28 states. Moreover, we significantly increased the number of our not-for-profit partners through USPI and now have relationships with more than 50 leading healthcare systems across the country. Also in June 2015, we acquired Aspen Healthcare in the United Kingdom. Although the U.K. provides government-funded healthcare to all of its residents through the National Health Service, the demand for healthcare services exceeds thepublic system’s capacity. Aspen’s four acute care hospitals, one cancer center and four outpatient facilities offer patients acomplete range of private healthcare and clinical services in a growing market. In addition, in July 2015, we began operating Hi-Desert Medical Center and its related healthcare facilities inJoshua Tree, California under a long-term lease agreement and, in August 2015, we formed a new joint venture with DignityHealth and Ascension Health to own and operate Carondelet Health Network based in Tucson, Arizona. In October 2015, weformed a new joint venture with Baptist Health System to own and operate a healthcare network serving Birmingham andcentral Alabama; we own a majority interest in the joint venture, and we manage the network’s five hospitals and relatedbusinesses. Effective January 1, 2016, we formed two joint ventures with Baylor Scott & White Health involving theownership and operation of five North Texas hospitals: Centennial Medical Center, Doctors Hospital at White Rock Lake,Lake Pointe Medical Center, and TRMC – which were operated by certain of our subsidiaries – and Baylor Medical Center atGarland – which was operated by BSW. The joint ventures will focus on delivering integrated, value-based care primarily toselect communities in Rockwall, Collin and Dallas counties. BSW holds a majority ownership interest in the joint ventures. Historically, our outpatient services have generated significantly higher margins for us than inpatient services.During the three months ended December 31, 2015, we derived approximately 42% of our net patient revenues fromoutpatient services. By expanding our outpatient business, we expect to increase our profitability over time. The facilities inour USPI joint venture specialize in non‑emergency surgical cases. Due in part to advancements in medical technology, anddue to the lower cost structure and greater efficiencies that are attainable in a specialized outpatient site, we believe thevolume and complexity of surgical cases performed in an outpatient setting will continue to steadily increase. In addition, wehave continued growing our urgent care business through our USPI joint venture’s acquisition of CareSpot ExpressHealthcare, which added 35 urgent care centers in Florida and Tennessee to its portfolio of outpatient centers, as part of ourbroader strategy to offer more services to patients and to expand into faster-growing, less capital intensive, higher-marginbusinesses. Furthermore, we continually evaluate joint venture opportunities with other healthcare providers in our marketsto maximize effectiveness, reduce costs and build clinically integrated networks that provide quality services across the carecontinuum. We intend to continue to market and expand Conifer’s revenue cycle management, patient communications andengagement services, and management services businesses. Conifer provides services to more than 800 Tenet and non-Tenethospital and other clients nationwide. This business has generated high margins and improved our overall results ofoperations in recent quarters. Conifer’s service offerings have also expanded to support value-based performance throughclinical integration, financial risk management and population health management, which are integral parts of the healthcareindustry’s movement toward accountable care organizations (“ACOs”) and similar risk-based or capitated contract models. Inaddition to hospitals and independent physician associations, clients for these services include health plans, self-insuredemployers, government agencies and other entities. We also remain focused on developing, acquiring or entering into jointventure arrangements to establish new capabilities at Conifer. In October 2014, Conifer acquired SPi Healthcare, whichprovides revenue cycle solutions for independent and provider-owned physician practices, thereby increasing our ability tooffer enterprise solutions to Conifer’s customers. In January 2015, Conifer announced a 10-year extension and expansion ofits agreement with Catholic Health Initiatives (“CHI”) to provide patient access, revenue integrity and patient financialservices to 92 CHI hospitals through 2032. Realizing HIT Incentive Payments and Other Benefits—Beginning in the year ended December 31, 2011, we beganachieving compliance with certain of the health information technology (“HIT”) requirements under the American Recoveryand Reinvestment Act of 2009 (“ARRA”). During the years ended December 31, 2015 and 2014, we recognizedapproximately $72 million and $104 million, respectively, of Medicare and Medicaid electronic health record (“EHR”)50 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsARRA incentives. These incentives partially offset the operating expenses and capital costs we have incurred and continueto incur to invest in HIT systems. We expect to recognize additional incentives in the future. Furthermore, we believe that theoperational benefits of HIT, including improved clinical outcomes and increased operating efficiencies, will contribute toour long-term ability to grow our business. General Economic Conditions—We believe that high unemployment rates in some of the markets our hospitalsserve and other adverse economic conditions have had a negative impact on our bad debt expense levels and payer mix.However, as the economy recovers, we expect to experience improvements in these metrics relative to recent levels. Webelieve our volumes were positively impacted in the year ended December 31, 2015 by incremental market share wegenerated through improved physician alignment and service line expansion, insurance coverage for a greater number ofindividuals, and a strengthening economy. Improving Operating Leverage—We believe targeted capital spending on critical growth opportunities for ourhospitals, emphasis on higher-demand clinical service lines (including outpatient lines), focus on expanding our outpatientbusiness, implementation of new payer contracting strategies, and improved quality metrics at our hospitals will improve ourpatient volumes. We believe our patient volumes have been constrained by the slow pace of the current economic recovery,increased competition, utilization pressure by managed care organizations, the effects of higher patient co-pays anddeductibles, and demographic trends. In addition, in several markets, we have formed clinically integrated organizations,which are collaborations with independent physicians and hospitals to develop ongoing clinical initiatives designed tocontrol costs and improve the quality of care delivered to patients. Arrangements like these provide a foundation fornegotiating with plans under an ACO structure or other risk-sharing model. Impact of Affordable Care Act—We anticipate that we will continue to benefit over time from the provisions of thePatient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010(“Affordable Care Act” or “ACA”) that have extended insurance coverage through Medicaid or private insurance to a broadersegment of the U.S. population. Although we are unable to predict the ultimate net effect of the Affordable Care Act on ourfuture results of operations, and while there have been and will continue to be some reductions in reimbursement rates bygovernmental payers, we began to receive reimbursement for caring for previously uninsured and underinsured patients in2014. Through collaborative efforts with local community organizations, we launched a campaign under the banner “Path toHealth” to assist our hospitals in educating and enrolling uninsured patients in insurance plans. At December 31, 2015, weoperated hospitals in six of the states (Arizona, California, Illinois, Massachusetts, Michigan and Pennsylvania) that haveexpanded their Medicaid programs. Our ability to execute on these strategies and manage these trends is subject to a number of risks and uncertaintiesthat may cause actual results to be materially different from expectations. In addition, it is important that we make steady andmeasurable progress in successfully integrating acquired businesses and new joint ventures into our business processes, asappropriate. For information about risks and uncertainties that could affect our results of operations, see the Forward-LookingStatements and Risk Factors sections in Part I of this report. RESULTS OF OPERATIONS—OVERVIEW We believe our results of operations for our most recent fiscal quarter best reflect recent trends we are experiencingwith respect to volumes, revenues and expenses; therefore, we have provided below information about these metrics for thethree months ended December 31, 2015 and 2014 on both a continuing operations and a same-hospital operations basis. Selected Operating Statistics for All Continuing Operations Hospitals— The following table shows certain selectedoperating statistics for our continuing operations, which includes the results of (i) our same 75 hospitals and six health plansoperated throughout the three months ended December 31, 2015 and 2014, (ii) TRMC, in which we acquired a majorityinterest on June 3, 2014, (iii) Resolute Health Hospital, which we opened on June 24, 2014, (iv) Emanuel Medical Center,which we acquired on August 1, 2014, (v) our USPI joint venture, in which we acquired a majority interest on June 16, 2015,(vi) Aspen, which we also acquired on June 16, 2015, (vii) Hi‑Desert Medical Center, which we began operating on July 15,2015, (viii) our Carondelet Heath Network joint venture, which we acquired a majority interest on August 31, 2015, (xi) ourjoint venture with Baptist Health System, Inc., which we formed on October 2, 2015, and (xii) DMC Surgery Hospital, whichwe closed in October 2015, in each case only for the period from acquisition, or commencement of operations of the facility,as the case may be, to December 31, 2015 and 2014, as applicable. We believe51 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsthis information is useful to investors because it reflects our current portfolio of operations and the recent trends we areexperiencing with respect to volumes, revenues and expenses. Continuing Operations Three Months Ended December 31, Increase Selected Operating Statistics 2015 2014 (Decrease) Hospital Operations and other Total admissions 211,991 202,337 4.8% Adjusted patient admissions 371,994 344,857 7.9% Paying admissions (excludes charity and uninsured) 200,462 191,105 4.9% Charity and uninsured admissions 11,529 11,232 2.6% Emergency department visits 778,148 737,680 5.5% Total surgeries 138,264 128,050 8.0% Patient days — total 983,856 937,803 4.9% Adjusted patient days 1,710,620 1,578,854 8.3% Average length of stay (days) 4.64 4.63 0.2% Number of hospitals (at end of period) 86 80 6 Average licensed beds 22,549 20,805 8.4% Utilization of licensed beds 47.4% 49.0% (1.6)% Total visits 2,198,005 1,995,237 10.2% Paying visits (excludes charity and uninsured) 2,024,725 1,829,872 10.6% Charity and uninsured visits 173,280 165,365 4.8% Ambulatory Care Total consolidated facilities (at end of period) 192 60 132 Total cases 289,033 148,019 95.3% (1)Adjusted patient admissions/days represents actual patient admissions/days adjusted to include outpatient services provided by facilities in ourHospital Operations and other segment by multiplying actual patient admissions/days by the sum of gross inpatient revenues and outpatientrevenues and dividing the results by gross inpatient revenues.(2)Utilization of licensed beds represents patient days divided by number of days in the period divided by average licensed beds.(3)The change is the difference between the 2015 and 2014 amounts shown. Total admissions increased by 9,654, or 4.8%, in the three months ended December 31, 2015 compared to the threemonths ended December 31, 2014. Total surgeries increased by 8.0% in the three months ended December 31, 2015compared to the same period in 2014. Our emergency department visits increased 5.5% in the three months endedDecember 31, 2015 compared to the same period in the prior year. Our volumes were positively impacted by acquisitions, aswell as, we believe, incremental market share we generated through improved physician alignment and service lineexpansion, insurance coverage for a greater number of individuals, and a strengthening economy. Charity and uninsuredadmissions and outpatient visits increased 2.6% and 4.8%, respectively, in the three months ended December 31, 2015compared to the three months ended December 31, 2014 primarily due to acquisitions. Continuing Operations Three Months Ended December 31, IncreaseRevenues 2015 2014 (Decrease)Net operating revenues before provision for doubtful accounts $5,417 $4,821 12.4% Hospital Operations and other Revenues from charity and the uninsured $267 $265 0.8%Net inpatient revenues $2,736 $2,719 0.6%Net outpatient revenues $1,616 $1,448 11.6% Ambulatory Care revenues $397 $90 341.1% Conifer revenues $384 $327 17.4% (1)Net inpatient revenues and net outpatient revenues are components of net operating revenues. Net inpatient revenues include self-payrevenues of $96 million and $99 million for the three months ended December 31, 2015 and 2014, respectively. Net outpatient revenuesinclude self-pay revenues of $171 million and $166 million for the three months ended December 31, 2015 and 2014, respectively.52 (1)(1)(3) (2)(3)(3) (1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsNet operating revenues before provision for doubtful accounts increased by $596 million, or 12.4%, in the threemonths ended December 31, 2015 compared to the same period in 2014, primarily due to acquisitions, increases in ouroutpatient volumes and improved managed care pricing, partially offset by decreased net revenues related to the timing ofthe approval of the California provider fee program that was approved in the three months ended December 31, 2014, whichresulted in a full year of program revenue being recorded in the fourth quarter of 2014. Net operating revenues beforeprovision for doubtful accounts in the three months ended December 31, 2015 included $49 million of net revenues from theCalifornia provider fee program compared to $165 million during the three months ended December 31, 2014 Continuing Operations Three Months Ended December 31, IncreaseProvision for Doubtful Accounts 2015 2014 (Decrease)Provision for doubtful accounts $391 $356 9.8%Provision for doubtful accounts as a percentage of net operating revenuesbefore provision for doubtful accounts 7.2% 7.4% (0.2)% (1)The change is the difference between the 2015 and 2014 amounts shown. Provision for doubtful accounts increased by $35 million, or 9.8%, in the three months ended December 31, 2015compared to the same period in 2014, and provision for doubtful accounts as a percentage of net operating revenues beforeprovision for doubtful accounts was 7.2% and 7.4% for the three months ended December 31, 2015 and 2014, respectively.The increase in the provision for doubtful accounts primarily related to the impact of the $596 million increase in our netoperating revenues before provision for doubtful accounts, including a $2 million increase in revenues from charity, and agreater amount of patient co-pays and deductibles. Our accounts receivable days outstanding (“AR Days”) from continuingoperations were 49.5 days at both December 31, 2015 and 2014, within our target of less than 55 days. Continuing Operations Three Months Ended December 31, IncreaseSelected Operating Expenses 2015 2014 (Decrease)Hospital Operations and other Salaries, wages and benefits $2,075 $1,898 9.3% Supplies 738 670 10.1% Other operating expenses 1,067 962 10.9% Total $3,880 $3,530 9.9% Ambulatory Care Salaries, wages and benefits $130 $24 441.7% Supplies 79 18 338.9% Other operating expenses 78 19 310.5% Total $287 $61 370.5% Conifer Salaries, wages and benefits $238 $196 21.4% Other operating expenses 85 67 26.9% Total $323 $263 22.8% Total Salaries, wages and benefits $2,443 $2,118 15.3% Supplies 817 688 18.8% Other operating expenses 1,230 1,048 17.4% Total $4,490 $3,854 16.5% Rent/lease expense Hospital Operations and other $67 $55 21.8%Conifer 4 3 33.3% Ambulatory Care 15 6 150.0% Total $86 $64 34.4%(1)Included in other operating expenses.53 (1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Continuing Operations Three Months Ended December 31, IncreaseSelected Operating Expenses per Adjusted Patient Admission 2015 2014 (Decrease)Hospital Operations and other Salaries, wages and benefits per adjusted patient admission $5,577 $5,550 0.5% Supplies per adjusted patient admission 1,984 1,943 2.1% Other operating expenses per adjusted patient admission 2,890 2,810 2.8% Total per adjusted patient admission $10,451 $10,303 1.4% (1)Adjusted patient admissions represents actual patient admissions adjusted to include outpatient services provided by facilities in our HospitalOperations and other segment by multiplying actual patient admissions by the sum of gross inpatient revenues and outpatient revenues anddividing the results by gross inpatient revenues. Salaries, wages and benefits per adjusted patient admission increased 0.5% in the three months endedDecember 31, 2015 compared to the same period in 2014. This change is primarily due to a greater number of employedphysicians, annual merit increases for certain of our employees and increased employee health benefits costs, partially offsetby a decline in contract labor costs, in the three months ended December 31, 2015 compared to the three months endedDecember 31, 2014. Supplies expense per adjusted patient admission increased 2.1% in the three months ended December 31, 2015compared to the three months ended December 31, 2014. The change in supplies expense was primarily attributable to highercosts for pharmaceuticals and cardiology supplies, and volume growth in our supply-intensive surgical services. Other operating expenses per adjusted patient admission increased by 2.8% in the three months endedDecember 31, 2015 compared to the three months ended December 31, 2014. This increase is due to higher contractedservices and medical fees primarily related to a greater number of employed and contracted physicians, as well as increasedmalpractice expense. Malpractice expense was $20 million higher in the 2015 period compared to the 2014 period due toincremental patient volumes and unfavorable adjustments to settle various cases to mitigate the risk of protracted litigation.The 2015 period included a favorable adjustment of approximately $7 million due to a 34 basis point increase in the interestrate used to estimate the discounted present value of projected future malpractice liabilities compared to a unfavorableadjustment of approximately $4 million as a result of a 25 basis point decrease in the interest rate in the 2014 period. The table below shows the pre-tax and after-tax impact on continuing operations for the three months and yearsended December 31, 2015 and 2014 of the following items: Three Months Ended Years Ended December 31, December 31, 2015 2014 2015 2014 (Expense) Income Impairment and restructuring charges, and acquisition-related costs $(52) $(63) $(318) $(153) Litigation and investigation costs (224) (6) (291) (25) Loss from early extinguishment of debt (1) — (1) (24) Gains on sales, consolidation and deconsolidation of facilities 186 — 186 — Pre-tax impact $(91) $(69) $(424) $(202) Total after-tax impact $(135) $(43) $(350) $(111) Diluted per-share impact of above items $(1.36) $(0.42) $(3.48) $(1.11) Diluted earnings (loss) per share, including above items $(1.01) $0.61 $(1.43) $0.34 54 (1)(1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsLIQUIDITY AND CAPITAL RESOURCES OVERVIEW Cash and cash equivalents were $356 million at December 31, 2015 compared to $450 million atSeptember 30, 2015. Significant cash flow items in the three months ended December 31, 2015 included: ·Net cash provided by operating activities before interest, taxes and restructuring charges, acquisition-relatedcosts, and litigation costs and settlements of $576 million; ·Capital expenditures of $276 million; ·Purchases of businesses and equity interests of $336 million; ·Interest payments of $340 million; ·$110 million of net repayment for revolving credit facility; and ·$522 million for proceeds from sales of facilities. Net cash provided by operating activities was $1.026 billion in the year ended December 31, 2015 compared to $687 millionin the year ended December 31, 2014. Key positive and negative factors contributing to the change between the 2015 and2014 periods include the following: ·Increased income from continuing operations before income taxes of $324 million, excluding net gain on salesof investments, investment earnings (loss), gain (loss) from early extinguishment of debt, interest expense, gainson sales, consolidation and deconsolidation of facilities, litigation and investigation costs, impairment andrestructuring charges, and acquisition-related costs, and depreciation and amortization in the year endedDecember 31, 2015 compared to the year ended December 31, 2014; ·$436 million less cash used by the change in accounts receivable, net of provision of doubtful accounts, in the2015 period; ·Higher aggregate annual 401(k) matching contributions and annual incentive compensation payments of$57 million and $95 million, respectively, in the year ended December 31, 2015 compared to the year endedDecember 31, 2014; ·An increase of $32 million in payments on reserves for restructuring charges, acquisition-related costs, andlitigation costs and settlements; and ·Higher interest payments of $133 million. SOURCES OF REVENUE We receive revenues for patient services from a variety of sources, primarily managed care payers and the federalMedicare program, as well as state Medicaid programs, indemnity-based health insurance companies and self-pay patients(that is, patients who do not have health insurance and are not covered by some other form of third-party arrangement). 55 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsThe table below shows the sources of net patient revenues before provision for doubtful accounts for our HospitalOperations and other segment, expressed as percentages of net patient revenues before provision for doubtful accounts fromall sources: Years Ended December 31, Net Patient Revenues from: 2015 2014 2013 Medicare 20.4% 22.0% 21.9% Medicaid 8.7% 9.6% 9.2% Managed care 60.6% 58.4% 58.0% Indemnity, self-pay and other 10.3% 10.0% 10.9% Our payer mix on an admissions basis for our Hospital Operations and other segment, expressed as a percentage oftotal admissions from all sources, is shown below: Years Ended December 31, Admissions from: 2015 2014 2013Medicare 26.7% 27.5% 28.0% Medicaid 8.0% 10.3% 11.7% Managed care 57.5% 54.5% 50.0% Indemnity, self-pay and other 7.8% 7.7% 10.3% GOVERNMENT PROGRAMS The Centers for Medicare and Medicaid Services is the single largest payer of healthcare services in theUnited States. Approximately 126 million Americans rely on healthcare benefits through Medicare, Medicaid and theChildren’s Health Insurance Program (“CHIP”). These three programs are authorized by federal law and directed by CMS, anagency of the U.S. Department of Health and Human Services (“HHS”). Medicare is a federally funded health insuranceprogram primarily for individuals 65 years of age and older, certain younger people with disabilities, and people with end-stage renal disease, and is provided without regard to income or assets. Medicaid is administered by the states and is jointlyfunded by the federal government and state governments. Medicaid is the nation’s main public health insurance program forpeople with low incomes and is the largest source of health coverage in the United States. The CHIP, which is alsoadministered by the states and jointly funded, provides health coverage to children in families with incomes too high toqualify for Medicaid, but too low to afford private coverage. The Affordable Care Act The ACA, which was signed into law on March 23, 2010, changes how healthcare services in the United States arecovered, delivered and financed. One key provision of the ACA is the individual mandate, which requires most Americans tomaintain “minimum essential” health insurance coverage. Those who do not comply with the individual mandate must makea “shared responsibility payment” to the federal government in the form of a tax penalty. The penalty percentage increasesthrough 2016, and is adjusted for inflation beginning in 2017. For individuals who are not exempt from the individualmandate, and who do not receive health insurance through an employer or government program, the means of satisfying therequirement is to purchase insurance from a private company or a health insurance exchange. Beginning in 2014, individualswho are enrolled in a health benefits plan purchased through an exchange may be eligible for a premium credit or cost-sharing subsidy. Following legal challenges seeking to limit the availability of premium credits and subsidies only toindividuals enrolled in coverage through a state-based exchange, the U.S. Supreme Court in June 2015 upheld U.S. InternalRevenue Service regulations extending such subsidies to individuals who purchase coverage through the federalgovernment’s health insurance exchange. As of December 31, 2015, we operated hospitals in two states that run their ownhealth insurance exchanges and 13 states that rely on the federal exchange. The “employer mandate” provision of the ACA requires the imposition of penalties on employers having 50 or moreemployees who do not offer affordable health insurance coverage to those working 30 or more hours per week. In February2014, certain requirements of the employer mandate were partially delayed. Employers with 100 or more full time equivalentemployees were required to insure at least 70% of their employees beginning in 2015 and 95% of their employees by 2016;employers with 50-99 full time equivalent employees are required to start insuring their employees in56 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents2016. We cannot predict what action the federal government might take to lift or extend the delay or the impact of any suchaction on insurance coverage. Another key provision of the ACA is the expansion of Medicaid coverage. Prior to the passage of the ACA, theMedicaid program offered federal funding to states to assist only limited categories of low-income individuals (includingchildren, pregnant women, the blind and the disabled) in obtaining medical care. The ACA expanded eligibility underexisting Medicaid programs to virtually all individuals under 65 years old with incomes up to 138% of the federal povertylevel beginning in 2014. Under the ACA, the federal government will pay 100% of the costs of Medicaid expansion in 2014,2015 and 2016; federal funding will be reduced to 90% over the course of the four-year period from 2017 through 2020, andit will remain at 90% for 2021 and beyond. The expansion of the Medicaid program in each state requires state legislative orregulatory action and the approval by CMS of a state Medicaid plan amendment. At December 31, 2015, 31 states and theDistrict of Columbia have taken action to expand Medicaid, and one other is considering action to expand in the near future.We currently operate hospitals in six of the states (Arizona, California, Illinois, Massachusetts, Michigan and Pennsylvania)that have expanded their Medicaid programs. We cannot provide any assurances as to whether or when the other states inwhich we operate might choose to expand their Medicaid programs. We anticipate that healthcare providers will continue to generally benefit over time from insurance coverageprovisions of the ACA; however, the ACA also contains a number of provisions designed to significantly reduce Medicareand Medicaid program spending to offset the cost of ACA or reduce payments for uncompensated care as the number ofuninsured individuals declines, including: (1) negative adjustments to the annual market basket updates for Medicareinpatient, outpatient, long-term acute and inpatient rehabilitation prospective payment systems, which began in 2010, aswell as additional “productivity adjustments” that began in 2011; and (2) reductions to Medicare and Medicaiddisproportionate share hospital (“DSH”) payments, which began for Medicare payments in federal fiscal year (“FFY”) 2014and will begin for Medicaid payments in FFY 2018. We are unable to predict the net effect of the ACA on our future revenuesand operations at this time due to uncertainty regarding the ultimate number of uninsured individuals who will obtain andretain insurance coverage, uncertainty regarding future negotiations with payers, uncertainty regarding Medicaid expansion,and gradual and, in some cases, delayed implementation. Furthermore, we are unable to predict the outcome of continuinglegal challenges to certain provisions of the ACA, what action, if any, Congress might take with respect to the ACA or theactions individual states might take with respect to expanding Medicaid coverage. For a discussion of the risks anduncertainties associated with the ACA, including the future course of related legislation and regulations, see Item 1A, RiskFactors, of Part I of this report. 57 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsMedicare Medicare offers its beneficiaries different ways to obtain their medical benefits. One option, the Original MedicarePlan (which includes “Part A” and “Part B”), is a fee-for-service payment system. The other option, called MedicareAdvantage (sometimes called “Part C” or “MA Plans”), includes health maintenance organizations (“HMOs”), preferredprovider organizations (“PPOs”), private fee-for-service Medicare special needs plans and Medicare medical savings accountplans. The major components of our net patient revenues from our Hospital Operations and other segment for servicesprovided to patients enrolled in the Original Medicare Plan for the years ended December 31, 2015, 2014 and 2013 are setforth in the following table: Years Ended December 31, Revenue Descriptions 2015 2014 2013 Medicare severity-adjusted diagnosis-related group — operating $1,744 $1,677 $1,201 Medicare severity-adjusted diagnosis-related group — capital 161 154 107 Outliers 61 69 53 Outpatient 953 896 594 Disproportionate share 337 370 250 Direct Graduate and Indirect Medical Education 256 250 138 Other 5 98 42 Adjustments for prior-year cost reports and related valuation allowances 62 30 32 Total Medicare net patient revenues $3,579 $3,544 $2,417 (1)Includes revenues related to the 28 hospitals we acquired from Vanguard on October 1, 2013, as well as TRMC, Resolute Health Hospital,Emanuel Medical Center, Hi-Desert Medical Center and our hospitals located in Tucson, Arizona.(2)Includes Indirect Medical Education revenue earned by our children’s hospitals under the Children’s Hospitals Graduate Medical EducationPayment Program administered by the Health Resources and Services Administration of HHS.(3)The other revenue category includes inpatient psychiatric units, inpatient rehabilitation units, one long-term acute care hospital, otherrevenue adjustments, and adjustments related to the estimates for current-year cost reports and related valuation allowances. A general description of the types of payments we receive for services provided to patients enrolled in the OriginalMedicare Plan is provided below. Recent regulatory and legislative updates to the terms of these payment systems and theirestimated effect on our revenues can be found under “Regulatory and Legislative Changes” below. Acute Care Hospital Inpatient Prospective Payment System Medicare Severity-Adjusted Diagnosis-Related Group Payments—Sections 1886(d) and 1886(g) of the SocialSecurity Act (the “Act”) set forth a system of payments for the operating and capital costs of inpatient acute care hospitaladmissions based on a prospective payment system (“PPS”). Under the inpatient prospective payment systems (“IPPS”),Medicare payments for hospital inpatient operating services are made at predetermined rates for each hospital discharge.Discharges are classified according to a system of Medicare severity-adjusted diagnosis-related groups (“MS-DRGs”), whichcategorize patients with similar clinical characteristics that are expected to require similar amounts of hospital resources.CMS assigns to each MS-DRG a relative weight that represents the average resources required to treat cases in that particularMS-DRG, relative to the average resources used to treat cases in all MS-DRGs. The base payment amount for the operating component of the MS-DRG payment is comprised of an averagestandardized amount that is divided into a labor-related share and a nonlabor-related share. Both the labor-related share ofoperating base payments and the base payment amount for capital costs are adjusted for geographic variations in labor andcapital costs, respectively. Using diagnosis and procedure information submitted by the hospital, CMS assigns to eachdischarge an MS-DRG, and the base payments are multiplied by the relative weight of the MS-DRG assigned. The MS-DRGoperating and capital base rates, relative weights and geographic adjustment factors are updated annually, with considerationgiven to: the increased cost of goods and services purchased by hospitals; the relative costs associated with each MS-DRG;and changes in labor data by geographic area. Although these payments are adjusted for area labor and capital costdifferentials, the adjustments do not take into consideration an individual hospital’s operating and capital costs. Outlier Payments—Outlier payments are additional payments made to hospitals on individual claims for treatingMedicare patients whose medical conditions are costlier to treat than those of the average patient in the same MS-DRG. Toqualify for a cost outlier payment, a hospital’s billed charges, adjusted to cost, must exceed the payment rate for the MS-DRGby a fixed threshold established annually by CMS. A Medicare administrative contractor (“MAC”) calculates the cost of aclaim by multiplying the billed charges by a cost-to-charge ratio that is typically based on the58 (1)(1)(2)(3)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentshospital’s most recently filed cost report. Generally, if the computed cost exceeds the sum of the MS-DRG payment plus thefixed threshold, the hospital receives 80% of the difference as an outlier payment. Under the Act, CMS must project aggregate annual outlier payments to all PPS hospitals to be not less than 5% ormore than 6% of total MS-DRG payments (“Outlier Percentage”). The Outlier Percentage is determined by dividing totaloutlier payments by the sum of MS-DRG and outlier payments. CMS annually adjusts the fixed threshold to bring projectedoutlier payments within the mandated limit. A change to the fixed threshold affects total outlier payments by changing: (1)the number of cases that qualify for outlier payments; and (2) the dollar amount hospitals receive for those cases that qualifyfor outlier payments. Disproportionate Share Hospital Payments—In addition to making payments for services provided directly tobeneficiaries, Medicare makes additional payments to hospitals that treat a disproportionately high share of low-incomepatients. Prior to October 1, 2013, DSH payments were determined annually based on certain statistical information definedby CMS and calculated as a percentage add-on to the MS-DRG payments. The ACA revised the Medicare DSH adjustmenteffective for discharges occurring on or after October 1, 2014. Under the revised methodology, hospitals receive 25% of theamount they previously would have received under the pre-ACA formula. This amount is referred to as the “EmpiricallyJustified Amount.” Hospitals qualifying for the Empirically Justified Amount of DSH payments are also eligible to receive anadditional payment for uncompensated care (the “UC DSH Amount”). The UC DSH Amount is a hospital’s share of a pool offunds that equal 75% of what otherwise would have been paid as Medicare DSH, adjusted for changes in the percentage ofindividuals that are uninsured. For FFY 2014, each Medicare DSH hospital’s share of the UC DSH Amount pool is based onits share of insured low income days reported by all Medicare DSH hospitals. Generally, the factors used to calculate anddistribute the UC DSH pool are set forth in ACA and are not subject to administrative or judicial review. The annual estimateof the size of the pool is made by the CMS Office of the Actuary and is based on the projections of total DSH payments thatwould have been made under the pre-ACA formula. Although the statute requires that each hospital’s cost of uncompensatedcare as a percentage of the total uncompensated care cost of all DSH hospitals be used to allocate the pool, CMS determinedthat the available cost data was unreliable and is using low income days (i.e., Medicaid days) to distribute the pool. AlthoughCMS indicated that it would provide additional information regarding the UC DSH allocation basis in the FFY 2017 IPPSProposed Rule, we cannot predict what action, if any, CMS will take, the timing of such action, or what impact such actionwill have on our net revenues and cash flows.During 2015, 71 of our acute care hospitals in continuing operations qualified for Medicare DSH payments. One ofthe variables used in the pre-ACA DSH formula is the number Medicare inpatient days attributable to patients receivingSupplemental Security Income (“SSI”) who are also eligible for Medicare Part A benefits divided by total Medicare inpatientdays (the “SSI Ratio”). In an earlier rulemaking, CMS established a policy of including not only days attributable to OriginalMedicare Plan patients, but also Medicare Advantage patients in the SSI ratio. The statutes and regulations that governMedicare DSH payments have been the subject of various administrative appeals and lawsuits, and our hospitals have beenparticipating in such appeals, including challenges to the inclusion of the Medicare Advantage days used in the DSHcalculation as set forth in the Changes to the Hospital Inpatient Prospective Payment Systems and Fiscal Year 2005 Rates(“FFY 2005 Final Rule”). We are not able to predict what action the Secretary might take with respect to the DSH calculationin this regard; however, a favorable outcome of our DSH appeals could have a material impact on our future revenues andcash flows.Direct Graduate and Indirect Medical Education Payments—The Medicare program provides additionalreimbursement to approved teaching hospitals for additional expenses incurred by such institutions. This additionalreimbursement, which is subject to certain limits, including intern and resident full-time equivalent (“FTE”) limits, is made inthe form of Direct Graduate Medical Education (“DGME”) and Indirect Medical Education (“IME”) payments. During 2015,30 of our hospitals in continuing operations were affiliated with academic institutions and were eligible to receive suchpayments. 59 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsHospital Outpatient Prospective Payment System Under the outpatient prospective payment system, hospital outpatient services, except for certain services that arereimbursed on a separate fee schedule, are classified into groups called ambulatory payment classifications (“APCs”).Services in each APC are similar clinically and in terms of the resources they require, and a payment rate is established foreach APC. Depending on the services provided, hospitals may be paid for more than one APC for an encounter. CMSperiodically updates the APCs and annually adjusts the rates paid for each APC. Inpatient Psychiatric Facility Prospective Payment System The inpatient psychiatric facility prospective payment system (“IPF-PPS”) applies to psychiatric hospitals andpsychiatric units located within acute care hospitals that have been designated as exempt from the hospital inpatientprospective payment system. The IPF-PPS is based on prospectively determined per-diem rates and includes an outlier policythat authorizes additional payments for extraordinarily costly cases. At December 31, 2015, 27 of our general hospitalsoperated IPF units. Inpatient Rehabilitation Prospective Payment System Rehabilitation hospitals and rehabilitation units in acute care hospitals meeting certain criteria established by CMSare eligible to be paid as an inpatient rehabilitation facility (“IRF”) under the IRF prospective payment system (“IRF-PPS”).Payments under the IRF-PPS are made on a per-discharge basis. The IRF-PPS uses federal prospective payment rates acrossdistinct case-mix groups established by a patient classification system. At December 31, 2015, we operated one freestandingIRF, and 20 of our general hospitals operated IRF units. Physician Services Payment System Medicare pays for physician and other professional services based on a list of services and their payment rates calledthe Medicare Physician Fee Schedule (“MPFS”). In determining payment rates for each service on the fee schedule, CMSconsiders the amount of work required to provide a service, expenses related to maintaining a practice, and liabilityinsurance costs. The values given to these three types of resources are adjusted by variations in the input prices in differentmarkets, and then a total is multiplied by a standard dollar amount, called the fee schedule’s conversion factor, to arrive atthe payment amount. Medicare’s payment rates may be adjusted based on provider characteristics, additional geographicdesignations and other factors. The conversion factor updates payments for physician services every year according topayment updates and provisions prescribed by The Medicare Access and Children’s Health Insurance Program Act(“MACRA”) that was signed into law on April 16, 2015. Cost Reports The final determination of certain Medicare payments to our hospitals, such as DSH, DGME, IME and bad debtexpense, are retrospectively determined based on our hospitals’ cost reports. The final determination of these payments oftentakes many years to resolve because of audits by the program representatives, providers’ rights of appeal, and the applicationof numerous technical reimbursement provisions. For filed cost reports, we adjust the accrual for estimated cost report settlements based on those cost reports andsubsequent activity, and record a valuation allowance against those cost reports based on historical settlement trends. Theaccrual for estimated cost report settlements for periods for which a cost report is yet to be filed is recorded based on estimatesof what we expect to report on the filed cost reports and a corresponding valuation allowance is recorded as previouslydescribed. Cost reports must generally be filed within five months after the end of the annual cost report reporting period.After the cost report is filed, the accrual and corresponding valuation allowance may need to be adjusted. Medicaid Medicaid programs and the corresponding reimbursement methodologies are administered by the states and varyfrom state to state and from year to year. Estimated revenues under various state Medicaid programs, including60 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsstate-funded managed care Medicaid programs, constituted approximately 18.3%, 18.1% and 16.5% of total net patientrevenues before provision for doubtful accounts of our continuing general hospitals for the years endedDecember 31, 2015, 2014 and 2013, respectively. We also receive DSH payments under various state Medicaid programs. Forthe years ended December 31, 2015, 2014 and 2013, our total Medicaid supplemental revenues attributable to DSH and othersupplemental revenues, including California provider fee program and Texas 1115 waiver program revenues described on thenext page, were approximately $888 million, $817 million and $428 million, respectively. The 2013 amount includes onlythree months of revenues related to the 28 hospitals we acquired from Vanguard on October 1, 2013. During the year endedDecember 31, 2015, we recorded an unfavorable adjustment of $35 million to reduce Medicaid supplemental revenuesrecognized over the past several years by our Valley Baptist hospitals in South Texas. This adjustment was necessary as aresult of the state’s recent review and update of several factors that influence payments to individual hospitals and statefunding levels. Also during the year ended December 31, 2015, we recognized a $41 million favorable adjustment to increasethe Medicaid supplemental revenues of our Detroit hospitals ($21 million of which related to the year endedDecember 31, 2014). This adjustment related to a recent update by Michigan of estimated funding levels, which increased asresult of the expansion of the state’s Medicaid program effective April 1, 2014. Several states in which we operate face budgetary challenges that have resulted, and likely will continue to result, inreduced Medicaid funding levels to hospitals and other providers. Because most states must operate with balanced budgets,and the Medicaid program is generally a significant portion of a state’s budget, states can be expected to adopt or consideradopting future legislation designed to reduce or not increase their Medicaid expenditures. In addition, some states delayissuing Medicaid payments to providers to manage state expenditures. As an alternative means of funding providerpayments, many of the states in which we operate have adopted provider fee programs or received waivers under Section1115 of the Social Security Act. Under a Medicaid waiver, the federal government waives certain Medicaid requirements,thereby giving states flexibility in the operation of their Medicaid program to allow states to test new approaches anddemonstration projects to improve care. Generally the Section 1115 waivers are for a period of five years with an option toextend the waiver for three additional years. Continuing pressure on state budgets and other factors could result in futurereductions to Medicaid payments, payment delays or additional taxes on hospitals. The Governor of California signed the Hospital Quality Assurance Fee (“HQAF”) renewal bill into law inOctober 2013, extending California’s provider fee program for three years beginning January 2014 (with a framework torenew the program for at least three additional years beyond 2016), and CMS approved the 36-month HQAF program in thethree months ended December 31, 2014. As of December 31, 2015, we expect the 36-month HQAF program will result inrevenues for our hospitals, net of provider fees and other expenses, of approximately $574 million in total. Certain of our Texas hospitals began to participate in the Texas Section 1115 demonstration waiver program. Thecurrent waiver five-year term expires on September 30, 2016, is funded by intergovernmental transfer payments from localgovernment entities, and includes two funding pools – Uncompensated Care and Delivery System Reform Payment. In 2015,we recognized $133 million of revenues from the Texas 1115 waiver programs. Separately, during the same period, weincurred $121 million of expenses related to funding indigent care services by certain of our Texas hospitals. On September30, 2015, the State of Texas submitted a request to CMS to extend the 1115 waiver program for a period of five years. Wecannot provide any assurances as to the extension of the 1115 waiver program, or the ultimate amount of revenues that ourhospitals may receive from this program in 2016 or future periods. Because we cannot predict what actions the federal government or the states may take under existing legislation andfuture legislation to address budget gaps, deficits, Medicaid expansion, provider fee programs or Medicaid section 1115waivers, we are unable to assess the effect that any such legislation might have on our business, but the impact on our futurefinancial position, results of operations or cash flows could be material. 61 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsMedicaid-related patient revenues recognized by our continuing general hospitals from Medicaid-related programsin the states in which they are located, as well as from Medicaid programs in neighboring states, for the years endedDecember 31, 2015, 2014 and 2013 are set forth in the table below: Years Ended December 31, 2015 2014 2013 Managed Managed Managed Hospital Location Medicaid Medicaid Medicaid Medicaid Medicaid Medicaid Michigan $366 $306 $337 $270 $64 $96 California 343 401 311 257 241 162 Texas 264 237 280 223 150 148 Florida 97 162 158 103 176 61 Illinois 88 50 80 32 33 6 Georgia 69 39 73 36 76 35 Missouri 50 14 67 9 64 6 Pennsylvania 66 206 73 194 74 200 Massachusetts 37 50 39 46 9 8 North Carolina 28 6 26 5 31 3 Alabama 37 — 12 — 13 — South Carolina 16 33 18 34 25 26 Tennessee 6 32 7 29 6 27 Arizona (16) 195 1 113 9 21 $1,451 $1,731 $1,482 $1,351 $971 $799 (1)Includes revenues related to the 28 hospitals we acquired from Vanguard on October 1, 2013, as well as TRMC, Resolute Health Hospital,Emanuel Medical Center, Hi-Desert Medical Center and our hospitals located in Tucson, Arizona. Regulatory and Legislative Changes The Medicare and Medicaid programs are subject to statutory and regulatory changes, administrative and judicialrulings, interpretations and determinations, requirements for utilization review, and federal and state funding restrictions, allof which could materially increase or decrease payments from these government programs in the future, as well as affect thecost of providing services to our patients and the timing of payments to our facilities. We are unable to predict the effect offuture government healthcare funding policy changes on our operations. If the rates paid by governmental payers arereduced, if the scope of services covered by governmental payers is limited, or if we or one or more of our subsidiaries’hospitals are excluded from participation in the Medicare or Medicaid program or any other government healthcare program,there could be a material adverse effect on our business, financial condition, results of operations or cash flows. Recentregulatory and legislative updates to the Medicare and Medicaid payment systems are provided below. Payment and Policy Changes to the Medicare Inpatient Prospective Payment Systems Under Medicare law, CMS is required to annually update certain rules governing the inpatient prospective paymentsystems (“IPPS”). The updates generally become effective October 1, the beginning of the federal fiscal year. On July 31,2015, CMS issued Changes to the Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and Fiscal Year2016 Rates (“Final IPPS Rule”). The Final IPPS Rule includes the following payment and policy changes:·A market basket increase of 2.4% for Medicare severity-adjusted diagnosis-related group (“MS-DRG”)operating payments for hospitals reporting specified quality measure data and that are meaningful users of EHRtechnology (hospitals that do not report specified quality measure data and/or are not meaningful users of EHRtechnology will receive a reduced market basket increase); CMS is also making certain adjustments to theestimated 2.4% market basket increase that result in a net market basket update of 0.9% (before budgetneutrality adjustments), including: ·Market basket index and multifactor productivity reductions required by the ACA of 0.5% and 0.2%,respectively; and62 (1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents ·A documentation and coding recoupment reduction of 0.8% as required by the American Taxpayer ReliefAct of 2012; ·Updates to the factors used to determine the amount and distribution of Medicare uncompensated caredisproportionate share (“UC-DSH”) payments; ·A 0.85% net increase in the capital federal MS-DRG rate; and ·A decrease in the cost outlier threshold from $24,626 to $22,544. CMS projects that the combined impact of the payment and policy changes in the Final IPPS Rule will yield anaverage 0.4% increase in payments for hospitals in large urban areas (populations over one million). The payment and policychanges result in an estimated 1.4% decrease in our annual IPPS payments, which yields an estimated reduction ofapproximately $35 million in our annual Medicare IPPS payments. Most of this decrease is due to an expected decline inMedicare UC-DSH reimbursement. Because of the uncertainty regarding factors that may influence our future IPPS paymentsby individual hospital, including legislative action, admission volumes, length of stay and case mix, we cannot provide anyassurances regarding our estimate. Payment and Policy Changes to the Medicare Outpatient Prospective Payment and Ambulatory Surgical CenterPayment Systems On October 30, 2015, CMS released the Medicare Hospital Outpatient Prospective Payment System (“OPPS”) andAmbulatory Surgical Center (“ASC”) Payment System changes for calendar year 2016 (“Final OPPS/ASC Rule”). The FinalOPPS/ASC Rule includes the following payment and policy changes: ·An estimated net decrease in the OPPS rates of 0.3% based on the projected market basket increase of 2.4%reduced by a multifactor productivity adjustment of 0.5%, an additional 0.2% adjustment required by the ACAand a 2.0% reduction to correct for inflation in OPPS payment rates; ·Changes to the two-midnight rule under CMS’ short inpatient hospital stay policy, including a case-by-caseexceptions policy for stays spanning fewer than two midnights, and the shifting of patient status medicalreviews from Medicare Administrative Contractors to Quality Improvement Organizations; and ·A 0.3% increase in the ASC payment rates for ASCs that meet the quality reporting requirements under the ASCQuality Reporting Program. CMS projects that the combined impact of the payment and policy changes in the Final OPPS/ASC Rule will yieldan average 0.4% decrease in OPPS payments for all facilities and an average 0.3% decrease in OPPS payments for facilities inlarge urban areas (populations over one million). Based on CMS’ estimates, the projected annual impact of the payment andpolicy changes in the Final OPPS/ASC Rule on our facilities is a decrease of approximately $8 million in Medicareoutpatient revenues. Because of the uncertainty associated with various factors that may influence our future OPPS payments,including legislative action, volumes and case mix, we cannot provide any assurances regarding our estimate of the impact ofthese changes. The Medicare Access and CHIP Reauthorization Act of 2015 On April 16, 2015, the President signed the Medicare Access and CHIP Reauthorization Act of 2015 (“MACRA”),which made numerous changes to Medicare, Medicaid, and other healthcare and related programs, as well as averted a 21%reduction to Medicare payments under the Medicare Physician Fee Schedule (“MPFS”) that was scheduled to take effect onApril 1, 2015. Significant provisions of the legislation include: ·Freezing MPFS payment rates at then-current levels for the period from April 1 through June 30, 2015, and thenincreasing the rates by 0.5% for services furnished during the last six months of 2015;63 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents ·Replacing the Sustainable Growth Rate (“SGR”) formula with new systems for establishing the annual updatesto payment rates for physicians’ services in Medicare; specifically, ·Payments made under the MPFS will increase by 0.5% per year for services furnished during calendaryears 2016 through 2019; ·Payment rates for services on the MPFS will remain at the 2019 level through 2025, but the amountspaid to individual providers will be subject to adjustment through one of two mechanisms, dependingon whether the physician chose to participate in the Merit-Based Incentive Payment System or anAlternative Payment Model (“APM”) program; and ·For 2026 and subsequent years, there will be two payment rates for services on the MPFS; for providerspaid through an APM program, payment rates will be increased each year by 0.75%, while paymentrates for other providers will be increased each year by 0.25%; ·Temporarily extending through 2017 the CHIP and a number of other expiring provisions, some of whichincrease payments to hospitals, physicians and ambulance providers; ·Delaying by one year the effective date and revising the reductions to Medicaid DSH allotments to states asrequired by the ACA from FFY 2017 to 2018; ·Extending through the remainder of FFY 2015 the two-midnight rule regarding certain medical patient statusreview activities conducted by Medicare Administrative Contractors and Recovery Audit Contractors (onAugust 12, 2015, CMS announced that it would extend until December 31, 2015 the moratorium onenforcement of the two-midnight policy); ·Making permanent a subsidy of Part B premiums for certain low-income Medicare beneficiaries and theavailability of up to one year of additional Medicaid benefits for certain low-income families who wouldotherwise lose such coverage; and ·Partially offsetting the budgetary cost of these provisions—largely by reducing updates to Medicare’s paymentrates for services furnished by hospitals and providers of post-acute care, and by increasing premiums paid byMedicare enrollees who have relatively high income. Payment and Policy Changes to the Medicare Physician Fee Schedule On October 30, 2015, CMS issued a final rule updating the MPFS for calendar year 2016 (“MPFS Final Rule”). Thefinal rule contains various provisions to update payment rates and policies, including an update mandated by the MACRAdescribed above, along with quality provisions for services furnished under the MPFS. The MPFS Final Rule also begins toimplement other provisions under the law, which will over time replace the SGR formula, with new payment systems forphysicians and other practitioners. Payment and policy changes in the MPFS Final Rule include: ·A net decrease of 0.29% in the MPFS payment rates resulting from a 0.5% update to the payment rates mandatedby the MACRA, a negative 0.02% Relative Value Unit Budget Neutrality Adjustment and a 0.77% negativeTarget Recapture Amount required by the Protecting Access to Medicare Act of 2014 and quality provisions forservices furnished under the MPFS; ·New exceptions to the physician self-referral law allowing payments to physicians to employ non-physicianpractitioners and allowing timeshare arrangements for the use of office space, equipment, personnel, suppliesand other services; ·Additional guidance and clarification of terminology related to how financial relationships are documented; 64 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents·Clarification of the calculation of the percentage of physician ownership of a hospital, which is limited underthe ACA to specify that the percentage would include all doctors rather than just those who refer to the hospital;and ·Providing payment for certain advance care planning services provided by physicians and other practitioners toMedicare beneficiaries. Comprehensive Care for Joint Replacement Final Rule On November 16, 2015, CMS issued the Comprehensive Care for Joint Replacement (“CJR”) Final Rule (“CJR FinalRule”). The CCJR Final Rule introduces a fee-for-service demonstration payment model that will hold hospitals financiallyaccountable for the quality of care delivered to Medicare fee-for-service beneficiaries for lower extremity joint replacement(“LEJR”) (i.e., hip and knee replacement) episodes from surgery through recovery for a period of 90 days followingdischarge. With some limited exceptions, the five-year demonstration program is effective on April 1, 2016 and is mandatoryfor all IPPS hospitals located in 67 geographic areas. Beginning in 2017, participating hospitals will be eligible to receiveincentive payments or will be subject to payment reductions within certain corridors based on their performance againstquality and spending criteria. As of December 31, 2015, 20 of our acute care hospitals and four short-stay surgical hospitals operated by our USPIjoint venture are located in one of the 67 geographic areas selected by CMS for the CJR demonstration program. We cannotpredict what impact, if any, the CJR Final Rule will have on our inpatient volumes, net revenues or cash flows. Bipartisan Budget Act of 2015 On November 2, 2015, the President signed the Bipartisan Budget Act of 2015 (“BBA 2015”). The legislation raisesthe debt ceiling through March 2017 and establishes a federal budget through FFY 2017. The BBA 2015 includes thefollowing payment policies affecting Medicare beneficiaries, hospitals and other providers: ·Medicare Part B premium relief for the 30% of beneficiaries facing massive increases beginning in 2016; ·An extension through FFY 2025 of a 2% reduction (referred to as the “sequestration adjustment”) to allMedicare payments, mandated by the Budget Control Act of 2011, that was originally scheduled to expire in2021 and subsequently extended through 2024; and ·Creation of a site-neutral payment policy for services provided in off-campus outpatient departments ofhospitals. This provision: ·Creates a permanent exemption from site-neutral payment adjustments for off-campus hospital-basedemergency departments; ·Grandfathers off-campus hospital outpatient departments that billed for services under the OPPS as of thedate of enactment; and ·Provides that, beginning January 1, 2017, off-campus hospital outpatient departments that are notgrandfathered or exempt will be paid under the MPFS or ASC fee schedule. Medicare Claims Reviews HHS estimates that approximately 12.1% of all Medicare Fee-For-Service (“FFS”) claim payments in FFY 2015 wereimproper. CMS has identified the FFS program as a program at risk for significant erroneous payments. One of CMS’ statedkey goals is to pay claims properly the first time. This means paying the right amount, to legitimate providers, for covered,reasonable and necessary services provided to eligible beneficiaries. According to CMS, paying correctly the first time savesresources required to recover improper payments and ensures the proper expenditure of65 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsMedicare Trust Fund dollars. As a result, in addition to the Recovery Audit Contractor (“RAC”) program, which currentlyperforms post-payment claims reviews, CMS has recently established initiatives to prevent improper payments before a claimis processed. These initiatives include a significant increase in the number of prepayment claims reviews performed byMACs. Claims selected for prepayment review are not subject to the normal Medicare FFS payment timeframe. Furthermore,prepayment claims denials are subject to administrative and judicial review. We have established robust protocols to respondto claims reviews and payment denials. Payment recoveries resulting from MAC reviews can be appealed throughadministrative and judicial processes, and we intend to pursue the reversal of adverse determinations where appropriate. Inaddition to overpayments that are not reversed on appeal, we will incur additional costs to respond to requests for records andpursue the reversal of payment denials. The degree to which our Medicare FFS claims are subjected to prepayment reviews,the extent to which payments are denied, and our success in overturning denials could have a material adverse effect on ourcash flows and results of operations. The American Recovery and Reinvestment Act of 2009 ARRA was enacted to stimulate the U.S. economy. One provision of ARRA provides financial incentives tohospitals and physicians to become “meaningful users” of electronic health records. The Medicare incentive payments toindividual hospitals are made over a four-year, front-weighted transition period. The Medicaid incentive payments, which areadministered by the states, are subject to more flexible payment and compliance standards than Medicare incentivepayments; hospitals that achieve compliance between 2014 and 2015 will receive reduced incentive payments during thetransition period. During the year ended December 31, 2015, we recognized approximately $72 million of EHR incentives related tothe Medicare and Medicaid EHR incentive programs as a result of 54 of our hospitals, and certain of our employedphysicians and Ambulatory Care segment facilities, demonstrating meaningful use of certified EHR technology. The finalMedicare EHR incentive payments are determined when the cost report that begins in the federal fiscal year during which thehospital achieved meaningful use is settled. Medicare and Medicaid incentive payment amounts to which a provider isentitled are subject to post-payment audits. We anticipate recognizing approximately $30 million of Medicare and Medicaid EHR incentive payments in 2016.In addition to the expenditures we incur to qualify for these incentive payments, our operating expenses have increased andwe anticipate will increase in the future as a result of these information system investments. Eligible hospitals must continueto demonstrate meaningful use of EHR technology every year to avoid payment reductions in subsequent years. Thesereductions, which will be based on the market basket update, will be phased in over three years and will continue until ahospital achieves compliance. Should all of our hospitals fail to become meaningful users (or fail to continue to demonstratemeaningful use) of EHRs and fail to submit quality data, the penalties would result in reductions to our annual Medicaretraditional inpatient net revenues of up to $30 million in 2016 and up to $60 million in 2017 and subsequent years. The complexity of the changes required to our hospitals’ systems and the time required to complete the changes willlikely result in some or all of our facilities and physicians not being fully compliant in time to be eligible for the maximumHIT funding permitted under ARRA. Because of the uncertainties regarding the implementation of HIT, including CMS’future EHR implementation regulations, our ability to achieve compliance and the associated costs, we cannot provide anyassurances regarding the aforementioned estimates of incentives or penalties in future periods. PRIVATE INSURANCE Managed Care We currently have thousands of managed care contracts with various HMOs and PPOs. HMOs generally maintain afull-service healthcare delivery network comprised of physician, hospital, pharmacy and ancillary service providers thatHMO members must access through an assigned “primary care” physician. The member’s care is then managed by his or herprimary care physician and other network providers in accordance with the HMO’s quality assurance and utilization reviewguidelines so that appropriate healthcare can be efficiently delivered in the most cost-66 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentseffective manner. HMOs typically provide reduced benefits or reimbursement (or none at all) to their members who use non-contracted healthcare providers for non-emergency care. PPOs generally offer limited benefits to members who use non-contracted healthcare providers. PPO members whouse contracted healthcare providers receive a preferred benefit, typically in the form of lower co-pays, co-insurance ordeductibles. As employers and employees have demanded more choice, managed care plans have developed hybrid productsthat combine elements of both HMO and PPO plans, including high-deductible healthcare plans that may have limitedbenefits, but cost the employee less in premiums. The amount of our managed care net patient revenues during the years ended December 31, 2015, 2014 and 2013was $10.6 billion, $9.3 billion and $6.3 billion, respectively. Approximately 62% of our managed care net patient revenuesfor the year ended December 31, 2015 was derived from our top ten managed care payers. National payers generatedapproximately 48% of our total net managed care revenues. The remainder comes from regional or local payers. At December31, 2015 and 2014 approximately 59% and 60%, respectively, of our net accounts receivable related to continuingoperations were due from managed care payers. Revenues under managed care plans are based primarily on payment terms involving predetermined rates perdiagnosis, per-diem rates, discounted fee-for-service rates and other similar contractual arrangements. These revenues are alsosubject to review and possible audit by the payers, which can take several years before they are completely resolved. Thepayers are billed for patient services on an individual patient basis. An individual patient’s bill is subject to adjustment on apatient-by-patient basis in the ordinary course of business by the payers following their review and adjudication of eachparticular bill. We estimate the discounts for contractual allowances at the individual hospital level utilizing billing data onan individual patient basis. At the end of each month, on an individual hospital basis, we estimate our expectedreimbursement for patients of managed care plans based on the applicable contract terms. We believe it is reasonably likelyfor there to be an approximately 3% increase or decrease in the estimated contractual allowances related to managed careplans. Based on reserves at December 31, 2015, a 3% increase or decrease in the estimated contractual allowance wouldimpact the estimated reserves by approximately $15 million. Some of the factors that can contribute to changes in thecontractual allowance estimates include: (1) changes in reimbursement levels for procedures, supplies and drugs whenthreshold levels are triggered; (2) changes in reimbursement levels when stop-loss or outlier limits are reached; (3) changes inthe admission status of a patient due to physician orders subsequent to initial diagnosis or testing; (4) final coding of in-house and discharged-not-final-billed patients that change reimbursement levels; (5) secondary benefits determined afterprimary insurance payments; and (6) reclassification of patients among insurance plans with different coverage levels.Contractual allowance estimates are periodically reviewed for accuracy by taking into consideration known contract terms,as well as payment history. Although we do not separately accumulate and disclose the aggregate amount of adjustments tothe estimated reimbursement for every patient bill, we believe our estimation and review process enables us to identifyinstances on a timely basis where such estimates need to be revised. We do not believe there were any adjustments toestimates of patient bills that were material to our operating income. In addition, on a corporate-wide basis, we do not recordany general provision for adjustments to estimated contractual allowances for managed care plans. We expect managed care governmental admissions to continue to increase as a percentage of total managed careadmissions over the near term. However, the managed Medicare and Medicaid insurance plans typically generate loweryields than commercial managed care plans, which have been experiencing an improved pricing trend. Although we havebenefitted from solid year-over-year aggregate managed care pricing improvements for several years, we have seen theseimprovements moderate recently, and we believe the moderation could continue in future years. In the year ended December31, 2015, our commercial managed care net inpatient revenue per admission from our acute care hospitals was approximately76% higher than our aggregate yield on a per admission basis from government payers, including managed Medicare andMedicaid insurance plans. Indemnity An indemnity-based agreement generally requires the insurer to reimburse an insured patient for healthcare expensesafter those expenses have been incurred by the patient, subject to policy conditions and exclusions. Unlike an HMO member,a patient with indemnity insurance is free to control his or her utilization of healthcare and selection of healthcare providers.67 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsSELF-PAY PATIENTS Self-pay patients are patients who do not qualify for government programs payments, such as Medicare andMedicaid, do not have some form of private insurance and, therefore, are responsible for their own medical bills. A significantnumber of our self-pay patients are admitted through our hospitals’ emergency departments and often require high-acuitytreatment that is more costly to provide and, therefore, results in higher billings, which are the least collectible of allaccounts. Self-pay accounts pose significant collectability problems. At December 31, 2015 and 2014, approximately 5% and7%, respectively, of our net accounts receivable for our Hospital Operations and other segment were due from self-paypatients. Further, a significant portion of our provision for doubtful accounts relates to self-pay patients, as well as co-paysand deductibles owed to us by patients with insurance. We provide revenue cycle management services through our Conifersubsidiary. Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), a new ConsumerFinancial Protection Bureau (“CFPB”) was formed within the U.S. Federal Reserve to promote transparency, simplicity,fairness, accountability and equal access in the market for consumer financial products or services, including debt collectionservices. The Dodd-Frank Act gives significant discretion to the CFPB in establishing regulatory requirements andenforcement priorities. We believe that the CFPB regulatory and enforcement processes will have a significant impact onConifer’s operations.. For additional information, see Item 1, Business — Regulations Affecting Conifer’s Operations, of PartI of this report. Conifer has performed systematic analyses to focus our attention on the drivers of bad debt expense for eachhospital. While emergency department use is the primary contributor to our provision for doubtful accounts in the aggregate,this is not the case at all hospitals. As a result, we have been increasing our focus on targeted initiatives that concentrate onnon-emergency department patients as well. These initiatives are intended to promote process efficiencies in collecting self-pay accounts, as well as co-pay and deductible amounts owed to us by patients with insurance, that we deem highlycollectible. We leverage a statistical-based collections model that aligns our operational capacity to maximize ourcollections performance. We are dedicated to modifying and refining our processes as needed, enhancing our technology andimproving staff training throughout the revenue cycle process in an effort to increase collections and reduce accountsreceivable. Over the longer term, several other initiatives we have previously announced should also help address thischallenge. For example, our Compact with Uninsured Patients (“Compact”) is designed to offer managed care-stylediscounts to certain uninsured patients, which enables us to offer lower rates to those patients who historically had beencharged standard gross charges. A significant portion of those charges had previously been written down in our provision fordoubtful accounts. Under the Compact, the discount offered to uninsured patients is recognized as a contractual allowance,which reduces net operating revenues at the time the self-pay accounts are recorded. The uninsured patient accounts, net ofcontractual allowances recorded, are further reduced to their net realizable value through provision for doubtful accountsbased on historical collection trends for self-pay accounts and other factors that affect the estimation process. We also provide charity care to patients who are financially unable to pay for the healthcare services they receive.Most patients who qualify for charity care are charged a per-diem amount for services received, subject to a cap. Except forthe per-diem amounts, our policy is not to pursue collection of amounts determined to qualify as charity care; therefore, wedo not report these amounts in net operating revenues. Most states include an estimate of the cost of charity care in thedetermination of a hospital’s eligibility for Medicaid DSH payments. These payments are intended to mitigate our cost ofuncompensated care, as well as reduced Medicaid funding levels. Generally, our method of measuring the estimated costsuses adjusted self-pay/charity patient days multiplied by selected operating expenses (which include salaries, wages andbenefits, supplies and other operating expenses) per adjusted patient day. The adjusted self-pay/charity patient daysrepresents actual self-pay/charity patient days adjusted to include self-pay/charity outpatient services by multiplying actualself-pay/charity patient days by the sum of gross self-pay/charity inpatient revenues and gross self-pay/charity outpatientrevenues and dividing the results by gross self-pay/charity inpatient revenues. The following table shows our estimated costs(based on selected operating expenses) of caring for self-pay patients and charity care patients, as well as revenuesattributable to DSH and other supplemental revenues we recognized, in the 68 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsyears ended December 31, 2015, 2014 and 2013. Years Ended December 31, 2015 2014 2013Estimated costs for: Self-pay patients $678 $620 $545Charity care patients $191 $180 $158DSH and other supplemental revenues $888 $817 $428 The expansion of health insurance coverage has resulted in an increase in the number of patients using our facilitieswho have either health insurance exchange or government healthcare insurance program coverage. However, we continue tohave to provide uninsured discounts and charity care due to the failure of states to expand Medicaid coverage and forpersons living in the country illegally who are not permitted to enroll in a health insurance exchange or governmenthealthcare insurance program. RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2015 COMPARED TO THE YEAR ENDEDDECEMBER 31, 2014 The following two tables summarize our net operating revenues, operating expenses and operating income fromcontinuing operations, both in dollar amounts and as percentages of net operating revenues, for the years endedDecember 31, 2015 and 2014: Years Ended December 31, Increase 2015 2014 (Decrease) Net operating revenues: General hospitals $16,741 $15,518 $1,223 Other operations 3,370 2,390 980 Net operating revenues before provision for doubtful accounts 20,111 17,908 2,203 Less provision for doubtful accounts 1,477 1,305 172 Net operating revenues 18,634 16,603 2,031 Equity in earnings of unconsolidated affiliates 99 12 87 Operating expenses: Salaries, wages and benefits 9,011 8,023 988 Supplies 2,963 2,630 333 Other operating expenses, net 4,555 4,114 441 Electronic health record incentives (72) (104) 32 Depreciation and amortization 797 849 (52) Impairment and restructuring charges, and acquisition-related costs 318 153 165 Litigation and investigation costs 291 25 266 Gains on sales, consolidation and deconsolidation of facilities (186) — (186) Operating income $1,056 $925 $131 69 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Years Ended December 31, Increase 2015 2014 (Decrease) Net operating revenues 100.0% 100.0% —% Equity in earnings of unconsolidated affiliates 0.5% 0.1% 0.4% Operating expenses: Salaries, wages and benefits 48.4% 48.3% 0.1% Supplies 15.9% 15.8% 0.1% Other operating expenses, net 24.4% 24.8% (0.4)% Electronic health record incentives (0.4)% (0.6)% 0.2% Depreciation and amortization 4.3% 5.1% (0.8)% Impairment and restructuring charges, and acquisition-related costs 1.7% 0.9% 0.8% Litigation and investigation costs 1.5% 0.2% 1.3% Gains on sales, consolidation and deconsolidation of facilities (1.0)% —% (1.0)% Operating income 5.7% 5.6% 0.1% Net operating revenues of our general hospitals include inpatient and outpatient revenues for services provided byfacilities in our Hospital Operations and other segment, as well as nonpatient revenues (e.g., rental income, management feerevenue, and income from services such as cafeterias, gift shops and parking) and other miscellaneous revenue. Net operatingrevenues of other operations primarily consist of revenues from (1) physician practices, (2) a long-term acute care hospital, (3)our Ambulatory Care segment, (4) services provided by our Conifer subsidiary to third parties and (5) our health plans.Revenues from our general hospitals represented approximately 83% and 87% of our total net operating revenues beforeprovision for doubtful accounts for the years ended December 31, 2015 and 2014, respectively. Net operating revenues from our other operations were $3.370 billion and $2.390 billion in the years endedDecember 31, 2015 and 2014, respectively. The increase in net operating revenues from other operations during 2015primarily relates to revenue cycle services provided by our Conifer subsidiary, as well as revenues from our USPI jointventure and Aspen acquisition, our health plans and physician practices. Equity earnings for unconsolidated affiliates were$99 million and $12 million for the years ended December 31, 2015 and 2014, respectively. The increase in equity earningsof unconsolidated affiliates in the 2015 period compared to the 2014 period primarily relates to our USPI joint venture. The following table shows selected operating expenses of our three reportable business segments. Information forour Hospital Operations and other segment is presented on a same-hospital basis, which includes the results of our same75 hospitals and six health plans operated throughout the years ended December 31, 2015 and 2014. The results of TRMC,in which we acquired a majority interest on June 3, 2014, Resolute Health Hospital, which we opened on June 24, 2014,Emanuel Medical Center, which we acquired on August 1, 2014, Hi-Desert Medical Center, which we began operating onJuly 15, 2015, our Carondelet Heath Network joint venture, in which we acquired a majority interest on August 31,2015, SLUH, which we sold on August 31, 2015, our joint venture with Baptist Health System, Inc., which we formed onOctober 2, 2015, and DMC Surgery Hospital, which we closed in October 2015, are excluded. Certain previously reportedinformation has been reclassified to conform to the current-year presentation, primarily related to the sale of SLUH and ourcontribution of freestanding ambulatory surgery and imaging center assets to the70 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsUSPI joint venture. These outpatient facilities were formerly part of our Hospital Operations and other segment, but are nowreported as part of our new Ambulatory Care segment. Same Hospital Continuing Operations Years Ended December 31, Increase Selected Operating Expenses 2015 2014 (Decrease) Hospital Operations and other — Same-Hospital Salaries, wages and benefits $7,438 $7,005 6.2% Supplies 2,590 2,459 5.3% Other operating expenses 3,779 3,569 5.9% Total $13,807 $13,033 5.9% Salaries, wages and benefits per adjusted patientadmission $5,579 $5,433 2.7% Supplies per adjusted patient admission 1,943 1,889 2.9% Other operating expenses per adjusted patient admission 2,856 2,774 3.0% Total per adjusted patient admission $10,378 $10,096 2.8% Ambulatory Care Salaries, wages and benefits $301 $87 246.0% Supplies 188 61 208.2% Other operating expenses 196 74 164.9% Total $685 $222 208.6% Conifer Salaries, wages and benefits $852 $727 17.2% Other operating expenses 296 263 12.5% Total $1,148 $990 16.0% Rent/lease expense Hospital Operations and other $214 $191 12.0% Conifer 16 21 (23.8)% Ambulatory Care 41 22 86.4% Total $271 $234 15.8% (1)Adjusted patient admissions represents actual patient admissions adjusted to include outpatient services provided by facilities in our HospitalOperations and other segment by multiplying actual patient admissions by the sum of gross inpatient revenues and outpatient revenues anddividing the results by gross inpatient revenues.(2)Included in other operating expenses. RESULTS OF OPERATIONS BY SEGMENT Our operations are reported under three segments: Hospital Operations and other, which is focused on operatingacute care hospitals, ancillary outpatient facilities, urgent care facilities, freestanding emergency departments, physicianpractices and health plans; Ambulatory Care, which is comprised of our freestanding ambulatory surgery and imagingcenters, short-stay surgical facilities and Aspen’s hospitals and clinics; and Conifer, which operates revenue cyclemanagement and patient communication and engagement services businesses. Hospital Operations and Other Segment The following tables show operating statistics of our continuing operations hospitals on a same-hospital basis,which includes the results of our same 75 hospitals and six health plans operated throughout the years ended December 31,2015 and 2014. The results of TRMC, in which we acquired a majority interest on June 3, 2014, Resolute Health Hospital,which we opened on June 24, 2014, Emanuel Medical Center, which we acquired on August 1, 2014, Hi-Desert MedicalCenter, which we began operating on July 15, 2015, our Carondelet Heath Network joint venture, in which we acquired amajority interest on August 31, 2015, SLUH, which we sold on August 31, 2015, our joint venture71 (1)(1)(1)(2)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentswith Baptist Health System, Inc., which we formed on October 2, 2015, and DMC Surgery Hospital, which we closed inOctober 2015, are excluded. Certain previously reported information has been reclassified to conform to the current-yearpresentation, primarily related to the sale of SLUH and our contribution of freestanding ambulatory surgery and imagingcenter assets to the USPI joint venture. These outpatient facilities were formerly part of our Hospital Operations and othersegment, but are now reported as part of our new Ambulatory Care segment. Same-Hospital Continuing Operations Years Ended December 31, Increase Admissions, Patient Days and Surgeries 2015 2014 (Decrease) Total admissions 774,480 765,951 1.1% Adjusted patient admissions 1,333,227 1,301,936 2.4% Paying admissions (excludes charity and uninsured) 733,155 722,455 1.5% Charity and uninsured admissions 41,325 43,496 (5.0)% Admissions through emergency department 489,401 479,805 2.0% Paying admissions as a percentage of total admissions 94.7% 94.3% 0.4% Charity and uninsured admissions as a percentage of total admissions 5.3% 5.7% (0.4)% Emergency department admissions as a percentage of total admissions 63.2% 62.6% 0.6% Surgeries — inpatient 211,063 209,385 0.8% Surgeries — outpatient 276,890 273,248 1.3% Total surgeries 487,953 482,633 1.1% Patient days — total 3,573,155 3,566,694 0.2% Adjusted patient days 6,083,749 5,993,861 1.5% Average length of stay (days) 4.61 4.66 (1.1)% Number of hospitals (at end of period) 75 75 — Licensed beds (at end of period) 19,882 19,984 (0.5)% Average licensed beds 19,969 19,905 0.3% Utilization of licensed beds 49.0% 49.1% (0.1)% (1)Adjusted patient admissions/days represents actual patient admissions/days adjusted to include outpatient services provided by facilities in ourHospital Operations and other segment by multiplying actual patient admissions/days by the sum of gross inpatient revenues and outpatientrevenues and dividing the results by gross inpatient revenues.(2)The change is the difference between 2015 and 2014 amounts shown.(3)Utilization of licensed beds represents patient days divided by number of days in the period divided by average licensed beds. Same-Hospital Continuing Operations Years Ended December 31, Increase Outpatient Visits 2015 2014 (Decrease) Total visits 7,831,785 7,496,243 4.5% Paying visits (excludes charity and uninsured) 7,213,214 6,859,531 5.2% Charity and uninsured visits 618,571 636,712 (2.8)% Emergency department visits 2,816,943 2,738,233 2.9% Surgery visits 276,890 273,248 1.3% Paying visits as a percentage of total visits 92.1% 91.5% 0.6% Charity and uninsured visits as a percentage of total visits 7.9% 8.5% (0.6)% (1)The change is the difference between 2015 and 2014 amounts shown. 72 (1)(2)(2)(2)(1)(2)(3)(2)(1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Same-Hospital Continuing Operations Years Ended December 31, Increase Revenues 2015 2014 (Decrease) Net operating revenues $15,334 $14,553 5.4% Revenues from charity and the uninsured $992 $1,025 (3.2)% Net inpatient revenues $10,079 $9,615 4.8% Net outpatient revenues $5,630 $5,271 6.8% (1)Net inpatient revenues and net outpatient revenues are components of net operating revenues. Net inpatient revenues include self-payrevenues of $374 million and $381 million for the years ended December 31, 2015 and 2014, respectively. Net outpatient revenues includeself-pay revenues of $618 million and $644 million for the years ended December 31, 2015 and 2014, respectively. Same-Hospital Continuing Operations Years Ended December 31, Increase Revenues on a Per Admission, Per Patient Day and Per Visit Basis 2015 2014 (Decrease) Net inpatient revenue per admission $13,014 $12,553 3.7% Net inpatient revenue per patient day $2,821 $2,696 4.6% Net outpatient revenue per visit $719 $703 2.3% Net patient revenue per adjusted patient admission $11,783 $11,434 3.1% Net patient revenue per adjusted patient day $2,582 $2,484 3.9% (1)Adjusted patient admissions/days represents actual patient admissions/days adjusted to include outpatient services provided by facilities in ourHospital Operations and other segment by multiplying actual patient admissions/days by the sum of gross inpatient revenues and outpatientrevenues and dividing the results by gross inpatient revenues. Same-Hospital Continuing Operations Years Ended December 31, Increase Provision for Doubtful Accounts 2015 2014 (Decrease) Provision for doubtful accounts $1,375 $1,250 10.0% Provision for doubtful accounts as a percentage of net operating revenuesbefore provision for doubtful accounts 8.2% 8.0% 0.2% (1)The change is the difference between the 2015 and 2014 amounts shown. REVENUES Same-hospital net operating revenues increased $781 million, or 5.4%, during the year ended December 31, 2015compared to the year ended December 31, 2014. The increase in same-hospital net operating revenues in the 2015 period isprimarily due to higher inpatient and outpatient volumes, improved terms of our managed care contracts, incremental netrevenues from the California provider fee program of $15 million and an increase in our other operations revenues. For theyears ended December 31, 2015 and 2014, our net operating revenues attributable to Medicaid DSH and other supplementalrevenues were approximately $840 million and $775 million, respectively. Same-hospital net inpatient revenues increased$464 million, or 4.8%, and same-hospital admissions increased 1.1% in the 2015 period compared to the 2014 period. Webelieve our volumes were positively impacted by incremental market share we generated through improved physicianalignment and service line expansion, insurance coverage for a greater number of individuals, and a strengthening economy.Same-hospital net inpatient revenue per admission increased 3.7%, primarily due to the improved terms of our managed carecontracts and volume growth in higher acuity service lines, in the year ended December 31, 2015. Same-hospital netoutpatient revenues increased $359 million, or 6.8%, and same-hospital outpatient visits increased 4.5% in the year endedDecember 31, 2015 compared to the year ended December 31, 2014. Growth in outpatient revenues and volumes wasprimarily driven by improved terms of our managed care contracts and increased outpatient volume levels associated withour outpatient development program.73 (1)(1)(1)(1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsSame-hospital net outpatient revenue per visit increased 2.3% primarily due to the improved terms of our managed carecontracts. PROVISION FOR DOUBTFUL ACCOUNTS Same-hospital provision for doubtful accounts as a percentage of net operating revenues before provision fordoubtful accounts was 8.2% and 8.0% for the years ended December 31, 2015 and 2014, respectively. The table below showsthe net accounts receivable and allowance for doubtful accounts by payer at December 31, 2015 and December 31, 2014: December 31, 2015 December 31, 2014 Accounts Accounts Receivable Receivable Before Before Allowance Allowance Allowance Allowance for Doubtful for Doubtful for Doubtful for Doubtful Accounts Accounts Net Accounts Accounts Net Medicare $360 $— $360 $323 $— $323 Medicaid 70 — 70 153 — 153 Net cost report settlements payableand valuation allowances (42) — (42) (51) — (51) Managed care 1,715 126 1,589 1,528 99 1,429 Self-pay uninsured 509 436 73 578 482 96 Self-pay balance after insurance 208 142 66 210 133 77 Estimated future recoveries fromaccounts assigned to our Conifersubsidiary 144 — 144 125 — 125 Other payers 442 166 276 337 125 212 Total Hospital Operations and other 3,406 870 2,536 3,203 839 2,364 Ambulatory Care 182 17 165 49 12 37 Total discontinued operations 3 — 3 4 1 3 $3,591 $887 $2,704 $3,256 $852 $2,404 A significant portion of our provision for doubtful accounts relates to self-pay patients, as well as co-pays anddeductibles owed to us by patients with insurance. Collection of accounts receivable has been a key area of focus,particularly over the past several years. At December 31, 2015, our collection rate on self-pay accounts was approximately29.7%. Our self-pay collection rate includes payments made by patients, including co-pays and deductibles paid by patientswith insurance. Based on our accounts receivable from self-pay patients and co-pays and deductibles owed to us by patientswith insurance at December 31, 2015, a 10% decrease or increase in our self-pay collection rate, or approximately 3%, whichwe believe could be a reasonably likely change, would result in an unfavorable or favorable adjustment to provision fordoubtful accounts of approximately $10 million. Payment pressure from managed care payers also affects our provision for doubtful accounts. We typicallyexperience ongoing managed care payment delays and disputes; however, we continue to work with these payers to obtainadequate and timely reimbursement for our services. Our estimated collection rate from managed care payers wasapproximately 98.0% at December 31, 2015. We manage our provision for doubtful accounts using hospital-specific goals and benchmarks such as (1) total cashcollections, (2) point-of-service cash collections, (3) accounts receivable days outstanding (“AR Days”), and (4) accountsreceivable by aging category. The following tables present the approximate aging by payer of our net accounts receivablefrom Hospital Operations and other segment of $2.578 billion and $2.415 billion at74 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsDecember 31, 2015 and 2014, respectively, excluding cost report settlements payable and valuation allowances of$42 million and $51 million at December 31, 2015 and 2014, respectively: December 31, 2015 Indemnity, Managed Self-Pay Medicare Medicaid Care and Other Total0-60 days 90% 65% 64% 27% 62% 61-120 days 6% 16% 16% 19% 15% 121-180 days 2% 6% 7% 11% 7% Over 180 days 2% 13% 13% 43% 16% Total 100% 100% 100% 100% 100% December 31, 2014 Indemnity, Managed Self-Pay Medicare Medicaid Care and Other Total0-60 days 81% 44% 66% 29% 61% 61-120 days 9% 22% 16% 19% 16% 121-180 days 4% 12% 7% 11% 7% Over 180 days 6% 22% 11% 41% 16% Total 100% 100% 100% 100% 100% Our AR Days from continuing operations were 49.5 days at both December 31, 2015 and December 31, 2014, withinour target of less than 55 days. AR Days are calculated as our accounts receivable from continuing operations on the last datein the quarter divided by our net operating revenues from continuing operations for the quarter ended on that date divided bythe number of days in the quarter. As of December 31, 2015, we had a cumulative total of patient account assignments to our Conifer subsidiary ofapproximately $2.7 billion related to our continuing operations, but excluding our newly acquired hospitals. These accountshave already been written off and are not included in our receivables or in the allowance for doubtful accounts; however, anestimate of future recoveries from all the accounts assigned to our Conifer subsidiary is determined based on our historicalexperience and recorded in accounts receivable. Patient advocates from Conifer’s Medicaid Eligibility Program (“MEP”) screen patients in the hospital to determinewhether those patients meet eligibility requirements for financial assistance programs. They also expedite the process ofapplying for these government programs. Receivables from patients who are potentially eligible for Medicaid are classifiedas Medicaid pending, under the MEP, with appropriate contractual allowances recorded. At the present time, our newlyacquired facilities are beginning to implement this program. Based on recent trends, approximately 94% of all accounts inthe MEP are ultimately approved for benefits under a government program, such as Medicaid. The following table shows theapproximate amount of accounts receivable in the MEP still awaiting determination of eligibility under a governmentprogram at December 31, 2015 and December 31, 2014 by aging category: December 31, December 31, 2015 2014 0-60 days $86 $85 61-120 days 14 20 121-180 days 7 10 Over 180 days 18 16 Total $125 $131 75 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsSALARIES, WAGES AND BENEFITS Same-hospital salaries, wages and benefits per adjusted patient admission increased by 2.7% in the year endedDecember 31, 2015 compared to the same period in 2014. This change is primarily due to a greater number of employedphysicians, annual merit increases for certain of our employees, and increased employee health benefits and incentivecompensation costs. Salaries, wages and benefits expense for the year ended December 31, 2015 and 2014 included stock-based compensation expense of $77 million and $51 million, respectively. At December 31, 2015, approximately 20% of the employees in our Hospital Operations and other segment wererepresented by labor unions. There were no unionized employees in our Ambulatory Care segment, and less than 1% ofConifer’s employees belong to a union. Unionized employees – primarily registered nurses and service and maintenanceworkers – are located at 37 of our hospitals, the majority of which are in California, Florida and Michigan. We currently havetwo expired contracts and are negotiating renewals under extension agreements. We are also negotiating first contracts at twoof our hospitals where employees selected union representation. At this time, we are unable to predict the outcome of thenegotiations, but increases in salaries, wages and benefits could result from these agreements. Furthermore, there is apossibility that strikes could occur during the negotiation process, which could increase our labor costs and have an adverseeffect on our patient admissions and net operating revenues. Future organizing activities by labor unions could increase ourlevel of union representation in 2016. SUPPLIES Supplies expense per adjusted patient admission for our Hospital Operations and other segment increased by 2.9%in the year ended December 31, 2015 compared to the same period in 2014. The increase in supplies expense per adjustedpatient admission was primarily attributable to higher costs for pharmaceuticals and cardiology supplies, as well as volumegrowth in our supply-intensive surgical services, partially offset by lower implant costs. We strive to control supplies expense through product standardization, contract compliance, improved utilization,bulk purchases and operational improvements. The items of current cost reduction focus continue to be cardiac stents andpacemakers, orthopedics and implants, and high-cost pharmaceuticals. We also utilize group-purchasing strategies andsupplies-management services in an effort to reduce costs. OTHER OPERATING EXPENSES, NET Same-hospital other operating expenses per adjusted patient admission increased by 3.0% in the year endedDecember 31, 2015 compared to the same period in 2014. Other operating expenses on a per adjusted admission basis wereimpacted by: ·higher same-hospital malpractice expense of $46 million; ·increased information systems maintenance contract costs of $45 million; ·additional costs related to a greater number of employed and contracted physicians for hospitals we operatedthroughout both periods of $56 million; and ·increased costs associated with funding indigent care services by the Texas hospitals we operated throughoutboth periods of $9 million, which costs were substantially offset by additional net patient revenues. Same-hospital malpractice expense was higher in the year ended December 31, 2015 compared to the year endedDecember 31, 2014 due to incremental patient volumes and unfavorable adjustments to settle various cases to mitigate therisk of protracted litigation, partially offset by a favorable adjustment in the 2015 period of approximately $3 million due toa 12 basis point increase in the interest rate used to estimate the discounted present value of projected future malpracticeliabilities compared to an unfavorable adjustment of approximately $7 million as a result of a 48 basis point decrease in theinterest rate in the 2014 period. 76 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsAmbulatory Care Segment On June 16, 2015, we completed the transaction that combined our freestanding ambulatory surgery and imagingcenter assets with the short-stay surgical facility assets of USPI into our new USPI joint venture, and we acquired Aspen,which operates nine private short-stay surgical hospitals and clinics in the United Kingdom, thereby forming our newAmbulatory Care separate reportable business segment. The results of our USPI joint venture and Aspen are included in thefinancial and statistical information provided only for the period from acquisition to December 31, 2015. Information that isreported on a same-facility basis relates to the freestanding ambulatory surgery and diagnostic imaging centers that weoperated throughout the year ended December 31, 2015 and 2014 and were contributed to the USPI joint venture. Our USPI joint venture operates its short-stay surgical facilities in partnership with local physicians and, in many ofthese facilities, a health system partner. We hold an ownership interest in each facility, with each being operated through aseparate legal entity. We operate facilities on a day-to-day basis through management services contracts. Our sources ofearnings from each facility consist of: ·management services revenues, computed as a percentage of each facility’s net revenues (often net of bad debtexpense); and ·our share of each facility’s net income (loss), which is computed by multiplying the facility’s net income (loss)times the percentage of each facility’s equity interests owned by us. Our role as an owner and day-to-day manager provides us with significant influence over the operations of eachfacility. In many of the facilities operated by our Ambulatory Care segment (139 of 333 at December 31, 2015), this influencedoes not represent control of the facility, so we account for our investment in the facility under the equity method for anunconsolidated affiliate. We control 194 of the facilities we operate and account for these investments as consolidatedsubsidiaries. Our net earnings from a facility are the same under either method, but the classification of those earnings differs. Forconsolidated subsidiaries, our financial statements reflect 100% of the revenues and expenses of the subsidiaries, after theelimination of intercompany amounts. The net profit attributable to owners other than us is classified within “net incomeattributable to noncontrolling interests.” For unconsolidated affiliates, our consolidated statements of operations reflect our earnings in two line items: ·equity in earnings of unconsolidated affiliates—our share of the net income of each facility, which is based onthe facility’s net income and the percentage of the facility’s outstanding equity interests owned by us; and ·management and administrative services revenues, which is included in our net operating revenues—income weearn in exchange for managing the day-to-day operations of each facility, usually quantified as a percentage ofeach facility’s net revenues less bad debt expense. Our Ambulatory Care operating income is driven by the performance of all facilities we operate and by ourownership interests in those facilities, but our individual revenue and expense line items contain only consolidatedbusinesses, which represent 58% of our facilities. This translates to trends in consolidated operating income that often do notcorrespond with changes in consolidated revenues and expenses. Year Ended December 31, 2015 Compared to the Year Ended December 31, 2014 The following table summarizes certain consolidated statements of operations items for the periods indicated: Years Ended December 31, IncreaseAmbulatory Care Results of Operations 2015 2014 (Decrease)77 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsNet operating revenues $959 $320 199.7% Equity in earnings of unconsolidated affiliates 83 — — Operating expenses, excluding depreciation and amortization 689 222 210.4% Gains on sales, consolidation and deconsolidation of facilities (32) — — Depreciation and amortization 46 14 228.6% Operating income $339 $84 303.6% Our Ambulatory Care net operating revenues increased by $639 million, or 199.7%, for the year ended December31, 2015 compared to the year ended December 31, 2014. The growth in revenues was driven by increases from acquisitionsof $603 million, and increases from our same-facility operations of $36 million, for the year ended December 31, 2015compared to the year ended December 31, 2014. Salaries, wages and benefits expense increased by $214 million, or 246.0%, for the year ended December 31, 2015compared to the year ended December 31, 2014. These increases were driven by increases in salaries, wages and benefitsexpense from acquisitions of $208 million, and increases in our same-facility salaries, wages and benefits expense of$6 million, for the year ended December 31, 2015 compared by the year ended December 31, 2014. Supplies expense increased by $127 million, or 208.2%, for the year ended December 31, 2015 compared to the yearended December 31, 2014. These increases were driven by increases in supplies expense from acquisitions of $117 million,and increases in our same-facility supplies expense of $10 million, for the year ended December 31, 2015 compared to theyear ended December 31, 2014. Other operating expenses increased by $120 million 157.9%, for the year ended December 31, 2015 compared to theyear ended December 31, 2014. These increases were driven by increases in other operating expenses from acquisitions of$113 million, and increases in our same‑facility supplies expense of $7 million, for the year ended December 31, 2015compared to the year ended December 31, 2014. Facility Growth The following table summarizes the changes in our same-facility revenue year-over-year on a systemwide basis,which includes both consolidated and unconsolidated (equity method) facilities. While we do not record the revenues of ourunconsolidated facilities, we believe this information is important in understanding the financial performance of ourAmbulatory Care segment because these revenues are the basis for calculating our management services revenues and,together with the expenses of our unconsolidated facilities, are the basis for our equity in earnings of unconsolidatedaffiliates. Year EndedAmbulatory Care Facility Growth December 31, 2015Net revenue 11.7% Cases 7.9% Net revenue per case 3.6% 78 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsJoint Ventures with Health System Partners During the three months ended June 30, 2015, we established our new Ambulatory Care segment as a result of ourjoint venture with USPI and our purchase of Aspen. USPI’s business model is to jointly own its facilities with localphysicians and not-for-profit health systems. Accordingly, as of December 31, 2015, the majority of facilities in ourAmbulatory Care segment are operated in this model. Year EndedAmbulatory Care Facilities with Health System Partners December 31, 2015Facilities: With a health system partner 181Without a health system partner 152Total facilities operated 333Change from December 31, 2014 Acquired through USPI joint venture and Aspen acquisition 227Other acquisitions 47Dispositions/Mergers (3)Total increase in number of facilities operated 271 Conifer Segment Our Conifer subsidiary generated net operating revenues of $1.4 billion and $1.2 billion during the years endedDecember 31, 2015 and 2014, respectively, a portion of which was eliminated in consolidation as described in Note 21 to theConsolidated Financial Statements. The increase in the revenue from third-party customers, which is not eliminated inconsolidation, is primarily due to new clients, service growth and Conifer’s acquisition of SPi Healthcare in the fourth quarterof 2014. Salaries, wages and benefits expense for Conifer increased $125 million, or 17.2%, in the year ended December 31,2015 compared to the year ended December 31, 2014 due to an increase in employee headcount as a result of the growth inConifer’s business primarily attributable to Conifer’s acquisition of SPi Healthcare and expanded services to CHI. Other operating expenses for Conifer increased $33 million, or 12.5%, in the year ended December 31, 2015 compared to the year ended December 31, 2014 due to the growth in Conifer’s business primarily attributable to Conifer’sacquisition of SPi Healthcare and expanded services to CHI. Conifer continues to implement revenue cycle initiatives to improve our cash flow. These initiatives are focused onstandardizing and improving patient access processes, including pre-registration, registration, verification of eligibility andbenefits, liability identification and collection at point-of-service, and financial counseling. These initiatives are intended toreduce denials, improve service levels to patients and increase the quality of accounts that end up in accounts receivable.Although we continue to focus on improving our methodology for evaluating the collectability of our accounts receivable,we may incur future charges if there are unfavorable changes in the trends affecting the net realizable value of our accountsreceivable. Consolidated IMPAIRMENT AND RESTRUCTURING CHARGES, AND ACQUISITION-RELATED COSTS During the year ended December 31, 2015, we recorded impairment and restructuring charges and acquisition-related costs of $318 million, including $168 million of impairment charges. We recorded an impairment charge ofapproximately $147 million to write-down assets held for sale to their estimated fair value, less estimated costs to sell, as aresult of entering into a definitive agreement for the sale of SLUH during the three months ended June 30, 2015, as furtherdescribed in Note 4. We also recorded impairment charges of approximately $19 million for the write-down of buildings,equipment and other long-lived assets, primarily capitalized software cost classified as other intangible assets,79 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsto their estimated fair values at two of our hospitals. Material adverse trends in our most recent estimates of futureundiscounted cash flows of the hospitals indicated the carrying value of the hospitals’ long-lived assets was not recoverablefrom the estimated future cash flows. We believe the most significant factors contributing to the adverse financial trendsinclude reductions in volumes of insured patients, shifts in payer mix from commercial to governmental payers combinedwith reductions in reimbursement rates from governmental payers, and high levels of uninsured patients. As a result, weupdated the estimate of the fair value of the hospitals’ long-lived assets and compared the fair value estimate to the carryingvalue of the hospitals’ long-lived assets. Because the fair value estimates were lower than the carrying value of the long-livedassets, an impairment charge was recorded for the difference in the amounts. Unless the anticipated future financial trends ofthese hospitals improve to the extent that the estimated future undiscounted cash flows exceed the carrying value of thelong-lived assets, these hospitals are at risk of future impairments, particularly if we spend significant amounts of capital atthe hospitals without generating a corresponding increase in the hospitals’ fair value or if the fair value of the hospitals’ realestate or equipment declines. The aggregate carrying value of assets held and used of the hospitals for which impairmentcharges were recorded was $45 million as of December 31, 2015 after recording the impairment charge. We also recorded $2million related to investments. We also recorded $25 million of employee severance costs, $6 million of restructuring costs,$19 million of contract and lease termination fees, and $100 million in acquisition-related costs, which include $55 millionof transaction costs and $45 million of acquisition integration costs. During the year ended December 31, 2014, we recorded impairment and restructuring charges and acquisition-related costs of $153 million. This amount included a $20 million impairment charge for the write-down of buildings andequipment of one of our previously impaired hospitals to their estimated fair values, primarily due to a decline in the fairvalue of real estate in the market in which the hospital operates and a decline in the estimated fair value of equipment.Material adverse trends in our most recent estimates of future undiscounted cash flows of the hospital, consistent with ourprevious estimates in prior years when impairment charges were recorded at this hospital, indicated the carrying value of thehospital’s long-lived assets was not recoverable from the estimated future cash flows. We believe the most significant factorscontributing to the adverse financial trends include reductions in volumes of insured patients, shifts in payer mix fromcommercial to governmental payers combined with reductions in reimbursement rates from governmental payers, and highlevels of uninsured patients. As a result, we updated the estimate of the fair value of the hospital’s long-lived assets andcompared the fair value estimate to the carrying value of the hospital’s long-lived assets. Because the fair value estimate waslower than the carrying value of the hospital’s long-lived assets, an impairment charge was recorded for the difference in theamounts. Unless the anticipated future financial trends of this hospital improve to the extent that the estimated futureundiscounted cash flows exceed the carrying value of the long-lived assets, this hospital is at risk of future impairments,particularly if we spend significant amounts of capital at the hospital without generating a corresponding increase in thehospital’s fair value or if the fair value of the hospital’s real estate or equipment declines. The aggregate carrying value ofassets held and used of the hospital for which an impairment charge was recorded was $23 million as of December 31, 2014after recording the impairment charge. We also recorded $16 million of employee severance costs, $19 million of contractand lease termination fees, $3 million of restructuring costs, and $95 million in acquisition-related costs, which include$16 million of transaction costs and $79 million of acquisition integration charges. Our impairment tests presume stable, improving or, in some cases, declining operating results in our hospitals, whichare based on programs and initiatives being implemented that are designed to achieve the hospital’s most recent projections.If these projections are not met, or if in the future negative trends occur that impact our future outlook, future impairments oflong-lived assets and goodwill may occur, and we may incur additional restructuring charges. LITIGATION AND INVESTIGATION COSTS Litigation and investigation costs for the years ended December 31, 2015 and 2014 were $291 million and$25 million, respectively, primarily related to costs associated with various legal proceedings and governmental reviewsdescribed in Note 15 to our Consolidated Financial Statements. 80 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsGAINS ON SALES, CONSOLIDATION AND DECONSOLIDATION OF FACILITIES During the year ended December 31, 2015, we recorded gains on sales, consolidation and deconsolidation offacilities of approximately $186 million, comprised of a $151 million gain on deconsolidation due to the Baylor Scott &White Health joint venture, a $3 million gain from the sale of our North Carolina facilities and $32 million of gains related tothe consolidation and deconsolidation of certain businesses of our USPI joint venture due to ownership changes. INTEREST EXPENSE Interest expense for the year ended December 31, 2015 was $912 million compared to $754 million for the yearended December 31, 2014, primarily due to increased borrowings relating to our recent acquisitions and our $254 millionpayment to acquire the remaining 49% noncontrolling interest of our Valley Baptist Health System in South Texas. LOSS FROM EARLY EXTINGUISHMENT OF DEBT During the year ended December 31, 2014, we recorded a loss from early extinguishment of debt of approximately$24 million, primarily related to the difference between the redemption price and the par value of the $474 million aggregateprincipal amount of our 9/4% senior notes due 2015 that we redeemed in the period, as well as the write-off of associatedunamortized note discounts and issuance costs. During the year ended December 31, 2015, we recorded a loss ofapproximately $1 million. INCOME TAX EXPENSE During the year ended December 31, 2015, we recorded income tax expense of $68 million compared to $49 millionduring the year ended December 31, 2014. NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS Net income attributable to noncontrolling interests was $218 million for the year ended December 31, 2015compared to $64 million for the year ended December 31, 2014. Net income attributable to noncontrolling interests for theyear ended December 31, 2015 was comprised of $31 million related to our Hospital Operations and other segment, $138million related to our Ambulatory Care segment and $49 million related to our Conifer segment. Of the portion related to ourAmbulatory Care segment, $50 million was related to the Welsh, Carson, Anderson & Stowe minority interest in our USPIjoint venture. The portion related to our Conifer segment is due to CHI’s ownership interest in Conifer’s revenue cyclesubsidiary, Conifer Health Solutions, LLC. ADDITIONAL SUPPLEMENTAL NON-GAAP DISCLOSURES The financial information provided throughout this report, including our Consolidated Financial Statements and thenotes thereto, has been prepared in conformity with accounting principles generally accepted in the United States of America(“GAAP”). However, we use certain non-GAAP financial measures defined below in communications with investors, analysts,rating agencies, banks and others to assist such parties in understanding the impact of various items on our financialstatements, some of which are recurring or involve cash payments. In addition, from time to time we use these measures todefine certain performance targets under our compensation programs. “Adjusted EBITDA” is a non-GAAP measure that we use in our analysis of the performance of our business, whichwe define as net income (loss) attributable to our common shareholders before: (1) the cumulative effect of changes inaccounting principle, net of tax; (2) net loss (income) attributable to noncontrolling interests; (3) preferred stock dividends;(4) income (loss) from discontinued operations, net of tax; (5) income tax benefit (expense); (6) investment earnings (loss);(7) gain (loss) from early extinguishment of debt; (8) net gain (loss) on sales of investments; (9) interest expense; (10)litigation and investigation benefit (costs), net of insurance recoveries; (11) hurricane insurance recoveries, net of costs; (12)net gains (losses) on sales, consolidation and deconsolidation of facilities; (13) impairment and restructuring charges andacquisition-related costs; and (14) depreciation and81 1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsamortization. As is the case with all non-GAAP measures, investors should consider the limitations associated with thismetric, including the potential lack of comparability of this measure from one company to another, and should recognize thatAdjusted EBITDA does not provide a complete measure of our operating performance because it excludes many items thatare included in our financial statements. Accordingly, investors are encouraged to use GAAP measures when evaluating ourfinancial performance. The following table shows the reconciliation of Adjusted EBITDA to net income attributable to our commonshareholders (the most comparable GAAP term) for the years ended December 31, 2015 and 2014: Years Ended December 31, 2015 2014 Net income available (loss attributable) to Tenet Healthcare Corporationcommon shareholders $(140) $12 Less: Net income attributable to noncontrolling interests (218) (64) Net loss from discontinued operations, net of tax 2 (22) Income from continuing operations 76 98 Income tax expense (68) (49) Investment earnings 1 — Loss from early extinguishment of debt (1) (24) Interest expense (912) (754) Operating income 1,056 925 Litigation and investigation costs (291) (25) Gains on sales, consolidation and deconsolidation of facilities 186 — Impairment and restructuring charges, and acquisition-related costs (318) (153) Depreciation and amortization (797) (849) Adjusted EBITDA $2,276 $1,952 Net operating revenues $18,634 $16,603 Adjusted EBITDA as % of net operating revenues (Adjusted EBITDA margin) 12.2% 11.8% RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2014 COMPARED TO THE YEAR ENDEDDECEMBER 31, 2013 The following two tables summarize our net operating revenues, operating expenses and operating income fromcontinuing operations, both in dollar amounts and as percentages of net operating revenues, for the years endedDecember 31, 2014 and 2013: Years Ended December 31, Increase 2014 2013 (Decrease) Net operating revenues: General hospitals $15,518 $10,655 $4,863 Other operations 2,390 1,404 986 Net operating revenues before provision for doubtful accounts 17,908 12,059 5,849 Less provision for doubtful accounts 1,305 972 333 Net operating revenues 16,603 11,087 5,516 Equity in earnings of unconsolidated affiliates 12 15 (3) Operating expenses: Salaries, wages and benefits 8,023 5,371 2,652 Supplies 2,630 1,784 846 Other operating expenses, net 4,114 2,701 1,413 Electronic health record incentives (104) (96) (8) Depreciation and amortization 849 545 304 Impairment and restructuring charges, and acquisition-related costs 153 103 50 Litigation and investigation costs 25 31 (6) Operating income $925 $663 $262 82 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Years Ended December 31, Increase 2014 2013 (Decrease) Net operating revenues 100.0% 100.0% —% Equity in earnings of unconsolidated affiliates 0.1% 0.1% —% Operating expenses: Salaries, wages and benefits 48.3% 48.4% (0.1)% Supplies 15.8% 16.1% (0.3)% Other operating expenses, net 24.8% 24.4% 0.4% Electronic health record incentives (0.6)% (0.9)% 0.3% Depreciation and amortization 5.1% 4.9% 0.2% Impairment and restructuring charges, and acquisition-related costs 0.9% 0.9% —% Litigation and investigation costs 0.2% 0.3% (0.1)% Operating income 5.6% 6.0% (0.4)% Net operating revenues of our general hospitals include inpatient and outpatient revenues, as well as nonpatientrevenues (rental income, management fee revenue, and income from services such as cafeterias, gift shops and parking) andother miscellaneous revenue. Net operating revenues of other operations primarily consist of revenues from (1) physicianpractices, (2) a long-term acute care hospital, (3) services provided by our Conifer subsidiary to third parties and (4) ourhealth plans. Revenues from our general hospitals represented approximately 87% and 88% of our total net operatingrevenues before provision for doubtful accounts for the years ended December 31, 2014 and 2013, respectively. Net operating revenues from our other operations were $2.390 billion and $1.404 billion in the years endedDecember 31, 2014 and 2013, respectively. The increase in net operating revenues from other operations during 2014primarily relates to revenue cycle services provided by our Conifer subsidiary, as well as revenues from our health plansacquired from Vanguard and additional physician practices. Equity earnings for unconsolidated affiliates included in our netoperating revenues from other operations were $12 million and $15 million for the years ended December 31, 2014 and2013, respectively. Selected Operating Statistics for All Continuing Operations Hospitals—The tables below show certain selectedoperating statistics for our continuing operations on a total hospital basis, which includes the results of the 28 hospitals weacquired from Vanguard on October 1, 2013, TRMC, in which we acquired a majority interest on June 3, 2014, ResoluteHealth Hospital, which we opened on June 24, 2014, and Emanuel Medical Center, which we acquired on August 1, 2014 (inthe case of Vanguard, TRMC Emanuel Medical Center, only for the period of time from acquisition to December 31, 2014)and the outpatient facilities now part of our Ambulatory Care segment beginning in 2015. We believe this information isuseful to investors because it reflects our current portfolio of hospitals and the significant increase in the scale of ouroperations as a result of these investments.83 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Years Ended December 31, Increase Admissions, Patient Days and Surgeries 2014 2013 (Decrease) Hospital Operations and other Total admissions 791,165 558,726 41.6% Adjusted patient admissions 1,343,511 906,472 48.2% Paying admissions (excludes charity and uninsured) 745,486 518,293 43.8% Charity and uninsured admissions 45,679 40,433 13.0% Admissions through emergency department 495,195 347,920 42.3% Paying admissions as a percentage of total admissions 94.2% 92.8% 1.4% Charity and uninsured admissions as a percentage of total admissions 5.8% 7.2% (1.4)% Emergency department admissions as a percentage of total admissions 62.6% 62.3% 0.3% Surgeries — inpatient 215,660 155,634 38.6% Surgeries — outpatient 280,320 198,033 41.6% Total surgeries 495,980 353,667 40.2% Patient days — total 3,695,288 2,621,245 41.0% Adjusted patient days 6,203,383 4,210,191 47.3% Average length of stay (days) 4.67 4.69 (0.4)% Number of hospitals (at end of period) 80 77 3 Licensed beds (at end of period) 20,814 20,293 2.6% Average licensed beds 20,531 14,963 37.2% Utilization of licensed beds 49.3% 48.0% 1.3% Ambulatory Care Total Cases 561,110 348,227 61.1% (1)Adjusted patient admissions/days represents actual patient admissions/days adjusted to include outpatient services by multiplying actualpatient admissions/days by the sum of gross inpatient revenues and outpatient revenues and dividing the results by gross inpatient revenues.(2)The change is the difference between the 2014 and 2013 amounts shown.(3)Utilization of licensed beds represents patient days divided by number of days in the period divided by average licensed beds. Years Ended December 31, Increase Outpatient Visits 2014 2013 (Decrease) Hospital Operations and other Total visits 7,720,886 4,767,626 61.9% Paying visits (excludes charity and uninsured) 7,059,962 4,255,554 65.9% Charity and uninsured visits 660,924 512,072 29.1% Emergency department visits 2,824,526 1,865,239 51.4% Surgery visits 280,320 198,033 41.6% Paying visits as a percentage of total visits 91.4% 89.3% 2.1% Charity and uninsured visits as a percentage of total visits 8.6% 10.7% (2.1)% (1)The change is the difference between the 2014 and 2013 amounts shown. 84 (1)(2)(2)(2)(1)(3)(2)(1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Years Ended December 31, Increase Revenues 2014 2013 (Decrease) Hospital Operations and other Net operating revenues $15,090 $9,963 51.5% Revenues from charity and the uninsured $1,061 $779 36.2% Net inpatient revenues $10,015 $6,952 44.1% Net outpatient revenues $5,448 $3,640 49.7% (1)Net inpatient revenues and net outpatient revenues are components of net operating revenues. Net inpatient revenues include self-payrevenues of $393 million and $324 million for the years ended December 31, 2014 and 2013, respectively. Net outpatient revenues includeself-pay revenues of $668 million and $455 million for the years ended December 31, 2014 and 2013, respectively. Years Ended December 31, Increase Revenues on a Per Admission, Per Patient Day and Per Visit Basis 2014 2013 (Decrease) Hospital Operations and other Net inpatient revenue per admission $12,659 $12,443 1.7% Net inpatient revenue per patient day $2,710 $2,652 2.2% Net outpatient revenue per visit $706 $763 (7.5)% Net patient revenue per adjusted patient admission $11,510 $11,685 (1.5)% Net patient revenue per adjusted patient day $2,493 $2,516 (0.9)% (1)Adjusted patient admissions/days represents actual patient admissions/days adjusted to include outpatient services by multiplying actualpatient admissions/days by the sum of gross inpatient revenues and outpatient revenues and dividing the results by gross inpatient revenues. Years Ended December 31, Increase Provision for Doubtful Accounts 2014 2013 (Decrease) Hospital Operations and other Provision for doubtful accounts $1,300 $967 34.4% Provision for doubtful accounts as a percentage of net operating revenues beforeprovision for doubtful accounts 7.9% 8.8% (0.9)% (1)The change is the difference between the 2014 and 2013 amounts shown. 85 (1)(1)(1)(1)(1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Years Ended December 31, Increase Selected Operating Expenses 2014 2013 (Decrease) Hospital Operations and other Salaries, wages and benefits $7,209 $4,740 52.1% Supplies 2,569 1,746 47.1% Other operating expenses 3,777 2,442 54.7% Total $13,555 $8,928 51.8% Ambulatory Care Salaries, wages and benefits $87 $55 58.2% Supplies 61 38 60.5% Other operating expenses 74 48 54.2% Total $222 $141 57.4% Conifer Salaries, wages and benefits $727 $576 26.2% Other operating expenses 263 211 24.6% Total $990 $787 25.8% Total Salaries, wages and benefits $8,023 $5,371 49.4% Supplies 2,630 1,784 47.4% Other operating expenses 4,114 2,701 52.3% Total $14,767 $9,856 49.8% Rent/lease expense Hospital Operations and other $199 $157 26.8% Conifer 21 14 50.0% Ambulatory Care 22 15 46.7% Total $242 $186 30.1% Hospital Operations and other Salaries, wages and benefits per adjusted patient day $1,173 $1,130 3.8% Supplies per adjusted patient day 414 415 (0.2)% Other operating expenses per adjusted patient day 616 583 5.7% Total per adjusted patient day $2,203 $2,128 3.5% Salaries, wages and benefits per adjusted patient admission $5,417 $5,249 3.2% Supplies per adjusted patient admission 1,912 1,926 (0.7)% Other operating expenses per adjusted patient admission 2,843 2,707 5.0% Total per adjusted patient admission $10,172 $9,882 2.9% (1)Included in other operating expenses.(2)Adjusted patient admissions/days represents actual patient admissions/days adjusted to include outpatient services by multiplying actualpatient admissions/days by the sum of gross inpatient revenues and outpatient revenues and dividing the results by gross inpatient revenues.These metrics exclude the expenses related to our health plans and our provider network based in Southern California that includescontracted independent physicians, ancillary providers and hospitals. REVENUES During the year ended December 31, 2014, our net operating revenues increased $5.516 billion, or 49.8%, comparedto the year ended December 31, 2013. Hospital acquisitions contributed approximately $4.849 billion to the increase in ournet operating revenues, while hospitals we operated throughout both periods contributed $667 million, or additionalrevenues of 7.8%. The increase in total hospital net operating revenues is primarily due to higher inpatient and outpatientvolumes, improved terms of our managed care contracts, $50 million of incremental net revenues from the Californiaprovider fee program ($165 million in 2014 compared to $115 million in 2013) and an increase in our other operationsrevenues. For the years ended December 31, 2014 and 2013, our net operating revenues attributable to DSH payments andother state-funded subsidy payments were approximately $817 million and $428 million, respectively. 86 (1)(2)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsDuring the year ended December 31, 2014, our net inpatient revenues increased $3.063 billion, or 44.1%, comparedto the same period in 2013. Net inpatient revenues from hospital acquisitions contributed approximately $2.651 billion tothe increase in our net inpatient revenues, while hospitals we operated throughout both periods contributed approximately$412 million, or 6.8% more revenues. Our total admissions increased 41.6% during the year ended December 31, 2014compared to the year ended December 31, 2013 primarily due to our hospital acquisitions in 2014 and 2013 and organicgrowth. Admissions at hospitals we operated at the beginning of 2013 increased 3.0% in 2014 compared to 2013. Webelieve our volumes were positively impacted by incremental market share we generated through improved physicianalignment and service line expansion, insurance coverage for a greater number of individuals as a result of the AffordableCare Act, and a strengthening economy. We believe our inpatient volume levels continue to be constrained by an increase inpatients with high-deductible health insurance plans and industry trends reflecting the shift of certain clinical proceduresbeing performed in an outpatient setting rather than an inpatient setting. Net inpatient revenue per admission increased1.7% for Hospital Operations and other segment and 3.7% for hospitals we operated throughout 2014 and 2013, primarilydue to the improved terms of our managed care contracts and incremental California provider fee program net revenues of ourCalifornia hospitals operated at the beginning of 2013, which revenues were $150 million in 2014 compared to $115 millionin 2013. During the year ended December 31, 2014, our net outpatient revenues increased $1.808 billion, or 49.7%, and ourtotal outpatient visits increased 61.9% compared to the same period in 2013. The growth in our outpatient revenues andvolumes was related to both acquisitions and organic growth. Net outpatient revenues from acquisitions contributedapproximately $1.571 billion to the increase in our net outpatient revenues, while facilities we operated throughout bothperiods contributed approximately $237 million, or 7.5% more revenues. The increase in total outpatient visits was primarilydue to our acquisitions in 2014 and 2013. Outpatient visits associated with facilities we operated at the beginning of 2013increased 5.2% in 2014 compared to 2013. Growth in outpatient revenues for facilities we operated throughout both periodswas primarily driven by improved terms of our managed care contracts and increased outpatient volume levels associatedwith our outpatient development program. Net outpatient revenue per visit decreased 7.5% for Hospital Operations and othersegment primarily due to the lower level of patient acuity at our recently opened or acquired facilities; however, netoutpatient revenue per visit for facilities we operated throughout 2014 and 2013 increased 2.1%, primarily due to theimproved terms of our managed care contracts. Our Conifer subsidiary generated net operating revenues of $1.193 billion and $919 million during the years endedDecember 31, 2014 and 2013, respectively, a portion of which was eliminated in consolidation as described in Note 21 to theConsolidated Financial Statements. The increase in the portion that was not eliminated in consolidation is primarily due tonew clients and expanded service offerings. PROVISION FOR DOUBTFUL ACCOUNTS The provision for doubtful accounts as a percentage of net operating revenues before provision for doubtfulaccounts was 7.3% for the year ended December 31, 2014 compared to 8.1% for the year ended December 31, 2013. Thedecrease in the provision for doubtful accounts as a percentage of net operating revenues before provision for doubtfulaccounts primarily related to the decrease in uninsured patient revenues as a percentage of net operating revenues from 8.3%for the year ended December 31, 2013 to 6.5% for the year ended December 31, 2014 due to expansion of insurance coverageunder the ACA, as well as the impact of favorable experience related to our estimated future recoveries in the 2014 period,partially offset by the impact of a greater amount of patient co-pays and deductibles and a 120 basis point decrease in ourself-pay collection rate for the hospitals we operated throughout both periods. The table87 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsbelow shows the net accounts receivable and allowance for doubtful accounts by payer at December 31, 2014 andDecember 31, 2013: December 31, 2014 December 31, 2013 Accounts Accounts Receivable Receivable Before Before Allowance Allowance Allowance Allowance for Doubtful for Doubtful for Doubtful for Doubtful Accounts Accounts Net Accounts Accounts Net Medicare $323 $— $323 $301 $— $301 Medicaid 153 — 153 133 — 133 Net cost report settlements payable andvaluation allowances (51) — (51) (75) — (75) Managed care 1,528 99 1,429 1,179 69 1,110 Self-pay uninsured 578 482 96 344 290 54 Self-pay balance after insurance 210 133 77 224 141 83 Estimated future recoveries from accountsassigned to our Conifer subsidiary 125 — 125 92 — 92 Other payers 337 125 212 233 78 155 Total Hospital Operations and other 3,203 839 2,364 2,431 578 1,853 Ambulatory Care 49 12 37 45 11 34 Total discontinued operations 4 1 3 3 — 3 $3,256 $852 $2,404 $2,479 $589 $1,890 The increase in our total accounts receivable net of allowance for doubtful accounts from December 31, 2013 toDecember 31, 2014 is primarily related to the growth in hospital patient volumes, our outpatient development initiatives, atemporary buildup in accounts receivable of certain hospitals we acquired from Vanguard due to the implementation of anew billing system that is expected to enhance efficiency, growth in physician practices, the acquisition of TRMC andEmanuel Medical Center, and the opening of Resolute Health Hospital. The increase in the allowance for doubtful accounts as a percentage of patient accounts receivable related to theaccounts receivable acquired from Vanguard as of October 1, 2013. Under the purchase price allocation rules, allowance fordoubtful accounts as of the acquisition date are offset against the gross receivables. As of the acquisition date, the acquirerbegins to disclose the net receivable amount with no disclosure of the former allowance for doubtful accounts amount.Accounts receivable generated after the acquisition are disclosed before the allowance for doubtful accounts and theassociated allowance for doubtful accounts is also disclosed to arrive at net accounts receivable. The increase also related tothe 120 basis point decrease in our self-pay collection rate for the 49 hospitals we operated throughout the years endedDecember 31, 2014 and 2013, well as higher patient co-pays and deductibles, partially offset by a decline in uninsuredrevenues due to the expansion of insurance coverage under the Affordable Care Act. A significant portion of our provision for doubtful accounts relates to self-pay patients, as well as co-pays anddeductibles owed to us by patients with insurance. Collection of accounts receivable has been a key area of focus,particularly over the past several years. At December 31, 2014, our collection rate on self-pay accounts for hospitals weoperated throughout 2014 and 2013 was approximately 27.5%. Our recent self-pay collection rates for hospitals we operatedthroughout all periods were as follows: 28.8% at March 31, 2013; 28.7% at June 30, 2013; 28.8% at September 30, 2013;28.7% at December 31, 2013; 28.1% at March 31, 2014; 27.8% at June 30, 2014; and 27.5% at September 30, 2014. Theseself-pay collection rates include payments made by patients, including co-pays and deductibles paid by patients withinsurance. Based on our accounts receivable from self-pay patients and co-pays and deductibles owed to us by patients withinsurance at December 31, 2014, a 10% decrease or increase in our self-pay collection rate, or approximately 3%, which webelieve could be a reasonably likely change, would result in an unfavorable or favorable adjustment to provision fordoubtful accounts of approximately $10 million.88 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Our estimated collection rate from managed care payers for hospitals we operated through 2014 and 2013 wasapproximately 98.3% at both December 31, 2014 and December 31, 2013. The following tables present the approximate aging by payer of our net accounts receivable from HospitalOperations and other segment of $2.415 billion and $1.928 billion at December 31, 2014 and 2013, respectively, excludingcost report settlements payable and valuation allowances of $51 million and $75 million at December 31, 2014 and 2013,respectively: December 31, 2014 Indemnity, Managed Self-Pay Medicare Medicaid Care and Other Total0-60 days 81% 44% 66% 29% 61% 61-120 days 9% 22% 16% 19% 16% 121-180 days 4% 12% 7% 11% 7% Over 180 days 6% 22% 11% 41% 16% Total 100% 100% 100% 100% 100% December 31, 2013 Indemnity, Managed Self-Pay Medicare Medicaid Care and Other Total0-60 days 76% 58% 73% 32% 65% 61-120 days 9% 21% 13% 17% 14% 121-180 days 4% 9% 5% 7% 6% Over 180 days 11% 12% 9% 44% 15% Total 100% 100% 100% 100% 100% Our AR Days from continuing operations were 49.5 days at December 31, 2014 and 44.7 days at December 31, 2013,within our target of less than 55 days. AR days at December 31, 2014 were negatively impacted by a temporary buildup inaccounts receivable of certain hospitals acquired from Vanguard due to the implementation of a new billing system that isexpected to enhance efficiency. AR Days are calculated as our accounts receivable from continuing operations on the lastdate in the quarter divided by our net operating revenues from continuing operations for the quarter ended on that datedivided by the number of days in the quarter. As of December 31, 2014, we had a cumulative total of patient account assignments to our Conifer subsidiary datingback at least three years or older of approximately $2.9 billion related to our continuing operations, but excluding ourrecently acquired hospitals. These accounts have already been written off and are not included in our receivables or in theallowance for doubtful accounts; however, an estimate of future recoveries from all the accounts assigned to our Conifersubsidiary is determined based on our historical experience and recorded in accounts receivable. 89 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsThe following table shows the approximate amount of accounts receivable in the MEP still awaiting determinationof eligibility under a government program at December 31, 2014 and December 31, 2013 by aging category: December 31, December 31, 2014 2013 0-60 days $85 $132 61-120 days 20 28 121-180 days 10 8 Over 180 days 16 18 Total $131 $186 SALARIES, WAGES AND BENEFITS Salaries, wages and benefits expense as a percentage of net operating revenues decreased 0.1% for the year endedDecember 31, 2014 compared to the year ended December 31, 2013. Salaries, wages and benefits per adjusted patientadmission for our Hospital Operations and other segment increased by approximately 3.2% in the year endedDecember 31, 2014 compared to the same period in 2013. This change is primarily due to a greater number of employedphysicians, annual merit increases for certain of our employees, increased overtime and contract labor costs, increasedincentive compensation expense, an increase in the 401(k) plan maximum matching percentage for certain employeepopulations and increased health benefits costs. Salaries, wages and benefits expense for the year ended December 31, 2014and 2013 included stock-based compensation expense of $51 million and $37 million, respectively. Salaries, wages and benefits expense for Conifer increased by $151 million in the year ended December 31, 2014compared to the year ended December 31, 2013 due to an increase in employee headcount as a result of the growth inConifer’s business primarily attributable to the integration of the Vanguard facilities’ revenue cycle operations now managedby Conifer, Conifer’s acquisition of SPi Healthcare and growth in Conifer’s services to CHI. SUPPLIES Supplies expense as a percentage of net operating revenues decreased by 0.3% for the year endedDecember 31, 2014 compared to the year ended December 31, 2013. Supplies expense per adjusted patient admission for ourHospital Operations and other segment decreased by 0.7% in the year ended December 31, 2014 compared to the same periodin 2013. The change in supplies expense per adjusted patient admission was favorably impacted by the supplies expensecontrol measures we have in place, including rebate arrangements, partially offset by higher costs for pharmaceuticals andimplants, as well as volume growth in our supply-intensive surgical services. In general, supplies expense changes areprimarily attributable to changes in our patient volume levels and the mix of procedures performed. OTHER OPERATING EXPENSES, NET Other operating expenses as a percentage of net operating revenues was 24.8% in the year ended December 31, 2014compared to 24.4% in the year ended December 31, 2013. Other operating expenses per adjusted patient admission for ourHospital Operations and other segment increased by 5.0% in the year ended December 31, 2014 compared to the same periodin 2013. The approximately $1.335 billion, or 54.7%, increase in other operating expenses for our Hospital Operations andother segment in the year ended December 31, 2014 compared to the year ended December 31, 2013 is primarily due to: ·increases due to hospital acquisitions of $1.099 billion; ·increased costs of contracted services for hospitals we operated throughout both periods of $46 million; ·higher medical fees primarily related to a greater number of employed and contracted physicians for hospitalswe operated throughout both periods of $49 million; 90 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents·increased costs associated with funding indigent care services by the Texas hospitals we operated throughoutboth periods of $25 million, which costs were substantially offset by additional net patient revenues; and ·increased malpractice expense for hospitals we operated throughout both periods of $57 million. Malpractice expense in the year ended December 31, 2014 included isolated unfavorable case reserve adjustments related toa small number of claims, as well as an unfavorable adjustment of approximately $7 million due to a 48 basis point decreasein the interest rate used to estimate the discounted present value of projected future malpractice liabilities compared to afavorable adjustment of approximately $17 million as a result of an 127 basis point increase in the interest rate in the 2013period. Other operating expenses for Conifer increased by $52 million in the year ended December 31, 2014 compared tothe year ended December 31, 2013 due to higher costs related to the growth in Conifer’s business primarily attributable to theintegration of the Vanguard facilities’ revenue cycle operations now managed by Conifer, Conifer’s acquisition of SPiHealthcare and growth in Conifer’s services to CHI. IMPAIRMENT AND RESTRUCTURING CHARGES, AND ACQUISITION-RELATED COSTS During the year ended December 31, 2014, we recorded impairment and restructuring charges and acquisition-related costs of $153 million. This amount included a $20 million impairment charge for the write-down of buildings andequipment of one of our previously impaired hospitals to their estimated fair values, primarily due to a decline in the fairvalue of real estate in the market in which the hospital operates and a decline in the estimated fair value of equipment.Material adverse trends in our most recent estimates of future undiscounted cash flows of the hospital, consistent with ourprevious estimates in prior years when impairment charges were recorded at this hospital, indicated the carrying value of thehospital’s long-lived assets was not recoverable from the estimated future cash flows. We believe the most significant factorscontributing to the adverse financial trends include reductions in volumes of insured patients, shifts in payer mix fromcommercial to governmental payers combined with reductions in reimbursement rates from governmental payers, and highlevels of uninsured patients. As a result, we updated the estimate of the fair value of the hospital’s long-lived assets andcompared the fair value estimate to the carrying value of the hospital’s long-lived assets. Because the fair value estimate waslower than the carrying value of the hospital’s long-lived assets, an impairment charge was recorded for the difference in theamounts. Unless the anticipated future financial trends of this hospital improve to the extent that the estimated futureundiscounted cash flows exceed the carrying value of the long-lived assets, this hospital is at risk of future impairments,particularly if we spend significant amounts of capital at the hospital without generating a corresponding increase in thehospital’s fair value or if the fair value of the hospital’s real estate or equipment declines. The aggregate carrying value ofassets held and used of the hospital for which an impairment charge was recorded was $23 million as of December 31, 2014after recording the impairment charge. We also recorded $16 million of employee severance costs, $19 million of contractand lease termination fees, $3 million of restructuring costs, and $95 million in acquisition-related costs, which include$16 million of transaction costs and $79 million of acquisition integration charges. During the year ended December 31, 2013, we recorded impairment and restructuring charges and acquisition-related costs of $103 million. This amount included a $12 million impairment charge for the write-down of buildings andequipment and other long-lived assets, primarily capitalized software costs classified in other intangible assets, of one of ourhospitals to their estimated fair values, primarily due to a decline in the fair value of real estate in the market in which thehospital operates and a decline in the estimated fair value of equipment. Material adverse trends in our estimates of futureundiscounted cash flows of the hospital at that time indicated the carrying value of the hospital’s long-lived assets was notrecoverable from the estimated future cash flows. We believed the most significant factors contributing to the adversefinancial trends at that time included reductions in volumes of insured patients, shifts in payer mix from commercial togovernmental payers combined with reductions in reimbursement rates from governmental payers, and high levels ofuninsured patients. As a result, we updated the estimate of the fair value of the hospital’s long-lived assets and compared thefair value estimate to the carrying value of the hospital’s long-lived assets. Because the fair value estimate was lower than thecarrying value of the hospital’s long-lived assets, an impairment charge was recorded for the difference in the amounts. Wedisclosed in our Annual Report on Form 10-K for the year ended December 31, 2013 that, unless the anticipated futurefinancial trends of this hospital improved to the extent that the estimated future undiscounted cash flows exceeded thecarrying value of the long-lived assets, this hospital was at risk of future impairments, which impairments occurred in 2014 asdescribed above, particularly if we spent significant amounts of capital at the hospital without generating a correspondingincrease in the hospital’s fair value or if the fair value of the hospital’s real estate or equipment91 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsdeclined. The aggregate carrying value of assets held and used of the hospital for which an impairment charge was recordedwas $44 million as of December 31, 2013 after recording the impairment charge. We also recorded $16 million ofrestructuring costs, $14 million of employee severance costs, $2 million of lease termination fees, and $59 million inacquisition-related costs, which included both transaction costs and acquisition integration charges. LITIGATION AND INVESTIGATION COSTS Litigation and investigation costs for the year ended December 31, 2014 and 2013 were $25 million and$31 million, respectively, primarily related to costs associated with various legal proceedings and governmental reviews. INTEREST EXPENSE Interest expense for the year ended December 31, 2014 was $754 million compared to $474 million for the yearended December 31, 2013, primarily due to increased borrowings relating to our acquisitions in 2014 and 2013, and$400 million of share repurchases during 2013. LOSS FROM EARLY EXTINGUISHMENT OF DEBT During the year ended December 31, 2014, we recorded a loss from early extinguishment of debt of approximately$24 million, primarily related to the difference between the redemption price and the par value of the $474 million aggregateprincipal amount of our 9/4% senior notes due 2015 that we redeemed in the period, as well as the write-off of associatedunamortized note discounts and issuance costs. During the year ended December 31, 2013, we recorded a loss from early extinguishment of debt of $348 millionconsisting of $177 million related to the difference between the purchase prices and the par values of the $714 millionaggregate principal amount of our 10% senior secured notes due 2018 that we purchased and called during the period, aswell as the write-off of unamortized note discounts and issuance costs, and $171 million related to the difference between thepurchase prices and the par values of the $925 million aggregate principal amount of our 8/8% senior secured notes due2019 that we purchased and called during the period, as well as the write-off of unamortized note discounts and issuancecosts. INCOME TAX EXPENSE During the year ended December 31, 2014, we recorded income tax expense of $49 million compared to $65 millionof income tax benefit during the year ended December 31, 2013, primarily related to the loss on early extinguishment of debtin 2013. 92 17Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsLIQUIDITY AND CAPITAL RESOURCES CASH REQUIREMENTS Our obligations to make future cash payments under contracts, such as debt and lease agreements, and undercontingent commitments, such as standby letters of credit and minimum revenue guarantees, are summarized in the tablebelow, all as of December 31, 2015: Years Ended December 31, Later Total 2016 2017 2018 2019 2020 Years (In Millions) Long-term debt $20,070 $865 $865 $1,906 $2,359 $4,919 $9,156 Capital lease obligations 1,057 142 154 71 61 44 585 Long-term non-cancelable operating leases 1,213 205 175 149 122 103 459 Standby letters of credit 110 105 5 — — — — Guarantees 100 72 22 6 — — — Asset retirement obligations 123 — — — — — 123 Academic affiliation agreements 98 31 30 28 9 — — Tax liabilities 34 — — — — — 34 Defined benefit plan obligations 689 45 21 21 21 22 559 Construction and capital improvements 241 81 80 80 — — — Information technology contract services 1,392 294 227 230 233 237 171 Purchase orders 352 352 — — — — — Total $25,479 $2,192 $1,579 $2,491 $2,805 $5,325 $11,087 (1)Includes interest through maturity date/lease termination.(2)Includes minimum revenue guarantees, primarily related to physicians under relocation agreements and physician groups that provideservices at our hospitals, and operating lease guarantees.(3)These agreements contain various rights and termination provisions.(4)Professional liability and workers’ compensation reserves, and our obligations under the Put/Call Agreement, as defined in Note 16 to ourConsolidated Financial Statements, have been excluded from the table. At December 31, 2015, the current and long-term professional andgeneral liability reserves included in our Consolidated Balance Sheet were approximately $177 million and $578 million, respectively, andthe current and long-term workers’ compensation reserves included in our Consolidated Balance Sheet were approximately $58 million and$192 million, respectively. In January 2016, subsidiaries of Welsh, Carson, Anderson & Stowe delivered a put notice for the minimumnumber of shares they are required to put to us in 2016 according to the Put/Call Agreement. The estimated amount we will pay torepurchase these shares is $127 million. Standby letters of credit are required principally by our insurers and various states to collateralize our workers’compensation programs pursuant to statutory requirements and as security to collateralize the deductible and self-insuredretentions under certain of our professional and general liability insurance programs. The amount of collateral required isprimarily dependent upon the level of claims activity and our creditworthiness. The insurers require the collateral in case weare unable to meet our obligations to claimants within the deductible or self-insured retention layers. On March 7, 2014, weentered into a new letter of credit facility agreement (“LC Facility”) that provides for the issuance of standby anddocumentary letters of credit (including certain letters of credit originally issued under our senior secured revolving creditfacility, which we transferred to the LC Facility), from time to time, in an aggregate principal amount of up to $180 million(subject to increase to up to $200 million). The LC Facility has a scheduled maturity date of March 7, 2017, and obligationsthereunder are guaranteed by and secured by a first priority pledge of the capital stock and other ownership interests ofcertain of our hospital subsidiaries on an equal ranking basis with our existing senior secured notes. We consummated the following transactions affecting our long-term commitments in the year endedDecember 31, 2015: ·In June 2015, we sold $900 million aggregate principal amount of floating rate senior secured notes, which willmature on June 15, 2020 (the “Secured Notes”), and assumed $1.9 billion aggregate principal amount of6/4% senior notes, which will mature on June 15, 2023 (the “Unsecured Notes” and, together with the SecuredNotes, the “Notes”), issued by THC Escrow Corporation II. We will pay interest on the Secured Notes quarterly93 (1)(1)(2)(3)(4)3Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsin arrears on March 15, June 15, September 15 and December 15 of each year, which payments commenced on September 15,2015. The Secured Notes accrue interest at a rate per annum, reset quarterly, equal to LIBOR plus 3/2%. We will pay intereston the Unsecured Notes semi-annually in arrears on June 15 and December 15 of each year, commencing onDecember 15, 2015. The proceeds from the sale of the Notes were used to repay borrowings outstanding under our InterimLoan Agreement and Credit Agreement, as well as to refinance the debt of USPI and to pay the cash consideration in respectof our USPI joint venture and Aspen acquisition. As part of our long-term objective to manage our capital structure, we may from time to time seek to retire, purchase,redeem or refinance some of our outstanding debt or equity securities subject to prevailing market conditions, our liquidityrequirements, contractual restrictions and other factors. These actions are part of our strategy to manage our leverage andcapital structure over time, which is dependent on our total amount of debt, our cash and our operating results. AtDecember 31, 2015, using the last 12 months of Adjusted EBITDA, our ratio of total long-term debt, net of cash and cashequivalent balances, to Adjusted EBITDA was 5.86x. We anticipate this ratio will fluctuate from quarter to quarter based onearnings performance and other factors, including acquisitions that involve the assumption of long-term debt. We intend tomanage this ratio by following our business plan, managing our cost structure, possible assets divestitures and through otherchanges in our capital structure, including, if appropriate, the issuance of equity or convertible securities. Our ability toachieve our leverage and capital structure objectives is subject to numerous risks and uncertainties, many of which aredescribed in the Forward-Looking Statements and Risk Factors sections of Part I of this report. Our capital expenditures primarily relate to the expansion and renovation of existing facilities (including amountsto comply with applicable laws and regulations), equipment and information systems additions and replacements (includingthose required to achieve compliance with the HIT requirements under ARRA), introduction of new medical technologies,design and construction of new buildings, and various other capital improvements. Capital expenditures were $842 million,$933 million and $691 million in the years ended December 31, 2015, 2014 and 2013, respectively. We anticipate that ourcapital expenditures for continuing operations for the year ending December 31, 2016 will total approximately $850 millionto $900 million, including $133 million that was accrued as a liability at December 31, 2015. Our budgeted 2016 capitalexpenditures include approximately $5 million to improve disability access at certain of our facilities pursuant to the termsof a negotiated consent decree. During the year ended December 31, 2015, we completed the transaction that combined our freestandingambulatory surgery and imaging center assets with USPI’s short-stay surgical facility assets into a new joint venture. We alsocompleted the acquisition of Aspen, a network of nine private hospitals and clinics in the United Kingdom. In addition, webegan operating Hi-Desert Medical Center, which is a 59-bed acute care hospital in Joshua Tree, California, and its relatedhealthcare facilities, including a 120-bed skilled nursing facility, an ambulatory surgery center and an imaging center, undera long-term lease agreement. Furthermore, we formed a new joint venture with Dignity Health and Ascension Health to ownand operate Carondelet Health Network, which is comprised of three hospitals with over 900 licensed beds, related physicianpractices, ambulatory surgery, imaging and urgent care centers, and other affiliated businesses, in Tucson and Nogales,Arizona. We also formed a new joint venture with Baptist Health Systems, Inc. to own and operate a healthcare networkserving Birmingham and central Alabama. We have a 60% ownership in the joint venture, and manage the network’soperations. The network has more than 1,700 licensed beds, nine outpatient centers, 68 physician clinics, deliveringprimarily and specialty care, and more than 7,000 employees and approximately 1,500 affiliated physicians. Additionally,we acquired majority interests in nine ambulatory surgery centers (all of which are owned by our USPI joint venture) andvarious physician practice entities. The fair value of the consideration conveyed in the acquisitions (the “purchase price”)was $940 million. Interest payments, net of capitalized interest, were $859 million, $726 million and $426 million in the years endedDecember 31, 2015, 2014 and 2013, respectively. Income tax payments, net of tax refunds, were approximately $7 million in the year ended December 31, 2015compared to approximately $8 million in the year ended December 31, 2014. At December 31, 2015, our carryforwardsavailable to offset future taxable income consisted of (1) federal net operating loss (“NOL”) carryforwards of approximately$1.8 billion pretax expiring in 2024 to 2034, (2) approximately $28 million in alternative minimum tax credits with noexpiration, (3) general business credit carryforwards of approximately $22 million expiring in 2023 to 2035, and (4) stateNOL carryforwards of $3.1 billion expiring in 2015 to 2035 for which the associated deferred tax94 1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsbenefit, net of valuation allowance and federal tax impact, is $12 million. Our ability to utilize NOL carryforwards to reducefuture taxable income may be limited under Section 382 of the Internal Revenue Code if our “five-percent shareholders” (asdefined in Section 382 of the Code) collectively increase their ownership by more than 50 percentage points (by value) overa rolling three-year period. These ownership changes include purchases of common stock under share repurchase programs,our offering of stock, the purchase or sale of our stock by five-percent shareholders, or the issuance or exercise of rights toacquire our stock. While we expect to be able to realize our total NOL carryforwards prior to their expiration, if an ownershipchange occurs, our ability to use the NOL carryforwards to offset future taxable income will be subject to an annuallimitation and will depend on the amount of taxable income we generate in future periods. Periodic examinations of our tax returns by the Internal Revenue Service (“IRS”) or other taxing authorities couldresult in the payment of additional taxes. The IRS has completed audits of our tax returns for all tax years ended on or beforeDecember 31, 2007, and of Vanguard’s tax returns for fiscal years ending on or before June 30, 2004. All disputed issues withrespect to these audits have been resolved, and all related tax assessments (including interest) have been paid. Our tax returnsfor years ended after December 31, 2007 and Vanguard’s tax returns for fiscal years ended after June 30, 2004 remain subjectto examination by the IRS. Vanguard’s tax returns for fiscal years ended June 30, 2013 and October 1, 2013 are currentlyunder audit by the IRS. USPI tax returns for years ended after December 31, 2011 remain subject to audit. SOURCES AND USES OF CASH Our liquidity for the year ended December 31, 2015 was primarily derived from net cash provided by operatingactivities, cash on hand, issuance of long-term debt and borrowings under our revolving credit facility. We hadapproximately $356 million of cash and cash equivalents on hand at December 31, 2015 to fund our operations and capitalexpenditures, and our borrowing availability under our credit facility was $995 million based on our borrowing basecalculation as of December 31, 2015. Our primary source of operating cash is the collection of accounts receivable. As such, our operating cash flow isimpacted by levels of cash collections and levels of bad debt due to shifts in payer mix and other factors. Net cash provided by operating activities was $1.026 billion in the year ended December 31, 2015 compared to$687 million in the year ended December 31, 2014. Key positive and negative factors contributing to the change betweenthe 2015 and 2014 periods include the following: ·Increased income from continuing operations before income taxes of $324 million, excluding net gain on sales ofinvestments, investment earnings (loss), gain (loss) from early extinguishment of debt, interest expense, gains onsales, consolidation and deconsolidation of facilities, litigation and investigation costs, impairment andrestructuring charges, acquisition-related costs, and depreciation and amortization in the year endedDecember 31, 2015 compared to the year ended December 31, 2014; ·$436 million less cash used by the change in accounts receivable, net of provision of doubtful accounts, in the2015 period; ·Higher aggregate annual 401(k) matching contributions and annual incentive compensation payments of$57 million and $95 million, respectively, in the year ended December 31, 2015 compared to the year endedDecember 31, 2014; ·An increase of $32 million in payments on reserves for restructuring charges, acquisition-related costs, andlitigation costs and settlements; and ·Higher interest payments of $133 million. We continue to seek further initiatives to increase the efficiency of our balance sheet by generating incrementalcash. These initiatives may include the sale of underutilized or inefficient assets.95 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCapital expenditures were $842 million and $933 million in the years ended December 31, 2015 and 2014,respectively. In November 2015, we announced that our board of directors had authorized the repurchase of up to $500 million ofour common stock through a share repurchase program that expires in December 2016. Under the program, shares may bepurchased in the open market or through privately negotiated transactions in a manner consistent with applicable securitieslaws and regulations. Pursuant to the share repurchase program, we paid approximately $40 million to repurchase a total of1,242,806 shares during the period from the commencement of the program through December 31, 2015. In October 2012, we announced that our board of directors had authorized the repurchase of up to $500 million ofour common stock through a share repurchase program that expired in December 2013. Under the program, shares could bepurchased in the open market or through privately negotiated transactions in a manner consistent with applicable securitieslaws and regulations, including pursuant to a Rule 10b5-1 plan we maintained. Shares were repurchased at times and inamounts based on market conditions and other factors. Pursuant to the share repurchase program, we paid approximately$100 million to repurchase a total of 3,406,324 shares during the period from the commencement of the program throughDecember 31, 2012, and we paid approximately $400 million to repurchase a total of 9,484,974 shares during the periodfrom January 1, 2013 to December 31, 2013. We record our investments that are available-for-sale at fair market value. As shown in Note 19 to the ConsolidatedFinancial Statements, the majority of our investments are valued based on quoted market prices or other observable inputs.We have no investments that we expect will be negatively affected by the current economic conditions such that they willmaterially impact our financial condition, results of operations or cash flows. DEBT INSTRUMENTS, GUARANTEES AND RELATED COVENANTS On December 4, 2015, we entered into an amendment to our existing senior secured revolving credit facility (asamended, “Credit Agreement”) in order to, among other things, extend the scheduled maturity date of the facility, reduce therates of certain interest and fees payable under the facility and remove certain restrictions with respect to the borrowing baseeligibility of certain account receivable. The Credit Agreement provides, subject to borrowing availability, for revolvingloans in an aggregate principal amount of up to $1 billion, with a $300 million subfacility for standby letters of credit. TheCredit Agreement has a scheduled maturity date of December 4, 2020. At December 31, 2015, we were in compliance with allcovenants and conditions in our Credit Agreement. At December 31, 2015, we had no cash borrowings outstanding under therevolving credit facility, and we had approximately $5 million of standby letters of credit outstanding. Based on our eligiblereceivables, approximately $995 million was available for borrowing under the revolving credit facility atDecember 31, 2015. On March 7, 2014, we entered into a new letter of credit facility agreement that provides for the issuance of standbyand documentary letters of credit (including certain letters of credit originally issued under our Credit Agreement, which wetransferred to the LC Facility), from time to time, in an aggregate principal amount of up to $180 million (subject to increaseto up to $200 million). The LC Facility has a scheduled maturity date of March 7, 2017, and obligations thereunder areguaranteed by and secured by a first priority pledge of the capital stock and other ownership interests of certain of ourhospital subsidiaries on an equal ranking basis with our existing senior secured notes. At December 31, 2015, we hadapproximately $105 million of standby letters of credit outstanding under the LC Facility. In June 2015, we sold $900 million aggregate principal amount of floating rate senior secured notes, which willmature on June 15, 2020 (the “Secured Notes”), and assumed $1.9 billion aggregate principal amount of 6/4% senior notes,which will mature on June 15, 2023 (the “Unsecured Notes” and, together with the Secured Notes, the “Notes”), issued byTHC Escrow Corporation II. We will pay interest on the Secured Notes quarterly in arrears on March 15, June 15, September15 and December 15 of each year, which payments commenced on September 15, 2015. The Secured Notes accrue interest ata rate per annum, reset quarterly, equal to LIBOR plus 3/2%. We will pay interest on the Unsecured Notes semi-annually inarrears on June 15 and December 15 of each year, which payments commenced on December 15, 2015. The proceeds from thesale of the Notes were used to repay borrowings outstanding under our Interim Loan Agreement and96 31Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCredit Agreement, as well as to refinance the debt of USPI and to pay the cash consideration in respect of our USPI jointventure and Aspen acquisition. In September 2014, we sold $500 million aggregate principal amount of 5/2% senior notes, which will mature onMarch 1, 2019. We will pay interest on the notes semi-annually in arrears on March 1 and September 1 of each year, whichpayments commenced on March 1, 2015. The proceeds from the sale of the notes were used for general corporate purposes,including the repayment of indebtedness and drawings under our Credit Agreement, related transaction fees and expenses,and acquisitions. In June and March 2014, we sold $500 million and $600 million aggregate principal amount, respectively, of5% senior notes, which will mature on March 1, 2019. We will pay interest on the notes semi-annually in arrears on March 1and September 1 of each year, which payments commenced on September 1, 2014. The net proceeds from the sale of thenotes in June 2014 were used to redeem our 91/4% senior notes due 2015 in July 2014. The net proceeds from the sale of thenotes in March 2014 were used for general corporate purposes, including the repayment of borrowings under our CreditAgreement. In October 2013, we sold $2.8 billion aggregate principal amount of 81/8% senior notes, which will mature on April1, 2022, and $1.8 billion aggregate principal amount of 6% senior secured notes, which will mature on October 1, 2020. Wewill pay interest on the 81/8% senior notes and 6% senior secured notes semi-annually in arrears on April 1 and October 1 ofeach year, which payments commenced on April 1, 2014. The proceeds from the sale of the notes were used to finance theacquisition of Vanguard. In May 2013, we sold $1.050 billion aggregate principal amount of 438% senior secured notes, which will matureon October 1, 2021. We will pay interest on the 43/8% senior secured notes semi-annually in arrears on January 1 and July 1of each year, which payments commenced on January 1, 2014. We used a portion of the proceeds from the sale of the notes topurchase approximately $767 million aggregate principal amount outstanding of our 87/8% senior secured notes due 2019 ina tender offer and to call approximately $158 million of the remaining aggregate principal amount outstanding of thosenotes. In connection with the purchase, we recorded a loss from early extinguishment of debt of $171 million, primarilyrelated to the difference between the purchase prices and the par values of the purchased notes, as well as the write-off ofunamortized note discounts and issuance costs. In February 2013, we sold $850 million aggregate principal amount of 412% senior secured notes, which will matureon April 1, 2021. We will pay interest on the 412% senior secured notes semi-annually in arrears on April 1 and October 1 ofeach year, which payments commenced on October 1, 2013. We used a portion of the proceeds from the sale of the notes topurchase approximately $645 million aggregate principal amount outstanding of our 10% senior secured notes due 2018 in atender offer and to call approximately $69 million of the remaining aggregate principal amount outstanding of those notes.In connection with the purchase, we recorded a loss from early extinguishment of debt of $177 million, primarily related tothe difference between the purchase prices and the par values of the purchased notes, as well as the write-off of unamortizednote discounts and issuance costs. For additional information regarding our long-term debt, see Note 6 to the accompanying Consolidated FinancialStatements. LIQUIDITY From time to time, we expect to engage in additional capital markets, bank credit and other financing activitiesdepending on our needs and financing alternatives available at that time. We believe our existing debt agreements providesignificant flexibility for future secured or unsecured borrowings. Our cash on hand fluctuates day-to-day throughout the year based on the timing and levels of routine cash receiptsand disbursements, including our book overdrafts, and required cash disbursements, such as interest and income taxpayments. These fluctuations result in material intra-quarter net operating and investing uses of cash that has caused, and inthe future could cause, us to use our Credit Agreement as a source of liquidity. We believe that existing cash and cashequivalents on hand, availability under our Credit Agreement, anticipated future cash provided by operating97 1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsactivities, and our investments in marketable securities of our captive insurance companies classified as noncurrentinvestments on our balance sheet should be adequate to meet our current cash needs. These sources of liquidity, incombination with any potential future debt incurrence, should also be adequate to finance planned capital expenditures,payments on the current portion of our long-term debt and other presently known operating needs. Long-term liquidity for debt service and other purposes will be dependent on the amount of cash provided byoperating activities and, subject to favorable market and other conditions, the successful completion of previouslyannounced asset divestitures, future borrowings or potential refinancings. However, our cash requirements could bematerially affected by the use of cash in acquisitions of businesses, repurchases of securities, the exercise of put rights orother exit options by our joint venture partners, and contractual commitments to fund capital expenditures in, orintercompany borrowings to, businesses we acquire. In addition, liquidity could be adversely affected by a deterioration inour results of operations, including our ability to generate cash from operations, as well as by the various risks anduncertainties discussed in this and other sections of this report, including any costs associated with a significant monetaryresolution of the Clinica de la Mama qui tam action and criminal investigation described in Note 15 to our ConsolidatedFinancial Statements. We do not rely on commercial paper or other short-term financing arrangements nor do we enter into repurchaseagreements or other short-term financing arrangements not otherwise reported in our period-end balance sheets. In addition,we do not have significant exposure to floating interest rates given that substantially all of our current long-termindebtedness has fixed rates of interest. We continue to aggressively identify and implement further actions to control costs and enhance our operatingperformance, including cash flow. Among the areas being addressed are volume growth, including the acquisition ofoutpatient businesses, physician recruitment and alignment strategies, expansion of our Conifer services businesses,managed care payer contracting, procurement efficiencies, cost standardization, bad debt expense reduction initiatives,underperforming hospitals and portfolio optimization, and certain hospital and overhead costs not related to patient care.Although these initiatives may result in improved performance, our performance may remain somewhat below our hospitalmanagement company peers because of geographic and other differences in hospital portfolios. OFF-BALANCE SHEET ARRANGEMENTS Our consolidated operating results for the years ended December 31, 2015, 2014 and 2013 include $94 million, $49million and $392 million, respectively, of net operating revenues and $15 million, ($1) million and $72 million,respectively, of operating income (loss) generated from hospitals operated by us under operating lease arrangements (twohospitals for the year ended December 31, 2015 and 2014, one hospital for the year ended December 31, 2013). Inaccordance with GAAP, the applicable buildings and the future lease obligations under these arrangements are not recordedon our consolidated balance sheet. One of the hospitals operated by us under an operating lease arrangement was contributedto one of our joint ventures with Baylor Scott & White Health effective January 1, 2016, as further described in Note 4 to ourConsolidated Financial Statements included in this report. The remaining operating lease is currently scheduled to expire in2016 and may be renewed through 2046. If we are unable to extend the lease or purchase the hospital, we would no longergenerate revenues or expenses from the hospital. We have no other off-balance sheet arrangements that may have a current or future material effect on our financialcondition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources, except for $210million of standby letters of credit outstanding and guarantees as of December 31, 2015.RECENTLY ISSUED ACCOUNTING STANDARDS See Note 22 to our Consolidated Financial Statements included in this report for a discussion of recently issuedaccounting standards. CRITICAL ACCOUNTING ESTIMATES In preparing our Consolidated Financial Statements in conformity with GAAP, we must use estimates andassumptions that affect the amounts reported in our Consolidated Financial Statements and accompanying notes. We98 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsregularly evaluate the accounting policies and estimates we use. In general, we base the estimates on historical experienceand on assumptions that we believe to be reasonable, given the particular circumstances in which we operate. Actual resultsmay vary from those estimates. We consider our critical accounting estimates to be those that (1) involve significant judgments and uncertainties,(2) require estimates that are more difficult for management to determine, and (3) may produce materially different outcomesunder different conditions or when using different assumptions. Our critical accounting estimates cover the following areas: ·Recognition of net operating revenues, including contractual allowances and provision for doubtful accounts; ·Accruals for general and professional liability risks; ·Accruals for defined benefit plans; ·Impairment of long-lived assets; ·Impairment of goodwill; and ·Accounting for income taxes.REVENUE RECOGNITION We recognize net operating revenues before provision for doubtful accounts in the period in which our services areperformed. Net operating revenues before provision for doubtful accounts primarily consist of net patient service revenuesthat are recorded based on established billing rates (i.e., gross charges), less estimated discounts for contractual and otherallowances, principally for patients covered by Medicare, Medicaid, and managed care and other health plans, as well ascertain uninsured patients under the Compact. Revenues under the traditional fee-for-service Medicare and Medicaid programs are based primarily on prospectivepayment systems. Retrospectively determined cost-based revenues under these programs, which were more prevalent inearlier periods, and certain other payments, such as DSH, DGME, IME and bad debt expense, which are based on ourhospitals’ cost reports, are estimated using historical trends and current factors. Cost report settlements under these programsare subject to audit by Medicare and Medicaid auditors and administrative and judicial review, and it can take several yearsuntil final settlement of such matters is determined and completely resolved. Because the laws, regulations, instructions andrule interpretations governing Medicare and Medicaid reimbursement are complex and change frequently, the estimatesrecorded by us could change by material amounts. We have a system and estimation process for recording Medicare net patient revenue and estimated cost reportsettlements. This results in us recording accruals to reflect the expected final settlements on our cost reports. For filed costreports, we record the accrual based on those cost reports and subsequent activity, and record a valuation allowance againstthose cost reports based on historical settlement trends. The accrual for periods for which a cost report is yet to be filed isrecorded based on estimates of what we expect to report on the filed cost reports, and a corresponding valuation allowance isrecorded as previously described. Cost reports must generally be filed within five months after the end of the annual costreport reporting period. After the cost report is filed, the accrual and corresponding valuation allowance may need to beadjusted. Revenues under managed care plans are based primarily on payment terms involving predetermined rates perdiagnosis, per-diem rates, discounted fee-for-service rates and other similar contractual arrangements. These revenues are alsosubject to review and possible audit by the payers, which can take several years before they are completely resolved. Thepayers are billed for patient services on an individual patient basis. An individual patient’s bill is subject to adjustment on apatient-by-patient basis in the ordinary course of business by the payers following their review and adjudication of eachparticular bill. We estimate the discounts for contractual allowances at the individual hospital level utilizing billing data onan individual patient basis. At the end of each month, on an individual hospital basis, we estimate our expectedreimbursement for patients of managed care plans based on the applicable contract terms. We99 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsbelieve it is reasonably likely for there to be an approximately 3% increase or decrease in the estimated contractualallowances related to managed care plans. Based on reserves as of December 31, 2015, a 3% increase or decrease in theestimated contractual allowance would impact the estimated reserves by approximately $15 million. Some of the factors thatcan contribute to changes in the contractual allowance estimates include: (1) changes in reimbursement levels for procedures,supplies and drugs when threshold levels are triggered; (2) changes in reimbursement levels when stop-loss or outlier limitsare reached; (3) changes in the admission status of a patient due to physician orders subsequent to initial diagnosis or testing;(4) final coding of in-house and discharged-not-final-billed patients that change reimbursement levels; (5) secondary benefitsdetermined after primary insurance payments; and (6) reclassification of patients among insurance plans with differentcoverage levels. Contractual allowance estimates are periodically reviewed for accuracy by taking into consideration knowncontract terms, as well as payment history. Although we do not separately accumulate and disclose the aggregate amount ofadjustments to the estimated reimbursement for every patient bill, we believe our estimation and review process enables us toidentify instances on a timely basis where such estimates need to be revised. We do not believe there were any adjustments toestimates of patient bills that were material to our revenues. In addition, on a corporate-wide basis, we do not record anygeneral provision for adjustments to estimated contractual allowances for managed care plans. Revenues related to self-pay patients may qualify for a discount under the Compact, whereby the gross chargesbased on established billing rates would be reduced by an estimated discount for contractual allowance. We believe that adequate provision has been made for any adjustments that may result from final determination ofamounts earned under all the above arrangements. We know of no material claims, disputes or unsettled matters with anypayers that would affect our revenues for which we have not adequately provided for in our Consolidated FinancialStatements. Although outcomes vary, our policy is to attempt to collect amounts due from patients, including co-pays anddeductibles due from patients with insurance, at the time of service while complying with all federal and state laws andregulations, including, but not limited to, the Emergency Medical Treatment and Active Labor Act (“EMTALA”). Generally,as required by EMTALA, patients may not be denied emergency treatment due to inability to pay. Therefore, services,including the legally required medical screening examination and stabilization of the patient, are performed withoutdelaying to obtain insurance information. In non-emergency circumstances or for elective procedures and services, it is ourpolicy to verify insurance prior to a patient being treated; however, there are various exceptions that can occur. Suchexceptions can include, for example, instances where (1) we are unable to obtain verification because the patient’s insurancecompany was unable to be reached or contacted, (2) a determination is made that a patient may be eligible for benefits undervarious government programs, such as Medicaid or Victims of Crime, and it takes several days or weeks before qualificationfor such benefits is confirmed or denied, and (3) under physician orders we provide services to patients that requireimmediate treatment. We provide for an allowance against accounts receivable that could become uncollectible by establishing anallowance to reduce the carrying value of such receivables to their estimated net realizable value. Generally, we estimate thisallowance based on the aging of our accounts receivable by hospital, our historical collection experience by hospital and foreach type of payer over a look-back period, and other relevant factors. Based on our accounts receivable from self-paypatients and co-pays and deductibles owed to us by patients with insurance at December 31, 2015, a 10% decrease orincrease in our self-pay collection rate, or approximately 3%, which we believe could be a reasonable likely change, wouldresult in an unfavorable or favorable adjustment to provision for doubtful accounts of approximately $10 million. There arevarious factors that can impact collection trends, such as changes in the economy, which in turn have an impact onunemployment rates and the number of uninsured and underinsured patients, the volume of patients through our emergencydepartments, the increased burden of co-pays and deductibles to be made by patients with insurance, and business practicesrelated to collection efforts. These factors continuously change and can have an impact on collection trends and ourestimation process. Our practice is to reduce the net carrying value of self-pay accounts receivable, including accounts related to the co-pays and deductibles due from patients with insurance, to their estimated net realizable value at the time of billing.Generally, uncollected balances are assigned to Conifer between 90 to 180 days, once patient responsibility has beenidentified. When accounts are assigned to Conifer by the hospital, the accounts are completely written off the hospital’sbooks through the provision for doubtful accounts, and an estimated future recovery amount is calculated and recorded as areceivable on the hospital’s books at the same time. The estimated future recovery amount is adjusted based on the100 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsaging of the accounts and changes to actual recovery rates. The estimated future recovery amount for self-pay accounts iswritten down whereby it is fully reserved if the amount is not paid within two years after the account is assigned to Conifer.At the present time, our new acquisitions have not yet been fully integrated into our Conifer collections processes. Managed care accounts are collected through the regional business offices of Conifer, whereby the account balancesremain in the related hospital’s patient accounting system and on the hospital’s books, and are adjusted based on an analysisof the net realizable value as they age. Generally, managed care accounts collected by Conifer are gradually written downwhereby they are fully reserved if the accounts are not paid within two years. Changes in the collectability of aged managed care accounts receivable are ongoing and impact our provision fordoubtful accounts. We continue to experience payment pressure from managed care companies concerning amounts of pastbillings. We aggressively pursue collection of these accounts receivable using all means at our disposal, includingarbitration and litigation, but we may not be successful. ACCRUALS FOR GENERAL AND PROFESSIONAL LIABILITY RISKS We accrue for estimated professional and general liability claims, to the extent not covered by insurance, when theyare probable and can be reasonably estimated. We maintain reserves, which are based on modeled estimates for the portion ofour professional liability risks, including incurred but not reported claims, to the extent we do not have insurance coverage.Our liability consists of estimates established based upon discounted calculations using several factors, including thenumber of expected claims, estimates of losses for these claims based on recent and historical settlement amounts, estimatesof incurred but not reported claims based on historical experience, the timing of historical payments, and risk free discountrates used to determine the present value of projected payments. We consider the number of expected claims, average cost perclaim and discount rate to be the most significant assumptions in estimating accruals for general and professional liabilities.Our liabilities are adjusted for new claims information in the period such information becomes known. Malpractice expenseis recorded within other operating expenses in the accompanying Consolidated Statements of Operations. Our estimated reserves for professional and general liability claims will change significantly if future claims differfrom expected trends. We believe it is reasonably likely for there to be a 5% increase or decrease in the number of expectedclaims or average cost per claim. Based on our reserves and other information as of December 31, 2015, a 5% increase in thenumber of expected claims would increase the estimated reserves by $50 million, and a 5% decrease in the number ofexpected claims would decrease the estimated reserves by $40 million. A 5% increase in the average cost per claim wouldincrease the estimated reserves by $50 million, and a 5% decrease in the average cost per claim would decrease the estimatedreserves by $43 million. Because our estimated reserves for future claim payments are discounted to present value, a changein our discount rate assumption could also have a significant impact on our estimated reserves. Our discount rate was 2.09%,1.97% and 2.45% at December 31, 2015, 2014 and 2013, respectively. A 100 basis point increase or decrease in the discountrate would change the estimated reserves by $22 million. In addition, because of the complexity of the claims, the extendedperiod of time to settle the claims and the wide range of potential outcomes, our ultimate liability for professional andgeneral liability claims could change materially from our current estimates. The table below shows the case reserves and incurred but not reported and loss development reserves as ofDecember 31, 2015, 2014 and 2013: December 31, 2015 2014 2013 Case reserves $219 $253 $188 Incurred but not reported and loss development reserves 584 472 575 Total undiscounted reserves $803 $725 $763 Several actuarial methods, including the incurred, paid loss development and Bornhuetter-Ferguson methods, areapplied to our historical loss data to produce estimates of ultimate expected losses and the resulting incurred but not reportedand loss development reserves. These methods use our specific historical claims data related to paid losses and lossadjustment expenses, historical and current case reserves, reported and closed claim counts, and a variety of hospital censusinformation. These analyses are considered in our determination of our estimate of the professional liability101 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsclaims, including the incurred but not reported and loss development reserve estimates. The determination of our estimatesinvolves subjective judgment and could result in material changes to our estimates in future periods if our actual experienceis materially different than our assumptions. Malpractice claims generally take four to five years to settle from the time of the initial reporting of the occurrenceto the settlement payment. Accordingly, the percentage of undiscounted reserves at both December 31, 2015 and 2014representing unsettled claims is approximately 98%.The following table, which includes both our continuing and discontinued operations, presents the amount of ouraccruals for professional and general liability claims and the corresponding activity therein: Years Ended December 31, 2015 2014 2013 Accrual for professional and general liability claims, beginning of the year $681 $711 $356 Assumed from acquisition 29 — 373 Expense (income) related to: Current year 151 144 102 Prior years 95 57 13 Expense (income) from discounting (3) 7 (13) Total incurred loss and loss expense 243 208 102 Paid claims and expenses related to: Current year (3) (3) (3) Prior years (195) (235) (117) Total paid claims and expenses (198) (238) (120) Accrual for professional and general liability claims, end of year $755 $681 $711 (1)Total malpractice expense for continuing operations, including premiums for insured coverage, was $283 million, $232 million and$112 million in the years ended December 31, 2015, 2014 and 2013, respectively. ACCRUALS FOR DEFINED BENEFIT PLANS Our defined benefit plan obligations and related costs are calculated using actuarial concepts. The discount rate is acritical assumption in determining the elements of expense and liability measurement. We evaluate this critical assumptionannually. Other assumptions include employee demographic factors such as retirement patterns, mortality, turnover and rateof compensation increase. During the year ended December 31, 2015, the Society of Actuaries issued a new mortalityimprovement scale (MP-2015), which we incorporated into the estimates of our defined benefit plan obligations as ofDecember 31, 2015. During the year ended December 31, 2014, the Society of Actuaries issued new mortality tables (RP-2014) and a mortality improvement scale (MP-2014), which we incorporated into the estimates of our defined benefit planobligations as of December 31, 2014. The discount rate enables us to state expected future cash payments for benefits as a present value on themeasurement date. The guideline for setting these rates is a high-quality long-term corporate bond rate. A lower discount rateincreases the present value of benefit obligations and impacts pension expense. Our discount rates for 2015 ranged from4.67% to 4.75% and our discount rate for 2014 ranged from 4.16% to 4.25%. The assumed discount rate for pension plansreflects the market rates for high-quality corporate bonds currently available. A 100 basis point decrease in the assumeddiscount rate would increase total net periodic pension expense for 2016 by approximately $3 million and would increasethe projected benefit obligation at December 31, 2015 by approximately $186 million. A 100 basis point increase in theassumed discount rate would decrease net periodic pension expense for 2016 by approximately $1 million and decrease theprojected benefit obligation at December 31, 2015 by approximately $153 million. IMPAIRMENT OF LONG-LIVED ASSETS We evaluate our long-lived assets for possible impairment annually or whenever events or changes in circumstancesindicate that the carrying amount of the asset, or related group of assets, may not be recoverable from102 (1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsestimated future undiscounted cash flows. If the estimated future undiscounted cash flows are less than the carrying value ofthe assets, we calculate the amount of an impairment charge if the carrying value of the long-lived assets exceeds the fairvalue of the assets. The fair value of the assets is estimated based on appraisals, established market values of comparableassets or internal estimates of future net cash flows expected to result from the use and ultimate disposition of the asset. Theestimates of these future cash flows are based on assumptions and projections we believe to be reasonable and supportable.They require our subjective judgments and take into account assumptions about revenue and expense growth rates. Theseassumptions may vary by type of facility and presume stable, improving or, in some cases, declining results at our hospitals,depending on their circumstances. If the presumed level of performance does not occur as expected, impairment may result. We report long-lived assets to be disposed of at the lower of their carrying amounts or fair values less costs to sell. Insuch circumstances, our estimates of fair value are based on appraisals, established market prices for comparable assets orinternal estimates of future net cash flows. Fair value estimates can change by material amounts in subsequent periods. Many factors and assumptions canimpact the estimates, including the following risks: ·future financial results of our hospitals, which can be impacted by volumes of insured patients and declines incommercial managed care patients, terms of managed care payer arrangements, our ability to collect accountsdue from uninsured and managed care payers, loss of volumes as a result of competition, and our ability tomanage costs such as labor costs, which can be adversely impacted by union activity and the shortage ofexperienced nurses; ·changes in payments from governmental healthcare programs and in government regulations such as reductionsto Medicare and Medicaid payment rates resulting from government legislation or rule-making or frombudgetary challenges of states in which we operate; ·how the hospitals are operated in the future; and ·the nature of the ultimate disposition of the assets. During the year ended December 31, 2015, we recorded $168 million of impairment charges. We recorded animpairment charge of approximately $147 million to write-down assets held for sale to their estimated fair value, lessestimated costs to sell, as a result of entering into a definitive agreement for the sale of SLUH during the three months endedJune 30, 2015, as further described in Note 4. We also recorded impairment charges of approximately $19 million for thewrite-down of buildings, equipment and other long-lived assets, primarily capitalized software cost classified as otherintangible assets, to their estimated fair values at two of our hospitals. Material adverse trends in our estimates of futureundiscounted cash flows of the hospitals indicated the carrying value of the hospitals’ long-lived assets was not recoverablefrom the estimated future cash flows. We believe the most significant factors contributing to the adverse financial trendsinclude reductions in volumes of insured patients, shifts in payer mix from commercial to governmental payers combinedwith reductions in reimbursement rates from governmental payers, and high levels of uninsured patients. As a result, weupdated the estimate of the fair value of the hospitals’ long-lived assets and compared the fair value estimate to the carryingvalue of the hospitals’ long-lived assets. Because the fair value estimates were lower than the carrying value of the long-livedassets, an impairment charge was recorded for the difference in the amounts. Unless the anticipated future financial trends ofthese hospitals improve to the extent that the estimated future undiscounted cash flows exceeds the carrying value of thelong-lived assets, these hospitals are at risk of future impairments. The aggregate carrying value of assets held and used of thehospitals for which impairment charges were recorded was $45 million as of December 31, 2015 after recording theimpairment charge. We also recorded $2 million related to investments. We also had four hospitals whose estimated futureundiscounted cash flows did not exceed the carrying value of long-lived assets. However, in each case, the fair value of thoseassets, based on independent appraisals, established market values of comparable assets or internal estimates exceeded thecarrying value, so no impairment was recorded. Future adverse trends that result in necessary changes in the assumptionsunderlying these estimates of future undiscounted cash flows could result in the hospitals’ estimated cash flows being lessthan the carrying value of the assets, which would require a fair value assessment of the long-lived assets and, if the fair valueamount is less than the carrying value of the assets, impairment charges would occur and could be material.103 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents IMPAIRMENT OF GOODWILL Goodwill represents the excess of costs over the fair value of assets of businesses acquired. Goodwill and otherintangible assets acquired in purchase business combinations and determined to have indefinite useful lives are notamortized, but instead are subject to impairment tests performed at least annually. For goodwill, we perform the test at thereporting unit level, as defined by applicable accounting standards, when events occur that require an evaluation to beperformed or at least annually. If we determine the carrying value of goodwill is impaired, or if the carrying value of abusiness that is to be sold or otherwise disposed of exceeds its fair value, then we reduce the carrying value, including anyallocated goodwill, to fair value. Estimates of fair value are based on appraisals, established market prices for comparableassets or internal estimates of future net cash flows and presume stable, improving or, in some cases, declining results at ourhospitals, depending on their circumstances. If the presumed level of performance does not occur as expected, impairmentmay result. Effective June 16, 2015, we completed the transaction that combined our freestanding ambulatory surgery andimaging center assets with the short-stay surgical facility assets of USPI. As of December 31, 2015, our continuing operationsconsisted of three reportable segments, our Hospital Operations and other, Ambulatory Care and Conifer. During the threemonths ended June 30, 2015, within our Hospital Operations and other segment, we combined our Central region with ourResolute Health, San Antonio and South Texas markets to create our new Texas region, and we moved our hospitals andother operations in Tennessee from our Texas region to our Southern region. Our Hospital Operations and other segment iscurrently structured as follows: ·Our Texas region included all of our hospitals and other operations in Missouri, New Mexico and Texas; ·Our Florida region included all of our hospitals and other operations in Florida; ·Our Northeast region included all of our hospitals and other operations in Illinois, Massachusetts andPennsylvania; ·Our Southern region included all of our hospitals and other operations in Alabama, Georgia, South Carolina andTennessee; ·Our Western region included all of our hospitals and other operations in Arizona and California; and ·Our Detroit market included all of our hospitals and other operations in the Detroit, Michigan area. These regions and markets are reporting units used to perform our goodwill impairment analysis and are one level below ourhospital operations reportable business segment level. The allocated goodwill balance related to our Hospital Operations and other segment totals approximately $3.122billion, of which the Texas Region has the largest balance at $1.742 billion. In our latest impairment analysis as ofDecember 31, 2015, the estimated fair value of the Texas Region exceeded the carrying value of long-lived assets, includinggoodwill, by approximately 23%. The allocated goodwill balance related to our Ambulatory Care segment, consisting generally of assets acquired in2015, totals approximately $3.243 billion. The allocated goodwill balance related to our Conifer segment totals approximately $605 million. In our latestimpairment analysis as of December 31, 2015, the estimated fair value of the Conifer segment exceeded the carrying value oflong-lived assets, including goodwill, by approximately 134%. 104 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsACCOUNTING FOR INCOME TAXES We account for income taxes using the asset and liability method. This approach requires the recognition of deferredtax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts andthe tax bases of assets and liabilities. Income tax receivables and liabilities and deferred tax assets and liabilities arerecognized based on the amounts that more likely than not will be sustained upon ultimate settlement with taxingauthorities. Developing our provision for income taxes and analysis of uncertain tax positions requires significant judgment andknowledge of federal and state income tax laws, regulations and strategies, including the determination of deferred tax assetsand liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. We assess the realization of our deferred tax assets to determine whether an income tax valuation allowance isrequired. Based on all available evidence, both positive and negative, and the weight of that evidence to the extent suchevidence can be objectively verified, we determine whether it is more likely than not that all or a portion of the deferred taxassets will be realized. The main factors that we consider include: ·Cumulative profits/losses in recent years, adjusted for certain nonrecurring items; ·Income/losses expected in future years; ·Unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels; ·The availability, or lack thereof, of taxable income in prior carryback periods that would limit realization of taxbenefits; and ·The carryforward period associated with the deferred tax assets and liabilities. During the year ended December 31, 2013, we increased the valuation allowance by $51 million, $34 million due to theacquisition of Vanguard and $17 million primarily due to the recording of deferred tax assets for state net operating losscarryforwards that have a full valuation allowance. During the year ended December 31, 2014, we decreased the valuationallowance by $20 million primarily due to the expiration of unutilized state net operating loss carryovers. During the yearended December 31, 2015, we increased the valuation allowance by $9 million, $5 million due to the acquisition of USPIand $4 million due to changes in expected realizability of deferred tax assets, primarily related to unutilized state netoperating loss carryforwards. The remaining balance in the valuation allowance as of December 31, 2015 is $96 million. We consider many factors when evaluating our uncertain tax positions, and such judgments are subject to periodicreview. Tax benefits associated with uncertain tax positions are recognized in the period in which one of the followingconditions is satisfied: (1) the more likely than not recognition threshold is satisfied; (2) the position is ultimately settledthrough negotiation or litigation; or (3) the statute of limitations for the taxing authority to examine and challenge theposition has expired. Tax benefits associated with an uncertain tax position are derecognized in the period in which the morelikely than not recognition threshold is no longer satisfied. While we believe we have adequately provided for our income tax receivables or liabilities and our deferred taxassets or liabilities, adverse determinations by taxing authorities or changes in tax laws and regulations could have a materialadverse effect on our consolidated financial position, results of operations or cash flows. 105 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The table below presents information about certain of our market-sensitive financial instruments as ofDecember 31, 2015. The fair values were determined based on quoted market prices for the same or similar instruments. Theaverage effective interest rates presented are based on the rate in effect at the reporting date. The effects of unamortizedpremiums and discounts are excluded from the table. Maturity Date, Years Ending December 31, 2016 2017 2018 2019 2020 Thereafter Total Fair Value (Dollars in Millions) Fixed rate long-term debt $127 $170 $1,128 $1,677 $3,410 $7,361 $13,873 $13,467 Average effective interestrates 6.7% 7.1% 6.6% 5.5% 6.7% 7.2% 6.8% Variable rate long-term debt $ — $ — $ — $ — $900 $ — $900 $879 Average effective interestrates — — — — 4% —% —% At December 31, 2015, the potential reduction of annual pretax earnings due to a one percentage point (100 basispoint) increase in variable interest rates on long-term debt would be approximately $9 million. At December 31, 2015, we had long-term, market-sensitive investments held by our captive insurance subsidiaries.Our market risk associated with our investments in debt securities classified as non-current assets is substantially mitigatedby the long-term nature and type of the investments in the portfolio. We have no affiliation with partnerships, trusts or other entities (sometimes referred to as “special-purpose” or“variable-interest” entities) whose purpose is to facilitate off-balance sheet financial transactions or similar arrangements byus. Thus, we have no exposure to the financing, liquidity, market or credit risks associated with such entities. We do not hold or issue derivative instruments for trading purposes and are not a party to any instruments withleverage or prepayment features.106 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING To Our Shareholders: Management is responsible for establishing and maintaining adequate internal control over financial reporting, assuch term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended. Management assessed theeffectiveness of Tenet’s internal control over financial reporting as of December 31, 2015. This assessment was performedunder the supervision of and with the participation of management, including the chief executive officer and chief financialofficer. In making this assessment, management used criteria based on the framework in Internal Control — IntegratedFramework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based onthe assessment using the COSO framework, management concluded that Tenet’s internal control over financial reporting waseffective as of December 31, 2015. As more fully described under the heading “Description of Business” in Note 1 to the Consolidated FinancialStatements in Item 8, we formed our USPI Holding Company, Inc. (“USPI joint venture”) and acquired European SurgicalPartners Ltd. (“Aspen”) on June 16, 2015. We excluded our USPI joint venture and Aspen from our 2015 assessment of theeffectiveness of our internal control over financial reporting. Our USPI joint venture and Aspen accounted forapproximately 22% of total assets and 5% of net operating revenues of our consolidated financial statement amounts as ofand for the year ended December 31, 2015. We expect that our internal control system will be fully implemented at our USPIjoint venture and Aspen during 2016 and correspondingly evaluated by us for effectiveness. Tenet’s internal control over financial reporting as of December 31, 2015 has been audited by Deloitte & ToucheLLP, an independent registered public accounting firm, as stated in their report, which is included herein. Deloitte & ToucheLLP has also audited Tenet’s Consolidated Financial Statements as of and for the year ended December 31, 2015, and thatfirm’s audit report on such Consolidated Financial Statements is also included herein. Internal control over financial reporting cannot provide absolute assurance of achieving financial reportingobjectives because of its inherent limitations. Internal control over financial reporting is a process that involves humandiligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internalcontrol over financial reporting also can be circumvented by collusion or improper management override. Because of suchlimitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal controlover financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore,it is possible to design into the process safeguards to reduce, though not eliminate, this risk. /s/ TREVOR FETTER /s/ DANIEL J. CANCELMI Trevor Fetter Daniel J. CancelmiChief Executive Officer and Chairmanof the Board of Directors Chief Financial OfficerFebruary 22, 2016 February 22, 2016 107 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders ofTenet Healthcare CorporationDallas, Texas We have audited the internal control over financial reporting of Tenet Healthcare Corporation and subsidiaries (the"Company") as of December 31, 2015, based on criteria established in Internal Control — Integrated Framework (2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission. As described in Management’sReport on Internal Control Over Financial Reporting, management excluded from its assessment the internal control overfinancial reporting at USPI Holding Company, Inc. and European Surgical Partners Ltd., which were formed and acquiredon June 16, 2015, and whose financial statements constitute 22% of total assets, and 5% of net operating revenues of theconsolidated financial statement amounts as of and for the year ended December 31, 2015. Accordingly, our audit did notinclude the internal control over financial reporting at USPI Holding Company, Inc. and European Surgical Partners Ltd.The Company's management is responsible for maintaining effective internal control over financial reporting and for itsassessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’sReport on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company'sinternal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (UnitedStates). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effectiveinternal control over financial reporting was maintained in all material respects. Our audit included obtaining anunderstanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing andevaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such otherprocedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for ouropinion. A company's internal control over financial reporting is a process designed by, or under the supervision of, the company'sprincipal executive and principal financial officers, or persons performing similar functions, and effected by thecompany's board of directors, management, and other personnel to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal control over financial reporting includes those policies andprocedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recordedas necessary to permit preparation of financial statements in accordance with generally accepted accounting principles,and that receipts and expenditures of the company are being made only in accordance with authorizations of managementand directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financialstatements. Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion orimproper management override of controls, material misstatements due to error or fraud may not be prevented or detectedon a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting tofuture periods are subject to the risk that the controls may become inadequate because of changes in conditions, or thatthe degree of compliance with the policies or procedures may deteriorate. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as ofDecember 31, 2015, based on the criteria established in Internal Control — Integrated Framework (2013) issued by theCommittee of Sponsoring Organizations of the Treadway Commission. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (UnitedStates), the consolidated financial statements and financial statement schedule as of and for the year ended December 31,2015 of the Company and our report dated February 22, 2016 expressed an unqualified opinion on those consolidatedfinancial statements and financial statement schedule and included an explanatory paragraph regarding the Company’sadoption of new accounting standards. /s/ DELOITTE & TOUCHE LLPDallas, TexasFebruary 22, 2016 108 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders ofTenet Healthcare CorporationDallas, Texas We have audited the accompanying consolidated balance sheets of Tenet Healthcare Corporation and subsidiaries (the"Company") as of December 31, 2015 and 2014, and the related consolidated statements of operations, othercomprehensive income (loss), changes in equity, and cash flows for each of the three years in the period ended December31, 2015. Our audits also included the financial statement schedule listed in the Index at Item 15. These consolidatedfinancial statements and financial statement schedule are the responsibility of the Company's management. Ourresponsibility is to express an opinion on the consolidated financial statements and financial statement schedule based onour audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (UnitedStates). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supportingthe amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles usedand significant estimates made by management, as well as evaluating the overall financial statement presentation. Webelieve that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the consolidated financialposition of the Company at December 31, 2015 and 2014, and the results of its operations and its cash flows for each ofthe three years in the period ended December 31, 2015, in conformity with accounting principles generally accepted inthe United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to thebasic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forththerein. As discussed in Note 1 to the consolidated financial statements, the Company has changed its method of accounting forpresentation of deferred tax assets and presentation of debt issuance costs in the consolidated balance sheet as ofDecember 31, 2014 due to the adoption of Accounting Standards Update (ASU) 2015-17, “Income Taxes (Topic 740):Balance Sheet Classification of Deferred Taxes” and ASU 2015-03, “Interest–Imputation of Interest (Subtopic 835-30):Simplifying the Presentation of Debt Issuance Costs.” We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (UnitedStates), the Company's internal control over financial reporting as of December 31, 2015, based on the criteria establishedin Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of theTreadway Commission and our report dated February 22, 2016, expressed an unqualified opinion on the Company'sinternal control over financial reporting. /s/ DELOITTE & TOUCHE LLPDallas, TexasFebruary 22, 2016109 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCONSOLIDATED BALANCE SHEETSDollars in Millions December 31, December 31, 2015 2014ASSETS Current assets: Cash and cash equivalents $356 $193Accounts receivable, less allowance for doubtful accounts ($887at December 31, 2015 and $852 at December 31, 2014) 2,704 2,404Inventories of supplies, at cost 309 276Income tax receivable 7 2Assets held for sale 550 2Other current assets 1,245 1,093Total current assets 5,171 3,970Investments and other assets 1,175 384Deferred income taxes 776 863Property and equipment, at cost, less accumulated depreciation and amortization ($4,323at December 31, 2015 and $4,478 at December 31, 2014) 7,915 7,733Goodwill 6,970 3,913Other intangible assets, at cost, less accumulated amortization($659 at December 31, 2015 and $630 at December 31, 2014) 1,675 1,088Total assets $23,682 $17,951 LIABILITIES AND EQUITY Current liabilities: Current portion of long-term debt $127 $112Accounts payable 1,380 1,179Accrued compensation and benefits 880 852Professional and general liability reserves 177 189Accrued interest payable 205 194Liabilities held for sale 101 —Accrued legal settlement costs 294 45Other current liabilities 1,144 1,006Total current liabilities 4,308 3,577Long-term debt, net of current portion 14,383 11,505Professional and general liability reserves 578 492Defined benefit plan obligations 595 633Other long-term liabilities 594 558Total liabilities 20,458 16,765Commitments and contingencies Redeemable noncontrolling interests in equity of consolidated subsidiaries 2,266 401Equity: Shareholders’ equity: Common stock, $0.05 par value; authorized 262,500,000 shares; 146,920,454shares issued at December 31, 2015 and 145,578,735 shares issued atDecember 31, 2014 7 7Additional paid-in capital 4,815 4,614Accumulated other comprehensive loss (164) (182)Accumulated deficit (1,550) (1,410)Common stock in treasury, at cost, 48,425,298 shares at December 31, 2015 and47,196,902 shares at December 31, 2014 (2,417) (2,378)Total shareholders’ equity 691 651Noncontrolling interests 267 134Total equity 958 785Total liabilities and equity $23,682 $17,951 See accompanying Notes to Consolidated Financial Statements. 110 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCONSOLIDATED STATEMENTS OF OPERATIONSDollars in Millions, Except Per-Share Amounts Years Ended December 31, 2015 2014 2013Net operating revenues: Net operating revenues before provision for doubtful accounts $20,111 $17,908 $12,059Less: Provision for doubtful accounts 1,477 1,305 972Net operating revenues 18,634 16,603 11,087Equity in earnings of unconsolidated affiliates 99 12 15Operating expenses: Salaries, wages and benefits 9,011 8,023 5,371Supplies 2,963 2,630 1,784Other operating expenses, net 4,555 4,114 2,701Electronic health record incentives (72) (104) (96)Depreciation and amortization 797 849 545Impairment and restructuring charges, and acquisition-related costs 318 153 103Litigation and investigation costs 291 25 31Gains on sales, consolidation and deconsolidation of facilities (186) — —Operating income 1,056 925 663Interest expense (912) (754) (474)Loss from early extinguishment of debt (1) (24) (348)Investment earnings 1 — 1Net income (loss) from continuing operations, before income taxes 144 147 (158)Income tax benefit (expense) (68) (49) 65Net income (loss) from continuing operations, before discontinued operations 76 98 (93)Discontinued operations: Loss from operations (5) (17) (5)Litigation and investigation costs 8 (18) (2)Income tax benefit (expense) (1) 13 (4)Net income (loss) from discontinued operations 2 (22) (11)Net income (loss) 78 76 (104)Less: Net income attributable to noncontrolling interests 218 64 30Net income available (loss attributable) to Tenet Healthcare Corporationcommon shareholders $(140) $12 $(134)Amounts available (attributable) to Tenet Healthcare Corporation commonshareholders Net income (loss) from continuing operations, net of tax $(142) $34 $(123)Net income (loss) from discontinued operations, net of tax 2 (22) (11)Net income available (loss attributable) to Tenet Healthcare Corporation commonshareholders $(140) $12 $(134)Earnings (loss) per share available (attributable) to Tenet Healthcare Corporationcommon shareholders: Basic Continuing operations $(1.43) $0.35 $(1.21)Discontinued operations 0.02 (0.23) (0.11) $(1.41) $0.12 $(1.32)Diluted Continuing operations $(1.43) $0.34 $(1.21)Discontinued operations 0.02 (0.22) (0.11) $(1.41) $0.12 $(1.32)Weighted average shares and dilutive securities outstanding (in thousands): Basic 99,167 97,801 101,648Diluted 99,167 100,287 101,648 See accompanying Notes to Consolidated Financial Statements. 111 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (LOSS)Dollars in Millions Years Ended December 31, 2015 2014 2013 Net income (loss) $78 $76 $(104) Other comprehensive income (loss): Adjustments for defined benefit plans 3 (258) 62 Amortization of net actuarial loss included in net periodic benefit costs 12 4 7 Unrealized gains (losses) on securities held as available-for-sale (2) 3 — Foreign currency translation adjustments 5 — — Other comprehensive income (loss) before income taxes 18 (251) 69 Income tax benefit (expense) related to items of othercomprehensive income (loss) — 93 (25) Total other comprehensive income (loss), net of tax 18 (158) 44 Comprehensive net income (loss) 96 (82) (60) Less: Comprehensive income attributable to noncontrolling interests 218 64 30 Comprehensive net income available (loss attributable) to Tenet HealthcareCorporation common shareholders $(122) $(146) $(90) See accompanying Notes to Consolidated Financial Statements. 112 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCONSOLIDATED STATEMENTS OF CHANGES IN EQUITYDollars in Millions,Share Amounts in Thousands Tenet Healthcare Corporation Shareholders’ Equity Accumulated Common Stock Additional Other Shares Issued Par Paid-in Comprehensive Accumulated Treasury Noncontrolling Outstanding Amount Capital Loss Deficit Stock Interests Total EquityBalance at December 31, 2012 104,633 $7 $4,471 $(68) $(1,288) $(1,979) $75 $1,218Net income (loss) — — — — (134) — 21 (113)Distributions paid tononcontrolling interests — — — — — — (22) (22)Other comprehensive income — — — 44 — — — 44Contributions fromnoncontrolling interests — — 56 — — — 49 105Repurchases of common stock (9,485) — — — — (400) — (400)Stock-based compensation expense andissuance of common stock 1,712 — 45 — — 1 — 46Balance at December 31, 2013 96,860 $7 $4,572 $(24) $(1,422) $(2,378) $123 $878Net income — — — — 12 — 31 43Distributions paid tononcontrolling interests — — — — — — (37) (37)Contributions fromnoncontrolling interests — — — — — — 7 7Other comprehensive income — — — (158) — — — (158)Purchases (sales) of businesses andnoncontrolling interests — — (22) — — — 10 (12)Stock-based compensation expense andissuance of common stock 1,522 — 64 — — — — 64Balances at December 31, 2014 98,382 $7 $4,614 $(182) $(1,410) $(2,378) $134 $785Net income (loss) — — — — (140) — 52 (88)Distributions paid tononcontrolling interests — — — — — — (50) (50)Contributions fromnoncontrolling interests — — — — — — 3 3Other comprehensive income — — — 18 — — — 18Purchases (sales) of businesses andnoncontrolling interests — — 124 — — — 128 252Repurchases of common stock (1,243) — — — — (40) — (40)Stock-based compensation expense andissuance of common stock 1,356 — 77 — — 1 — 78Balances at December 31, 2015 98,495 $7 $4,815 $(164) $(1,550) $(2,417) $267 $958 See accompanying Notes to Consolidated Financial Statements. 113 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsCONSOLIDATED STATEMENTS OF CASH FLOWSDollars in Millions Years Ended December 31, 2015 2014 2013 Net income (loss) $78 $76 $(104) Adjustments to reconcile net income (loss) to net cash provided by operatingactivities: Depreciation and amortization 797 849 545 Provision for doubtful accounts 1,477 1,305 972 Deferred income tax expense (benefit) 42 30 (67) Stock-based compensation expense 69 51 36 Impairment and restructuring charges, and acquisition-related costs 318 153 103 Litigation and investigation costs 291 25 31 Loss from early extinguishment of debt 1 24 348 Gains on sales, consolidation and deconsolidation of facilities (186) — — Undistributed earnings from affiliates (99) (10) (13) Amortization of debt discount and debt issuance costs 41 28 19 Pre-tax loss (income) from discontinued operations (3) 35 7 Other items, net 59 (30) (20) Changes in cash from operating assets and liabilities: Accounts receivable (1,632) (1,896) (987) Inventories and other current assets (130) (314) (203) Income taxes 18 3 — Accounts payable, accrued expenses and other current liabilities 68 505 38 Other long-term liabilities 38 44 13 Payments for restructuring charges, acquisition-related costs, andlitigation costs and settlements (200) (168) (114) Net cash used in operating activities from discontinued operations, excludingincome taxes (21) (23) (15) Net cash provided by operating activities 1,026 687 589 Cash flows from investing activities: Purchases of property and equipment — continuing operations (842) (933) (691) Purchases of businesses or joint venture interests, net of cash acquired (940) (428) (1,515) Proceeds from sales of facilities and other assets 549 6 20 Proceeds from sales of marketable securities, long-term investments and other assets 60 13 12 Purchases of equity investments (134) (12) (1) Other long-term assets (4) 31 8 Other items, net (6) 1 3 Net cash used in investing activities (1,317) (1,322) (2,164) Cash flows from financing activities: Repayments of borrowings under credit facility (2,815) (2,430) (1,286) Proceeds from borrowings under credit facility 2,595 2,245 1,691 Repayments of other borrowings (2,049) (683) (5,133) Proceeds from other borrowings 3,158 1,608 6,507 Repurchases of common stock (40) — (400) Debt issuance costs (80) (27) (154) Distributions paid to noncontrolling interests (110) (45) (27) Contributions from noncontrolling interests 4 18 99 Purchase of noncontrolling interests (254) — — Proceeds from exercise of stock options 15 26 22 Other items, net 30 3 5 Net cash provided by financing activities 454 715 1,324 Net increase (decrease) in cash and cash equivalents 163 80 (251) Cash and cash equivalents at beginning of period 193 113 364 Cash and cash equivalents at end of period $356 $193 $113 Supplemental disclosures: Interest paid, net of capitalized interest $(859) $(726) $(426) Income tax payments, net $(7) $(8) $(6) See accompanying Notes to Consolidated Financial Statements. 114 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. SIGNIFICANT ACCOUNTING POLICIES Description of Business Tenet Healthcare Corporation (together with our subsidiaries, referred to herein as “Tenet,” “we” or “us”) is adiversified healthcare services company. At December 31, 2015, we operated 86 hospitals, 20 short-stay surgical hospitals,over 475 outpatient centers, and nine facilities in the United Kingdom through our subsidiaries, partnerships and jointventures, including USPI Holding Company, Inc. (“USPI joint venture”). The results of 146 of these facilities, in which wehold noncontrolling interests, are recorded using the equity method of accounting. Our Conifer Holdings, Inc. (“Conifer”)subsidiary provides healthcare business process services in the areas of revenue cycle management and technology-enabledperformance improvement and health management solutions to health systems, as well as individual hospitals, physicianpractices, self-insured organizations and health plans. Effective June 16, 2015, we completed the transaction that combined our freestanding ambulatory surgery andimaging center assets with the short-stay surgical facility assets of United Surgical Partners International, Inc. (“USPI”) intoour new USPI joint venture. We also refinanced approximately $1.5 billion of existing USPI debt and paid approximately$424 million to align the respective valuations of the assets contributed to the joint venture. We currently own 50.1% of theUSPI joint venture. In addition, we completed the acquisition of European Surgical Partners Ltd. (“Aspen”) for approximately$226 million on June 16, 2015. Aspen has nine private hospitals and clinics in the United Kingdom. Basis of Presentation Our Consolidated Financial Statements include the accounts of Tenet and its wholly owned and majority-ownedsubsidiaries. We eliminate intercompany accounts and transactions in consolidation, and we include the results of operationsof businesses that are newly acquired in purchase transactions from their dates of acquisition. We account for significantinvestments in other affiliated companies using the equity method. Unless otherwise indicated, all financial and statisticaldata included in these notes to our Consolidated Financial Statements relate to our continuing operations, with dollaramounts expressed in millions (except per-share amounts). Effective December 31, 2015, we adopted Accounting Standards Update (“ASU”) 2015-03, “Interest–Imputation ofInterest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that debt issuance costsrelated to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of thatdebt liability, and ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes,” whichrequires that deferred tax liabilities and assets be classified as noncurrent in a classified balance sheet. All periods presentedhave been reclassified to reflect retrospective adoption in accordance with the provisions of ASU 2015-03 and ASU 2015‑17.The adoption of ASU 2015-03 resulted in a decrease in other intangible assets and long-term debt, net of current portion, of$190 million in the accompanying Consolidated Balance Sheet at December 31, 2014. The adoption of ASU 2015-17resulted in a decrease in current portion of deferred income taxes and an increase in deferred income taxes of $747 million inthe accompanying Consolidated Balance Sheet at December 31, 2014. The accompanying Notes and related amounts have been recasted to reflect the formation of Ambulatory Caresegment. The facilities we contributed to our new USPI joint venture were moved to the new Ambulatory Care segment.Certain prior-year amounts have also been reclassified to conform to current-year presentation. Use of Estimates The preparation of financial statements, in conformity with accounting principles generally accepted in the UnitedStates of America (“GAAP”), requires us to make estimates and assumptions that affect the amounts reported in ourConsolidated Financial Statements and these accompanying notes. We regularly evaluate the accounting policies andestimates we use. In general, we base the estimates on historical experience and on assumptions that we believe to be115 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsreasonable given the particular circumstances in which we operate. Although we believe all adjustments considerednecessary for a fair presentation have been included, actual results may vary from those estimates. Financial and statisticalinformation we report to other regulatory agencies may be prepared on a basis other than GAAP or using differentassumptions or reporting periods and, therefore, may vary from amounts presented herein. Although we make every effort toensure that the information we report to those agencies is accurate, complete and consistent with applicable reportingguidelines, we cannot be responsible for the accuracy of the information they make available to the public. Translation of Foreign Currencies The accounts of Aspen were measured in its local currency (the pound sterling) and then translated into U.S. dollars.All assets and liabilities were translated using the current rate of exchange at the balance sheet date. Results of operationswere translated using the average rates prevailing throughout the period of operations. Translation gains or losses resultingfrom changes in exchange rates are accumulated in shareholders’ equity. Net Operating Revenues Before Provision for Doubtful Accounts We recognize net operating revenues before provision for doubtful accounts in the period in which our services areperformed. Net operating revenues before provision for doubtful accounts primarily consist of net patient service revenuesthat are recorded based on established billing rates (i.e., gross charges), less estimated discounts for contractual and otherallowances, principally for patients covered by Medicare, Medicaid, managed care and other health plans, as well as certainuninsured patients under our Compact with Uninsured Patients (“Compact”) and other uninsured discount and charityprograms. Gross charges are retail charges. They are not the same as actual pricing, and they generally do not reflect what ahospital is ultimately paid and, therefore, are not displayed in our consolidated statements of operations. Hospitals aretypically paid amounts that are negotiated with insurance companies or are set by the government. Gross charges are used tocalculate Medicare outlier payments and to determine certain elements of payment under managed care contracts (such asstop-loss payments). Because Medicare requires that a hospital’s gross charges be the same for all patients (regardless ofpayer category), gross charges are what hospitals charge all patients prior to the application of discounts and allowances. Revenues under the traditional fee-for-service Medicare and Medicaid programs are based primarily on prospectivepayment systems. Retrospectively determined cost-based revenues under these programs, which were more prevalent inearlier periods, and certain other payments, such as Indirect Medical Education, Direct Graduate Medical Education,disproportionate share hospital and bad debt expense reimbursement, which are based on our hospitals’ cost reports, areestimated using historical trends and current factors. Cost report settlements under these programs are subject to audit byMedicare and Medicaid auditors and administrative and judicial review, and it can take several years until final settlement ofsuch matters is determined and completely resolved. Because the laws, regulations, instructions and rule interpretationsgoverning Medicare and Medicaid reimbursement are complex and change frequently, the estimates recorded by us couldchange by material amounts. We have a system and estimation process for recording Medicare net patient revenue and estimated cost reportsettlements. This results in us recording accruals to reflect the expected final settlements on our cost reports. For filed costreports, we record the accrual based on those cost reports and subsequent activity, and record a valuation allowance againstthose cost reports based on historical settlement trends. The accrual for periods for which a cost report is yet to be filed isrecorded based on estimates of what we expect to report on the filed cost reports, and a corresponding valuation allowance isrecorded as previously described. Cost reports generally must be filed within five months after the end of the annual costreporting period. After the cost report is filed, the accrual and corresponding valuation allowance may need to be adjusted.Adjustments for prior-year cost reports and related valuation allowances, principally related to Medicare and Medicaid,increased revenues in the years ended December 31, 2015, 2014 and 2013 by $64 million, $20 million, and $38 million,respectively. Estimated cost report settlements and valuation allowances are included in accounts receivable in theaccompanying Consolidated Balance Sheets (see Note 3). We believe that we have made116 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsadequate provision for any adjustments that may result from final determination of amounts earned under all the abovearrangements with Medicare and Medicaid. Revenues under managed care plans are based primarily on payment terms involving predetermined rates perdiagnosis, per-diem rates, discounted fee-for-service rates and/or other similar contractual arrangements. These revenues arealso subject to review and possible audit by the payers, which can take several years before they are completely resolved. Thepayers are billed for patient services on an individual patient basis. An individual patient’s bill is subject to adjustment on apatient-by-patient basis in the ordinary course of business by the payers following their review and adjudication of eachparticular bill. We estimate the discounts for contractual allowances at the individual hospital level utilizing billing data onan individual patient basis. At the end of each month, on an individual hospital basis, we estimate our expectedreimbursement for patients of managed care plans based on the applicable contract terms. Contractual allowance estimatesare periodically reviewed for accuracy by taking into consideration known contract terms as well as payment history.Although we do not separately accumulate and disclose the aggregate amount of adjustments to the estimated reimbursementfor every patient bill, we believe our estimation and review process enables us to identify instances on a timely basis wheresuch estimates need to be revised. We do not believe there were any adjustments to estimates of patient bills that werematerial to our revenues. In addition, on a corporate-wide basis, we do not record any general provision for adjustments toestimated contractual allowances for managed care plans. Managed care accounts, net of contractual allowances recorded, arefurther reduced to their net realizable value through provision for doubtful accounts based on historical collection trends forthese payers and other factors that affect the estimation process. We know of no claims, disputes or unsettled matters with any payer that would materially affect our revenues forwhich we have not adequately provided for in the accompanying Consolidated Financial Statements. Under our Compact or other uninsured discount programs, the discount offered to certain uninsured patients isrecognized as a contractual allowance, which reduces net operating revenues at the time the self-pay accounts are recorded.The uninsured patient accounts, net of contractual allowances recorded, are further reduced to their net realizable valuethrough provision for doubtful accounts based on historical collection trends for self-pay accounts and other factors thataffect the estimation process. We also provide charity care to patients who are financially unable to pay for the healthcare services they receive.Most patients who qualify for charity care are charged a per-diem amount for services received, subject to a cap. Except forthe per-diem amounts, our policy is not to pursue collection of amounts determined to qualify as charity care; therefore, wedo not report these amounts in net operating revenues or in provision for doubtful accounts. Patient advocates from Conifer’sMedical Eligibility Program screen patients in the hospital to determine whether those patients meet eligibility requirementsfor financial assistance programs. They also expedite the process of applying for these government programs. The table below shows the sources of net operating revenues before provision for doubtful accounts from continuingoperations: Years Ended December 31, 2015 2014 2013 General Hospitals: Medicare $3,403 $3,395 $2,319 Medicaid 1,451 1,482 971 Managed care 10,098 9,027 6,140 Indemnity, self-pay and other 1,726 1,561 1,162 Acute care hospitals — other revenue 63 53 63 Other: Other operations 3,370 2,390 1,404 Net operating revenues before provision for doubtful accounts $20,111 $17,908 $12,059 117 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsProvision for Doubtful Accounts Although outcomes vary, our policy is to attempt to collect amounts due from patients, including co-pays anddeductibles due from patients with insurance, at the time of service while complying with all federal and state laws andregulations, including, but not limited to, the Emergency Medical Treatment and Active Labor Act (“EMTALA”). Generally,as required by EMTALA, patients may not be denied emergency treatment due to inability to pay. Therefore, services,including the legally required medical screening examination and stabilization of the patient, are performed withoutdelaying to obtain insurance information. In non-emergency circumstances or for elective procedures and services, it is ourpolicy to verify insurance prior to a patient being treated; however, there are various exceptions that can occur. Suchexceptions can include, for example, instances where (1) we are unable to obtain verification because the patient’s insurancecompany was unable to be reached or contacted, (2) a determination is made that a patient may be eligible for benefits undervarious government programs, such as Medicaid or Victims of Crime, and it takes several days or weeks before qualificationfor such benefits is confirmed or denied, and (3) under physician orders we provide services to patients that requireimmediate treatment. We provide for an allowance against accounts receivable that could become uncollectible by establishing anallowance to reduce the carrying value of such receivables to their estimated net realizable value. Generally, we estimate thisallowance based on the aging of our accounts receivable by hospital, our historical collection experience by hospital and foreach type of payer over a look-back period, and other relevant factors. A significant portion of our provision for doubtfulaccounts relates to self-pay patients, as well as co-pays and deductibles owed to us by patients with insurance. Paymentpressure from managed care payers also affects our provision for doubtful accounts. We typically experience ongoingmanaged care payment delays and disputes; however, we continue to work with these payers to obtain adequate and timelyreimbursement for our services. There are various factors that can impact collection trends, such as changes in the economy,which in turn have an impact on unemployment rates and the number of uninsured and underinsured patients, the volume ofpatients through our emergency departments, the increased burden of co-pays and deductibles to be made by patients withinsurance, and business practices related to collection efforts. These factors continuously change and can have an impact oncollection trends and our estimation process. Electronic Health Record Incentives Under certain provisions of the American Recovery and Reinvestment Act of 2009 (“ARRA”), federal incentivepayments are available to hospitals, physicians and certain other professionals when they adopt, implement or upgrade(“AIU”) certified electronic health record (“EHR”) technology or become “meaningful users,” as defined under ARRA, ofEHR technology in ways that demonstrate improved quality, safety and effectiveness of care. Providers can become eligiblefor annual Medicare incentive payments by demonstrating meaningful use of EHR technology in each period over fourperiods. Medicaid providers can receive their initial incentive payment by satisfying AIU criteria, but must demonstratemeaningful use of EHR technology in subsequent years in order to qualify for additional payments. Hospitals may beeligible for both Medicare and Medicaid EHR incentive payments; however, physicians and other professionals may beeligible for either Medicare or Medicaid incentive payments, but not both. Hospitals that are meaningful users under theMedicare EHR incentive payment program are deemed meaningful users under the Medicaid EHR incentive paymentprogram and do not need to meet additional criteria imposed by a state. Medicaid EHR incentive payments to providers are100% federally funded and administered by the states. The Centers for Medicare and Medicaid Services (“CMS”) establishedcalendar year 2011 as the first year states could offer EHR incentive payments. Before a state may offer EHR incentivepayments, the state must submit and CMS must approve the state’s incentive plan. We recognize Medicaid EHR incentive payments in our consolidated statements of operations for the first paymentyear when: (1) CMS approves a state’s EHR incentive plan; and (2) our hospital or employed physician acquires certifiedEHR technology (i.e., when AIU criteria are met). Medicaid EHR incentive payments for subsequent payment years arerecognized in the period during which the specified meaningful use criteria are met. We recognize Medicare EHR incentivepayments when: (1) the specified meaningful use criteria are met; and (2) contingencies in estimating the amount of theincentive payments to be received are resolved. During the years ended December 31, 2015, 2014 and 2013, certain of ourhospitals and physicians satisfied the CMS AIU and/or meaningful use criteria. As a result, we recognized approximately $72million, $104 million and $96 million of Medicare and118 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsMedicaid EHR incentive payments as a reduction to expense in our Consolidated Statement of Operations for the yearsended December 31, 2015, 2014 and 2013, respectively. Cash and Cash Equivalents We treat highly liquid investments with original maturities of three months or less as cash equivalents. Cash andcash equivalents were approximately $356 million and $193 million at December 31, 2015 and 2014, respectively. As ofDecember 31, 2015 and 2014, our book overdrafts were approximately $301 million and $264 million, respectively, whichwere classified as accounts payable. At December 31, 2015 and 2014, approximately $171 million and $157 million, respectively, of total cash and cashequivalents in the accompanying Consolidated Balance Sheets were intended for the operations of our captive insurancesubsidiaries and health plans. Also at December 31, 2015 and 2014, we had $133 million and $150 million, respectively, of property andequipment purchases accrued for items received but not yet paid. Of these amounts, $95 million and $112 million,respectively, were included in accounts payable. During the years ended December 31, 2015 and 2014, we entered into non-cancellable capital leases ofapproximately $162 million and $173 million, respectively, primarily for buildings and equipment. Investments in Debt and Equity Securities We classify investments in debt and equity securities as either available-for-sale, held-to-maturity or as part of atrading portfolio. At December 31, 2015 and 2014, we had no significant investments in securities classified as either held-to-maturity or trading. We carry securities classified as available-for-sale at fair value. We report their unrealized gains andlosses, net of taxes, as accumulated other comprehensive income (loss) unless we determine that a loss is other-than-temporary, at which point we would record a loss in our consolidated statements of operations. We include realized gains orlosses in our consolidated statements of operations based on the specific identification method. Investments in Unconsolidated AffiliatesWe control 194 of the facilities operated by our Ambulatory Care segment and, therefore, consolidate their results (192are consolidated within our Ambulatory Care segment and two are consolidated within our Hospital Operations and othersegment). We account for many of the facilities our Ambulatory Care segment operates (139 of 333 at December 31, 2015)under the equity method as investments in unconsolidated affiliates and report only our share of net income attributable tothe investee as equity in earnings of unconsolidated affiliates in the accompanying Condensed Consolidated Statements ofOperations. Summarized financial information for our equity method investees is included in the following table. Forinvestments acquired during the reported periods, amounts reflect 100% of the investee’s results beginning on the date of ouracquisition of the investment. December 31, 2015Current assets $866Noncurrent assets $854Current liabilities $(301)Noncurrent liabilities $(377)Noncontrolling interests $(309) Year Ended December 31, 2015Net operating revenues $1,335Net income $436Net income attributable to the investee $356119 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsProperty and Equipment Additions and improvements to property and equipment exceeding established minimum amounts with a useful lifegreater than one year are capitalized at cost. Expenditures for maintenance and repairs are charged to expense as incurred. Weuse the straight-line method of depreciation for buildings, building improvements and equipment. The estimated useful lifefor buildings and improvements is primarily 15 to 40 years, and for equipment three to 15 years. Newly constructed hospitalsare usually depreciated over 50 years. We record capital leases at the beginning of the lease term as assets and liabilities. Thevalue recorded is the lower of either the present value of the minimum lease payments or the fair value of the asset. Suchassets, including improvements, are generally amortized over the shorter of either the lease term or their estimated useful life.Interest costs related to construction projects are capitalized. In the years ended December 31, 2015, 2014 and 2013,capitalized interest was $12 million, $25 million and $14 million, respectively. We evaluate our long-lived assets for possible impairment annually or whenever events or changes in circumstancesindicate that the carrying amount of the asset, or related group of assets, may not be recoverable from estimated futureundiscounted cash flows. If the estimated future undiscounted cash flows are less than the carrying value of the assets, wecalculate the amount of an impairment if the carrying value of the long-lived assets exceeds the fair value of the assets. Thefair value of the assets is estimated based on appraisals, established market values of comparable assets or internal estimatesof future net cash flows expected to result from the use and ultimate disposition of the asset. The estimates of these futurecash flows are based on assumptions and projections we believe to be reasonable and supportable. They require oursubjective judgments and take into account assumptions about revenue and expense growth rates. These assumptions mayvary by type of facility and presume stable, improving or, in some cases, declining results at our hospitals, depending ontheir circumstances. We report long-lived assets to be disposed of at the lower of their carrying amounts or fair values less costs to sell. Insuch circumstances, our estimates of fair value are based on appraisals, established market prices for comparable assets orinternal estimates of future net cash flows. Goodwill and Other Intangible Assets Goodwill represents the excess of costs over the fair value of assets of businesses acquired. Goodwill and otherintangible assets acquired in purchase business combinations and determined to have indefinite useful lives are notamortized, but instead are subject to impairment tests performed at least annually. For goodwill, we perform the test at thereporting unit level when events occur that require an evaluation to be performed or at least annually. If we determine thecarrying value of goodwill is impaired, or if the carrying value of a business that is to be sold or otherwise disposed ofexceeds its fair value, we reduce the carrying value, including any allocated goodwill, to fair value. Estimates of fair valueare based on appraisals, established market prices for comparable assets or internal estimates of future net cash flows andpresume stable, improving or, in some cases, declining results at our hospitals, depending on their circumstances. Other intangible assets primarily consist of capitalized software costs, which are amortized on a straight-line basisover the estimated useful life of the software, which ranges from three to 15 years, and miscellaneous intangible assets. Accruals for General and Professional Liability Risks We accrue for estimated professional and general liability claims, when they are probable and can be reasonablyestimated. The accrual, which includes an estimate for incurred but not reported claims, is updated each quarter based on amodel of projected payments using case-specific facts and circumstances and our historical loss reporting, development andsettlement patterns and is discounted to its net present value using a risk-free discount rate of 2.09% at December 31, 2015and 1.97% at December 31, 2014. To the extent that subsequent claims information varies from our estimates, the liability isadjusted in the period such information becomes available. Malpractice expense is presented within other operatingexpenses in the accompanying Consolidated Statements of Operations. 120 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIncome Taxes We account for income taxes using the asset and liability method. This approach requires the recognition of deferredtax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts andthe tax bases of assets and liabilities. Income tax receivables and liabilities and deferred tax assets and liabilities arerecognized based on the amounts that more likely than not will be sustained upon ultimate settlement with taxingauthorities. Developing our provision for income taxes and analysis of uncertain tax positions requires significant judgment andknowledge of federal and state income tax laws, regulations and strategies, including the determination of deferred tax assetsand liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. We assess the realization of our deferred tax assets to determine whether an income tax valuation allowance isrequired. Based on all available evidence, both positive and negative, and the weight of that evidence to the extent suchevidence can be objectively verified, we determine whether it is more likely than not that all or a portion of the deferred taxassets will be realized. The main factors that we consider include: ·Cumulative profits/losses in recent years, adjusted for certain nonrecurring items; ·Income/losses expected in future years; ·Unsettled circumstances that, if unfavorably resolved, would adversely affect future operations and profit levels; ·The availability, or lack thereof, of taxable income in prior carryback periods that would limit realization of taxbenefits; and ·The carryforward period associated with the deferred tax assets and liabilities. We consider many factors when evaluating our uncertain tax positions, and such judgments are subject to periodicreview. Tax benefits associated with uncertain tax positions are recognized in the period in which one of the followingconditions is satisfied: (1) the more likely than not recognition threshold is satisfied; (2) the position is ultimately settledthrough negotiation or litigation; or (3) the statute of limitations for the taxing authority to examine and challenge theposition has expired. Tax benefits associated with an uncertain tax position are derecognized in the period in which the morelikely than not recognition threshold is no longer satisfied. Segment Reporting We primarily operate acute care hospitals and related healthcare facilities. Our general hospitals generated 83%, 87% and 88% of our net operating revenues before provision for doubtful accounts in the years endedDecember 31, 2015, 2014 and 2013, respectively. Each of our operating regions and markets related to our general hospitalsreport directly to our president of hospital operations. Major decisions, including capital resource allocations, are made at theconsolidated level, not at the regional, market or hospital level. Our core business is Hospital Operations and other, which is focused on operating acute care hospitals, ancillaryoutpatient facilities, urgent care centers, freestanding emergency departments, physician practices and health plans. In thethree months ended June 30, 2015, we began reporting Ambulatory Care as a separate reportable business segment.Previously, our business consisted of our Hospital Operations and other segment and our Conifer segment, which provideshealthcare business process services in the areas of revenue cycle management and technology-enabled performanceimprovement and health management solutions to health systems, as well as individual hospitals, physician practices, self-insured organizations and health plans. Effective June 16, 2015, we completed the joint venture transaction that combined our freestanding ambulatorysurgery and imaging center assets with USPI’s short-stay surgical facility assets. We contributed our interests in121 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents49 ambulatory surgery centers and 20 imaging centers, which had previously been included in our Hospital Operations andother segment, to the joint venture. The USPI joint venture has interests in 249 ambulatory surgery centers, 20 short-staysurgical hospitals, 20 imaging centers and 35 urgent care centers in 28 states. We also completed the acquisition of Aspeneffective June 16, 2015, which includes nine private hospitals and clinics in the United Kingdom. Our Ambulatory Caresegment is comprised of the operations of our USPI joint venture and Aspen facilities. The factors for determining thereportable segments include the manner in which management evaluates operating performance combined with the nature ofthe individual business activities. Costs Associated With Exit or Disposal Activities We recognize costs associated with exit (including restructuring) or disposal activities when they are incurred andcan be measured at fair value, rather than at the date of a commitment to an exit or disposal plan.NOTE 2. EQUITY Share Repurchase Programs In November 2015, we announced that our board of directors had authorized the repurchase of up to $500 million ofour common stock through a share repurchase program that expires in December 2016. Under the program, shares may bepurchased in the open market or through privately negotiated transactions in a manner consistent with applicable securitieslaws and regulations. The program may be suspended for periods or discontinued at any time. The timing and amount ofrepurchase transactions will be based on an evaluation of market conditions, share purchase prices, the timing of divestitureproceeds and other factors. Pursuant to the share repurchase program, we paid approximately $40 million to repurchase atotal of 1,242,806 shares during the period from the commencement of the program through December 31, 2015. Total Number of Maximum Dollar Value Total Number of Average Price Shares Purchased as of Shares That May Yet Shares Paid Per Part of Publicly Be Purchased Under Period Purchased Share Announced Program the Program (In Thousands) (In Thousands) (In Millions) November 1, 2015 throughNovember 30, 2015 978 $32.71 978 $468 December 1, 2015 throughDecember 31, 2015 265 30.25 265 460 November 1, 2015 throughDecember 31, 2015 1,243 $32.18 1,243 $460 In October 2012, we announced that our board of directors had authorized the repurchase of up to $500 million ofour common stock through a share repurchase program that expired in December 2013. Under the program, shares could bepurchased in the open market or through privately negotiated transactions in a manner consistent with applicable securitieslaws and regulations, including pursuant to a Rule 10b5-1 plan we maintained. Shares were repurchased at times and inamounts based on market conditions and other factors. Pursuant to the share repurchase122 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsprogram, we paid approximately $500 million to repurchase a total of 12,891,298 shares during the period from thecommencement of the program through December 31, 2013. Total Number of Maximum Dollar Value Total Number of Average Price Shares Purchased as of Shares That May Yet Shares Paid Per Part of Publicly Be Purchased Under Period Purchased Share Announced Program the Program (In Thousands) (In Thousands) (In Millions) November 1, 2012through December 31, 2012 3,406 $29.36 3,406 $400 January 1, 2013 through January 31, 2013 531 37.13 531 380 February 1, 2013 through February 28, 2013 914 39.30 914 344 March 1, 2013 through March 31, 2013 1,010 43.95 1,010 300 Three Months Ended March 31, 2013 2,455 40.74 2,455 300 May 1, 2013 through May 31, 2013 933 46.78 933 256 June 1, 2013 through June 30, 2013 1,065 45.71 1,065 208 Three Months Ended June 30, 2013 1,998 46.21 1,998 208 July 1, 2013 through July 31, 2013 166 46.08 166 200 August 1, 2013 through August 31, 2013 1,045 40.43 1,045 158 September 1, 2013 through September 30,2013 1,431 40.35 1,431 100 Three Months Ended September 30, 2013 2,642 40.75 2,642 100 November 1, 2013 through November 30,2013 796 42.28 796 66 December 1, 2013 through December 31,2013 1,594 41.62 1,594 — Three Months Ended December 31, 2013 2,390 41.84 2,390 — Total 12,891 $38.79 12,891 $ — Repurchased shares are recorded based on settlement date and are held as treasury stock. NOTE 3. ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS The principal components of accounts receivable are shown in the table below: December 31, December 31, 2015 2014Continuing operations: Patient accounts receivable $3,486 $3,178Allowance for doubtful accounts (887) (851)Estimated future recoveries from accounts assigned to our Conifer subsidiary 144 125Net cost reports and settlements payable and valuation allowances (42) (51) 2,701 2,401Discontinued operations 3 3Accounts receivable, net $2,704 $2,404 At December 31, 2015 and 2014, our allowance for doubtful accounts was 25.4% and 26.8%, respectively, of ourpatient accounts receivable. Our allowance was impacted by higher patient co–pays and deductibles, partially offset by adecline in uninsured revenues due to the expansion of insurance coverage under the Patient Protection and Affordable CareAct, as amended by the Health Care and Education Reconciliation Act of 2010. Additionally, the composition of ouraccounts receivable has been impacted by our acquisition and divestiture activity. Accounts that are pursued for collection through Conifer’s regional business offices are maintained on our hospitals’books and reflected in patient accounts receivable with an allowance for doubtful accounts established to reduce the carryingvalue of such receivables to their estimated net realizable value. Generally, we estimate this allowance based on the aging ofour accounts receivable by hospital, our historical collection experience by hospital and for each type of payer, and otherrelevant factors. At December 31, 2015 and 2014, our allowance for doubtful accounts123 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsfor self-pay was 80.6% and 78.0%, respectively, of our self-pay patient accounts receivable, including co-pays anddeductibles owed by patients with insurance. At December 31, 2015 and 2014, our allowance for doubtful accounts formanaged care was 7.5% and 6.5%, respectively, of our managed care patient accounts receivable. Accounts assigned to our Conifer subsidiary are written off and excluded from patient accounts receivable andallowance for doubtful accounts; however, an estimate of future recoveries from all accounts at our Conifer subsidiary isdetermined based on historical experience and recorded on our hospitals’ books as a component of accounts receivable in theaccompanying Consolidated Balance Sheets. At the present time, our new acquisitions have not yet been fully integratedinto our Conifer collections processes. We also provide charity care to patients who are financially unable to pay for the healthcare services they receive.Most patients who qualify for charity care are charged a per-diem amount for services received, subject to a cap. Except forthe per-diem amounts, our policy is not to pursue collection of amounts determined to qualify as charity care; therefore, wedo not report these amounts in net operating revenues. Most states include an estimate of the cost of charity care in thedetermination of a hospital’s eligibility for Medicaid disproportionate share hospital (“DSH”) payments. These payments areintended to mitigate our cost of uncompensated care, as well as reduced Medicaid funding levels. Generally, our method ofmeasuring the estimated costs uses adjusted self-pay/charity patient days multiplied by selected operating expenses (whichinclude salaries, wages and benefits, supplies and other operating expenses) per adjusted patient day. The adjusted self-pay/charity patient days represents actual self-pay/charity patient days adjusted to include self-pay/charity outpatientservices by multiplying actual self-pay/charity patient days by the sum of gross self-pay/charity inpatient revenues and grossself-pay/charity outpatient revenues and dividing the results by gross self-pay/charity inpatient revenues. The table belowshows our estimated costs for charity care patients and self-pay patients, as well as DSH payments we received, for the yearsended December 31, 2015, 2014 and 2013. Years Ended December 31, 2015 2014 2013Estimated costs for: Self-pay patients $678 $620 $545Charity care patients $191 $180 $158DSH and other supplemental revenues $888 $817 $428 As of December 31, 2015 and 2014, we had approximately $387 million and $399 million, respectively, of receivablesrecorded in other current assets and approximately $139 million and $212 million, respectively, of payables recorded inother current liabilities in the accompanying Consolidated Balance Sheets related to California’s provider fee program. NOTE 4. ASSETS AND LIABILITIES HELD FOR SALE In the three months ended June 30, 2015, we entered into a definitive agreement for the sale of the assets of our SaintLouis University Hospital (“SLUH”) to Saint Louis University. In accordance with the guidance in the Financial AccountingStandards Board’s Accounting Standards Codification (“ASC”) 360, “Property, Plant and Equipment,” we classified SLUH’sassets as “assets held for sale” in current assets and SLUH’s liabilities as “liabilities held for sale” in current liabilities in ourConsolidated Balance Sheet at June 30, 2015. These assets and liabilities were recorded at the lower of their carrying amountor their fair value less estimated costs to sell. As a result of this anticipated transaction, we recorded an impairment charge of$147 million for the write-down of assets held for sale to their estimated fair value, less estimated costs to sell, in the threemonths ended June 30, 2015. We completed the sale of SLUH on August 31, 2015 at a transaction price of approximately$32 million, excluding working capital and subject to customary purchase price adjustments. Because we did not sellSLUH’s accounts receivable related to the pre-closing period, net receivables of approximately $32 million are included inaccounts receivable, less allowance for doubtful accounts, in the accompanying Consolidated Balance Sheet at December 31,2015. Our hospitals, physician practices and related assets in North Carolina also met the criteria to be classified as assetsheld for sale in the three months ended June 30, 2015. We completed the sale of our North Carolina assets onDecember 31, 2015 at a transaction price of approximately $191 million and recognized a gain on sale of approximately$3 million. Because we did not sell the related accounts receivable related to the pre-closing period, net receivables of124 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsapproximately $45 million are included in accounts receivable, less allowance for doubtful accounts in the accompanyingConsolidated Balance Sheet at December 31, 2015. During the three months ended March 31, 2015, we entered into a definitive agreement to form two joint ventureswith Baylor Scott & White Health involving the ownership and operation of Centennial Medical Center, Doctors Hospital atWhite Rock Lake, Lake Pointe Medical Center and Texas Regional Medical Center at Sunnyvale (collectively, “our NorthTexas hospitals”) – which were operated by certain of our subsidiaries – and Baylor Medical Center at Garland – which wasowned and operated by Baylor Scott & White Health, which will hold a majority ownership interest in the joint ventures. Thetransactions closed on December 31, 2015 at a net transaction price of approximately $288 million, and we recorded a gainon deconsolidation of these facilities of approximately $151 million. We also recorded an equity investment in the new jointventures of approximately $164 million, which included $11 million of cash contributed at closing. Our hospitals, physician practices and related assets in Georgia also met the criteria to be classified as assets held forsale in the three months ended June 30, 2015. In accordance with the guidance in ASC 360, we have classified $549 millionof our assets in Georgia as “assets held for sale” in current assets and $101 million of our liabilities in Georgia as “liabilitiesheld for sale” in current liabilities in the accompanying Consolidated Balance Sheet at December 31, 2015. These assets andliabilities were recorded at the lower of their carrying amount or their fair value less estimated costs to sell. There were noimpairment charges recorded as a result of these anticipated transactions. These transactions are subject to the execution ofdefinitive asset sales agreements and customary closing conditions, including regulatory approvals. Assets and liabilities classified as held for sale at December 31, 2015, all of which were in the Hospital Operationsand other segment, were comprised of the following: Other current assets $14Property and equipment 401Other long-term assets 135Current liabilities (10)Long-term liabilities (91)Net assets held for sale $449 NOTE 5. IMPAIRMENT AND RESTRUCTURING CHARGES, AND ACQUISITION-RELATED COSTS We recognized impairment charges on long-lived assets in 2015, 2014 and 2013 because the fair values of thoseassets or groups of assets indicated that the carrying amount was not recoverable. The fair value estimates were derived fromappraisals, established market values of comparable assets, or internal estimates of future net cash flows. These fair valueestimates can change by material amounts in subsequent periods. Many factors and assumptions can impact the estimates,including the future financial results of the hospitals, how the hospitals are operated in the future, changes in healthcareindustry trends and regulations, and the nature of the ultimate disposition of the assets. In certain cases, these fair valueestimates assume the highest and best use of hospital assets in the future to a market place participant is other than as ahospital. In these cases, the estimates are based on the fair value of the real property and equipment if utilized other than as ahospital. The impairment recognized does not include the costs of closing the hospitals or other future operating costs, whichcould be substantial. Accordingly, the ultimate net cash realized from the hospitals, should we choose to sell them, could besignificantly less than their impaired value. Our impairment tests presume stable, improving or, in some cases, declining operating results in our hospitals, whichare based on programs and initiatives being implemented that are designed to achieve the hospital’s most recent projections.If these projections are not met, or if in the future negative trends occur that impact our future outlook, impairments of long-lived assets and goodwill may occur, and we may incur additional restructuring charges, which could be material. Effective June 16, 2015, we completed the transaction that combined our freestanding ambulatory surgery andimaging center assets with the short-stay surgical facility assets of USPI. As of December 31, 2015, our continuing operationsconsisted of three reportable segments, our Hospital Operations and other, Ambulatory Care and Conifer. During the threemonths ended June 30, 2015, within our Hospital Operations and other segment, we combined our Central region with our125 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsResolute Health, San Antonio and South Texas markets to create our new Texas region, and we moved our hospitals andother operations in Tennessee from our Texas region to our Southern region. Our Hospital Operations and other segment iscurrently structured as follows: ·Our Texas region included all of our hospitals and other operations in Missouri, New Mexico and Texas; ·Our Florida region included all of our hospitals and other operations in Florida; ·Our Northeast region included all of our hospitals and other operations in Illinois, Massachusetts andPennsylvania; ·Our Southern region included all of our hospitals and other operations in Alabama, Georgia, South Carolina andTennessee; ·Our Western region included all of our hospitals and other operations in Arizona and California; and ·Our Detroit market included all of our hospitals and other operations in the Detroit, Michigan area. These regions and markets are reporting units used to perform our goodwill impairment analysis and are one level below ourhospital operations reportable business segment level. We periodically incur costs to implement restructuring efforts for specific operations, which are recorded in ourstatement of operations as they are incurred. Our restructuring plans focus on various aspects of operations, includingaligning our operations in the most strategic and cost-effective structure. Certain restructuring and acquisition-related costsare based on estimates. Changes in estimates are recognized as they occur. Year Ended December 31, 2015 During the year ended December 31, 2015, we recorded impairment and restructuring charges and acquisition-related costs of $318 million, including $168 million of impairment charges. We recorded an impairment charge ofapproximately $147 million to write-down assets held for sale to their estimated fair value, less estimated costs to sell, as aresult of entering into a definitive agreement for the sale of SLUH during the three months ended June 30, 2015, as furtherdescribed in Note 4. We also recorded impairment charges of approximately $19 million for the write-down of buildings,equipment and other long-lived assets, primarily capitalized software cost classified as other intangible assets, to theirestimated fair values at two of our hospitals. Material adverse trends in our estimates of future undiscounted cash flows of thehospitals indicated the carrying value of the hospitals’ long-lived assets was not recoverable from the estimated future cashflows. We believe the most significant factors contributing to the adverse financial trends include reductions in volumes ofinsured patients, shifts in payer mix from commercial to governmental payers combined with reductions in reimbursementrates from governmental payers, and high levels of uninsured patients. As a result, we updated the estimate of the fair value ofthe hospitals’ long-lived assets and compared the fair value estimate to the carrying value of the hospitals’ long-lived assets.Because the fair value estimates were lower than the carrying value of the long-lived assets, an impairment charge wasrecorded for the difference in the amounts. Unless the anticipated future financial trends of these hospitals improves to theextent that the estimated future undiscounted cash flows exceeds the carrying value of the long-lived assets, these hospitalsare at risk of future impairments. The aggregate carrying value of assets held and used of the hospital for which animpairment charge was recorded was $45 million as of December 31, 2015 after recording the impairment charge. We alsorecorded $2 million related to investments. We also recorded $25 million of employee severance costs, $6 million ofrestructuring costs, $19 million of contract and lease termination fees, and $100 million in acquisition-related costs, whichinclude $55 million of transaction costs and $45 million of acquisition integration charges. Year Ended December 31, 2014 During the year ended December 31, 2014, we recorded impairment and restructuring charges and acquisition-related costs of $153 million. This amount included a $20 million impairment charge for the write-down of buildings and126 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsequipment of one of our previously impaired hospitals to their estimated fair values, primarily due to a decline in the fairvalue of real estate in the market in which the hospital operates and a decline in the estimated fair value of equipment.Material adverse trends in our most recent estimates of future undiscounted cash flows of the hospital, consistent with ourprevious estimates in prior years when impairment charges were recorded at this hospital, indicated the carrying value of thehospital’s long-lived assets was not recoverable from the estimated future cash flows. We believe the most significant factorscontributing to the adverse financial trends include reductions in volumes of insured patients, shifts in payer mix fromcommercial to governmental payers combined with reductions in reimbursement rates from governmental payers, and highlevels of uninsured patients. As a result, we updated the estimate of the fair value of the hospital’s long-lived assets andcompared the fair value estimate to the carrying value of the hospital’s long-lived assets. Because the fair value estimate waslower than the carrying value of the hospital’s long-lived assets, an impairment charge was recorded for the difference in theamounts. Unless the anticipated future financial trends of this hospital improve to the extent that the estimated futureundiscounted cash flows exceed the carrying value of the long-lived assets, this hospital is at risk of future impairments,particularly if we spend significant amounts of capital at the hospital without generating a corresponding increase in thehospital’s fair value or if the fair value of the hospital’s real estate or equipment declines. The aggregate carrying value ofassets held and used of the hospital for which an impairment charge was recorded was $23 million as of December 31, 2014after recording the impairment charge. We also recorded $16 million of employee severance costs, $19 million of contractand lease termination fees, $3 million of restructuring costs, and $95 million in acquisition-related costs, which include $16million of transaction costs and $79 million of acquisition integration charges. Year Ended December 31, 2013 During the year ended December 31, 2013, we recorded impairment and restructuring charges and acquisition-related costs of $103 million. This amount included a $12 million impairment charge for the write-down of buildings andequipment and other long-lived assets, primarily capitalized software costs classified in other intangible assets, of one of ourhospitals to their estimated fair values, primarily due to a decline in the fair value of real estate in the market in which thehospital operates and a decline in the estimated fair value of equipment. Material adverse trends in our estimates of futureundiscounted cash flows of the hospital at that time indicated the carrying value of the hospital’s long-lived assets was notrecoverable from the estimated future cash flows. We believed the most significant factors contributing to the adversefinancial trends at that time included reductions in volumes of insured patients, shifts in payer mix from commercial togovernmental payers combined with reductions in reimbursement rates from governmental payers, and high levels ofuninsured patients. As a result, we updated the estimate of the fair value of the hospital’s long-lived assets and compared thefair value estimate to the carrying value of the hospital’s long-lived assets. Because the fair value estimate was lower than thecarrying value of the hospital’s long-lived assets, an impairment charge was recorded for the difference in the amounts. Wedisclosed in our Annual Report on Form 10-K for the year ended December 31, 2013 that, unless the anticipated futurefinancial trends of this hospital improved to the extent that the estimated future undiscounted cash flows exceeded thecarrying value of the long-lived assets, this hospital was at risk of future impairments, which impairments occurred in 2014 asdescribed above, particularly if we spent significant amounts of capital at the hospital without generating a correspondingincrease in the hospital’s fair value or if the fair value of the hospital’s real estate or equipment declined. The aggregatecarrying value of assets held and used of the hospital for which an impairment charge was recorded was $44 million as ofDecember 31, 2013 after recording the impairment charge. We also recorded $16 million of restructuring costs, $14 millionof employee severance costs, $2 million of lease termination fees, and $59 million in acquisition-related costs, whichincluded both transaction costs and acquisition integration charges. NOTE 6. SHORT-TERM BORROWINGS AND LONG-TERM DEBT AND LEASE OBLIGATIONS Interim Loan Agreement During the three months ended March 31, 2015, we entered into a new interim loan agreement (the “Interim LoanAgreement”) providing for a 364-day secured term loan facility in the aggregate principal amount of $400 million. OnJune 16, 2015, we repaid the $400 million aggregate principal amount of the term loan (plus accrued interest of $1 million)outstanding under the Interim Loan Agreement as of that day. We had used the proceeds of the term loan (i) to repayoutstanding obligations under our Credit Agreement (defined below), and (ii) to pay certain costs, fees and expenses127 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsincurred in connection with entering into the Interim Loan Agreement. Amounts borrowed under the Interim Loan Agreementand repaid or prepaid may not be reborrowed. As a result, the Interim Loan Agreement was terminated as of June 16, 2015. Long-Term Debt and Lease Obligations The table below shows our long-term debt as of December 31, 2015 and 2014: December 31, December 31, 2015 2014 Senior notes: 5%, due 2019 $1,100 $1,100 5/2%, due 2019 500 500 6/4%, due 2020 300 300 8%, due 2020 750 750 8/8%, due 2022 2,800 2,800 6/4%, due 2023 1,900 — 6/8%, due 2031 430 430 Senior secured notes: 6/4%, due 2018 1,041 1,041 4/4%, due 2020 500 500 6%, due 2020 1,800 1,800 Floating % due 2020 900 — 4/2%, due 2021 850 850 4/8%, due 2021 1,050 1,050 Credit facility due 2020 — 220 Capital leases and mortgage notes 852 487 Unamortized issue costs, note discounts and premium (263) (211) Total long-term debt 14,510 11,617 Less current portion 127 112 Long-term debt, net of current portion $14,383 $11,505 Credit Agreement On December 4, 2015, we entered into an amendment to our existing senior secured revolving credit facility (asamended, “Credit Agreement”) in order to, among other things, extend the scheduled maturity date of the facility, reduce therates of certain interest and fees payable under the facility and remove certain restrictions with respect to the borrowing baseeligibility of certain account receivable. The Credit Agreement provides, subject to borrowing availability, for revolvingloans in an aggregate principal amount of up to $1 billion, with a $300 million subfacility for standby letters of credit. As ofDecember 31, 2015, we were in compliance with all covenants and conditions in our Credit Agreement. The CreditAgreement, which has a scheduled maturity date of December 4, 2020, is collateralized by patient accounts receivable ofsubstantially all of our domestic wholly owned hospitals. In addition, borrowings under the Credit Agreement are guaranteedby substantially all of our wholly owned domestic hospital subsidiaries. Outstanding revolving loans accrue interest at a baserate plus a margin ranging from 0.25% to 0.75% per annum or the London Interbank Offered Rate (“LIBOR”) plus a marginranging from 1.25% to 1.75% per annum, in each case based on available credit. An unused commitment fee payable on theundrawn portion of the revolving loans ranges from 0.25% to 0.375% per annum based on available credit. Our borrowingavailability is based on a specified percentage of eligible accounts receivable, including self-pay accounts. AtDecember 31, 2015, we had no cash borrowings outstanding under the revolving credit facility and we had approximately $5million of standby letters of credit outstanding. Based on our eligible receivables, approximately $995 million was availablefor borrowing under the revolving credit facility at December 31, 2015. 128 131371313Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsLetter of Credit Facility On March 7, 2014, we entered into a new letter of credit facility agreement (“LC Facility”) that provides for theissuance of standby and documentary letters of credit (including certain letters of credit issued under our existing CreditAgreement, which we transferred to the LC Facility (the “Existing Letters of Credit”)), from time to time, in an aggregateprincipal amount of up to $180 million (subject to increase to up to $200 million). The LC Facility has a scheduled maturitydate of March 7, 2017, and obligations thereunder are guaranteed by and secured by a first priority pledge of the capitalstock and other ownership interests of certain of our hospital subsidiaries on an equal ranking basis with our existing seniorsecured notes. Drawings under any letter of credit issued under the LC Facility (including the Existing Letters of Credit) that wehave not reimbursed within three business days after notice thereof will accrue interest at a base rate plus a margin equal to0.875% per annum. An unused commitment fee is payable at an initial rate of 0.50% per annum with a step down to 0.375%per annum based on the secured debt to EBITDA ratio of 3.00 to 1.00. A per annum fee on the aggregate outstanding amountof issued but undrawn letters of credit (including Existing Letters of Credit) will accrue at a rate of 1.875% per annum. Anissuance fee equal to 0.125% per annum of the aggregate face amount of each outstanding letter of credit is payable to theaccount of the issuer of the related letter of credit. At December 31, 2015, we had approximately $105 million of standbyletters of credit outstanding under the LC Facility. Senior Notes and Senior Secured Notes In June 2015, we sold $900 million aggregate principal amount of floating rate senior secured notes, which willmature on June 15, 2020 (the “Secured Notes”), and assumed $1.9 billion aggregate principal amount of 6/4% senior notes,which will mature on June 15, 2023 (the “Unsecured Notes” and, together with the Secured Notes, the “Notes”), issued byTHC Escrow Corporation II. We will pay interest on the Secured Notes quarterly in arrears on March 15, June 15, September15 and December 15 of each year, which payments commenced on September 15, 2015. The Secured Notes accrue interest ata rate per annum, reset quarterly, equal to LIBOR plus 3/2%. We will pay interest on the Unsecured Notes semi-annually inarrears on June 15 and December 15 of each year, commencing on December 15, 2015. The proceeds from the sale of theNotes were used to repay borrowings outstanding under our Interim Loan Agreement and Credit Agreement, as well as torefinance the debt of USPI and to pay the cash consideration in respect of our USPI joint venture and Aspen acquisition. In September 2014, we sold $500 million aggregate principal amount of 5/2% senior notes, which will mature onMarch 1, 2019. We will pay interest on the notes semi-annually in arrears on March 1 and September 1 of each year,commencing on March 1, 2015. The proceeds from the sale of the notes were used for general corporate purposes, includingthe repayment of indebtedness and drawings under our Credit Agreement, related transaction fees and expenses, andacquisitions. In June and March 2014, we sold $500 million and $600 million aggregate principal amount, respectively, of5% senior notes, which will mature on March 1, 2019. We will pay interest on the notes semi-annually in arrears on March 1and September 1 of each year, which payments commenced on September 1, 2014. The net proceeds from the sale of thenotes in June 2014 were used to redeem our 91/4% senior notes due 2015 in July 2014. In connection with the redemption,we recorded a loss from early extinguishment of debt of approximately $24 million, primarily related to the differencebetween the redemption price and the par value of the notes, as well as the write-off of associated unamortized note discountsand issuance costs. The net proceeds from the sale of the notes in March 2014 were used for general corporate purposes,including the repayment of borrowings under our Credit Agreement. In October 2013, we sold $2.8 billion aggregate principal amount of 81/8% senior notes, which will mature onApril 1, 2022, and $1.8 billion aggregate principal amount of 6% senior secured notes, which will mature onOctober 1, 2020. We will pay interest on the 81/8% senior notes and 6% senior secured notes semi-annually in arrears onApril 1 and October 1 of each year, commencing on April 1, 2014. The proceeds from the sale of the notes were used tofinance the acquisition of Vanguard. 129 311Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIn May 2013, we sold $1.050 billion aggregate principal amount of 43/8% senior secured notes, which will matureon October 1, 2021. We will pay interest on the 43/8% senior secured notes semi-annually in arrears on January 1 and July 1of each year, which payments commenced on January 1, 2014. We used a portion of the proceeds from the sale of the notes topurchase approximately $767 million aggregate principal amount outstanding of our 87/8% senior secured notes due 2019 ina tender offer and to call approximately $158 million of the remaining aggregate principal amount outstanding of thosenotes. In connection with the purchase, we recorded a loss from early extinguishment of debt of $171 million, primarilyrelated to the difference between the purchase prices and the par values of the purchased notes, as well as the write-off ofunamortized note discounts and issuance costs. In February 2013, we sold $850 million aggregate principal amount of 41/2% senior secured notes, which willmature on April 1, 2021. We will pay interest on the 41/2% senior secured notes semi-annually in arrears on April 1 andOctober 1 of each year, which payments commenced on October 1, 2013. We used a portion of the proceeds from the sale ofthe notes to purchase approximately $645 million aggregate principal amount outstanding of our 10% senior secured notesdue 2018 in a tender offer and to call approximately $69 million of the remaining aggregate principal amount outstanding ofthose notes. In connection with the purchase, we recorded a loss from early extinguishment of debt of $177 million, primarilyrelated to the difference between the purchase prices and the par values of the purchased notes, as well as the write-off ofunamortized note discounts and issuance costs. The remaining net proceeds were used for general corporate purposes,including the repayment of borrowings under our senior secured revolving credit facility. All of our senior notes are general unsecured senior debt obligations that rank equally in right of payment with all ofour other unsecured senior indebtedness, but are effectively subordinated to our senior secured notes described below, theobligations of our subsidiaries and any obligations under our Credit Agreement to the extent of the collateral. We mayredeem any series of our senior notes, in whole or in part, at any time at a redemption price equal to 100% of the principalamount of the notes redeemed, plus a make-whole premium specified in the applicable indenture, together with accrued andunpaid interest to the redemption date. All of our senior secured notes are guaranteed by certain of our hospital company subsidiaries and secured by a first-priority pledge of the capital stock and other ownership interests of those subsidiaries. All of our senior secured notes and therelated subsidiary guarantees are our and the subsidiary guarantors’ senior secured obligations. All of our senior securednotes rank equally in right of payment with all of our other senior secured indebtedness. Our senior secured notes rank seniorto any subordinated indebtedness that we or such subsidiary guarantors may incur; they are effectively senior to our and suchsubsidiary guarantors’ existing and future unsecured indebtedness and other liabilities to the extent of the value of thecollateral securing the notes and the subsidiary guarantees; they are effectively subordinated to our and such subsidiaryguarantors’ obligations under our Credit Agreement to the extent of the value of the collateral securing borrowingsthereunder; and they are structurally subordinated to all obligations of our non-guarantor subsidiaries. The indentures setting forth the terms of our senior secured notes contain provisions governing our ability to redeemthe notes and the terms by which we may do so. At our option, we may redeem our senior secured notes, in whole or in part, atany time at a redemption price equal to 100% of the principal amount of the notes redeemed plus the make-whole premiumset forth in the related indenture, together with accrued and unpaid interest thereon, if any, to the redemption date. In addition, we may be required to purchase for cash all or any part of each series of our senior secured notes uponthe occurrence of a change of control (as defined in the applicable indentures) for a cash purchase price of 101% of theaggregate principal amount of the notes, plus accrued and unpaid interest. Covenants Credit Agreement. Our Credit Agreement contains customary covenants for an asset-backed facility, including aminimum fixed charge coverage ratio to be met when the designated excess availability under the revolving credit facilityfalls below $100 million, as well as limits on debt, asset sales and prepayments of senior debt. The Credit Agreement alsoincludes a provision, which we believe is customary in receivables-backed credit facilities, that gives our lenders the right torequire that proceeds of collections of substantially all of our consolidated accounts receivable be130 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsapplied directly to repay outstanding loans and other amounts that are due and payable under the Credit Agreement at anytime that unused borrowing availability under the revolving credit facility is less than $100 million for three consecutivebusiness days or if an event of default has occurred and is continuing thereunder. In that event, we would seek to re-borrowunder the Credit Agreement to satisfy our operating cash requirements. Our ability to borrow under the Credit Agreement issubject to conditions that we believe are customary in revolving credit facilities, including that no events of default thenexist. Unsecured Senior Notes. The indentures governing our senior notes contain covenants and conditions that have,among other requirements, limitations on (1) liens on principal properties and (2) sale and lease-back transactions withrespect to principal properties. A principal property is defined in the indentures as a hospital that has an asset value on ourbooks in excess of 5% of our consolidated net tangible assets, as defined. The above limitations do not apply, however, to(1) debt that is not secured by principal properties or (2) debt that is secured by principal properties if the aggregate of suchsecured debt does not exceed 15% of our consolidated net tangible assets, as further described in the indentures. Theindentures also prohibit the consolidation, merger or sale of all or substantially all assets unless no event of default wouldresult after giving effect to such transaction. Unsecured Notes. The indenture governing the Unsecured Notes contains covenants and terms (including termsregarding mandatory and optional redemption) that are similar to those in the indentures governing our unsecured seniornotes described above. All of our senior unsecured notes are general unsecured senior debt obligations that rank equally inright of payment with all of our other unsecured senior indebtedness, but are effectively subordinated to our senior securednotes described above, the obligations of our subsidiaries, and any obligations under our Credit Agreement and the LCFacility to the extent of the collateral. Senior Secured Notes. The indentures governing our senior secured notes contain covenants that, among otherthings, restrict our ability and the ability of our subsidiaries to incur liens, consummate asset sales, enter into sale and lease-back transactions or consolidate, merge or sell all or substantially all of our or their assets, other than in certain transactionsbetween one or more of our wholly owned subsidiaries. These restrictions, however, are subject to a number of importantexceptions and qualifications. In particular, there are no restrictions on our ability or the ability of our subsidiaries to incuradditional indebtedness, make restricted payments, pay dividends or make distributions in respect of capital stock, purchaseor redeem capital stock, enter into transactions with affiliates or make advances to, or invest in, other entities (includingunaffiliated entities). In addition, the indentures governing our senior secured notes contain a covenant that neither we norany of our subsidiaries will incur secured debt, unless at the time of and after giving effect to the incurrence of such debt, theaggregate amount of all such secured debt (including the aggregate principal amount of senior secured notes outstanding atsuch time) does not exceed the greater of (i) $3.2 billion or (ii) the amount that would cause the secured debt ratio (as definedin the indentures) to exceed 4.0 to 1.0; provided that the aggregate amount of all such debt secured by a lien on par to thelien securing the senior secured notes may not exceed the greater of (a) $2.6 billion or (b) the amount that would cause thesecured debt ratio to exceed 3.0 to 1.0. Secured Notes. The indenture governing the Secured Notes contains covenants and terms (including terms regardingmandatory redemption) that are similar to those in the indentures governing our senior secured notes described above, exceptwe are permitted under the indenture governing the Secured Notes to incur secured debt so long as, at the time of and aftergiving effect to the incurrence of such debt, the aggregate amount of all such secured debt (including the aggregate principalamount of Secured Notes outstanding at such time) does not exceed the greater of (i) $8.5 billion or (ii) the amount thatwould cause the secured debt ratio (as defined in the indenture) to exceed 4.0 to 1.0 and, provided further, that the aggregateamount of all such debt secured by a lien on par to the lien securing the Secured Notes does not exceed the greater of (a) $6.4billion or (b) the amount that would cause the secured debt ratio to exceed 3.0 to 1.0. In addition, pursuant to the SecuredNotes indenture, we may, at our option, redeem the Secured Notes, in whole or in part, at any time prior to June 15, 2016 at aredemption price equal to 100% of the principal amount of the notes being redeemed plus the make-whole premium set forthin the Secured Notes indenture, together with accrued and unpaid interest thereon, if any, to the redemption date. From andafter June 15, 2016, we may, at our option, redeem the Secured Notes in whole or in part at the redemption prices specified inthe Secured Notes indenture. All of our senior secured notes are guaranteed by certain of our domestic hospital company subsidiaries and securedby a first-priority pledge of the capital stock and other ownership interests of those subsidiaries. All of our senior131 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentssecured notes and the related subsidiary guarantees are our and the subsidiary guarantors’ senior secured obligations. All ofour senior secured notes rank equally in right of payment with all of our other senior secured indebtedness. Our seniorsecured notes rank senior to any subordinated indebtedness that we or such subsidiary guarantors may incur; they areeffectively senior to our and such subsidiary guarantors’ existing and future unsecured indebtedness and other liabilities tothe extent of the value of the collateral securing the notes and the subsidiary guarantees; they are effectively subordinated toour and such subsidiary guarantors’ obligations under our Credit Agreement and the LC Facility to the extent of the value ofthe collateral securing borrowings thereunder; and they are structurally subordinated to all obligations of our nonguarantorsubsidiaries. Future Maturities Future long-term debt maturities and minimum operating lease payments as of December 31, 2015 are as follows: Years Ending December 31, Later Total 2016 2017 2018 2019 2020 Years Long-term debt, including capital leaseobligations $14,978 $142 $154 $1,112 $1,661 $4,294 $7,615 Long-term non-cancelable operating leases $1,213 $205 $175 $149 $122 $103 $459 Rental expense under operating leases, including short-term leases, was $292 million, $242 million and$186 million in the years ended December 31, 2015, 2014 and 2013, respectively. Included in rental expense for each ofthese periods was sublease income of $12 million, $9 million and $8 million, respectively, which were recorded as areduction to rental expense.NOTE 7. GUARANTEES Consistent with our policy on physician relocation and recruitment, we provide income guarantee agreements tocertain physicians who agree to relocate to fill a community need in the service area of one of our hospitals and commit toremain in practice in the area for a specified period of time. Under such agreements, we are required to make payments to thephysicians in excess of the amounts they earn in their practices up to the amount of the income guarantee. The incomeguarantee periods are typically 12 months. If a physician does not fulfill his or her commitment period to the community,which is typically three years subsequent to the guarantee period, we seek recovery of the income guarantee payments fromthe physician on a prorated basis. We also provide revenue collection guarantees to hospital-based physician groupsproviding certain services at our hospitals with terms generally ranging from one to three years. At December 31, 2015, the maximum potential amount of future payments under our income guarantees to certainphysicians who agree to relocate and revenue collection guarantees to hospital-based physician groups providing certainservices at our hospitals was $100 million. We had a liability of $82 million recorded for these guarantees included in othercurrent liabilities at December 31, 2015. At December 31, 2015, we also had issued guarantees of the indebtedness and other obligations of our investees tothird parties, the maximum potential amount of future payments under which was approximately $35 million. Of the total,$17 million relates to the obligations of consolidated subsidiaries, which obligations are recorded in theaccompanying Consolidated Balance Sheet at December 31, 2015. NOTE 8. EMPLOYEE BENEFIT PLANS Share-Based Compensation Plans We currently grant stock-based awards to our directors and key employees pursuant to our 2008 Stock IncentivePlan, which was approved by our shareholders at their 2008 annual meeting. At December 31, 2015, approximately3.4 million shares of common stock were available under our 2008 Stock Incentive Plan for future stock132 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsoption grants and other incentive awards, including restricted stock units. Options have an exercise price equal to the fairmarket value of the shares on the date of grant and generally expire 10 years from the date of grant. A restricted stock unit is acontractual right to receive one share of our common stock or the equivalent value in cash in the future. Options andrestricted stock units typically vest one-third on each of the first three anniversary dates of the grant; however, from time totime, we grant performance-based options and restricted stock units that vest subject to the achievement of specifiedperformance goals within a specified timeframe. Our income from continuing operations for the years ended December 31, 2015, 2014 and 2013 includes$77 million, $51 million and $39 million, respectively, of pretax compensation costs related to our stock-basedcompensation arrangements ($48 million, $32 million and $24 million, respectively, after-tax). The table below showscertain stock option and restricted stock unit grants and other awards that comprise the $77 million of stock-basedcompensation expense recorded in salaries, wages and benefits in the year ended December 31, 2015. Compensation cost ismeasured by the fair value of the awards on their grant dates and is recognized over the requisite service period of the awards,whether or not the awards had any intrinsic value during the period. Stock-Based Fair Value Compensation Expense Exercise Price Per Share at for Year Ended Grant Date Awards Per Share Grant Date December 31, 2015 (In Thousands) (In Millions) Stock Options: February 28, 2013 278 $39.31 $14.46 $1 Restricted Stock Units: May 8, 2015 44 37.06 2 February 25, 2015 1,573 45.63 22 August 25, 2014 673 59.90 9 February 26, 2014 1,329 44.12 22 June 13, 2013 318 47.13 3 February 28, 2013 842 39.31 11 Other grants 7 $77 Prior to our shareholders approving the 2008 Stock Incentive Plan, we granted stock-based awards to our directorsand employees pursuant to other plans. Stock options remain outstanding under those other plans, but no additional stock-based awards will be granted under them. Pursuant to the terms of our stock-based compensation plans, awards granted under the plans vest and may beexercised as determined by the compensation committee of our board of directors. In the event of a change in control, thecompensation committee may, at its sole discretion without obtaining shareholder approval, accelerate the vesting orperformance periods of the awards. 133 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsStock Options The following table summarizes stock option activity during the years ended December 31, 2015, 2014 and 2013: Weighted Average Exercise Price Aggregate Weighted Average Options Per Share Intrinsic Value Remaining Life (In Millions) Outstanding at December 31, 2012 4,289,192 $30.49 Granted 295,639 39.41 Exercised (946,086) 23.34 Forfeited/Expired (330,634) 55.79 Outstanding at December 31, 2013 3,308,111 $30.79 Granted — Exercised (699,910) 33.53 Forfeited/Expired (624,052) 47.97 Outstanding at December 31, 2014 1,984,149 $24.42 Granted — — Exercised (340,869) 29.85 Forfeited/Expired (36,438) 42.08 Outstanding at December 31, 2015 1,606,842 $22.87 $14 3.2years Vested and expected to vest at December 31, 2015 1,605,971 $22.86 $14 3.2years Exercisable at December 31, 2015 1,328,391 $19.42 $14 3.4years There were 340,869 stock options exercised during the year ended December 31, 2015 with a $8 million aggregateintrinsic value, and 699,910 stock options exercised in 2014 with a $13 million aggregate intrinsic value. As of December 31, 2015, there were less than $1 million of total unrecognized compensation costs related to stockoptions. These costs are expected to be recognized over a weighted average period of one month. In the years ended December 31, 2015, and 2014 there were no stock options granted. The weighted average estimated fair value of stock options we granted in the year ended December 31, 2013 was$14.46 per share. These fair values were calculated based on each grant date, using a binomial lattice model with thefollowing assumptions: Year Ended December 31, 2013 Expected volatility 50% Expected dividend yield 0% Expected life 3.6 years Expected forfeiture rate 6% Risk-free interest rate 0.48% Early exercise threshold 100% gain Early exercise rate 50% per year The expected volatility used in the binomial lattice model incorporated historical and implied share-price volatilityand was based on an analysis of historical prices of our stock and open-market exchanged options. The expected volatilityreflects the historical volatility for a duration consistent with the contractual life of the options, and the volatility implied bythe trading of options to purchase our stock on open-market exchanges. The historical share-price volatility excludes themovements in our stock price on two dates (one in 2010 and one in 2011) with unusual volatility due to an unsolicitedacquisition proposal. The expected life of options granted is derived from the output of the binomial lattice model andrepresents the period of time that the options are expected to be outstanding. This model134 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsincorporates an early exercise assumption in the event of a significant increase in stock price. The risk-free interest rates arebased on zero-coupon United States Treasury yields in effect at the date of grant consistent with the expected exercisetimeframes. The following table summarizes information about our outstanding stock options at December 31, 2015: Options Outstanding Options Exercisable Weighted Average Number of Remaining Weighted Average Number of Weighted Average Range of Exercise Prices Options Contractual Life Exercise Price Options Exercise Price $0.00 to $4.569 206,102 3.1years $4.56 206,102 $4.56 $4.57 to $25.089 910,897 4.0years 20.99 910,897 20.99 $25.09 to $32.569 211,392 1.0years 27.14 211,392 27.14 $32.57 to $42.529 278,451 2.2years 39.31 — — 1,606,842 3.2years $22.87 1,328,391 $19.42 As of December 31, 2015, approximately 96.1% of all our outstanding options were held by current employees andapproximately 3.9% were held by former employees. Approximately 80.8% of our outstanding options were in-the-money,that is, they had exercise price less than the $30.30 market price of our common stock on December 31, 2015, andapproximately 19.2% were out-of-the-money, that is, they had an exercise price of more than $30.30 as shown in the tablebelow: In-the-Money Options Out-of-the-Money Options All Options Outstanding % of Total Outstanding % of Total Outstanding % of Total Current employees 1,254,297 96.6% 289,986 —% 1,544,283 96.1% Former employees 44,702 3.4% 17,857 5.8% 62,559 3.9% Totals 1,298,999 100.0% 307,843 5.8% 1,606,842 100.0% % of all outstanding options 80.8% 19.2% 100.0% Restricted Stock Units The following table summarizes restricted stock unit activity during the years ended December 31, 2015, 2014and 2013: Restricted Stock Weighted Average Grant Units Date Fair Value Per Unit Unvested at December 31, 2012 2,295,942 $23.40 Granted 1,564,224 41.20 Vested (966,838) 24.20 Forfeited (186,106) 29.69 Unvested at December 31, 2013 2,707,222 $33.34 Granted 1,772,276 48.42 Vested (1,009,927) 27.49 Forfeited (169,851) 36.64 Unvested at December 31, 2014 3,299,720 $40.99 Granted 1,718,057 45.51 Vested (1,210,159) 38.40 Forfeited (180,386) 42.46 Unvested at December 31, 2015 3,627,232 $44.69 In the year ended December 31, 2015, we granted 1,142,230 restricted stock units subject to time-vesting of which1,067,383 will vest and be settled ratably over a three-year period from the date of the grant and 31,000 will vest 100% onthe fifth anniversary of the grant date. In addition, in May 2015, we made an annual grant of 43,847 restricted stock units toour non-employee directors for the 2015-2016 board service year, which units vested immediately and will135 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentssettle in shares of our common stock on the third anniversary of the date of the grant. In March 2015, following theappointment of a new member of our Board of Directors, we made an initial grant of 1,311 restricted stock units to thatdirector, which units vested immediately, but will not settle until her separation from the Board, as well as a prorated annualgrant of 526 restricted stock units for the 2014-2015 board service year, which units vested immediately, but will not settleuntil the earlier of three years from the date of grant or her separation from the board. Also, we granted 306,968 performance-based restricted stock units to certain of our senior officers; the vesting of these restricted stock units is contingent on ourachievement of a specified one-year performance goal for the year ending December 31, 2015. The performance-basedrestricted stock units will vest ratably over a three-year period from the grant date. Based on our level of achievement withrespect to the target performance goal for the year ended December 31, 2015, the performance-based restricted stock unitswill be granted at 165% of the initial grant and will vest ratably over a three-year period from the grant date. In the year ended December 31, 2014, we granted 1,046,910 restricted stock units subject to time-vesting, of which945,409 will vest and be settled ratably over a three-year period from the grant date and 23,435 will vest 100% on the tenthanniversary of the grant date, 63,623 will vest 100% on the fifth anniversary of the grant date and 14,443 will vest 100% onthe third anniversary of the grant date. In addition, our newly appointed Board of Director member received an initial grant of1,240 restricted stock units that immediately vested but will not settle until her separation from the board and an annualgrant of 1,368 restricted stock units that immediately vested but will not settle until the earlier of three years or her separationfrom the board. We also granted 450,943 special retention restricted stock units to a select group of officers: two-thirds of theaward will vest contingent on our achievement of a performance goal of which one-half will vest based on performance overone-year period ending in December 2015 (these grants met the 140% range) and the remaining one-half will vest based onperformance over a four-year period ending in December 2018. The remaining one-third of this special retention award willvest in full on the fifth anniversary of the grant date. In addition, we granted 271,815 performance-based restricted stockunits to certain of our senior officers. Based on our level of achievement with respect to the target performance goal for theyear ended December 31, 2014, a total of 538,837 performance-based restricted stock units (or 200% of the initial grant) willvest ratably over a three-year period from the grant date. As of December 31, 2015, there were $117 million of total unrecognized compensation costs related to restrictedstock units. These costs are expected to be recognized over a weighted average period of 2.3 years. Employee Stock Purchase Plan We have an employee stock purchase plan under which we are currently authorized to issue up to 5,062,500 sharesof common stock to our eligible employees. As of December 31, 2015, there were approximately 70,363 shares available forissuance under our employee stock purchase plan. Under the terms of the plan, eligible employees may elect to have between1% and 10% of their base earnings withheld each quarter to purchase shares of our common stock. Shares are purchased at aprice equal to 95% of the closing price on the last day of the quarter. The plan requires a one-year holding period for allshares issued. The holding period does not apply upon termination of employment. Under the plan, no individual maypurchase, in any year, shares with a fair market value in excess of $25,000. The plan is currently not considered to becompensatory. We sold the following numbers of shares under our employee stock purchase plan in the years endedDecember 31, 2015, 2014 and 2013: Years Ended December 31, 2015 2014 2013 Number of shares 145,290 162,128 100,217 Weighted average price $43.96 $46.91 $42.88 Employee Retirement Plans Substantially all of our employees, upon qualification, are eligible to participate in one of our defined contribution401(k) plans. Under the plans, employees may contribute a portion of their eligible compensation, and we136 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsmatch such contributions annually up to a maximum percentage for participants actively employed, as defined by the plandocuments. Employer matching contributions will vary by plan. Plan expenses, primarily related to our contributions to theplan, were approximately $105 million, $92 million and $35 million for the years ended December 31, 2015, 2014 and 2013,respectively. Such amounts are reflected in salaries, wages and benefits in the accompanying Consolidated Statements ofOperations. We maintain three frozen non-qualified defined benefit pension plans (“SERPs”) that provide supplementalretirement benefits to certain of our current and former executives. One of these SERPs was frozen during the year endedDecember 31, 2014. These plans are not funded, and plan obligations for these plans are paid from our working capital.Pension benefits are generally based on years of service and compensation. Upon completing the acquisition of Vanguard onOctober 1, 2013, we assumed a frozen qualified defined benefit plan (“DMC Pension Plan”) covering substantially all of theemployees of our Detroit market that were hired prior to June 1, 2003. The benefits paid under the DMC Pension Plan areprimarily based on years of service and final average earnings. During the year ended December 31, 2015, the Society ofActuaries issued a new mortality improvement scale (MP-2015), which we incorporated into the estimates of our definedbenefit plan obligations as of December 31, 2015. During the year ended December 31, 2014, the Society of Actuaries issuednew mortality tables (RP-2014) and a mortality improvement scale (MP-2014), which we incorporated into the estimates ofour defined benefit plan obligations as of December 31, 2014. These changes to our mortality assumptions decreased andincreased our projected benefit obligations as of December 31, 2015 and 2014 by approximately $25 million and $87million, respectively. The following tables summarize the balance sheet impact, as well as the benefit obligations, fundedstatus and rate assumptions associated with the SERPs and the DMC Pension Plan based on actuarial valuations prepared asof December 31, 2015 and 2014: December 31, 2015 2014 Reconciliation of funded status of plans and the amounts included inthe Consolidated Balance Sheets: Projected benefit obligations Beginning obligations $(1,559) $(1,303) Service cost (3) (3) Interest cost (64) (66) Actuarial gain(loss) 96 (268) Benefits paid/employer contributions 75 81 Ending obligations (1,455) (1,559) Fair value of plans assets Beginning obligations 898 886 Gain (loss) on plan assets (36) 70 Employer contribution 8 3 Benefits paid (55) (61) Ending plan assets 815 898 Funded status of plans $(640) $(661) Amounts recognized in the Consolidated Balance Sheets consist of: Other current liability $(45) $(28) Other long-term liability (595) (633) Accumulated other comprehensive loss 261 276 $(379) $(385) SERP Assumptions: Discount rate 4.75% 4.25% Compensation increase rate 3.00% 3.00% Measurement date December 31, 2015 December 31, 2014 DMC Pension Plan Assumptions: Discount rate 4.67% 4.16 Compensation increase rate Frozen Frozen Measurement date December 31, 2015 December 31, 2014 (1)The accumulated benefit obligation at December 31, 2015 and 2014 was approximately $1.443 billion and $1.544 billion, respectively.137 (1)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents The components of net periodic benefit costs and related assumptions are as follows: Years Ended December 31, 2015 2014 2013 Service costs $3 $3 $2 Interest costs 64 66 25 Expected return on plan assets (57) (60) (15) Amortization of net actuarial loss 12 4 7 Net periodic benefit cost $22 $13 $19 SERP Assumptions: Discount rate 4.25% 5.00% 4.00% Long-term rate of return on assets n/a n/a n/a Compensation increase rate 3.00% 3.00% 3.00% Measurement date January 1, 2015 January 1, 2014 January 1, 2013 Census date January 1, 2015 January 1, 2014 January 1, 2013 DMC Pension Plan Assumptions: Discount rate 4.16% 5.18% 5.01% Long-term rate of return on assets 6.50% 7.00% 7.00% Compensation increase rate Frozen Frozen Frozen Measurement date January 1, 2015 January 1, 2014 October 1, 2013 Census date January 1, 2015 January 1, 2014 January 1, 2013 Net periodic benefit costs for the current year are based on assumptions determined at the valuation date of the prioryear for the SERPs and the DMC Pension Plan. We recorded gain/(loss) adjustments of $15 million, ($254) million and $69 million in other comprehensive income(loss) in the years ended December 31, 2015, 2014 and 2013, respectively, to recognize changes in the funded status of ourSERPs and the DMC Pension Plan. Changes in the funded status are recorded as a direct increase or decrease to shareholders’equity through accumulated other comprehensive loss. Net actuarial gains/(losses) of $3 million, ($258) million and$62 million during the years ended December 31, 2015, 2014 and 2013, respectively, and the amortization of net actuarialloss of $12 million, $4 million and $7 million for the years ended December 31, 2015, 2014 and 2013, respectively, wererecognized in other comprehensive income (loss). Cumulative net actuarial losses of $261 million, $276 million and$22 million as of December 31, 2015, 2014 and 2013, respectively, and unrecognized prior service costs of less than $1million as of each of the years ended December 31, 2015, 2014 and 2013, have not yet been recognized as components of netperiodic benefit costs. To develop the expected long-term rate of return on plan assets assumption, the DMC Pension Plan considers thecurrent level of expected returns on risk-free investments (primarily government bonds), the historical level of risk premiumassociated with the other asset classes in which the portfolio is invested and the expectations for future returns on each assetclass. The expected return for each asset class is then weighted based on the target asset allocation to develop the expectedlong-term rate of return on assets assumption for the portfolio. The weighted-average asset allocations by asset category as ofDecember 31, 2015, were as follows: Asset Category Target Actual Cash and cash equivalents 6% 5% United States government obligations 1% 1% Equity securities 50% 50% Debt Securities 43% 44% The DMC Pension Plan assets are invested in separately managed portfolios using investment management firms.The objective for all asset categories is to maximize total return without assuming undue risk exposure. The DMC PensionPlan maintains a well-diversified asset allocation that best meets these objectives. The DMC Pension Plan assets are largelycomprised of equity securities, which include companies with various market capitalization sizes in addition138 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsto international and convertible securities. Cash and cash equivalents are comprised of money market funds. Debt securitiesinclude domestic and foreign government obligations, corporate bonds, and mortgage-backed securities. Under theinvestment policy of the DMC Pension Plan, investments in derivative securities are not permitted for the sole purpose ofspeculating on the direction of market interest rates. Included in this prohibition are leveraging, shorting, swaps, futures,options, forwards, and similar strategies. In each investment account, the DMC Pension Plan investment managers are responsible to monitor and react toeconomic indicators, such as gross domestic product, consumer price index and U.S. monetary policy that may affect theperformance of their account. The performance of all managers and the aggregate asset allocation are formally reviewed on aquarterly basis, with a rebalancing of the asset allocation occurring at least once a year. The current asset allocation objectiveis to maintain a certain percentage with each class allowing for a 10% deviation from the target. The following tables summarize the DMC Pension Plan assets measured at fair value on a recurring basis as ofDecember 31, 2015, aggregated by the level in the fair value hierarchy within which those measurements are determined. Fairvalue methodologies for Level 1, Level 2 and Level 3 are consistent with the inputs described in Note 19. December 31, 2015 (Level 1) (Level 2) (Level 3) Cash and cash equivalents $44 $44 $— $— United States government obligations 5 5 — — Corporate bonds 354 354 — — Equity securities 412 412 — — $815 $815 $— $— The following table presents the estimated future benefit payments to be made from the SERPs and the DMCPension Plan, a portion of which will be funded from plan assets, for the next five years and in the aggregate for the five yearsthereafter: Years Ending December 31, 2015 Five Years Total 2016 2017 2018 2019 2020 Thereafter Estimated benefit payments $919 $82 $85 $88 $91 $93 $480 The SERP and DMC Pension Plan obligations of $640 million at December 31, 2015 are classified in theaccompanying Consolidated Balance Sheet as an other current liability ($45 million) and defined benefit plan obligations($595 million) based on an estimate of the expected payment patterns. We expect to make total contributions to the plans ofapproximately $45 million for the year ending December 31, 2016.NOTE 9. CAPITAL COMMITMENTS In connection with Vanguard’s acquisition of Detroit Medical Center, certain capital commitments were agreed tobe satisfied at particular dates. If these commitments are not met by these required dates, we are required to escrow cash forthe purpose of funding certain capital projects. There was no required escrow balance as of December 31, 2015. 139 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsNOTE 10. PROPERTY AND EQUIPMENT The principal components of property and equipment are shown in the table below: December 31, 2015 2014 Land $680 $650 Buildings and improvements 7,041 7,013 Construction in progress 191 161 Equipment 4,326 4,387 12,238 12,211 Accumulated depreciation and amortization (4,323) (4,478) Net property and equipment $7,915 $7,733 Property and equipment is stated at cost, less accumulated depreciation and amortization and impairment write-downs related to assets held and used. NOTE 11. GOODWILL AND OTHER INTANGIBLE ASSETS The following table provides information on changes in the carrying amount of goodwill, which is included in theaccompanying Consolidated Balance Sheets as of December 31, 2015 and 2014: 2015 2014 Hospital Operations and other As of January 1: Goodwill $5,642 $5,547 Accumulated impairment losses (2,430) (2,430) Total 3,212 3,117 Goodwill acquired during the year and purchase price allocation adjustments 100 95 Goodwill allocated to assets held for sale (190) — Impairment of goodwill — — Total $3,122 $3,212 As of December 31: Goodwill $5,552 $5,642 Accumulated impairment losses (2,430) (2,430) Total $3,122 $3,212 Ambulatory Care As of January 1: Goodwill $95 $37 Accumulated impairment losses — — Total 95 37 Goodwill acquired during the year and purchase price allocation adjustments 3,148 58 Total $3,243 $95 As of December 31: Goodwill $3,243 $95 Accumulated impairment losses — — Total $3,243 $95 140 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents 2015 2014 Conifer As of January 1: Goodwill $606 $412 Accumulated impairment losses — — Total 606 412 Goodwill acquired during the year and purchase price allocation adjustments (1) 194 Total $605 $606 As of December 31: Goodwill $605 $606 Accumulated impairment losses — — Total $605 $606 The following table provides information regarding other intangible assets, which are included in theaccompanying Consolidated Balance Sheets as of December 31, 2015 and 2014: Gross Carrying Accumulated Net Book Amount Amortization Value At December 31, 2015: Capitalized software costs $1,456 $(594) $862 Trade names 106 — 106 Contracts 653 (26) 627 Other 119 (39) 80 Total $2,334 $(659) $1,675 At December 31, 2014: Capitalized software costs $1,412 $(586) $826 Trade Names 106 — 106 Contracts 57 (6) 51 Other 143 (38) 105 Total $1,718 $(630) $1,088 Estimated future amortization of intangibles with finite useful lives as of December 31, 2015 is as follows: Years Ending December 31, Later Total 2016 2017 2018 2019 2020 Years Amortization of intangible assets $1,212 $189 $163 $136 $116 $88 $520 141 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsNOTE 12. INVESTMENTS AND OTHER ASSETS The principal components of investments and other assets in our accompanying Consolidated Balance Sheets are asfollows: December 31, 2015 2014 Marketable debt securities $59 $77 Equity investments in unconsolidated healthcare entities 817 56 Total investments 876 133 Cash surrender value of life insurance policies 28 27 Long-term deposits 36 36 Land held for expansion, long-term receivables and other assets 235 188 Investments and other assets $1,175 $384 Our policy is to classify investments that may be needed for cash requirements as “available-for-sale.” In doing so,the carrying values of the shares and debt instruments are adjusted at the end of each accounting period to their marketvalues through a credit or charge to other comprehensive income (loss), net of taxes. At both December 31, 2015 and 2014,there were approximately $1 million of accumulated unrealized loss on these investments. NOTE 13. ACCUMULATED OTHER COMPREHENSIVE LOSS Our accumulated other comprehensive loss is comprised of the following: December 31, 2015 2014 Adjustments for defined benefit plans $(169) $(182) Foreign currency translation adjustments 5 — Accumulated other comprehensive loss $(164) $(182) The tax effect allocated to the adjustments for our defined benefit plans was less than $1 million for the year endedDecember 31, 2015 and $93 million for the year ended December 31, 2014.NOTE 14. PROPERTY AND PROFESSIONAL AND GENERAL LIABILITY INSURANCE Property Insurance We have property, business interruption and related insurance coverage to mitigate the financial impact ofcatastrophic events or perils that is subject to deductible provisions based on the terms of the policies. These policies are onan occurrence basis. Professional and General Liability Insurance At December 31, 2015 and 2014, the aggregate current and long-term professional and general liability reserves inour accompanying Consolidated Balance Sheets were approximately $755 million and $681 million, respectively. Thesereserves include the reserves recorded by our captive insurance subsidiaries and our self-insured retention reserves recordedbased on modeled estimates for the portion of our professional and general liability risks, including incurred but not reportedclaims, for which we do not have insurance coverage. We estimated the reserves for losses and related expenses usingexpected loss-reporting patterns discounted to their present value under a risk-free rate approach using a Federal Reserveseven-year maturity rate of 2.09%, 1.97% and 2.45% at December 31, 2015, 2014 and 2013, respectively. 142 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsIf the aggregate limit of any of our professional and general liability policies is exhausted, in whole or in part, itcould deplete or reduce the limits available to pay any other material claims applicable to that policy period. Included in other operating expenses, net, in the accompanying Consolidated Statements of Operations ismalpractice expense of $283 million, $232 million and $112 million for the years ended December 31, 2015, 2014 and 2013,respectively. NOTE 15. CLAIMS AND LAWSUITS We operate in a highly regulated and litigious industry. As a result, we commonly become involved in disputes,litigation and regulatory matters incidental to our operations, including governmental investigations, personal injurylawsuits, employment claims and other matters arising out of the normal conduct of our business. We record accruals for estimated losses relating to claims and lawsuits when available information indicates that aloss is probable and we can reasonably estimate the amount of the loss or a range of loss. Significant judgment is required inboth the determination of the probability of a loss and the determination as to whether a loss is reasonably estimable. Thesedeterminations are updated at least quarterly and are adjusted to reflect the effects of negotiations, settlements, rulings,advice of legal counsel and technical experts, and other information and events pertaining to a particular matter. If a loss on amaterial matter is reasonably possible and estimable, we disclose an estimate of the loss or a range of loss. In cases where wehave not disclosed an estimate, we have concluded that the loss is either not reasonably possible or the loss, or a range ofloss, is not reasonably estimable, based on available information. Governmental Reviews and Lawsuits Healthcare companies are subject to numerous investigations by various governmental agencies. Further, privateparties have the right to bring qui tam or “whistleblower” lawsuits against companies that allegedly submit false claims forpayments to, or improperly retain overpayments from, the government and, in some states, private payers. We and oursubsidiaries have received inquiries in recent years from government agencies, and we may receive similar inquiries in futureperiods. The following matters are pending. ·Clinica de la Mama Qui Tam Action and Criminal Investigation—As previously disclosed, we and four of ourhospital subsidiaries are defendants in civil qui tam litigation (United States of America, ex rel. Ralph D.Williams v. Health Management Associates, Inc., et al.) that alleges that the contractual arrangements betweeneach of Atlanta Medical Center, North Fulton Hospital, Spalding Regional Medical Center and Hilton HeadHospital and Hispanic Medical Management, Inc. (“HMM”) violated the federal and state anti-kickback statutesand false claims acts. HMM owned and operated clinics that provided, among other things, prenatal carepredominantly to uninsured patients. Beginning in 2000, the hospital subsidiaries contracted with HMM fortranslation, marketing, management and Medicaid eligibility determination services. Subsequently, the GeorgiaAttorney General’s Office and the U.S. Attorney’s Office intervened in the qui tam action. If the plaintiff in the pending civil litigation were to prevail, the potential sanctions could include up to threetimes the reimbursement of relevant government program payments received by the four hospital subsidiariesfor uninsured HMM patients treated at the hospitals, the assessment of civil penalties and potential exclusionfrom participation in federal healthcare programs. Also as previously disclosed, the U.S. Department of Justice (“DOJ”) is conducting a criminal investigation ofus, certain of our subsidiaries and former employees with respect to the contractual arrangements between HMMand the four hospitals. We are cooperating in the investigation and have responded, and continue to respond, todocument and other requests pursuant to subpoenas issued to us and the four subsidiaries. If we or oursubsidiaries were determined in any potential criminal proceeding to have violated the federal anti-kickbackstatute, the sanctions would include fines, which could be significant, and mandatory exclusion fromparticipation in federal healthcare programs. Additional information regarding143 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentsthe procedural history of the qui tam action and criminal investigation is contained in quarterly and annualreports we have previously filed with the SEC. In January 2016, we commenced discussions with the DOJ and the State of Georgia regarding potentialresolution of these matters. Management increased its aggregate reserve for these matters in the three monthsended December 31, 2015 from $20 million to $238 million to reflect an offer we made on February 18, 2016 toresolve the criminal investigation and civil litigation. We expect that the DOJ will make a counterproposal,and there can be no assurance that the ongoing discussions to resolve these matters will be successful. The termsof a final resolution may require us to pay significant fines and penalties and give rise to other costs or adverseconsequences that materially exceed the reserve we have established. Based on the ongoing uncertainties andpotentially wide range of outcomes associated with any potential resolution, we cannot estimate the ultimateamount of potential loss or range of reasonably possible loss we may face. In addition to the payment of a monetary penalty, the final terms of any resolution of these matters couldinclude: (i) the execution by the Company of a Corporate Integrity Agreement or a non-prosecution agreement,which may provide for the appointment of a corporate monitor and ongoing compliance audits; (ii) a deferredprosecution agreement by an intermediate subsidiary of the Company; and (iii) a commitment that one or moreof the hospital subsidiaries subject to the investigation and proceedings enter into a guilty plea. The non-monetary terms of any resolution could expose us to increased operating costs, reputational harm,administrative burdens, and diminished profits and revenues. To the extent that either the civil or the criminal matter discussed above is determined adversely to ourinterests, such determination could have a material adverse effect on our business, financial condition, results ofoperations or cash flows. The following previously reported matters have recently been resolved. ·Implantable Cardioverter Defibrillators (“ICDs”)—Fifty-six of our hospitals were subject to a DOJ review thatwas commenced in March 2010 to determine whether ICD procedures performed at the hospitals from 2002 to2010 complied with Medicare coverage requirements. In July 2015, we reached final agreement with the DOJ toresolve the investigation for approximately $12 million, which was fully reserved as of June 30, 2015 and paidon August 3, 2015. ·Review of Conifer’s Debt Collection Activities—In order to resolve allegations that it had not fully complied inlimited instances with debt validation and dispute resolution requirements under federal consumer protectionlaws, in June 2015, a Conifer subsidiary paid a civil penalty of less than $1 million and stipulated to a ConsentOrder issued by the U.S. Consumer Financial Protection Bureau (“CFPB”). The Consent Order requires theConifer subsidiary to: (i) improve its consumer protection compliance program; (ii) make periodic reports to theCFPB over five years; (iii) forgive approximately $1 million in consumer debt; and (iv) pay approximately$5 million in consumer redress. Antitrust Class Action Lawsuits Filed by Registered Nurses in Detroit and San Antonio On January 27, 2016, the court granted final approval of a settlement between the parties in Cason-Merenda, et al. v.VHS of Michigan, Inc. d/b/a Detroit Medical Center, et al., which was filed in December 2006 in the U.S. District Court forthe Eastern District of Michigan. In that matter, a certified class composed of the registered nurses (exclusive of supervisory,managerial and advanced practical nurses) employed by eight unaffiliated Detroit-area hospital systems allege those hospitalsystems, including Detroit Medical Center (“DMC”), violated Section §1 of the federal Sherman Act by exchangingcompensation-related information among themselves in a manner that reduced competition and suppressed the wages paid tosuch nurses. A subsidiary of Vanguard acquired DMC in January 2011, and we acquired Vanguard in October 2013. All ofthe defendant hospital systems other than DMC settled prior to our acquisition of Vanguard. We will make the $42 millionsettlement payment, which was fully reserved in the year ended December 31, 2015, by February 26, 2016.144 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents In Maderazo, et al. v. VHS San Antonio Partners, L.P. d/b/a Baptist Health Systems, et al., filed in June 2006 in theU.S. District Court for the Western District of Texas, a purported class of registered nurses employed by three unaffiliated SanAntonio-area hospital systems allege those hospital systems, including Baptist Health System, and other unidentified SanAntonio regional hospitals violated Section §1 of the federal Sherman Act by conspiring to depress nurses’ compensationand exchanging compensation-related information among themselves in a manner that reduced competition and suppressedthe wages paid to such nurses. The suit seeks unspecified damages (subject to trebling under federal law), interest, costs andattorneys’ fees. The case had been stayed since 2008; however, in July 2015, the court lifted the stay and re-openeddiscovery. Because these proceedings are at an early stage, it is impossible at this time to predict their outcome with anycertainty; however, we believe that the ultimate resolution of this matter will not have a material effect on our business,financial condition or results of operations. We will continue to seek to defeat class certification and vigorously defendourselves against the plaintiffs’ allegations. Ordinary Course Matters We are also subject to other claims and lawsuits arising in the ordinary course of business, including potentialclaims related to, among other things, the care and treatment provided at our hospitals and outpatient facilities, theapplication of various federal and state labor laws, tax audits and other matters. Although the results of these claims andlawsuits cannot be predicted with certainty, we believe that the ultimate resolution of these ordinary course claims andlawsuits will not have a material effect on our business or financial condition. In addition, as previously reported, in the year ended December 31, 2015, we paid a total of approximately$14 million to settle a class action lawsuit filed in Louisiana in March 1997 alleging tortious invasion of privacy as a resultof the potential disclosure of patient identifying records. We had made an initial deposit of approximately $6 million into anescrow account in late November 2014 and, based on low class participation as of March 31, 2015 (the end of the claimsperiod), management reduced the reserve for this matter from approximately $12 million at December 31, 2014 to $8 million,recorded in discontinued operations, to reflect its then-current estimate of probable remaining liability. The case is nowclosed. New claims or inquiries may be initiated against us from time to time. These matters could (1) require us to paysubstantial damages or amounts in judgments or settlements, which, individually or in the aggregate, could exceed amounts,if any, that may be recovered under our insurance policies where coverage applies and is available, (2) cause us to incursubstantial expenses, (3) require significant time and attention from our management, and (4) cause us to close or sellhospitals or otherwise modify the way we conduct business. The following table presents reconciliations of the beginning and ending liability balances in connection with legalsettlements and related costs recorded during the years ended December 31, 2015, 2014 and 2013: Balances at Litigation and Balances at Beginning Investigation Cash End of of Period Costs Payments Other Period Year Ended December 31, 2015 Continuing operations $73 $291 $(72) $7 $299 Discontinued operations 10 (8) (2) — — $83 $283 $(74) $7 $299 Year Ended December 31, 2014 Continuing operations $64 $25 $(16) $ — $73 Discontinued operations 6 18 (14) — 10 $70 $43 $(30) $ — $83 Year Ended December 31, 2013 Continuing operations $5 $31 $(10) $38 $64 Discontinued operations 5 2 (1) — 6 $10 $33 $(11) $38 $70 145 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsFor the years ended December 31, 2015, 2014 and 2013, we recorded net costs of $283 million, $43 million and$33 million, respectively, in connection with significant legal proceedings and governmental reviews. The amount for 2013in the column entitled “Other” above relates to reserves assumed as part of our acquisition of Vanguard in October 2013.NOTE 16. REDEEMABLE NONCONTROLLING INTEREST IN EQUITY OF CONSOLIDATED SUBSIDIARIES In October 2015, we formed a new joint venture with Baptist Health System, Inc. to own and operate a healthcarenetwork serving Birmingham and central Alabama. We have a 60% ownership interest in the joint venture, and we managethe network’s operations. Baptist Health System contributed four hospitals—Citizens Baptist Medical Center, PrincetonBaptist Medical Center, Shelby Baptist Medical Center and Walker Baptist Medical Center—to the joint venture, and wecontributed Brookwood Medical Center. The network also includes each contributed hospital’s related businesses. We paidapproximately $184 million to align the respective valuations of the assets contributed to the joint venture. The jointventure’s operating agreement includes a put option that the minority owners may exercise on their respective non-controlling interest upon the occurrence of certain specified events. The redemption value is calculated using a fair marketvalue analysis. As a result of this transaction, we recorded approximately $322 million of redeemable noncontrollinginterests. In August 2015, we formed a joint venture with Dignity Health and Ascension Health to own and operateCarondelet Health Network (the “Carondelet JV”) based in Tucson, Arizona. We own a 60% controlling interest in the newjoint venture and manage the operations of the network. Affiliates of Dignity Health and Ascension Health (the “minorityowners”) own the remaining 40% non-controlling interest in the Carondelet JV. The joint venture’s operating agreementincludes a put option that the minority owners may exercise on their respective non-controlling interest onSeptember 1, 2025. The redemption value is calculated using a fair market value analysis. As a result of this transaction, werecorded approximately $68 million of redeemable noncontrolling interests. In June 2015, we formed a new joint venture by combining our freestanding ambulatory surgery and imaging centerassets with the short-stay surgical facility assets of USPI. We currently own 50.1% of the USPI joint venture. In connectionwith the formation of the USPI joint venture, we entered into a stockholders agreement pursuant to which we and our jointventure partners agreed to certain rights and obligations with respect to the governance of the joint venture. As part of the USPI transaction, we also entered into a put/call agreement (the “Put/Call Agreement”) that containsput and call options with respect to the equity interests in the joint venture held by our joint venture partners. Each yearstarting in 2016, our joint venture partners must put to us at least 12.5%, and may put up to 25%, of the equity held by themin the joint venture immediately after the closing. In each year that our joint venture partners are to deliver a put and do notput the full 25% of the USPI joint venture’s shares allowable, we may call the difference between the number of shares ourjoint venture partners put and the maximum number of shares they could have put that year. In addition, the Put/CallAgreement contains certain other call options pursuant to which we will have the ability to acquire all of the ownershipinterests from our joint venture partners controlled by Welsh, Carson, Anderson & Stowe (“Welsh Carson”) by 2020. In theevent of a put by our joint venture partners controlled by Welsh Carson, we will have the ability to choose whether to settlethe purchase price in cash or shares of our common stock and, in the event of a call by us, our joint venture partnerscontrolled by Welsh Carson will have the ability to choose whether to settle the purchase price in cash or shares of ourcommon stock. In addition, we entered into a separate put call agreement (the “Baylor Put/Call Agreement”) with Baylor UniversityMedical Center that contains put and call options with respect to the equity interests in the USPI joint venture held byBaylor University Medical Center (“Baylor”). Each year starting in 2021, Baylor may put up to 1/3 of their total shares heldas of January 1, 2017 in the joint venture. In each year that Baylor does not put the full 33.3% of the USPI joint venture’sshares allowable, we may call the difference between the number of shares Baylor put and the maximum number of sharesthey could have put that year. In addition, the Baylor Put/Call Agreement contains a call option pursuant to which we havethe ability to acquire all of Baylor’s ownership interest by 2024. We have the ability to choose whether to settle the purchaseprice for the Baylor put/call in cash or shares of our common stock. 146 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsBased on the nature of these put/call structures, the minority shareholders’ interests in the USPI joint venture isclassified as redeemable noncontrolling interests in our Consolidated Balance Sheet at December 31, 2015. As a result of thistransaction, we recorded approximately $1.48 billion of redeemable noncontrolling interests. In January 2016, Welsh Carsonsubsidiaries delivered a put notice for the minimum number of shares they are required to put to us in 2016 according to thePut/Call Agreement. The estimated amount we will pay to repurchase these shares is $127 million. When we acquired Vanguard Health Systems, Inc. (“Vanguard”) in October 2013, we obtained a 51% controllinginterest in a limited liability company that held the assets and liabilities of Valley Baptist Health System (“Valley Baptist”),which consists of two hospitals in Brownsville and Harlingen, Texas. The remaining 49% noncontrolling interest in the jointventure was held by the former owner of Valley Baptist (the “seller”). The joint venture operating agreement included a putoption that would allow the seller to require us to purchase all or a portion of the seller’s remaining noncontrolling interest inthe limited liability company at certain specified time periods. In connection with the seller’s exercise and the settlement ofthe put option, we acquired the remaining 49% noncontrolling interest from the seller on February 11, 2015 in exchange forapproximately $254 million in cash, which was applied to and reduced our redeemable noncontrolling interests, with thedifference between the payment and the carrying value of approximately $270 million recorded as additional paid-in capital.The redemption value of the put option was calculated pursuant to the terms of the operating agreement based on theoperating results and the debt of the joint venture. As a result, we now own 100% of Valley Baptist. In January 2015, Conifer announced a 10-year extension and expansion of its agreement with Catholic HealthInitiatives (“CHI”) to provide patient access, revenue integrity and patient financial services to 92 CHI hospitals through2032. At that time, CHI increased its minority ownership position in Conifer’s revenue cycle solutions subsidiary, ConiferHealth Solutions, LLC, to approximately 23.8%, resulting in an increase in our redeemable noncontrolling interests ofapproximately $47 million. The following table shows the changes in redeemable noncontrolling interests in equity of consolidated subsidiariesduring the years ended December 31, 2015 and 2014: Years Ended December 31, 2015 2014Balances at beginning of period $401 $340Net income 166 33Distributions paid to noncontrolling interests (60) (8)Contributions from noncontrolling interests 1 11Purchases and sales of businesses and noncontrolling interests, net 1,758 25Balances at end of period $2,266 $401 NOTE 17. INCOME TAXES The provision for income taxes for continuing operations for the years ended December 31, 2015, 2014 and 2013consists of the following: Years Ended December 31, 2015 2014 2013 Current tax expense (benefit): Federal $(2) $(12) $2 State 28 18 4 26 6 6 Deferred tax expense (benefit): Federal 24 46 (56) State 18 (3) (15) 42 43 (71) $68 $49 $(65) 147 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsA reconciliation between the amount of reported income tax expense (benefit) and the amount computed bymultiplying income (loss) from continuing operations before income taxes by the statutory federal income tax rate is shownbelow. State income tax for the year ended December 31, 2015 includes $11 million of expense related to the write off ofexpired unutilized state net operating loss carryforwards for which a full valuation allowance had been provided in prioryears. A corresponding tax benefit of $11 million is included for the year ended December 31, 2015 to reflect the reductionin the valuation allowance. Years Ended December 31, 2015 2014 2013 Tax expense at statutory federal rate of 35% $50 $52 $(55) State income taxes, net of federal income tax benefit 18 5 1 Expired state net operating losses, net of federal income tax benefit 11 34 — Tax attributable to noncontrolling interests (59) (23) (10) Nondeductible goodwill 22 — — Nontaxable gains (11) — — Nondeductible litigation 44 — — Nondeductible acquisition costs 4 2 6 Nondeductible health insurance provider fee 2 3 — Changes in valuation allowance 4 (20) (2) Change in tax contingency reserves, including interest 7 (2) (7) Amendment of prior-year tax returns (17) — — Prior-year provision to return adjustments and other changes in deferred taxes (12) (5) 3 Other items 5 3 (1) $68 $49 $(65) Deferred income taxes reflect the tax effects of temporary differences between the carrying amount of assets andliabilities for financial reporting purposes and the amount used for income tax purposes. The following table discloses thosesignificant components of our deferred tax assets and liabilities, including any valuation allowance: December 31, 2015 December 31, 2014 Assets Liabilities Assets Liabilities Depreciation and fixed-asset differences $ — $718 $ — $847 Reserves related to discontinued operations and restructuring charges 15 — 28 — Receivables (doubtful accounts and adjustments) 185 — 173 — Deferred gain on debt exchanges — 32 — 42 Accruals for retained insurance risks 318 — 329 — Intangible assets — 366 — 157 Other long-term liabilities 141 — 166 — Benefit plans 459 — 451 — Other accrued liabilities 99 — 83 — Investments and other assets — 69 — 4 Net operating loss carryforwards 715 — 659 — Stock-based compensation 40 — 31 — Other items 55 6 80 — 2,027 1,191 2,000 1,050 Valuation allowance (96) — (87) — $1,931 $1,191 $1,913 $1,050 148 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsBelow is a reconciliation of the deferred tax assets and liabilities and the corresponding amounts reported in theaccompanying Consolidated Balance Sheets. December 31, 2015 2014 Deferred income tax assets $776 $863 Other long-term liabilities (36) — Net deferred tax asset $740 $863 During the year ended December 31, 2015, the valuation allowance increased by $9 million, $5 million due to theacquisition of USPI and $4 million due to changes in expected realizability of deferred tax assets. The balance in thevaluation allowance as of December 31, 2015 is $96 million. During the year ended December 31, 2014, the valuationallowance decreased by $20 million, primarily due to the expiration of unutilized state net operating loss carryovers. Duringthe year ended December 31, 2013, the valuation allowance increased by $51 million, $34 million due to the acquisition ofVanguard and $17 million primarily due to the adjustment of deferred tax assets for state net operating loss carryforwards thathave a full valuation allowance. We account for uncertain tax positions in accordance with ASC 740-10-25, which prescribes a comprehensivemodel for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken orexpected to be taken in income tax returns. The table below summarizes the total changes in unrecognized tax benefitsduring the year ended December 31, 2015. The additions and reductions for tax positions include the impact of items forwhich the ultimate deductibility is highly certain, but for which there is uncertainty about the timing of such deductions.Such amounts include unrecognized tax benefits that have impacted deferred tax assets and liabilities at December 31, 2015,2014 and 2013. Continuing Discontinued Operations Operations Total Balance at December 31, 2012 31 1 32 Additions for prior-year tax positions 15 — 15 Additions for current-year tax positions 3 — 3 Reductions due to a lapse of statute of limitations (6) (1) (7) Balance at December 31, 2013 43 $ — 43 Reductions for tax positions of prior years (1) — (1) Additions for current-year tax positions 1 — 1 Reductions due to a lapse of statute of limitations (5) — (5) Balance at December 31, 2014 $38 $ — $38 Additions for prior-year tax positions 1 — 1 Additions for current-year tax positions 5 — 5 Reductions due to a lapse of statute of limitations (4) — (4) Balance at December 31, 2015 $40 $ — $40 The total amount of unrecognized tax benefits as of December 31, 2015 was $40 million, of which $37 million, ifrecognized, would affect our effective tax rate and income tax expense (benefit) from continuing operations. Income taxexpense in the year ended December 31, 2015 includes expense of $2 million in continuing operations attributable to aincrease in our estimated liabilities for uncertain tax positions, net of related deferred tax effects. The total amount ofunrecognized tax benefits as of December 31, 2014 was $38 million, of which $31 million, if recognized, would affect oureffective tax rate and income tax expense (benefit) from continuing operations. Income tax expense in the year endedDecember 31, 2014 includes a benefit of $6 million in continuing operations attributable to a decrease in our estimatedliabilities for uncertain tax positions, net of related deferred tax effects. The total amount of unrecognized tax benefits as ofDecember 31, 2013 was $43 million, of which $34 million, if recognized, would affect our effective tax rate and income taxexpense (benefit) from continuing and discontinued operations. Income tax expense in the year ended December 31, 2013includes a benefit of $1 million in continuing operations attributable to a decrease in our estimated liabilities for uncertaintax positions, net of related deferred tax effects.149 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsOur practice is to recognize interest and/or penalties related to income tax matters in income tax expense in ourconsolidated statements of operations. Approximately $3 million of interest and penalties related to accrued liabilities foruncertain tax positions related to continuing operations are included in the accompanying Consolidated Statement ofOperations for the year ended December 31, 2015. Total accrued interest and penalties on unrecognized tax benefits as ofDecember 31, 2015 were $6 million, all of which related to continuing operations. The Internal Revenue Service (“IRS”) has completed audits of our tax returns for all tax years ending on or beforeDecember 31, 2007, and of Vanguard’s tax returns for fiscal years ending on or before June 30, 2004. All disputed issues withrespect to these audits have been resolved and all related tax assessments (including interest) have been paid. Our tax returnsfor years ended after December 31, 2007, and Vanguard’s tax returns for fiscal years ended after June 30, 2004 remain subjectto examination by the IRS. Vanguard’s tax returns for fiscal years ended June 30, 2013 and October 1, 2013 are currentlyunder audit by the IRS. USPI tax returns for years ended after December 31, 2011 remain subject to audit. As of December 31, 2015, approximately $7 million of unrecognized federal and state tax benefits, as well asreserves for interest and penalties, may decrease in the next 12 months as a result of the settlement of audits, the filing ofamended tax returns or the expiration of statutes of limitations. At December 31, 2015, our carryforwards available to offset future taxable income consisted of (1) federal netoperating loss (“NOL”) carryforwards of approximately $1.8 billion pretax expiring in 2024 to 2034, (2) approximately$28 million in alternative minimum tax credits with no expiration, (3) general business credit carryforwards of approximately$22 million expiring in 2023 through 2035, and (4) state NOL carryforwards of $3.1 billion expiring in 2014 through 2035for which the associated deferred tax benefit, net of valuation allowance and federal tax impact, is $12 million. Our ability toutilize NOL carryforwards to reduce future taxable income may be limited under Section 382 of the Internal Revenue Code ifcertain ownership changes in our company occur during a rolling three-year period. These ownership changes includepurchases of common stock under share repurchase programs (see Note 2), the offering of stock by us, the purchase or sale ofour stock by 5% shareholders, as defined in the Treasury regulations, or the issuance or exercise of rights to acquire our stock.If such ownership changes by 5% shareholders result in aggregate increases that exceed 50 percentage points during thethree-year period, then Section 382 imposes an annual limitation on the amount of our taxable income that may be offset bythe NOL carryforwards or tax credit carryforwards at the time of ownership change.150 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsNOTE 18. EARNINGS (LOSS) PER COMMON SHARE The table below is a reconciliation of the numerators and denominators of our basic and diluted earnings (loss) percommon share calculations for income (loss) from continuing operations for the years ended December 31, 2015, 2014and 2013. Income (loss) is expressed in millions and weighted average shares are expressed in thousands. Net Income Available (Loss Attributable) to Common Weighted Shareholders AverageShares Per-Share (Numerator) (Denominator) Amount Year Ended December 31, 2015 Net loss attributable to Tenet Healthcare Corporation commonshareholders for basic loss per share $(142) 99,167 $(1.43) Effect of dilutive stock options, restricted stock units and deferredcompensation units — — — Net loss attributable to Tenet Healthcare Corporation commonshareholders for diluted loss per share $(142) 99,167 $(1.43) Year Ended December 31, 2014 Net income available to Tenet Healthcare Corporation commonshareholders for basic earnings per share $34 97,801 $0.35 Effect of dilutive stock options, restricted stock units and deferredcompensation units — 2,486 (0.01) Net income available to Tenet Healthcare Corporation commonshareholders for diluted earnings per share $34 100,287 $0.34 Year Ended December 31, 2013 Net loss attributable to Tenet Healthcare Corporation commonshareholders for basic loss per share $(123) 101,648 $(1.21) Effect of dilutive stock options, restricted stock units and deferredcompensation units — — — Net loss attributable to Tenet Healthcare Corporation commonshareholders for diluted loss per share $(123) 101,648 $(1.21) All potentially dilutive securities were excluded from the calculation of diluted earnings (loss) per share for theyears ended December 31, 2015 and 2013, because we did not report income from continuing operations in the period. Incircumstances where we do not have income from continuing operations, the effect of stock options and other potentiallydilutive securities is anti-dilutive, that is, a loss from continuing operations has the effect of making the diluted loss per shareless than the basic loss per share. Had we generated income from continuing operations in those periods, the effect (inthousands) of employee stock options, restricted stock units and deferred compensation units on the diluted sharescalculation would have been an increase in shares of 2,380 and 2,310 for the years ended December 31, 2015 and 2013,respectively. NOTE 19. FAIR VALUE MEASUREMENTS Our financial assets and liabilities recorded at fair value on a recurring basis primarily relate to investments inavailable-for-sale securities held by our captive insurance subsidiaries. The following tables present information about ourassets and liabilities that are measured at fair value on a recurring basis as of December 31, 2015 and 2014. The followingtables also indicate the fair value hierarchy of the valuation techniques we utilized to determine such fair values. In general,fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities.We consider a security that trades at least weekly to have an active market. Fair values determined by Level 2 inputs utilizedata points that are observable, such as quoted prices, interest rates and yield151 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contentscurves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and include situationswhere there is little, if any, market activity for the asset or liability. Quoted Prices in Active Significant Markets for Significant Other Unobservable Identical Assets Observable Inputs InputsInvestments December 31, 2015 (Level 1) (Level 2) (Level 3)Marketable debt securities — noncurrent $59 $24 $35 $ — $59 $24 $35 $ — Quoted Prices in Active Significant Markets for Significant Other Unobservable Identical Assets Observable Inputs InputsInvestments December 31, 2014 (Level 1) (Level 2) (Level 3)Marketable securities — current $2 $2 $ — $ —Investments in Reserve Yield Plus Fund 2 — 2 —Marketable debt securities — noncurrent 60 54 5 1 $64 $56 $7 $1 Our non-financial assets and liabilities not permitted or required to be measured at fair value on a recurring basistypically relate to long-lived assets held and used, long-lived assets held for sale and goodwill. We are required to provideadditional disclosures about fair value measurements as part of our financial statements for each major category of assets andliabilities measured at fair value on a non-recurring basis. The following table presents this information and indicates the fairvalue hierarchy of the valuation techniques we utilized to determine such fair values. In general, fair values determined byLevel 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities, which generally are notapplicable to non-financial assets and liabilities. Fair values determined by Level 2 inputs utilize data points that areobservable, such as definitive sales agreements, appraisals or established market values of comparable assets. Fair valuesdetermined by Level 3 inputs are unobservable data points for the asset or liability and include situations where there islittle, if any, market activity for the asset or liability, such as internal estimates of future cash flows. Quoted Prices in Active Significant Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs December 31, 2015 (Level 1) (Level 2) (Level 3) Long-lived assets held and used $45 $— $45 $— Quoted Prices in Active Significant Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs December 31, 2014 (Level 1) (Level 2) (Level 3)Long-lived assets held and used $23 $— $23 $— As described in Note 5, in the year ended December 31, 2015, we recorded impairment charges in continuingoperations of $19 million for the write-down of buildings, equipment and other long-lived assets of two hospitals to theirestimated fair values. In the year ended December 31, 2014, we recorded an impairment charge in continuing operations of$20 million for the write-down of buildings, equipment and other long-lived assets of one hospital to their estimated fairvalues primarily due to a decline in the fair value of real estate in the market in which the hospital operates and a decline inthe estimated fair value of equipment. The fair value of our long-term debt is based on quoted market prices (Level 1). The inputs used to establish the fairvalue of the borrowings outstanding under the Credit Agreement are considered to be Level 2 inputs, which include inputsother than quoted prices included in Level 1 that are observable, either directly or indirectly. At152 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsDecember 31, 2015 and 2014, the estimated fair value of our long-term debt was approximately 96.2% and 105.0%,respectively, of the carrying value of the debt.NOTE 20. ACQUISITIONS During the year ended December 31, 2015, we completed the transaction that combined our freestandingambulatory surgery and imaging center assets with USPI’s short-stay surgical facility assets into a new joint venture. We alsocompleted the acquisition of Aspen, a network of nine private hospitals and clinics in the United Kingdom. In addition, webegan operating Hi-Desert Medical Center, which is a 59-bed acute care hospital in Joshua Tree, California, and its relatedhealthcare facilities, including a 120-bed skilled nursing facility, an ambulatory surgery center and an imaging center, undera long-term lease agreement. Furthermore, we formed a new joint venture with Dignity Health and Ascension Health to ownand operate Carondelet Health Network, which is comprised of three hospitals with over 900 licensed beds, related physicianpractices, ambulatory surgery, imaging and urgent care centers, and other affiliated businesses, in Tucson and Nogales,Arizona. We also formed a new joint venture with Baptist Health Systems, Inc. to own and operate a healthcare networkserving Birmingham and central Alabama. We have a 60% ownership in the joint venture, and manage the network’soperations. The network has more than 1,700 licensed beds, nine outpatient centers, 68 physician clinics, deliveringprimarily and specialty care, and more than 7,000 employees and approximately 1,500 affiliated physicians. Additionally,we acquired majority interests in nine ambulatory surgery centers and purchased 35 urgent care centers (all of which areowned by our USPI joint venture), and various physician practice entities. The fair value of the consideration conveyed inthe acquisitions (the “purchase price”) was $940 million. During the year ended December 31, 2014, we acquired a majority interest in Texas Regional Medical Center atSunnyvale, a 70-bed hospital in Sunnyvale, Texas, a suburban community east of Dallas, and completed our acquisition ofEmanuel Medical Center, a 209-bed hospital in Turlock, California, located approximately 100 miles southeast of SanFrancisco. We also acquired five ambulatory surgery centers, three urgent care centers, one diagnostic imaging center, SPiHealthcare, a provider of revenue cycle management, health information management and software solutions, and variousphysician practice entities in the same period. The fair value of the consideration conveyed in the acquisitions (the “purchaseprice”) was $428 million. During the year ended December 31, 2013, we acquired 28 hospitals (plus one more under construction),39 outpatient centers and five health plans, serving communities in Arizona, California, Illinois, Massachusetts, Michiganand Texas, through our acquisition of Vanguard. We also purchased the following businesses: (1) 11 ambulatory surgerycenters (in one of which we had previously held a noncontrolling interest); (2) an urgent care center; (3) a provider networkbased in Southern California that includes contracted independent physicians, ancillary providers and hospitals; (4) amedical office building; and (5) various physician practice entities. The fair value of the consideration conveyed in theacquisitions (the “purchase price”) was $1.515 billion. We are required to allocate the purchase prices of the acquired businesses to assets acquired or liabilities assumedand, if applicable, noncontrolling interests based on their fair values at the respective acquisition dates. The excess of thepurchase price allocated over those fair values is recorded as goodwill. The purchase price allocations for certain acquisitionscompleted in 2015, including our USPI joint venture, is preliminary. We are in the process of obtaining and evaluatingvaluations of the acquired property and equipment, management contracts and other intangible assets, equity methodinvestments and noncontrolling interests. Therefore, those purchase price allocations including goodwill recorded in theseconsolidated financial statements are subject to adjustment once the valuation work is completed and evaluated. Suchadjustments will be recorded as soon as practical and within the measurement period as defined by the accounting literature.During the year ended December 31, 2014, we completed the analysis required to finalize the purchase price allocation forour acquisition of Vanguard. During the years ended December 31, 2015, 2014 and 2013, we made adjustments to purchaseprice allocations for businesses acquired in 2014, 2013 and 2012 (other than Vanguard), respectively, that increased(decreased) goodwill by approximately ($11) million, $7 million and $5 million, respectively. 153 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPreliminary or final purchase price allocations for all the acquisitions made during the years endedDecember 31, 2015, 2014 and 2013 are as follows: 2015 2014 2013Current assets $457 $34 $980Property and equipment 1,059 113 2,890Other intangible assets 361 46 213Goodwill 3,374 340 2,645Other long-term assets 557 2 160Current liabilities (443) (30) (1,205)Deferred taxes — long term (128) (18) (116)Other long-term liabilities (2,146) (23) (3,725)Redeemable noncontrolling interests in equity of consolidatedsubsidiaries (1,974) (21) (268)Noncontrolling interests (147) (15) (49)Cash paid, net of cash acquired $940 $428 $1,515Gains on consolidations $30 $ — $10 The goodwill generated from these transactions, the majority of which will not be deductible for income tax purposes, can beattributed to the benefits that we expect to realize from operating efficiencies and increased reimbursement. Approximately$45 million, $16 million and $6 million in transaction costs related to prospective and closed acquisitions were expensedduring the years ended December 31, 2015, 2014 and 2013, respectively, and are included in impairment and restructuringcharges, and acquisition-related costs in the accompanying Consolidated Statements of Operations. During the years ended December 31, 2015 and 2013, we recognized gains totaling $30 million and $10 million,respectively, associated with stepping up our ownership interests in previously held equity investments, which we beganconsolidating after we acquired controlling interests. USPI Joint Venture and Acquisition of Aspen Effective June 16, 2015, we entered into the USPI joint venture, of which we own 50.1%. On the date of acquisition,the joint venture had interests in 249 ambulatory surgery centers, 18 short-stay surgical hospitals and 20 imaging centers in29 states. We refinanced approximately $1.5 billion of existing USPI debt, which was allocated to the joint venture throughan intercompany loan, and paid approximately $424 million in cash to align the respective valuations of the assetscontributed to the joint venture. We also completed the Aspen acquisition for approximately $226 million. The preliminary purchase price allocations for our USPI joint venture and Aspen acquisition, which are alsoincluded in the table above, are as follows: Current assets $237Property and equipment 526Other intangible assets 359Goodwill 2,786Other long-term assets 658Current liabilities (306)Deferred taxes — long term (128)Other long-term liabilities (2,025)Redeemable noncontrolling interests in equity of consolidated subsidiaries (1,477)Noncontrolling interests (64)Cash paid, net of cash acquired $566 154 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPro Forma Information – Unaudited The following table provides certain pro forma information for Tenet as if the USPI joint venture and Aspenacquisition had occurred at the beginning of the year ended December 31, 2013. The net income of USPI for the year endedDecember 31, 2015 was adjusted by $30 million to remove a nonrecurring loss on extinguishment of debt. Years Ended December 31, 2015 2014 2013Net operating revenues $19,018 $17,423 $11,851Equity in earnings of unconsolidated affiliates $143 $129 $111Net loss attributable to common shareholders $(171) $(40) $(156)Net loss per share attributable to common shareholders $(1.73) $(0.41) $(1.53) NOTE 21. SEGMENT INFORMATION In the three months ended June 30, 2015, we began reporting Ambulatory Care as a separate reportable businesssegment. Previously, our business consisted of our Hospital Operations and other segment and our Conifer segment. EffectiveJune 16, 2015, we completed the joint venture transaction that combined our freestanding ambulatory surgery and imagingcenter assets with USPI’s short-stay surgical facility assets. We contributed our interests in 49 ambulatory surgery centers and20 imaging centers, which had previously been included in our Hospital Operations and other segment, to the USPI jointventure. The USPI joint venture has interests in 249 ambulatory surgery centers, 20 short-stay surgical hospitals, 20 imagingcenters and 35 urgent care centers in 28 states. We also completed the acquisition of Aspen effective June 16, 2015, whichincludes nine private hospitals and clinics in the United Kingdom. Our Ambulatory Care segment is comprised of theoperations of our USPI joint venture and Aspen facilities. The factors for determining the reportable segments include themanner in which management evaluates operating performance combined with the nature of the individual businessactivities. Our core business is Hospital Operations and other, which is focused on operating acute care hospitals, ancillaryoutpatient facilities, urgent care centers, freestanding emergency departments, physician practices and health plans. We alsoown various related healthcare businesses. At December 31, 2015, our subsidiaries operated 86 hospitals, with a total of22,525 licensed beds, primarily serving urban and suburban communities in 14 states, and six health plans, as well ashospital-based outpatient centers, freestanding emergency departments and freestanding urgent care centers. We provide healthcare business process services in the areas of revenue cycle management and technology-enabledperformance improvement and health management solutions to health systems, as well as individual hospitals, physicianpractices, self-insured organizations and health plans, under our Conifer subsidiary. At December 31, 2015, Conifer providedservices to more than 800 Tenet and non-Tenet hospitals and other clients nationwide. Our Conifer subsidiary and ourHospital Operations and other segment entered into formal agreements documenting terms and conditions of various servicesprovided by Conifer to Tenet hospitals, as well as certain administrative services provided by our Hospital Operations andother segment to Conifer. The services provided by both parties under these agreements are charged to the other party basedon estimated third-party pricing terms. The following table includes amounts for each of our reportable segments and the reconciling items necessary toagree to amounts reported in the accompanying Consolidated Balance Sheets and Consolidated Statements of Operations: December 31, 2015 2014 Assets: Hospital Operations and other $17,353 $16,810 Ambulatory Care 5,159 212 Conifer 1,170 929 Total $23,682 $17,951 155 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents Years Ended December 31, 2015 2014 2013Capital expenditures: Hospital Operations and other $786 $899 $664Ambulatory Care 28 9 6Conifer 28 25 21Total $842 $933 $691 Net Operating revenues: Hospital Operations and other $16,928 $15,681 $10,367Ambulatory Care 959 320 205Conifer Tenet 666 591 404Other customers 747 602 515Total Conifer revenues 1,413 1,193 919Intercompany eliminations (666) (591) (404)Total $18,634 $16,603 $11,087 Adjusted EBITDA: Hospital Operations and other $1,653 $1,651 $1,146Ambulatory Care 358 98 64Conifer 265 203 132Total $2,276 $1,952 $1,342 Depreciation and amortization: Hospital Operations and other $702 $810 $516Ambulatory Care 46 14 10Conifer 49 25 19Total $797 $849 $545 Adjusted EBITDA $2,276 $1,952 $1,342Depreciation and amortization (797) (849) (545)Impairment and restructuring charges, and acquisition-related costs (318) (153) (103)Litigation and investigation costs (291) (25) (31)Interest expense (912) (754) (474)Loss from early extinguishment of debt (1) (24) (348)Gains on sales, consolidation and deconsolidation of facilities 186 — —Investment earnings 1 — 1Net income (loss) from continuing operations before income taxes $144 $147 $(158) NOTE 22. RECENT ACCOUNTING STANDARDS Recently Adopted Accounting Standards In April 2015, the Financial Accounting Standards Board (“FASB”) issued ASU 2015-03, “Interest–Imputation ofInterest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that debt issuance costsrelated to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of thatdebt liability. As further discussed in Note 1, we adopted ASU 2015-03 effective December 31, 2015 and such adoption didnot affect the Company’s results of operations or cash flows. In November 2015, the FASB issued ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification ofDeferred Taxes,” which requires that deferred tax liabilities and assets be classified as noncurrent in a classified balancesheet. As further discussed in Note 1, we adopted ASU 2015-17 effective December 31, 2015 and such adoption did notaffect the Company’s results of operations or cash flows. 156 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsRecently Issued Accounting Standards In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 affects any entity that either enters into contracts with customers to transfer goods or services or entersinto contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards. The coreprinciple of the guidance in ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goodsor services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange forthose goods or services. We are currently evaluating the potential impact of this guidance, which will be effective for usbeginning in 2018. 157 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsSUPPLEMENTAL FINANCIAL INFORMATION SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) Year Ended December 31, 2015 First Second Third Fourth Net operating revenues $4,424 $4,492 $4,692 $5,026 Net income available (loss attributable) to Tenet HealthcareCorporation common shareholders $47 $(61) $(29) $(97) Net income (loss) $76 $(28) $28 $2 Earnings (loss) per share available (attributable) to Tenet HealthcareCorporation common shareholders: Basic $0.48 $(0.61) $(0.29) $(0.98) Diluted $0.47 $(0.61) $(0.29) $(0.98) Year Ended December 31, 2014 First Second Third Fourth Net operating revenues $3,925 $4,038 $4,175 $4,465 Net income available (loss attributable) to Tenet HealthcareCorporation common shareholders $(32) $(26) $9 $61 Net income (loss) $(16) $(7) $18 $81 Earnings (loss) per share available (attributable) to TenetHealthcare Corporation common shareholders: Basic $(0.33) $(0.27) $0.09 $0.62 Diluted $(0.33) $(0.27) $0.09 $0.61 Quarterly operating results are not necessarily indicative of the results that may be expected for the full year.Reasons for this include, but are not limited to: overall revenue and cost trends, particularly the timing and magnitude ofprice changes; fluctuations in contractual allowances and cost report settlements and valuation allowances; managed carecontract negotiations, settlements or terminations and payer consolidations; changes in Medicare and Medicaid regulations;Medicaid and other supplemental funding levels set by the states in which we operate; the timing of approval by the Centersfor Medicare and Medicaid Services of Medicaid provider fee revenue programs; trends in patient accounts receivablecollectability and associated provisions for doubtful accounts; fluctuations in interest rates; levels of malpractice insuranceexpense and settlement trends; the number of covered lives managed by our health plans and the plans’ ability to effectivelymanage medical costs; the timing of when we meet the criteria to recognize electronic health record incentives; impairmentof long-lived assets and goodwill; restructuring charges; losses, costs and insurance recoveries related to natural disasters;litigation and investigation costs; acquisitions and dispositions of facilities and other assets; income tax rates and deferredtax asset valuation allowance activity; changes in estimates of accruals for annual incentive compensation; the timing andamounts of stock option and restricted stock unit grants to employees and directors; gains or losses from earlyextinguishment of debt; and changes in occupancy levels and patient volumes. Factors that affect patient volumes and,thereby, the results of operations at our hospitals and related healthcare facilities include, but are not limited to: the businessenvironment, economic conditions and demographics of local communities in which we operate; the number of uninsuredand underinsured individuals in local communities treated at our hospitals; seasonal cycles of illness; climate and weatherconditions; physician recruitment, retention and attrition; advances in technology and treatments that reduce length of stay;local healthcare competitors; managed care contract negotiations or terminations; the number of patients with high-deductible health insurance plans; any unfavorable publicity about us, which impacts our relationships with physicians andpatients; changes in healthcare regulations and the participation of individual states in federal programs; and the timing ofelective procedures. These considerations apply to year-to-year comparisons as well. 158 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING ANDFINANCIAL DISCLOSURE None. ITEM 9A. CONTROLS AND PROCEDURES We formed our USPI Holding Company, Inc. (“USPI joint venture”) and acquired European Surgical Partners Ltd. (“Aspen”)on June 16, 2015. The facilities acquired as part of these transactions utilize different information technology systems thanour other facilities. We have excluded all of the USPI joint venture and Aspen operations from our assessment of andconclusion on the effectiveness of our internal control over financial reporting. The rules of the Securities and ExchangeCommission (“SEC”) require us to include acquired entities in our assessment of the effectiveness of internal control overfinancial reporting no later than the annual management report following the first anniversary of the acquisition. We willcomplete the evaluation and integration of the USPI joint venture and Aspen operations within the required timeframe andreport management's assessment of our internal control over financial reporting, including the acquired hospitals and otheroperations, in our first annual report in which such assessment is required. Other than the USPI joint venture and Aspentransactions, there were no changes in our internal control over financial reporting during the quarter ended December 31,2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls andprocedures as defined by Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the“Exchange Act”), as of the end of the period covered by this report with respect to our operations that existed prior to theUSPI joint venture and Aspen transactions. The evaluation was performed under the supervision and with the participation ofmanagement, including our chief executive officer and chief financial officer. Based upon that evaluation, our chiefexecutive officer and chief financial officer concluded that our disclosure controls and procedures are effective to ensure thatmaterial information is recorded, processed, summarized and reported by management on a timely basis in order to complywith our disclosure obligations under the Exchange Act and the SEC rules thereunder. Management’s report on internal control over financial reporting is set forth on page 106 and is incorporated hereinby reference. The independent registered public accounting firm that audited the financial statements included in this reporthas issued an attestation report on our internal control over financial reporting as set forth on page 107 herein. ITEM 9B. OTHER INFORMATION None. 159 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPART III. ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Certain information required by this Item is hereby incorporated by reference to our definitive proxy statement inaccordance with General Instruction G(3) to Form 10-K. Information concerning our executive officers appears under Item 1,Executive Officers, of Part I of this report, and information concerning our Standards of Conduct, by which all of ouremployees, including our chief executive officer, chief financial officer and principal accounting officer, are required toabide appears under Item 1, Business — Compliance and Ethics, of Part I of this report. ITEM 11. EXECUTIVE COMPENSATION Information required by this Item is hereby incorporated by reference to our definitive proxy statement inaccordance with General Instruction G(3) to Form 10-K. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATEDSTOCKHOLDER MATTERS Information required by this Item is hereby incorporated by reference to our definitive proxy statement inaccordance with General Instruction G(3) to Form 10-K. ITEM 13. . CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Information required by this Item is hereby incorporated by reference to our definitive proxy statement inaccordance with General Instruction G(3) to Form 10-K. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES Information required by this Item is hereby incorporated by reference to our definitive proxy statement inaccordance with General Instruction G(3) to Form 10-K.160 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsPART IV. ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES FINANCIAL STATEMENTS The Consolidated Financial Statements and notes thereto can be found on pages 109 through 156. FINANCIAL STATEMENT SCHEDULES Schedule II—Valuation and Qualifying Accounts (included on page 168). All other schedules and financial statements of the Registrant are omitted because they are not applicable or notrequired or because the required information is included in the Consolidated Financial Statements or notes thereto. EXHIBITS (2)Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession (a)Contribution and Purchase Agreement, dated March 23, 2015, by and among the Registrant,USPI Group Holdings, Inc., Ulysses JV Holding I L.P., Ulysses JV Holding II L.P. andBB Blue Holdings, Inc. (Incorporated by reference to Exhibit 2.1 to Registrant’s Current Report onForm 8‑K, dated and filed March 23, 2015) (b)Put/Call Agreement, dated June 16, 2015, by and among the Registrant, USPI Group Holdings, Inc.,Ulysses JV Holding I L.P., Ulysses JV Holding II L.P. and USPI Holding Company, Inc. (Incorporatedby reference to Exhibit 2(b) to Registrant’s Quarterly Report on Form 10-Q for the quarter ended June30, 2015, filed August 3, 2015) (3)Articles of Incorporation and Bylaws (a)Amended and Restated Articles of Incorporation of the Registrant, as amended and restated May 8,2008 (Incorporated by reference to Exhibit 3(a) to Registrant’s Quarterly Report on Form 10-Q for thequarter ended June 30, 2008, filed August 5, 2008) (b)Certificate of Designation, Preferences, and Rights of Series A Junior Participating Preferred Stock, parvalue $0.15 per share, dated January 7, 2011 (Incorporated by reference to Exhibit 3.1 to Registrant’sCurrent Report on Form 8-K, dated and filed January 7, 2011) (c)Certificate of Change Pursuant to NRS 78.209, filed with the Nevada Secretary of State effectiveOctober 10, 2012 (Incorporated by reference to Exhibit 3.1 to Registrant’s Current Report on Form 8-K,dated October 10, 2012 and filed October 11, 2012) (d)Amended and Restated Bylaws of the Registrant, as amended and restated effective January 7, 2011(Incorporated by reference to Exhibit 3.2 to Registrant’s Current Report on Form 8-K, dated and filedJanuary 7, 2011) (4)Instruments Defining the Rights of Security Holders, Including Indentures (a)Indenture, dated as of November 6, 2001, between the Registrant and The Bank of New York, as trustee(Incorporated by reference to Exhibit 4.1 to Registrant’s Current Report on Form 8-K, dated November6, 2001 and filed November 9, 2001) 161 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents(b)Third Supplemental Indenture, dated as of November 6, 2001, between the Registrant and The Bank ofNew York, as trustee, relating to 6⅞% Senior Notes due 2031 (Incorporated by reference to Exhibit 4.4to Registrant’s Current Report on Form 8-K, dated November 6, 2001 and filed November 9, 2001) (c)Twelfth Supplemental Indenture, dated as of August 17, 2010, between the Registrant and The Bank ofNew York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, relating to 8%Senior Notes due 2020 (Incorporated by reference to Exhibit 4.1 to Registrant’s Current Report onForm 8-K, dated and filed August 17, 2010) (d)Fourteenth Supplemental Indenture, dated as of November 21, 2011, by and among the Registrant, TheBank of New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, and theguarantors party thereto, relating to 6¼% Senior Secured Notes due 2018 (Incorporated by reference toExhibit 4.2 to Registrant’s Current Report on Form 8-K, dated November 21, 2011 and filed November22, 2011) (e)Fifteenth Supplemental Indenture, dated as of October 16, 2012, by and among the Registrant, TheBank of New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, and theguarantors party thereto, relating to 4¾% Senior Secured Notes due 2020 (Incorporated by reference toExhibit 4.1 to Registrant’s Current Report on Form 8-K, dated and filed October 16, 2012) (f)Sixteenth Supplemental Indenture, dated as of October 16, 2012, between the Registrant and The Bankof New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, relating to6¾% Senior Notes due 2020 (Incorporated by reference to Exhibit 4.2 to Registrant’s Current Reporton Form 8-K, dated and filed October 16, 2012) (g)Seventeenth Supplemental Indenture, dated as of February 5, 2013, by and among the Registrant, TheBank of New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, and theguarantors party thereto, relating to 4½% Senior Secured Notes due 2021 (Incorporated by reference toExhibit 4.1 to Registrant’s Current Report on Form 8-K, dated and filed February 5, 2013) (h)Twentieth Supplemental Indenture, dated as of May 30, 2013, by and among the Registrant, The Bankof New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, and theguarantors party thereto, relating to 4⅜% Senior Secured Notes due 2021 (Incorporated by reference toExhibit 4.1 to Registrant’s Current Report on Form 8-K, dated May 30, 2013 and filed May 31, 2013) (i)Indenture, dated as of September 27, 2013, among THC Escrow Corporation and The Bank of NewYork Mellon Trust Company, N.A., as trustee, relating to 6% Senior Secured Notes due 2020(Incorporated by reference to Exhibit 4.1 to Registrant’s Current Report on Form 8-K, dated and filedOctober 1, 2013) (j)Supplemental Indenture, dated as of October 1, 2013, among the Registrant, certain of its subsidiariesand The Bank of New York Mellon Trust Company, N.A., as trustee, relating to 6% Senior SecuredNotes due 2020 (Incorporated by reference to Exhibit 4.2 to Registrant’s Current Report on Form 8-K,dated and filed October 1, 2013) (k)Indenture, dated as of September 27, 2013, among THC Escrow Corporation and The Bank of NewYork Mellon Trust Company, N.A., as trustee, relating to 8⅛% Senior Notes due 2022 (Incorporated byreference to Exhibit 4.3 to Registrant’s Current Report on Form 8-K, dated and filed October 1, 2013) 162 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents(l)Supplemental Indenture, dated as of October 1, 2013, among the Registrant, certain of its subsidiariesand The Bank of New York Mellon Trust Company, N.A., as trustee, relating to 8⅛% Senior Notes due2022 (Incorporated by reference to Exhibit 4.4 to Registrant’s Current Report on Form 8-K, dated andfiled October 1, 2013) (m)Twenty-Third Supplemental Indenture, dated as of March 10, 2014, between the Registrant and TheBank of New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York,relating to 5% Senior Notes due 2019 (Incorporated by reference to Exhibit 4.2 to Registrant’s CurrentReport on Form 8-K, dated March 7, 2014 and filed March 10, 2014) (n)Twenty-Fourth Supplemental Indenture, dated as of September 29, 2014, between the Registrant andThe Bank of New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York,relating to 5½% Senior Notes due 2019 (Incorporated by reference to Exhibit 4.2 to Registrant’sCurrent Report on Form 8-K dated and filed September 29, 2014) (o)Twenty-Sixth Supplemental Indenture, dated as of June 16, 2015, among the Registrant, The Bank ofNew York Mellon Trust Company, N.A., as successor trustee to The Bank of New York, and theguarantors party thereto, relating to Floating Rate Senior Secured Notes due 2020 (Incorporated byreference to Exhibit 4.2 to Registrant’s Current Report on Form 8-K, dated and filed June 16, 2015) (p)Indenture, dated as of June 16, 2015, between THC Escrow Corporation II and The Bank of New YorkMellon Trust Company, N.A. (Incorporated by reference to Exhibit 4.3 to Registrant’s Current Reporton Form 8-K, dated and filed June 16, 2015) (q)Supplemental Indenture, dated as of June 16, 2015, between the Registrant and The Bank of New YorkMellon Trust Company, N.A. (Incorporated by reference to Exhibit 4.4 to Registrant’s Current Reporton Form 8-K, dated and filed June 16, 2015) (10)Material Contracts (a)Amended and Restated Credit Agreement, dated as of October 19, 2010, among the Registrant, thelenders and issuers party thereto, Citicorp USA, Inc., as administrative agent, Bank of America, N.A., assyndication agent, Citigroup Global Markets Inc. and Banc of America Securities LLC, as joint leadarrangers, and the joint bookrunners and co-documentation agents named therein (Incorporated byreference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K, dated October 19, 2010 and filedOctober 20, 2010) (b)Amendment No. 1, dated as of November 29, 2011, to that certain Amended and Restated CreditAgreement, dated as of October 19, 2010, among the Registrant, the lenders and issuers party thereto,Citicorp USA, Inc., as administrative agent, Bank of America, N.A., as syndication agent, CitigroupGlobal Markets Inc. and Banc of America Securities LLC, as joint lead arrangers, and the jointbookrunners and co-documentation agents named therein (Incorporated by reference to Exhibit 10.1 toRegistrant’s Current Report on Form 8-K, dated November 29, 2011 and filed December 1, 2011) (c)Amendment No. 2, dated as of January 23, 2014, to that certain Amended and Restated CreditAgreement, dated as of October 19, 2010, among the Registrant, the lenders and issuers party thereto,Citicorp USA, Inc., as administrative agent, Bank of America, N.A., as syndication agent, CitigroupGlobal Markets Inc. and Banc of America Securities LLC, as joint lead arrangers, and the jointbookrunners and co-documentation agents named therein (Incorporated by reference to Exhibit 10(c)to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2013, filedFebruary 24, 2014) 163 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents(d)Amendment No. 3, dated as of December 4, 2015, to that certain Amended and Restated CreditAgreement, dated as of October 19, 2010, among the Registrant, the lenders and issuers party theretoand Citicorp USA, Inc., as administrative agent (Incorporated by reference to Exhibit 10.1 toRegistrant’s Current Report on Form 8-K, dated December 4, 2015 and filed December 9, 2015) (e)Letter of Credit Facility Agreement, dated as of March 7, 2014, among the Registrant, certain financialinstitutions party thereto from time to time as letter of credit participants and issuers, and BarclaysBank PLC, as administrative agent (Incorporated by reference to Exhibit 10.1 to Registrant’s CurrentReport on Form 8-K, dated March 7, 2014 and filed March 10, 2014) (f)Guaranty, dated as of March 7, 2014, among Barclays Bank PLC, as administrative agent and theguarantors party thereto (Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report onForm 8-K, dated March 7, 2014 and filed March 10, 2014) (g)Stock Pledge Agreement, dated as of March 3, 2009, by and among the Registrant, as pledgor, TheBank of New York Mellon Trust Company, N.A., as collateral trustee, and the other pledgers partythereto (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K, datedMarch 3, 2009 and filed March 5, 2009) (h)First Amendment to Stock Pledge Agreement, dated as of May 8, 2009, by and among the Registrant,as pledgor, The Bank of New York Mellon Trust Company, N.A., as collateral trustee, and the otherpledgors party thereto† (i)Second Amendment to Stock Pledge Agreement, dated as of June 15, 2009, by and among theRegistrant, as pledgor, The Bank of New York Mellon Trust Company, N.A., as collateral trustee, andthe other pledgors party thereto (Incorporated by reference to Exhibit 10.1 to Registrant’s CurrentReport on Form 8-K, dated June 15, 2009 and filed June 16, 2009)(j)Third Amendment to Stock Pledge Agreement, dated as of March 7, 2014, by and among theRegistrant, as pledgor, The Bank of New York Mellon Trust Company, N.A., as collateral trustee, andthe other pledgors party thereto† (k)Fourth Amendment to Stock Pledge Agreement, dated as of March 23, 2015, by and among theRegistrant, as pledgor, The Bank of New York Mellon Trust Company, N.A., as collateral trustee, andthe other pledgors party thereto† (l)Collateral Trust Agreement, dated as of March 3, 2009, by and among the Registrant, as pledgor, TheBank of New York Mellon Trust Company, N.A., as collateral trustee, and the other pledgers partythereto (Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K, datedMarch 3, 2009 and filed March 5, 2009) (m)Support Agreement, dated January 18, 2016, by and among the Registrant, Glenview CapitalManagement, LLC, Glenview Capital Partners, L.P., Glenview Capital Master Fund, Ltd., GlenviewInstitutional Partners, L.P., Glenview Offshore Opportunity Master Fund, Ltd. and Glenview CapitalOpportunity Fund, L.P. (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report onForm 8-K, dated January 18, 2016 and filed January 19, 2016) (n)Letter from the Registrant to Trevor Fetter, dated November 7, 2002 (Incorporated by reference toExhibit 10(k) to Registrant’s Transition Report on Form 10-K for the seven-month transition periodended December 31, 2002, filed May 15, 2003)* 164 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents(o)Letter from the Registrant to Trevor Fetter dated September 15, 2003 (Incorporated by reference toExhibit 10(l) to Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003,filed November 10, 2003)* (p)Letter from the Registrant to Keith B. Pitts dated June 21, 2013 (Incorporated by reference to Exhibit10(j) to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2013, filedFebruary 24, 2014)* (q)Letter from the Registrant to Britt T. Reynolds, dated December 15, 2011 (Incorporated by reference toExhibit 10(j) to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2011, filedFebruary 28, 2012)* (r)Letter from the Registrant to Daniel J. Cancelmi, dated September 6, 2012 (Incorporated by reference toExhibit 10(c) to Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012,filed November 7, 2012)* (s)Letter from the Registrant to Audrey Andrews, dated January 22, 2013 (Incorporated by reference toExhibit 10(m) to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012,filed February 26, 2013)* (t)Tenet Second Amended and Restated Executive Severance Plan, as amended and restated effectiveMay 9, 2012 (Incorporated by reference to Exhibit 10(e) to Registrant’s Quarterly Report on Form 10-Qfor the quarter ended September 30, 2012, filed November 7, 2012)* (u)Tenet Healthcare Corporation Ninth Amended and Restated Supplemental Executive Retirement Plan,as amended and restated effective November 30, 2015*† (v)Ninth Amended and Restated Tenet 2001 Deferred Compensation Plan, as amended and restatedeffective May 9, 2012 (Incorporated by reference to Exhibit 10(g) to Registrant’s Quarterly Report onForm 10-Q for the quarter ended September 30, 2012, filed November 7, 2012)* (w)Fourth Amended and Restated Tenet 2006 Deferred Compensation Plan, as amended and restatedeffective November 30, 2015*† (x)Fifth Amended and Restated Tenet Healthcare Corporation 2001 Stock Incentive Plan, as amended andrestated effective May 9, 2012 (Incorporated by reference to Exhibit 10(i) to Registrant’s QuarterlyReport on Form 10-Q for the quarter ended September 30, 2012, filed November 7, 2012)* (y)Form of Stock Award used to evidence grants of stock options and/or restricted units underthe Amended and Restated Tenet Healthcare Corporation 2001 Stock Incentive Plan (Incorporated byreference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K, dated February 14, 2006 andfiled February 17, 2006)* (z)Fifth Amended and Restated Tenet Healthcare 2008 Stock Incentive Plan, as amended and restatedeffective February 26, 2014 (Incorporated by reference to Exhibit 4.1 to Registrant’s RegistrationStatement on Form S-8, filed May 23, 2014)* (aa)Forms of Award used to evidence (i) initial grants of restricted stock units to directors, (ii) annual grantsof restricted stock units to directors, (iii) grants of stock options to executives, and (iv) grants ofrestricted stock units to executives, all under the Amended and Restated Tenet Healthcare 2008 StockIncentive Plan (Incorporated by reference to Exhibit 10(aa) to Registrant’s Annual Report on Form 10-K for the year ended December 31, 2008, filed February 24, 2009)* 165 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents(bb)Award Agreement, dated June 13, 2013, used to evidence grant of performance-based restricted stockunits to Trevor Fetter under the Amended and Restated Tenet Healthcare 2008 Stock Incentive Plan(Incorporated by reference to Exhibit 10 to Registrant’s Quarterly Report on Form 10-Q for the quarterended June 30, 2013, filed August 6, 2013)* (cc)Form of Award used to evidence grants of performance cash awards under the Amended and RestatedTenet Healthcare Corporation 2001 Stock Incentive Plan and the Amended and Restated TenetHealthcare 2008 Stock Incentive Plan (Incorporated by reference to Exhibit (ee) to Registrant’s AnnualReport on Form 10-K for the year ended December 31, 2009, filed February 23, 2010)* (dd)Tenet Special RSU Deferral Plan (Incorporated by reference to Exhibit 10(d) to Registrant’s QuarterlyReport on Form 10-Q for the quarter ended March 31, 2009, filed May 5, 2009)* (ee)Second Amended Tenet Healthcare Corporation Annual Incentive Plan, as amended and restatedeffective May 9, 2012 (Incorporated by reference to Exhibit 10(k) to Registrant’s Quarterly Report onForm 10-Q for the quarter ended September 30, 2012, filed November 7, 2012)* (ff)Sixth Amended and Restated Tenet Executive Retirement Account, as amended and restated effectiveNovember 30, 2015*† (gg)Form of Indemnification Agreement entered into with each of the Registrant’s directors (Incorporatedby reference to Exhibit 10(a) to Registrant’s Quarterly Report on Form 10-Q for the quarter endedSeptember 30, 2005, filed November 1, 2005) (21)Subsidiaries of the Registrant† (23)Consent of Deloitte & Touche LLP† (31)Rule 13a-14(a)/15d-14(a) Certifications (a)Certification of Trevor Fetter, Chief Executive Officer and Chairman of the Board of Directors† (b)Certification of Daniel J. Cancelmi, Chief Financial Officer† (32)Section 1350 Certifications of Trevor Fetter, Chief Executive Officer and Chairman of the Board ofDirectors, and Daniel J. Cancelmi, Chief Financial Officer† (101 INS)XBRL Instance Document (101 SCH)XBRL Taxonomy Extension Schema Document (101 CAL)XBRL Taxonomy Extension Calculation Linkbase Document (101 DEF)XBRL Taxonomy Extension Definition Linkbase Document (101 LAB)XBRL Taxonomy Extension Label Linkbase Document (101 PRE)XBRL Taxonomy Extension Presentation Linkbase Document________________________________________*Management contract or compensatory plan or arrangement.†Filed herewith. 166 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsSIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has dulycaused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TENET HEALTHCARE CORPORATION(Registrant) Date: February 22, 2016By:/s/ R. SCOTT RAMSEY R. Scott Ramsey Vice President and Controller (Principal Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by thefollowing persons on behalf of the Registrant and in the capacities and on the dates indicated. Date: February 22, 2016By:/s/ TREVOR FETTER Trevor FetterChief Executive Officer and Chairman of the Board of Directors(Principal Executive Officer) Date: February 22, 2016By:/s/ DANIEL J. CANCELMI Daniel J. CancelmiChief Financial Officer(Principal Financial Officer) Date: February 22, 2016By:/s/ R. SCOTT RAMSEY R. Scott RamseyVice President and Controller(Principal Accounting Officer) Date: February 22, 2016By:/s/ BRENDA J. GAINES Brenda J. GainesDirector Date: February 22, 2016By:/s/ KAREN M. GARRISON Karen M. GarrisonDirector Date: February 22, 2016By:/s/ EDWARD A. KANGAS Edward A. KangasLead Director Date: February 22, 2016By:/s/ J. ROBERT KERREY J. Robert KerreyDirector Date: February 22, 2016By:/s/ FREDA C. LEWIS-HALL, M.D. Freda C. Lewis-Hall, M.D.Director Date: February 22, 2016By:/s/ RICHARD R. PETTINGILL Richard R. PettingillDirector Date: February 22, 2016By:/s/ MATTHEW J. RIPPERGER Matthew J. RippergerDirector Date: February 22, 2016By:/s/ RONALD A. RITTENMEYER Ronald A. RittenmeyerDirector 167 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of ContentsDate: February 22, 2016By:/s/ TAMMY ROMO Tammy RomoDirector Date: February 22, 2016By:/s/ RANDOLPH C. SIMPSON Randolph C. SimpsonDirector Date: February 22, 2016By:/s/ JAMES A. UNRUH James A. UnruhDirector 168 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Table of Contents SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS(In Millions) Additions Charged To: Balance at Balance at Beginning Costs and Other Other End of of Period Expenses Accounts Deductions Items Period Allowance for doubtful accounts: Year ended December 31, 2015 $852 $1,480 $ — $(1,388) $(57) $887 Year ended December 31, 2014 $589 $1,305 $ — $(1,042) $ — $852 Year ended December 31, 2013 $401 $975 $ — $(787) $ — $589 Valuation allowance for deferred tax assets Year ended December 31, 2015 $87 $4 $ — $ — $5 $96 Year ended December 31, 2014 $107 $(20) $ — $ — $ — $87 Year ended December 31, 2013 $56 $23 $(1) $ — $29 $107 (1)Includes amounts recorded in discontinued operations.(2)Before considering recoveries on accounts or notes previously written off.(3)Accounts written off.(4)Acquisition and divestiture activity. 169(1)(2)(3)(4)Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Exhibit 10(ff) TENET SIXTH AMENDED AND RESTATED EXECUTIVE RETIREMENT ACCOUNT As Amended and Restated Effective as of November 30, 2015 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. SIXTH AMENDED AND RESTATEDTENET EXECUTIVE RETIREMENT ACCOUNT TABLE OF CONTENTS PageARTICLE I PREAMBLE AND PURPOSE1 1.1Preamble.1 1.2Purpose.2 ARTICLE II DEFINITIONS AND CONSTRUCTION3 2.1Definitions.3 2.2Construction.10 2.3409A Compliance.11 ARTICLE III PARTICIPATION AND FORFEITABILITY OF BENEFITS12 3.1Eligibility and Participation.12 3.2Forfeitability of Benefits.13 ARTICLE IV COMPANY CONTRIBUTIONS, VESTING, ACCOUNTING AND INVESTMENT CREDITING RATES14 4.1 Company Contributions.14 4.2 Vesting in ERA Account.14 4.3 Accounting for Deferred Compensation.16 4.4 Computation of Earnings Credited.17 ARTICLE V DISTRIBUTION OF BENEFITS19 5.1Normal Retirement Distribution.19 5.2Early Retirement Distribution.19 5.3Termination of Employment Distribution.19 5.4Termination Distributions to Key Employees.20 5.5Death Distribution.20 5.6Disability Distribution.21 5.7Deferral of Distributions.21 5.8Withholding.21 5.9Impact of Reemployment on Benefits.21 ARTICLE VI PAYMENT LIMITATIONS 22 6.1Spousal Claims22 6.2Legal Disability.22 6.3Assignment.22 ARTICLE VII FUNDING24 7.1No Right to Assets.24 7.2Creditor Status.24 ARTICLE VIII ADMINISTRATION25 8.1The RPAC.25 8.2Powers of RPAC.25 8.3Appointment of Plan Administrator.25 (i) Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 8.4Duties of Plan Administrator.25 8.5Indemnification of RPAC and Plan Administrator.27 8.6Claims for Benefits.27 8.7Arbitration.30 8.8Receipt and Release of Necessary Information.31 8.9Overpayment and Underpayment of Benefits.31 8.10Change of Control.32 ARTICLE IX OTHER BENEFIT PLANS OF THE COMPANY33 9.1 Other Plans.33 ARTICLE X AMENDMENT AND TERMINATION OF THE PLAN34 10.1Continuation.34 10.2Amendment of ERA.34 10.3Termination of ERA.34 10.4Termination of Affiliate's Participation.35 ARTICLE XI MISCELLANEOUS36 11.1No Reduction of Employer Rights.36 11.2Provisions Binding.36 EXHIBIT A GRANDFATHERED CONIFER EMPLOYEESA-1EXHIBIT B LIMITS ON ELIGIBILITY AND PARTICIPATIONB-1 (ii) Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. SIXTH AMENDED AND RESTATEDTENET EXECUTIVE RETIREMENT ACCOUNT ARTICLE IPREAMBLE AND PURPOSE 1.1 Preamble. Tenet Healthcare Corporation (the "Company'') established the Tenet Executive Retirement Account (the "ERA")effective July 1, 2007, to permit the Company and its participating Affiliates, as defined herein (collectively, the "Employer"),to attract and retain a select group of management or highly compensated employees, as defined herein. Through an instrument adopted in December 2008, the Company previously amended and restated the ERA, effectiveDecember 31, 2008, to (a) modify the fixed return investment option to provide that interest will be credited based on onehundred and twenty percent (120%) of the long-term applicable federal rate as opposed to the current provision which creditedinterest based on the prime rate of interest less one percent (1%), (b) revise the manner for determining vesting to years ofplan participation. (c) reflect the right of the Pension Administration Committee to make non-material amendments to the ERAto comply with changes in the law or facilitate administration and (d) comply with final regulations issued under section 409Aof the Internal Revenue Code of 1986, as amended (the "Code"). The amended and restated ERA was known as the FirstAmended and Restated Tenet Executive Retirement Account. Through an instrument, adopted on December 11, 2009, the Company further amended and restated the ERA, also effectiveDecember 31, 2008, to clarify the ERA's intent to comply with section 409A of the Code; namely, to clarify that (a) ERAparticipants who incur a separation from service and are reemployed such that they do not have a break in employment underthe Company's Rehire and Reinstatement Policy (or any successor thereto) will have any prior forfeited ERA account balancerestored at the time of such reemployment (i.e., for consistency purposes, both the participant's prior years of service andaccount balance will be restored and administered on a going forward basis under the ERA) and (b) any subsequent deferralelection made in accordance with the terms of the ERA will apply to an ERA participant's "Normal Retirement Benefit" (asdefined herein). The amended and restated ERA was known as the Second Amended and Restated Tenet ExecutiveRetirement Account, Through an instrument adopted on July 21, 2011, the Company further amended and restated the ERA, effective May 3,2011, to (a) provide that in the event of a Change of Control before July 1 of any year, the full Annual Contribution will bemade to the ERA within ten (10) days following the occurrence of such Change of Control and (b) make other clarifyingamendments to the ERA. The amended and restated ERA was known as the Third Amended and Restated Tenet ExecutiveRetirement Account. The Company subsequently amended and restated the ERA, effective as of May 9, 2012, to clarify certain Change of Controlprovisions; substitute a prorated payout for post Change of Control terminations, in place of the prior automatic post-Changeof Control contributions; and revise the definitions for certain termination events. The amended and restated ERA was knownas the Fourth Amended and Restated Tenet Executive Retirement Account. Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. The Company further amended and restated the ERA, effective November 6, 2013 to (i) delegate to the Senior VicePresident, Human Resources and the Plan Administrator the authority to determine the employees eligible to participate in theERA and the amount of contribution each employee will receive, (ii) modify the definition of “Year of Vesting Service” toinclude service performed for an entity acquired by the Company through a stock, asset or other business transaction to theextent provided in the transaction documents or as determined by to the Senior Vice President, Human Resources or thePlan Administrator and (iii) clarify that a participant who is terminated for “Cause” will forfeit his ERA benefit in itsentirety. By this restatement, the Company also desires to remove Conifer Health Solutions, LLC (“Conifer”) as aparticipating employer in the ERA effective as of December 31, 2013 except for prior Company employees who now work forConifer and will be grandfathered. The amended and restated ERA was known as the Fifth Amended and Restated TenetExecutive Retirement Account. Effective January 1, 2015, the Retirement Plans Administrative Committee (“RPAC”) amended the ERA to provide that an“Affiliate” as defined in the ERA will be determined based on an ownership percentage of greater than fifty percent (50%). By this instrument the RPAC desires to further amend and restate the ERA effective November 30, 2015 to (i) incorporate theprior amendment to the ERA, (ii) delegate to the Senior Vice President, Human Resources and the Plan Administrator theauthority to provide annual contributions and/or continued age and service credit for vesting purposes for any participant whotransfers to an Affiliate who has not adopted the ERA as an Employer without the need for adoption of the ERA by suchAffiliate, (iii) permit participants who are not participants in the “SERP,” as defined in Article II, who are ineligible or whobecome ineligible to participate in the ERA to receive earnings credit until they terminate employment with the Company andall Affiliates, and (iv) reflect that the name of the Compensation Committee has changed to the “Human ResourcesCommittee.” This amended and restated ERA will be known as the Sixth Amended and Restated Tenet ExecutiveRetirement Account. The Employer may adopt one (1) or more domestic trusts to serve as a possible source of funds for the payment of benefitsunder this ERA. 1.2 Purpose. Through this ERA, the Employer intends to permit the deferral of compensation and to provide additional benefits toa select group of management or highly compensated employees of the Employer. Accordingly, it is intended that this ERAwill not constitute a "qualified plan" subject to the limitations of section 401(a) of the Code, nor will it constitute a "fundedplan," for purposes of such requirements. It also is intended that this ERA will be exempt from the participation and vestingrequirements of Part 2 of Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Thefunding requirements of Part 3 of Title I of ERISA, and the fiduciary requirements of Part 4 of Title I of ERISA by reason ofthe exclusions afforded plans that are unfunded and maintained by an employer primarily for the purpose of providing deferredcompensation for a select group of management or highly compensated employees. End of Article I2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IIDEFINITIONS AND CONSTRUCTION 2.1 Definitions. When a word or phrase appears in this ERA with the initial letter capitalized, and the word or phrase does notcommence a sentence, the word or phrase will generally be a term defined in this Section 2.1. The following words andphrases with the initial letter capitalized will have the meaning set forth in this Section 2.1, unless a different meaning isrequired by the context in which the word or phrase is used. (a) "Account" means one (1) or more of the bookkeeping accounts maintained by the Company or its agent on behalf of aParticipant, as described in more detail in Section 4.3. A Participant's Account may be divided into one or more"Cash Accounts" or "Stock Unit Accounts" as defined in Section 4.3. (b) "Affiliate" means a corporation that is a member of a controlled group of corporations (as defined in section 414(b) ofthe Code) that includes the Company, any trade or business (whether or not incorporated) that is in common control(as defined in section 414(c) of the Code) with the Company, or any entity that is a member of the same affiliatedservice group (as defined in section 414(m) of the Code) as the Company; provided, however that effective January1, 2015, for purposes of determining if an entity is an Affiliate under sections 414(b) or (c) of the Code ownership willbe determined based on an ownership percentage of greater than fifty percent (50%). (c) "Alternate Payee" means any spouse, former spouse, child, or other dependent of a Participant who is recognized bya DRO as having a right to receive all, or a portion of the benefits payable under the ERA with respect to suchParticipant. (d) "Annual Contribution" means the contribution made by the Employer on behalf of a Participant as described inSection 4.1(a). (e) "Beneficiary" means the person designated by the Participant to receive a distribution of his benefits under the ERAupon the death of the Participant. If the Participant is married, his spouse will be his Beneficiary, unless his spouseconsents in writing to the designation of an alternate Beneficiary. For this purpose, the term “spouse” means aParticipant’s spouse under applicable state law, including effective August 3, 2011, a Participant's Domestic Partneras defined under the Criteria for Domestic Partnership Status under the Tenet Employee Benefit Plan, and effectiveSeptember 16, 2013, a same sex spouse recognized as such in the state where the marriage is performed. In theevent that a Participant fails to designate a Beneficiary, or if the Participant's Beneficiary does not survive theParticipant, the Participant's Beneficiary will be his surviving spouse, if any, or if the Participant does not have asurviving spouse, his estate. The term "Beneficiary" also will mean a Participant's spouse or former spouse who isentitled to all or a portion of a Participant's benefit pursuant to Section 6.1. (f) "Board" means the Board of Directors of the Company. (g) "Cause" means3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (i)For any event occurring on or within two (2) years after a Change of Control, the same meaning as set forthin Section 2.1(f)(ii) of the ESP. (ii)For any Participant who is a Covered Executive under the Company’s Executive Severance Plan, withrespect to any event not occurring on or within two (2) years after a Change of Control, the same meaning asset forth in Section 2.1(f)(i) of the ESP. (iii)for any Participant who is not a Covered Executive under the Company’s Executive Severance Plan, withrespect to any event not occurring on or within two (2) years after a Change of Control, the same meaning asset forth in Section 2.5(b)(ii) of the Stock Incentive Plan. (h)“Change of Control” will have the meaning set forth in the ESP. (i)"Code" means the Internal Revenue Code of 1986, as amended from time to time and any regulations and rulingsissued thereunder. (j)"Compensation" means the Participant's annual gross base salary including amounts reduced from the Participant'ssalary and contributed on the Participant's behalf as deferrals under any qualified or non-qualified employee benefitplans sponsored by the Employer or, to the extent provided in Section 4.1(a), an Affiliate. Compensation excludesbonuses, hardship withdrawal allowances, annual cash and/or stock bonuses, automobile allowances, housingallowances, relocation payments, deemed income, income payable under stock incentive plans, Christmas gifts,insurance premiums and other imputed income, pensions, and retirement benefits. (k)"Disability" means the inability of a Participant to engage in any substantial gainful activity by reason of a mental orphysical impairment expected to result in death or last for at least twelve (12) months, or the Participant, because ofsuch a condition. is receiving income replacement benefits for at least three (3) months under an accident or healthplan covering the Employer's employees. (l)"Discretionary Contribution" means the contribution made by the Employer on behalf of a Participant as describedin Section 4.1(b). (m) "DRO" means a domestic relations order that is a judgment, decree, or order (including one that approves a propertysettlement agreement) that relates to the provision of child support, alimony payments or marital property rights to aspouse, former spouse, child or other dependent of a Participant and is rendered under a state (within the meaning ofsection 7701(a)(10) of the Code) domestic relations law (including a community property law) and that: (i)Creates or recognizes the existence of an Alternate Payee's right to, or assigns to an Alternate Payee theright to receive all or a portion of the benefits payable with respect to a Participant under the ERA; (ii)Does not require the ERA to provide any type or form of benefit, or any option, not otherwise provided underthe ERA;4 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (iii)Does not require the ERA to provide increased benefits (determined on the basis of actuarial value); (iv)Does not require the payment of benefits to an Alternate Payee that are required to be paid to anotherAlternate Payee under another order previously determined to be a DRO; and (v)Clearly specifies: the name and last known mailing address of the Participant and of each Alternate Payeecovered by the DRO; the amount or percentage of the Participant's benefits to be paid by the ERA to eachsuch Alternate Payee, or the manner in which such amount or percentage is to be determined; the number ofpayments or payment periods to which such order applies; and that it is applicable with respect to this ERA. (n)"Early Retirement Age" means the date the Participant attains age fifty-five (55) and has completed ten (10) Yearsof Vesting Service. (o)"Early Retirement Benefit" means the benefit payable to a Participant who has attained Early Retirement Age asprovided in Section 5.2. (p)"Effective Date" means November 30, 2015, except as provided otherwise herein. (q)"Eligible Person" means an Employee who is designated as eligible to participate in the ERA by the Senior VicePresident, Human Resources or the Plan Administrator or an Employee who satisfied the definition of Eligible Personin a prior ERA document and, in each case, who is not a participant in the SERP. As provided in Section 3.1 theRPAC may at any time, in its sole and absolute discretion, limit the classification of Employees who are eligible toparticipate in the ERA for a Plan Year and/or may modify or terminate an Eligible Person's participation in the ERAwithout the need for an amendment to the ERA. (r)"Employee" means each select member of management or highly compensated employee receiving remuneration,or who is entitled to remuneration, for services rendered to the Employer or an Affiliate, in the legal relationship ofemployer and employee. (s)"Employer" means the Company and each Affiliate who with the consent of the Senior Vice President, HumanResources or Plan Administrator has adopted the ERA as a participating employer. An Affiliate may evidence itsadoption of the ERA either by a formal action of its governing body or by commencing deferrals and taking otheradministrative actions with respect to this ERA on behalf of its employees. An entity will cease to be a participatingemployer as of the date such entity ceases to be an Affiliate or the date specified by the Company. EffectiveDecember 31, 2013, Conifer Health Solutions, LLC ceased to be an Employer under the ERA with respect to all of itsEmployees except those specified in Exhibit A. (t)"Employment" means any continuous period during which an employee is actively engaged in performing servicesfor the Employer or, to the extent provided in Section 2.1(ss), an Affiliate, plus the term of any leave of absence5 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. approved by the Employer; provided, however, that if an employee takes an approved leave of absence and does notreturn to the employ of the Employer, such leave of absence will not count as Employment except as required bylaw. (u) "ERA" means the Sixth Amended and Restated Tenet Executive Retirement Account as set forth herein and as thesame may be amended from time to time. (v) "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time. (w) "ESP" means the Tenet Executive Severance Plan, as amended from time to time. (x) "Five Percent Owner" means any person who owns (or is considered as owning within the meaning of section 318 ofthe Code (as modified by section 416(i)(1)(B)(iii) of the Code)) more than five percent (5%) of the outstanding stock ofthe Company or an Affiliate or stock possessing more than five percent (5%) of the total combined voting power of allstock of the Company or an Affiliate. The rules of sections 414(b), (c) and (m) of the Code will not apply for purposesof applying these ownership rules. Thus, this ownership test will be applied separately with respect to the Companyand each Affiliate. (y) "Good Reason" means (i)For an event occurring on or within two (2) years of a Change of Control, the same meaning as set forth inSection 2.1(x)(ii) of the ESP. (ii)For any event not occurring on or within two (2) years after a Change of Control, the same meaning as setforth in Section 2.1(x)(i) of the ESP. (z) "Human Resources Committee" means the Human Resources Committee of the Board (including any predecessor orsuccessor to such committee in name or form), which has the authority to amend and terminate the ERA as providedin Article X. (aa) “Inactive Participant” means a Participant under this ERA who separates from Employment with the Employer orwho is no longer or ceases to be an Eligible Person. Generally, no future contributions or earnings will be credited toan Inactive Participant’s Account; provided, however, an Inactive Participant who is not a participant in the SERP willcontinue to have earnings credited to his Account on and after the Effective Date until he ceases employment withthe Employer and all Affiliates. (bb) "Initial Enrollment Period" means the thirty (30) day period immediately following the date the Eligible Person firstbecomes eligible to participate in the ERA during which the Eligible Person may elect the time at which to receive adistribution of Early Retirement Benefits pursuant to Section 3.1(b). (cc) "Involuntary Termination" means:6 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (i) the Participant's Termination of Employment by the Employer without Cause, or (ii) the Participant's resignation from Employment of the Employer for Good Reason; provided, however, that an Involuntary Termination will not occur by reason of the divestiture of an Affiliate withrespect to a Participant employed by such Affiliate who is offered a comparable position with the purchaser and eitherdeclines or accepts such position. (dd) "Key Employee" means any employee or former employee (including any deceased employee) who at any timeduring the Plan Year was: (i)an officer of the Company or an Affiliate having greater than one hundred thirty thousand dollars ($130,000)(as adjusted under section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002) (suchlimit is one hundred seventy thousand dollars ($170,000) for 2014); (ii)a Five Percent Owner; or (iii)a One Percent Owner having compensation of more than one hundred fifty thousand dollars ($150,000). For purposes of the preceding paragraphs, the Company has elected to determine the compensation of an officer orOne Percent Owner in accordance with section 1.415(c)-2(d)(4) of the Treasury Regulations (i.e., W-2 wages plusamounts that would be includible in wages except for an election under section 125(a) of the Code (regardingcafeteria plan elections) under section 132(f) of the Code (regarding qualified transportation fringe benefits) or section402(e)(3) of the Code (regarding section 401(k) plan deferrals)) without regard to the special timing rules and specialrules set forth, respectively, in sections 1.415(c)-2(e) and 2(g) of the Treasury Regulations. The determination of Key Employees will be based upon a twelve (12) month period ending on December 31 of eachyear (i.e., the identification date). Employees that are Key Employees during such twelve (12) month period will betreated as Key Employees for the twelve (12) month period beginning on the first day of the fourth month followingthe end of the twelve (12) month period (i.e., since the identification date is December 31, then the twelve (12) monthperiod to which it applies begins on the next following April 1). The determination of who is a Key Employee will be made in accordance with section 416(i)(1) of the Code and otherguidance of general applicability issued thereunder. For purposes of determining whether an employee or formeremployee is an officer, a Five Percent Owner or a One Percent Owner, the Company and each Affiliate will be treatedas a separate employer (i.e., the controlled group rules of sections 414(b), (c), (m) and (o) of the Code will not apply).Conversely, for purposes of determining whether the one hundred thirty thousand dollar ($130,000) adjusted limit oncompensation is met under the officer test described in Section 2.1(dd)(i), compensation from the Company and7 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. all Affiliates will be taken into account (i.e., the controlled group rules of sections 414(b). (c), (m) and (o) of the Codewill apply). Further, in determining who is an officer under the officer test described in Section 2.1(dd)(i), no more thanfifty (50) employees of the Company or its Affiliates (i.e., the controlled group rules of sections 414(b), (c), (m) and(o) of the Code will apply) will be treated as officers. If the number of officers exceeds fifty (50). the determination ofwhich employees or former employees are officers will be determined based on who had the largest annualcompensation from the Company and its Affiliates for the Plan Year. For the avoidance of doubt, for purposes of thisSection 2.1(dd) the controlled group rules under sections 414(b) and (c) of the Code will be applied based on thenormal ownership percentage of greater than eighty percent (80%) rather than the fifty percent (50%) standard used inthe definition of Affiliate. (ee) "Normal Retirement Age" means the date the Participant attains age sixty-two (62). (ff) "Normal Retirement Benefit" means the benefit payable to a Participant at Normal Retirement Age pursuant toSection 5.1. (gg) "One Percent Owner" means any person who would be described as a Five Percent Owner if "one percent (1%)" weresubstituted for "five percent (5%)" each place where it appears therein. (hh) "Other Termination" means a Termination of Employment that is not an Involuntary Termination, including aTermination of Employment for Cause. (ii) "Participant" means each Eligible Person who participates in this ERA and each Eligible Person or former EligiblePerson whose participation in this ERA has not terminated. (jj) "Plan Administrator" means the individual or entity appointed by the RPAC to handle the day-to-day administration ofthe ERA, including but not limited to determining an Employee's status as an Eligible Person, the Employee’s AnnualContribution amount, a Participant's eligibility for benefits and the amount of a Participant's benefits and complyingwith all applicable reporting and disclosure obligations imposed on the ERA. If the RPAC does not appoint anindividual or entity as Plan Administrator, the RPAC will serve as the Plan Administrator. (kk) "Plan Year" means the fiscal year of this ERA, which will commence on January 1 each year and end on December31 of such year. The initial Plan Year was a short Plan Year beginning July 1, 2007 and ending December 31. 2007. (ll) "Retirement" means a Termination of Employment on or after a Participant has attained Early Retirement Age orNormal Retirement Age. (mm) "RPAC" means the Retirement Plans Administration Committee of the Company established by the Human ResourcesCommittee, and whose members have been appointed by such Human Resources Committee or a delegate thereof.The RPAC will have the responsibility to administer the ERA and make final determinations regarding claims forbenefits, as described in Article VIII.8 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (nn) "SERP" means the Tenet Healthcare Corporation Supplemental Executive Retirement Plan. (oo) "Stock" means the common stock, par value $0.05 per share, of the Company. (pp) "Stock Unit" means a non-voting, non-transferable unit of measurement that is deemed for bookkeeping anddistribution purposes only to represent one outstanding share of Stock. (qq) "Stock Incentive Plan" means the Tenet Healthcare 2008 Stock Incentive Plan, as amended from time to time. (rr) "Target Bonus" means the target bonus percent applicable to the Participant under the Company's Annual IncentivePlan multiplied by his Compensation at the time of a Termination of Employment with the Employer. For example, ifthe Covered Executive earns one hundred and fifty thousand dollars ($150,000) and has a Target Bonus of fiftypercent (50%), his Target Bonus equals seventy five thousand dollars ($75,000). (ss) "Termination of Employment" means the date that a Participant ceases performing services for the Employer andits Affiliates in the capacity of an employee, or a reduction in Employment or other provision of services that qualifiesas a separation from service under Section 409A of the Code. For this purpose a Participant who is on a leave ofabsence that exceeds six (6) months and who does not have statutory or contractual reemployment rights withrespect to such leave, will be deemed to have incurred a Termination of Employment on the first day of the seventh(7th) month of such leave. A Participant who transfers Employment from an Employer to an Affiliate, regardless ofwhether such Affiliate has adopted the ERA as a participating employer, will not incur a Termination of Employmentand such Participant may continue to be credited with Annual Contributions pursuant to Section 4.1(a) and/or accrueage and/or Years of Vesting Service pursuant to Section 2.1(vv). A Termination of Employment will either be anInvoluntary Termination or an Other Termination. (tt) “Trust” means the rabbi trust established with respect to the ERA the assets of which are to be used for the paymentof benefits under the ERA. (uu) "Trustee" means the individual or entity appointed to serve as trustee of any Trust established as a possible sourceof funds for the payment of benefits under this ERA as provided in Section 7.1. After the occurrence of a Change ofControl, the Trustee must be independent of any successor to the Company or any affiliate of such successor. (vv) "Year of Vesting Service" means each complete Plan Year in which an Eligible Person is employed as an Employeeof the Employer, beginning with the Plan Year in which the Participant commences participation in the ERA, and hasan Account balance under the ERA. Such Plan Years will be referred to as "Years of Plan Participation" for purposesof this Section 2.1(vv). At the time an Eligible Person first becomes eligible to participate in the ERA, his priorcomplete years of continuous Employment with the Employer, commencing on the Eligible Person's date ofEmployment with the Employer in any capacity, will be9 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. converted to an equivalent number of complete Years of Plan Participation and count as Years of Vesting Serviceunder the ERA. In addition, service performed for an entity that is acquired by the Company through a stock, asset or other businesstransaction will be counted as Years of Vesting Service under the ERA to the extent provided in the transactiondocuments or as determined by the Senior Vice President, Human Resources or the Plan Administrator. The Senior Vice President, Human Resources or the Plan Administrator may also credit a Participant who transfersto an Affiliate that is not an Employer with age and/or vesting service for employment with such Affiliate without theneed for such Affiliate to adopt the ERA as an Employer. An Eligible Person will not be given credit for partial Years of Plan Participation or partial years of Employment asYears of Vesting Service under the ERA. Further, to be counted as a Year of Vesting Service such Years of PlanParticipation or years of Employment must be continuous. In the event an Eligible Person incurs a Termination of Employment and is reemployed by the Employer within thetime period required to prevent a break in Employment under the Company's Rehire and Reinstatement Policy (or anysuccessor thereto), the provisions of which are incorporated herein by this reference: (i)such Eligible Person's previously forfeited ERA Account balance will be restored at the time of suchreemployment, and (ii)his Years of Plan Participation or years of Employment completed before such reemployment will be treatedas Years of Vesting Service under the ERA to the extent provided in such Rehire and Reinstatement Policy(or any successor thereto). 2.2 Construction. If any provision of this ERA is determined to be for any reason invalid or unenforceable, the remainingprovisions of this ERA will continue in full force and effect. All of the provisions of this ERA will be construed and enforced in accordance with the laws of the State of Texas and will beadministered according to the laws of such state, except as otherwise required by ERISA, the Code or other applicablefederal law. The term "delivered to the RPAC or Plan Administrator," as used in this ERA, will include delivery to a person or personsdesignated by the RPAC or Plan Administrator, as applicable, for the disbursement and the receipt of administrative forms.Delivery will be deemed to have occurred only when the form or other communication is actually received. Headings and subheadings are for the purpose of reference only and are not to be considered in the construction of this ERA. The pronouns "he," "him" and "his" used in the ERA will also refer to similar pronouns of the female gender unless otherwisequalified by the context.10 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 2.3 409A Compliance. The ERA is intended to comply with the requirements of section 409A of the Code. The provisions of theERA will be construed and administered in a manner that enables the ERA to comply with the provisions of section 409A ofthe Code. End of Article II 11 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IIIPARTICIPATION AND FORFEITABILITY OF BENEFITS 3.1 Eligibility and Participation. (a)Determination of Eligibility. An Employee who is designated as an Eligible Person by the Senior Vice President,Human Resources, or Plan Administrator will automatically become a Participant in the ERA as of the effective dateof such designation. An Employee who was a Participant under the terms of a prior ERA document will continueparticipation on and after the Effective Date in accordance with the terms of this document. (b)Early Retirement Election. An Eligible Person must elect during the Initial Enrollment Period whether he desires ordoes not desire to commence the distribution of the vested balance of his Account on the first day of the secondcalendar month following the date of his Retirement on or after attaining Early Retirement Age as provided pursuant toSection 5.2. If the Eligible Person fails to make this election during the Initial Enrollment Period, he will be deemed tohave affirmatively elected to commence the distribution of the vested balance of his Account on the first day of thesecond calendar month following the date of his Retirement on or after attaining Early Retirement Age. Once made (ordeemed made), this election cannot be revoked; however, the Participant may elect to defer payment of his vestedAccount balance pursuant to Section 5.7. Payment of such Early Retirement Benefit will be subject to the six (6)month restriction applicable to Key Employees, described in Section 5.4 of this ERA. The provisions of this Section3.1(b) will apply to all Eligible Persons who are Employees on or after the Effective Date. (c)Limits on Eligibility. The RPAC may at any time, in its sole and absolute discretion, limit the classification ofEmployees eligible to participate in the ERA and/or may limit or terminate an Eligible Person's participation in theERA. Any action taken by the RPAC that limits the classification of Employees eligible to participate in the ERA orthat modifies or terminates an Eligible Person's participation in the ERA will be set forth in Exhibit B attached hereto.Exhibit B may be modified from time to time without a formal amendment to the ERA. in which case a revised ExhibitB will be attached hereto. (d)Loss of Eligibility Status. A Participant who becomes an Inactive Participant, under this ERA will retain such statusuntil the Participant has received payment of any and all amounts payable to him under this ERA. An InactiveParticipant who continues employment with an Affiliate who is not an Employer may continue to be credited withannual contributions pursuant to Section 4.1(a) and/or with age and/or Years of Vesting Service pursuant to Section2.1(vv). (e)Subsequent SERP Participation. A Participant's participation and Account balances will be frozen upon beingnamed to the SERP (i.e., he will become an Inactive Participant and no additional contributions or earnings creditswill be made); however, the Participant will continue to earn age and Years of Vesting Service for purposes of thisERA. Upon termination or retirement, the Participant will receive his Account balance under the ERA pursuant to theterms hereof. In12 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. addition, the Participant will be entitled to receive a benefit from the SERP equal to the benefit accrued under theSERP as reduced by his benefit under the ERA. Distribution of the Participant's SERP benefit will be made pursuantto the terms of the SERP. (f)Initial SERP Participation. A Participant who participated in the SERP before becoming a Participant in the ERAwill be entitled to a benefit under this ERA, if any, equal to the amount of his Account. The Participant's accruedbenefit under the SERP will be paid pursuant to the terms of the SERP and his benefit under this ERA, if any, will bepaid pursuant to the terms hereof. 3.2 Forfeitability of Benefits. A Participant will forfeit any amounts credited to his Account as follows: (a)Other Termination. Except as provided in section 4.2(a), if a Participant incurs an Other Termination before attainingage fifty-five (55), he will forfeit the entire balance of his Account. If a Participant incurs an Other Termination on orafter attaining age fifty-five (55), he will forfeit the non-vested balance of his Account, as determined in accordancewith Section 4.2(b) below. (b)Involuntary Termination. If a Participant incurs an Involuntary Termination either before or on or after attaining agefifty-five (55), he will forfeit the non-vested balance of his Account. The vested balance of a Participant's Account inthe event of an Involuntary Termination is determined in accordance with Section 4.2(c) (or, if applicable, Section4.2(a)) below. (c)Cause. If a Participant incurs a Termination of Employment for Cause, he will forfeit the entire balance, whethervested or not, of his Account. End of Article III 13 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IVCOMPANY CONTRIBUTIONS, VESTING, ACCOUNTINGAND INVESTMENT CREDITING RATES 4.1 Company Contributions. (a)Annual Contribution. The Company will make an Annual Contribution to the ERA each Plan Year on behalf of eachParticipant in an amount equal to ten percent (10%) of the Participant’s Compensation unless the Senior VicePresident, Human Resources or the Plan Administrator determine a different amount will apply and communicate thatto the Participant in an offer letter or other communication. Unless declared otherwise by the Senior Vice President,Human Resources or the Plan Administrator, such Annual Contribution will be based on the Participant'sCompensation on the date on which the Annual Contribution is made. In addition, in the case of Retirement on orafter Normal Retirement Age, death, Disability, or an Involuntary Termination or change in position that results in thetermination of active participation in the ERA without establishment of a successor plan within two (2) years after aChange of Control, a Participant will receive a prorated Annual Contribution based on the number of months duringwhich he was employed from July 1 immediately preceding the applicable event. The Senior Vice President, Human Resources or the Plan Administrator may credit a Participant who transfers to anAffiliate that is not an Employer with an Annual Contribution based on his Compensation with such Affiliate withoutthe need for such Affiliate to adopt the ERA as an Employer. (b)Discretionary Contribution. The Chief Executive Officer (or any successor title to such position) of the Companymay declare that a Discretionary Contribution be made by the Employer to a Participant's Account in such amount,and at such time, as he may determine in his sole and absolute discretion. 4.2 Vesting in ERA Account. (a)Full Vesting Events. A Participant will become one hundred percent (100%) vested in the balance of his Accountupon the occurrence of any of the following events while an Employee: (i) the Participant's attainment of age sixty (60) and completion of five (5) Years of Vesting Service; (ii) the Participant's attainment of sixty-two (62) regardless of Years of Vesting Service; (iii) the Participant's death; (iv) the Participant's Disability; or (v) the occurrence of a Change of Control. (b)Other Termination of Employment. Except in the case of a Termination of Employment for Cause, a Participantwho incurs an Other Termination before the occurrence of a full vesting event described in Section 4.2(a) will vest inthe balance of his Account pursuant to the following schedule:14 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Vesting Schedule for Other TerminationVesting (as a % ofAccount Balance)Age54 and Below5556575859606162Whole Years ofService4 or less0%0% 525% 630%735%840%945%1050%1155%1260%1365%1470%1575%1680%1785%1890%1995%20100% The non-vested portion of the Participant's Account will be forfeited as of the date of his Termination of Employment(subject to the rules set forth in Section 2.1(vv) (regarding an individual who is reemployed before experiencing abreak in employment under the Company's Rehire and Reinstatement Policy (or any successor thereto))). In the case of a Termination of Employment for Cause, the Participant will forfeit the entire balance of his Accountregardless if vested or not. (c)Involuntary Termination of Employment. A Participant who incurs an Involuntary Termination before theoccurrence of a full vesting event described in Section 4.2(a) will vest in the balance of his Account as follows: Vesting Schedule for Involuntary TerminationYears of Vesting ServiceVested Percent4 or less0%525%630%735%840%945%1050%1155%1260%1365%1470%1575%1680%1785%1890%1995%20100% 15 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. The non-vested portion of the Participant's Account will be forfeited as of the date of his Termination of Employment. 4.3 Accounting for Deferred Compensation. The Plan Administrator will establish and maintain an individual Account orAccounts under the name of each Participant under the ERA. Depending on the Participant's selection of an investmentcrediting rate option pursuant to Section 4.4, the Plan Administrator may set up a Cash Account and/or a Stock Unit Account. (a)Cash Account. If a Participant has made an election to have the balance of his Account to be deemed invested in afixed rate of return or benchmark mutual funds pursuant to Section 4.4(a) or Section 4.4(b), the Company may, in itssole and absolute discretion, establish and maintain a Cash Account for the Participant under this ERA. Each CashAccount will be adjusted at least monthly to reflect the Annual Contributions and Discretionary Contributions creditedthereto, earnings credited on such Annual Contributions and Discretionary Contributions pursuant to Section 4.4, andany payment of such Annual Contributions or Discretionary Contributions under this ERA. Such Annual Contributionsand any Discretionary Contributions made on behalf of the Participant will be credited to each Participant's CashAccount at such times as determined by the Human Resources Committee. In the sole discretion of the PlanAdministrator. more than one (1) Cash Account may be established for each Participant to facilitate record keepingconvenience and accuracy. (b)Stock Unit Account. If a Participant has made an election to have the balance of his Account to be deemedinvested in Stock Units pursuant to Section 4.4(c), the Plan Administrator may, in its sole and absolute discretion.establish and maintain a Stock Unit Account and credit the Participant's Stock Unit Account with a number of StockUnits determined by dividing an amount equal to the Annual Contributions and Discretionary Contributions made onbehalf of the Participant for a Plan Year by the Fair Market Value of a share of Stock on the date such Contributionsare made. Such Stock Units will be credited to the Participant's Stock Unit Account as soon as administrativelypracticable after the determination of the number of Stock Units is made pursuant to the preceding sentence. In thesole and absolute discretion of the Plan Administrator, more than one Stock Unit Account may be established foreach Participant to facilitate record-keeping convenience and accuracy. Each such Stock Unit Account will becredited and adjusted as provided in this ERA. The Stock Units credited to a Participant's Stock Unit Account will be used solely as a device for determining thenumber of shares of Stock eventually to be distributed to the Participant in accordance with this ERA. The StockUnits will not be treated as property of the Participant or as a trust fund of any kind. No Participant will be entitled toany voting or other stockholder rights with respect to Stock Units credited under this ERA. If the outstanding shares of Stock are increased, decreased, or exchanged for a different number or kind of shares orother securities, or if additional shares or new or different shares or other securities are distributed with respect tosuch shares of Stock or other securities, through merger, consolidation, spin-off, sale of all or substantially all theassets of the Company, reorganization. recapitalization, reclassification, stock dividend, stock split, reverse stocksplit or other distribution with respect to such shares of Stock or other securities, an16 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. appropriate and proportionate adjustment will be made by the Human Resources Committee in the number and kindof Stock Units credited to a Participant's Stock Unit Account. (c)Unfunded Nature of Accounts. Amounts credited to the Participant's Cash and Stock Unit Accounts will be heldwith the general assets of the Employer and, as provided in Section 7.2, will be subject to the claims of theEmployer's general creditors. Establishment and maintenance of a separate Account or Accounts for each Participantwill not be construed as giving any person any interest in assets of the Employer, or a right to payment other than asprovided under this ERA. Such Accounts will be maintained until all amounts credited as to such Account have beendistributed in accordance with the terms and provisions of this ERA. 4.4 Computation of Earnings Credited. The Participant may, pursuant to administrative procedures established by the RPAC,request the type of investment crediting rate option with which the Participant would like the Employer, in its sole andabsolute discretion, to credit to the Participant's Account during the Participant's Employment. Such investment crediting rateelection will apply to all contributions under the ERA; provided that no investment crediting will be made after the Participantincurs a Termination of Employment or transfers to an ineligible position, except as provided in Section 2,1(aa) (i.e., theParticipant qualifies as an Inactive Participant who is not a participant in the SERP). To the extent the Participant hasinvested in Stock Units, upon his Termination of Employment or transfer to another position, the number of shares of Stockto which he is entitled will be determined and distributable to him pursuant to the terms of the ERA. For purposes ofdetermining when a Participant incurs a Termination of Employment for investment crediting purposes, Employment will bedeemed to have ceased on the last day of the calendar month of Employment. The Participant will specify his preference from among the following possible investment crediting rate options: (a)The annual rate of interest based on the benchmark money market mutual fund, compounded daily, such benchmarkmoney market mutual fund will be for periods before October 1, 2008, the Fidelity Money Market Fund and fromOctober 1, 2008, through December 31, 2008, an annual rate of interest equal to one percent (1%) below the primerate of interest as quoted by Bloomberg, compounded daily, and effective on and after January 1, 2009, an annualrate of interest equal to one hundred and twenty percent (120%) of the long-term applicable federal rate. compoundeddaily; (b)One (1) or more benchmark mutual funds; or (c)Stock Units; provided that any request to have the Participant's Account to be deemed invested in Stock Units isirrevocable (i.e., a Participant may only change such investment election on a prospective basis) and such amountswill be distributed in an equivalent whole number of shares of Stock pursuant to the provisions of Article V. Anyfractional share interests will be paid in cash with the last distribution. During his Employment, the Participant may change, on a monthly basis, the investment crediting rate preference under thisSection 4.4 by filing an election in such manner as will be determined by the RPAC. Notwithstanding any request made by aParticipant, the Company will not be bound by such request and the Company, in its sole and absolute17 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. discretion, will determine the investment rate with which to credit amounts contributed on behalf of Participants under thisERA, provided, however, that if the Company chooses an investment crediting rate other than the investment crediting raterequested by the Participant, such investment crediting rate cannot be less than (a) above. If a Participant fails to set forthhis investment crediting rate preference under this Section 4.4, he will be deemed to have elected the investment creditingrate in (a) above. The RPAC will select from time to time, in its sole and absolute discretion, the possible investmentcrediting rate options to be offered under the ERA. End of Article IV18 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VDISTRIBUTION OF BENEFITS 5.1 Normal Retirement Distribution. A Participant who remains in the employ of the Employer until his Normal Retirement Agewill receive a Normal Retirement Benefit equal to the vested balance of his Account as of the date of his Retirement. Exceptas provided in Section 10.3, payment of the Normal Retirement Benefit will begin on the first day of the second calendarmonth following the date of the Participant's Retirement in the form of equal annual installments through the date theParticipant attains age eighty (80). Distributions will be made in the form of cash or Stock, depending on the Participant'sinvestment crediting rates as provided in Section 4.4. The commencement of payment of the Normal Retirement Benefit willbe subject to the six (6) month delay applicable to Key Employees under Section 5.4. A Participant who is entitled to aNormal Retirement Benefit distribution may elect to defer payment of such distribution pursuant to Section 5.7. 5.2 Early Retirement Distribution. A Participant who remains in the employ of the Employer until his Early Retirement Age (andis not entitled to a distribution by reason of an Involuntary Termination pursuant to Section 5.3(a)) will receive an EarlyRetirement Benefit equal to the vested balance of his Account as of the date of his Retirement. Payment of the EarlyRetirement Benefit will begin on the first day of the second calendar month following the date of the Participant's Retirement;provided, that the Participant timely elected (or was deemed to have timely elected) to receive an Early Retirement Benefitpursuant to Section 3.1(b) and did not subsequently elect to defer such payment pursuant to Section 5.7. Except as providedin Section 10.3, distribution of the Early Retirement Benefit will be made in the form of equal annual installments through thedate the Participant attains age eighty (80). Distributions will be made in the form of cash or Stock, depending on theParticipant's investment crediting rates as provided in Section 4.4. The commencement of the payment of the EarlyRetirement benefit will be subject to the six (6) month delay applicable to Key Employees under Section 5.4. 5.3 Termination of Employment Distribution. A Participant who incurs a Termination of Employment for a reason other thanRetirement, Disability or death, will receive a distribution of the vested balance of his Account, if any, pursuant to this Section5.3. The commencement of the payment of the vested balance of the Participant's Account will be subject to the six (6)month delay applicable to Key Employees under Section 5.4. (a)Involuntary Termination Distribution. If a Participant incurs an Involuntary Termination, he will receive payment ofhis vested Account balance, as determined in accordance with Section 4.2(c), commencing on the first day of thesecond calendar month following his attainment of age sixty-two (62) (regardless if the Participant has attained agefifty-five (55) and completed ten (10) Years of Vesting Service and has elected (or was deemed to have elected) anEarly Retirement Benefit pursuant to Section 3.1(b)), unless he elected to defer payment pursuant to Section 5.7.Except as provided in Section 10.3, distribution of the Participant's vested Account balance will be made in equalannual installments through the date the Participant attains age eighty (80). Distributions will be made in the form ofcash or Stock, depending on the Participant's investment crediting rates as provided in Section 4.4.19 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (b)Other Termination Distribution. Except in the case of a Termination of Employment for Cause, if a Participantincurs an Other Termination after attaining age fifty-five (55) and completing ten (10) Years of Vesting Service andthe Participant elected (or was deemed to have elected) an Early Retirement Benefit pursuant to Section 3.1(b),distribution of the Participant's vested Account balance will be made pursuant to Section 5.2. If the Participant hasnot completed ten (10) Years of Vesting Service or did not elect (or was not deemed to have elected) an EarlyRetirement Benefit, distribution of the Participant's vested Account balance will commence on the first day of thesecond calendar month following the date he attains age sixty-two (62) unless he elected to defer payment pursuantto Section 5.7. Except as provided in Section 10.3, distribution of the Participant's vested Account balance will bemade in the form of equal annual installments through the date the Participant attains age eighty (80). Distributionswill be made in the form of cash or Stock, depending on the Participant's investment crediting rates as provided inSection 4.4. A Participant who incurs a Termination of Employment for Cause will forfeit the entire balance of his Accountregardless if vested. 5.4 Termination Distributions to Key Employees. Distributions under this ERA that are payable to a Key Employee onaccount of a Termination of Employment, including Retirement, will be delayed for a period of six (6) months following suchParticipant's Termination of Employment. This six (6) month restriction will not apply, or will cease to apply, with respect to adistribution to a Participant's Beneficiary by reason of the death of the Participant. 5.5 Death Distribution. In the event of the Participant's death, his vested Account balance will be distributed as follows: (a)Death While an Employee. If the Participant dies while employed by the Employer, the Participant's vested Accountbalance, as determined pursuant to Section 4.2(a), will be paid to the Participant's Beneficiary in a lump sum, in cashand/or Stock depending on the Participant's investment crediting rates, by the later of the end of the Plan Year inwhich the Participant dies or ninety (90) days following the date of the Participant's death. (b)Death Following Termination. If the Participant dies after his Termination of Employment while receivinginstallment payments from the ERA, the remaining amount of such installment payments will be paid to theParticipant's Beneficiary in a lump sum, in cash and/or Stock depending on the Participant's investment creditingrates, by the later of the end of the Plan Year in which the Participant dies or ninety (90) days following the date ofthe Participant's death. If the Participant dies after his Termination of Employment before he begins receivinginstallment payments from the ERA, his vested Account balance will be paid in a to his Beneficiary in a lump sum, incash and/or Stock depending on the Participant's investment crediting rates, by the later of the end of the Plan Yearin which the Participant dies or ninety (90) days following the date of the Participant's death. Amounts distributed pursuant to this Section 5.5 will not be subject to or, in the event installment payments to the Participanthad already commenced at the time of the20 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Participant's death, will cease to be subject to the six (6) month delay applicable to Key Employees under Section 5.4. 5.6 Disability Distribution. If a Participant incurs a Disability while employed by the Employer, distribution of his vested Accountbalance will begin on the first day of the second calendar month following the Participant's attainment of age sixty-five (65).Except as provided in Section 10.3, distribution of the Participant's vested Account will be made in the form of equal annualinstallments through the date the Participant attains age eighty (80). Distributions will be made in the form of cash or Stock,depending on the Participant's investment crediting rates as provided in Section 4.4. A Participant who is entitled to aDisability distribution may not elect to defer payment of such distribution pursuant to Section 5.7. Amounts distributedpursuant to this Section 5.6, will not be subject to the six (6) month delay applicable to Key Employees. 5.7 Deferral of Distributions. A Participant may elect to defer payment of his Normal Retirement Benefit payable pursuant toSection 5.1, his Early Retirement Benefit payable pursuant to Section 5.2 or a Termination of Employment distributionpursuant to Section 5.3 for a period of five (5) years from the date such payment would otherwise be made by making adeferral election at least twelve (12) months before the date payment would otherwise be made. In the event that theParticipant becomes entitled to a distribution pursuant to Section 5.1, Section 5.2 or Section 5.3 during this twelve (12) monthperiod, the deferral election will be of no effect and payment of the Participant's benefits will commence at the time specifiedin Section 5.1, Section 5.2 or Section 5.3, as applicable. A Participant who becomes entitled to distribution of a Disabilitybenefit pursuant to Section 5.6 may not elect to defer payment of such distribution pursuant to this Section 5.7 and anydeferral election made by such Participant will be null and of no effect. 5.8 Withholding. Any taxes or other legally required withholdings from distributions to Participants under the ERA will bededucted and withheld from the Participant's vested Accounts by the Employer, benefit provider or funding agent as requiredpursuant to applicable law. A Participant will be provided with a tax withholding election form for purposes of federal and statetax withholding, if applicable. A Beneficiary will be responsible for payment of his own federal, state and local taxes. 5.9 Impact of Reemployment on Benefits. If a Participant incurs a Termination of Employment and begins receiving, installmentpayments from the ERA and such Participant is reemployed by the Employer or an Affiliate, then such Participant'sinstallment payments will continue as scheduled during the period of his reemployment. End of Article V21 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VIPAYMENT LIMITATIONS 6.1 Spousal Claims (a)Distribution of Benefit. In the event that an Alternate Payee is entitled to all or a portion of a Participant's vestedAccount balance pursuant to the terms of a DRO, such amount will be paid to the Alternate Payee in a lump sum, incash or Stock, based on the Participant's investment crediting rates under the ERA as provided in Section 4.4 andthe terms of the DRO, within ninety (90) days after the Plan Administrator approves the DRO. An Alternate Payee must complete and deliver to the Plan Administrator all required forms within thirty (30) days fromthe date the Alternate Payee is notified by the Plan Administrator that the DRO has been accepted.. The AlternatePayee will be responsible for payment of any federal, state or local taxes. (b)Determination of Qualification of DRO. The Plan Administrator will have sole and absolute discretion to determinewhether a judgment, decree or order is a DRO, to determine whether a DRO will be accepted for purposes of thisSection 6.1 and to make interpretations under this Section 6.1, including determining who is to receive benefits, theamount of such benefits, and the amount of taxes to be withheld. The decisions of the Plan Administrator will bebinding on all parties with an interest. (c)Subject to ERA Provisions. Any benefits payable to an Alternate Payee pursuant to the terms of a DRO will besubject to all provisions and restrictions of the ERA and any dispute regarding such benefits will be resolved pursuantto the ERA claims procedure in Article VIII. 6.2 Legal Disability. If a person entitled to any payment under this ERA is, in the sole judgment of the Plan Administrator, undera legal disability, or otherwise is unable to apply such payment to his own interest and advantage, the Plan Administrator, inthe exercise of its discretion, may direct the Employer or payor of the benefit to make any such payment in any one (1) ormore of the following ways: (a)Directly to such person; (b)To his legal guardian or conservator; or (c)To his spouse or to any person charged with the duty of his support, to be expended for his benefit and/or that of hisdependents. The decision of the Plan Administrator will in each case be final and binding upon all persons in interest, unless the PlanAdministrator reverses its decision due to changed circumstances. 6.3 Assignment. Except as provided in Section 6,1, no Participant or Beneficiary will have any right to assign, pledge, transfer,convey, hypothecate, anticipate or in any way create a lien on any amounts payable under this ERA. No amounts payableunder this ERA will be subject to assignment or transfer or otherwise be alienable, either by22 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. voluntary or involuntary act, or by operation of law, or subject to attachment, execution, garnishment, sequestration or other seizureunder any legal, equitable or other process, or be liable in any way for the debts or defaults of Participants and their Beneficiaries. End of Article VI23 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VIIFUNDING 7.1 No Right to Assets. (a)Employer Obligation. Benefits under this ERA will be funded solely by the Employer. Benefits under this ERA willconstitute an unfunded general obligation of the Employer, but the Employer may create reserves, funds and/orprovide for amounts to be held in trust to fund such benefits on its behalf. Payment of benefits may be made by theEmployer, any trust established by the Employer or through a service or benefit provider to the Employer or suchtrust. Upon the occurrence of a Change of Control, the Company will establish a rabbi trust to fund the benefitsaccrued under the ERA as of the date of the Change of Control. (b)Rabbi Trust. Upon a Change of Control, the following will occur: (i)the Trust will become (or continue to be) irrevocable; (ii)for three (3) years following a Change of Control, the Trustee can only be removed as set forth in the Trust; (iii)if the Trustee is removed or resigns within three (3) years following a Change of Control, the Trustee willselect a successor Trustee, as set forth in the Trust; (iv)for three (3) years following a Change of Control, the Company will be responsible for directly paying allTrustee fees and expenses, together with all fees and expenses incurred under Article VIII relating to theRPAC, Plan Administrator, and ERA administrative expenses (unless otherwise paid by the Trust from theTrust’s expense reserve); and (v)the Trust Agreement may be amended only as set forth in the Trust (with the Trustee's consent); provided,however, that no such amendment will (A) change the irrevocable nature of the Trust; (B) adversely affect aParticipant's rights to benefits under the ERA without the consent of the Participant; (C) impair the rights ofthe Company's creditors under the Trust; or (D) cause the Trust to fail to be a "grantor trust" pursuant toCode sections 671 through 679. 7.2 Creditor Status. Participants and their Beneficiaries will be general unsecured creditors of their respective Employer withrespect to the payment of any benefit under this ERA, unless such benefits are provided under a contract of insurance or anannuity contract that has been delivered to Participants, in which case Participants and their Beneficiaries will look to theinsurance carrier or annuity provider for payment, and not to the Employer. The Employer's obligation for such benefit will bedischarged by the purchase and delivery of such annuity or insurance contract. End of Article VII24 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VIIIADMINISTRATION 8.1 The RPAC. The overall administration of the ERA will be the responsibility of the RPAC. 8.2 Powers of RPAC. The RPAC will have sole and absolute discretion regarding the exercise of its powers and duties under thisERA. In order to effectuate the purposes of the ERA, the RPAC will have the following powers and duties: (a) To appoint the Plan Administrator; (b) To review and render decisions respecting a denial of a claim for benefits under the ERA; (c) To construe the ERA and to make equitable adjustments for any mistakes or errors made in the administration of theERA; and (d) To determine and resolve, in its sole and absolute discretion, all questions relating to the administration of the ERAand the trust established to secure the assets of the ERA when differences of opinion arise between the Company,an Affiliate, the Plan Administrator, the Trustee, a Participant, or any of them, and whenever it is deemed advisableto determine such questions in order to promote the uniform and nondiscriminatory administration of the ERA for thegreatest benefit of all parties concerned. The foregoing list of express powers is not intended to be either complete or conclusive, and the RPAC will, in addition, havesuch powers as it may reasonably determine to be necessary or appropriate in the performance of its powers and dutiesunder the ERA. 8.3 Appointment of Plan Administrator. The RPAC will appoint the Plan Administrator, who will have the responsibility andduty to administer the ERA on a daily basis. The RPAC may remove the Plan Administrator with or without cause at anytime. The Plan Administrator may resign upon written notice to the RPAC. 8.4 Duties of Plan Administrator. The Plan Administrator will have sole and absolute discretion regarding the exercise of itspowers and duties under this ERA. The Plan Administrator will have the following powers and duties: (a)To direct the administration of the ERA in accordance with the provisions herein set forth; (b)To adopt rules of procedure and regulations necessary for the administration of the ERA, provided such rules are notinconsistent with the terms of the ERA: (c)To determine all questions with regard to rights of Employees. Participants, and Beneficiaries under the ERAincluding, but not limited to, questions involving eligibility of an Employee to participate in the ERA, the amount of aParticipant’s Annual Contribution and the value of a Participant's vested Account: (d)To enforce the terms of the ERA and any rules and regulations adopted by the RPAC;25 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (e)To review and render decisions respecting a claim for a benefit under the ERA; (f)To furnish the Employer with information that the Employer may require for tax or other purposes; (g)To engage the service of counsel (who may, if appropriate, be counsel for the Employer), actuaries, and agentswhom it may deem advisable to assist it with the performance of its duties; (h)To prescribe procedures to be followed by Participants in obtaining benefits; (i)To receive from the Employer and from Participants such information as is necessary for the proper administration ofthe ERA; (j)To establish and maintain, or cause to be maintained, the individual Accounts described in Section 4.3; (k)To create and maintain such records and forms as are required for the efficient administration of the ERA; (l)To make all determinations and computations concerning the benefits, credits and debits to which any Participant, orother Beneficiary, is entitled under the ERA; (m)To give the Trustee of the trust established to serve as a source of funds under the ERA specific directions in writingwith respect to: (i)making distribution payments, giving the names of the payees, specifying the amounts to be paid and thetime or times when payments will be made; and (ii)making any other payments which the Trustee is not by the terms of the trust agreement authorized to makewithout a direction in writing by the Plan Administrator; (n)To comply with all applicable lawful reporting and disclosure requirements of ERISA; (o)To comply (or transfer responsibility for compliance to the Trustee) with all applicable federal income tax withholdingrequirements for benefit distributions; and (p)To construe the ERA, in its sole and absolute discretion, and make equitable adjustments for any errors made in theadministration of the ERA. The foregoing list of express duties is not intended to be either complete or conclusive, and the Plan Administrator will, inaddition, exercise such other powers and perform such other duties as it may deem necessary, desirable, advisable or properfor the supervision and administration of the ERA.26 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 8.5 Indemnification of RPAC and Plan Administrator. To the extent not covered by insurance, or if there is a failure to providefull insurance coverage for any reason, and to the extent permissible under corporate by-laws and other applicable laws andregulations. the Employer agrees to hold harmless and indemnify the RPAC and Plan Administrator against any and allclaims and causes of action by or on behalf of any and all parties whomsoever, and all losses therefrom, including, withoutlimitation, costs of defense and reasonable attorneys' fees, based upon or arising out of any act or omission relating to or inconnection with the ERA other than losses resulting from the RPAC's, or any such person's commission of fraud or willfulmisconduct. 8.6 Claims for Benefits. (a) Initial Claim. In the event that an Employee, Eligible Person, Participant or his Beneficiary claims to be eligible forbenefits, or claims any rights under this ERA, such claimant must complete and submit such claim forms andsupporting documentation as will be required by the Plan Administrator, in its sole and absolute discretion. Likewise,any Participant or Beneficiary who feels unfairly treated as a result of the administration of the ERA must file awritten claim. setting forth the basis of the claim, with the Plan Administrator. In connection with the determination ofa claim, or in connection with review of a denied claim. the claimant may examine this ERA, and any other pertinentdocuments generally available to Participants that are specifically related to the claim. Different claims procedures apply to claims for benefits on account of Disability, referred to as "Disability claims,"and all other claims for benefits, referred to as "non-Disability claims " (b) Non-Disability Claims. (i) Initial Decision. If a claimant files a non-Disability claim, written notice of the disposition of such claim willbe furnished to the claimant within ninety (90) days after the claim is filed with the Plan Administrator. Suchnotice will refer, if appropriate, to pertinent provisions of this ERA, will set forth in writing the reasons fordenial of the claim if a claim is denied (including references to any pertinent provisions of this ERA) and,where appropriate, will describe any additional material or information necessary for the claimant to perfectthe claim and an explanation of why such material or information is necessary. If the claim is denied, inwhole or in part, the claimant will also be notified of the ERA's claim review procedure and the time limitsapplicable to such procedure, including the claimant's right to arbitration following an adverse benefitdetermination on review as provided below. All benefits provided in this ERA as a result of the disposition ofa claim will be paid as soon as practicable following receipt of proof of entitlement, if requested. (ii) Request for Review. Within ninety (90) days after receiving written notice of the Plan Administrator'sdisposition of the claim, the claimant may file with the RPAC a written request for review of his claim. Inconnection with the request for review, the claimant will be entitled to be represented by counsel and will begiven; upon request and free of charge, reasonable access to all pertinent documents for the preparation27 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. of his claim. If the claimant does not file a written request for review within ninety (90) days after receivingwritten notice of the Plan Administrator's disposition of the claim, the claimant will be deemed to haveaccepted the Plan Administrator's written disposition, unless the claimant was physically or mentallyincapacitated so as to be unable to request review within the ninety (90) day period. (iii) Decision on Review. After receipt by the RPAC of a written application for review of his claim, the RPAC willreview the claim taking into account all comments, documents, records and other information submitted bythe claimant regarding the claim without regard to whether such information was considered in the initialbenefit determination. The RPAC will notify the claimant of its decision by delivery or by certified orregistered mail to his last known address. A decision on review of the claim will be made by the RPAC at itsnext meeting following receipt of the written request for review. If no meeting of the RPAC is scheduledwithin forty-five (45) days of receipt of the written request for review, then the RPAC will hold a specialmeeting to review such written request for review within such forty-five (45) day period. If specialcircumstances require an extension of the forty-five (45) day period, the RPAC will so notify the claimant anda decision will be rendered within ninety (90) days of receipt of the request for review. In any event, if a claimis not determined by the RPAC within ninety (90) days of receipt of written submission for review. it will bedeemed to be denied. The decision of the RPAC will be provided to the claimant as soon as possible but no later than five (5) daysafter the benefit determination is made. The decision will be in writing and will include the specific reasons forthe decision presented in a manner calculated to be understood by the claimant and will contain referencesto all relevant ERA provisions on which the decision was based. Such decision will also advise the claimantthat he may receive upon request, and free of charge, reasonable access to and copies of all documents,records and other information relevant to his claim and will inform the claimant of his right to arbitration in thecase of an adverse decision regarding his appeal. The decision of the RPAC will be final and conclusive. (c) Disability Claims. (i) Initial Decision. If a claimant files a Disability claim, written notice of the disposition of such claim will befurnished to the claimant within forty-five (45) days after the claim is filed with the Plan Administrator. Thisperiod may be extended by the Plan Administrator for up to thirty (30) days provided that the PlanAdministrator determines that such an extension is necessary due to matters beyond its control and theclaimant is notified before the expiration of the initial forty-five (45) day period of the circumstances requiringthe extension of time and the date by which the Plan Administrator expects to render a decision. If, beforethe first thirty (30) day extension period, the Plan Administrator determines that, due to matters beyond itscontrol, a decision cannot be made within that extension period, the period for making the determination maybe28 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. extended for up to an additional thirty (30) days provided that the claimant is notified before the expiration ofthe first thirty (30) day extension period of the circumstances requiring the extension and the date as ofwhich the Plan Administrator expects to issue a decision. In the case of any extension. the notice ofextension will specifically explain the standards on which entitlement to a benefit on account of Disability isbased, the unresolved issues that prevent a decision on the claim, and the additional information needed toresolve those issues and the claimant will be given at least forty-five (45) days within which to provide thespecified information. Written notice of the disposition of the claim will refer. if appropriate, to pertinent provisions of this ERA, willset forth in writing the reasons for denial of the claim if a claim is denied (including references to anypertinent provisions of this ERA), the protocol relied upon in denying the claim or a statement that suchprotocol is available on request and, where appropriate, will describe any additional material or informationnecessary for the claimant to perfect the claim and an explanation of why such material or information isnecessary. If the claim is denied, in whole or in part, the claimant will also be notified of the ERA's claimreview procedure and the time limits applicable to such procedure, including the claimant's right to arbitrationfollowing an adverse benefit determination on review as provided below. (ii) Request for Review. Within one hundred and eighty (180) days after receiving written notice of the PlanAdministrator’s denial of the claim, the claimant may file with the RPAC a written request for review of hisclaim. In connection with the request for review, the claimant will be entitled to be represented by counseland will be given, upon request and free of charge, reasonable access to all pertinent documents for thepreparation of his claim. If the claimant does not file a written request for review within this one hundred andeighty (180) day period, the claimant will be deemed to have accepted the Plan Administrator's writtendisposition, unless the claimant was physically or mentally incapacitated so as to be unable to requestreview within the one hundred and eighty (180) day period. If the benefit denial is based in whole or in part on a medical judgment. the claimant will be entitled to areview by the RPAC based on the RPAC's consultation with a health care professional who has appropriatetraining and experience in the field of medicine involved in the medical judgment whereby such professionalis neither an individual who was consulted in connection with the benefit denial that is the subject of therequest for review nor the subordinate of any such individual. The claimant will also be provided with theidentity of any medical or vocational experts whose advice was obtained on behalf of the ERA in connectionwith the benefit denial, without regard to whether the advice was relied upon in making the initial benefitdetermination. The RPAC's review will take into account all comments, documents, records and other information submittedby the claimant relating to the29 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. claim without regard to whether such information was submitted or considered in the initial benefitdetermination. In addition, the RPAC's review will not give deference to the initial adverse benefitdetermination. If the Plan Administrator is a member of the RPAC, he will not participate in the RPAC'sreview of the request for review (iii) Decision on Review. The claimant will be provided with written notice of the RPAC's benefit determination onreview within a reasonable period of time; provided, however, that such period will not last more than forty-five (45) days or ninety (90) days if an extension is required and proper notice is given to the claimant. In anyevent, if a claim is not determined by the RPAC within ninety (90) days of receipt of written submission forreview, it will be deemed to be denied. The decision of the RPAC will be in writing and will include the specific reasons for the decision presented ina manner calculated to be understood by the claimant and will contain references to all relevant ERAprovisions on which the decision was based. Such decision will also advise the claimant that he may receiveupon request, and free of charge, reasonable access to and copies of all documents, records and otherinformation relevant to his claim and will inform the claimant of his right to arbitration in the case of anadverse decision regarding his appeal. In addition, the notice will set forth the following additional information,to the extent applicable: (A) the protocol relied upon in making the adverse decision; (B) if the adverse decision is based on a medical necessity or similar exclusion or limit, either anexplanation of the scientific or clinical judgment for the decision, applying the terms of the ERA tothe claimant's medical circumstances, or a statement that such explanation will be provided free ofcharge upon request; and (C) the following statement: You and your ERA may have other voluntary alternative dispute resolutionoptions, such as mediation. One way to find out what may be available is to contact your local U.S.Department of Labor Office. The decision of the RPAC will be final and conclusive. 8.7 Arbitration. In the event the claims review procedure described in Section 8.6 of the ERA does not result in an outcomethought by the claimant to be in accordance with the ERA document, he may appeal to a third party neutral arbitrator. Theclaimant must appeal to an arbitrator within sixty (60) days after receiving the RPAC’s denial or deemed denial of his requestfor review and before bringing suit in court. The arbitration will be conducted pursuant to the American Arbitration Association(“AAA”) Rules on Employee Benefit Claims. The arbitrator will be mutually selected by the claimant and the RPAC from a list of arbitrators who are experienced innonqualified deferred compensation plan benefit matters that is provided by the AAA. If the parties are unable to agree on theselection of30 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. an arbitrator within ten (10) days of receiving the list from the AAA, the AAA will appoint an arbitrator. The arbitrator’s reviewwill be limited to interpretation of the ERA document in the context of the particular facts involved. The claimant, the RPACand the Company agree to accept the award of the arbitrator as binding, and all exercises of power by the arbitrator hereunderwill be final, conclusive and binding on all interested parties, unless found by a court of competent jurisdiction, in a finaljudgment that is no longer subject to review or appeal, to be arbitrary and capricious. The claimant, RPAC and the Companyagree that the venue for the arbitration will be in Dallas, Texas. The costs of arbitration will be paid by the Company; thecosts of legal representation for the claimant or witness costs for the claimant will be borne by the claimant; provided, that,as part of his award, the Arbitrator may require the Company to reimburse the claimant for all or a portion of such amounts. The following discovery may be conducted by the parties: interrogatories, demands to produce documents, requests foradmissions and oral depositions. The arbitrator will resolve any discovery disputes by such pre hearing conferences as maybe needed. The Company, RPAC and claimant agree that the arbitrator will have the power of subpoena process as providedby law. Disagreements concerning the scope of depositions or document production, its reasonableness and enforcement ofdiscovery requests will be subject to agreement by the Company and the claimant or will be resolved by the arbitrator. Alldiscovery requests will be subject to the proprietary rights and rights of privilege and other protections granted by applicablelaw to the Company and the claimant and the arbitrator will adopt procedures to protect such rights. With respect to anydispute, the Company, RPAC and the claimant agree that all discovery activities will be expressly limited to matters directlyrelevant to the dispute and the arbitrator will be required to fully enforce this requirement. The arbitrator will have no power to add to, subtract from, or modify any of the terms of the ERA, or to change or add to anybenefits provided by the ERA, or to waive or fail to apply any requirements of eligibility for a benefit under the ERA.Nonetheless, the arbitrator will have absolute discretion in the exercise of its powers in this ERA. Arbitration decisions will notestablish binding precedent with respect to the administration or operation of the ERA. 8.8 Receipt and Release of Necessary Information. In implementing the terms of this ERA, the RPAC and Plan Administrator,as applicable, may, without the consent of or notice to any person, release to or obtain from any other insuring entity or otherorganization or person any information, with respect to any person, which the RPAC or Plan Administrator deems to benecessary for such purposes. Any Participant or Beneficiary claiming benefits under this ERA will furnish to the RPAC orPlan Administrator, as applicable, such information as may be necessary to determine eligibility for and amount of benefit, asa condition of claiming and receiving such benefit. 8.9 Overpayment and Underpayment of Benefits. The Plan Administrator may adopt, in its sole and absolute discretion,whatever rules, procedures and accounting practices are appropriate in providing for the collection of any overpayment ofbenefits. If a Participant or Beneficiary receives an underpayment of benefits. the Plan Administrator will direct that paymentbe made as soon as practicable to make up for the underpayment. If an overpayment is made to a Participant or Beneficiary.for whatever reason, the Plan Administrator may, in its sole and absolute discretion, (a) withhold payment of any furtherbenefits under the ERA until the overpayment has been31 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. collected; provided, that the entire amount of reduction in any calendar year does not exceed five thousand dollars ($5,000),and the reduction is made at the same time and in the same amount as the debt otherwise would have been due andcollected from the Participant, or (b) may require repayment of benefits paid under this ERA without regard to further benefitsto which the Participant or Beneficiary may be entitled. 8.10 Change of Control. Upon a Change of Control and for the following three (3) years thereafter, if any arbitration arises relatingto an event occurring or a claim made within three (3) years of a Change of Control, (i) the arbitrator will not decide the claimbased on an abuse of discretion principle or give the previous RPAC decision any special deference, but rather will determinethe claim de novo based on its own independent reading of the ERA; and (ii) the Company will pay the Participant'sreasonable legal and other related fees and expenses, by applying Section 3.1(f) of the ESP (except that if the Participant isnot entitled to severance benefits under the ESP on account of the Termination of Employment that entitles the Participant toreceive benefits under this ERA, the reference to the “shorter of the Severance Period or the Reimbursement Period” in theESP will be changed to the “Reimbursement Period” only). End of Article VIII 32 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IXOTHER BENEFIT PLANS OF THE COMPANY 9.1 Other Plans. Nothing contained in this ERA will prevent a Participant before his death, or a Participant's spouse or otherBeneficiary after such Participant's death, from receiving, in addition to any payments provided for under this ERA, anypayments provided for under any other plan or benefit program of the Employer or an Affiliate, or which would otherwise bepayable or distributable to him, his surviving spouse or Beneficiary under any plan or policy of the Employer, an Affiliate orotherwise. Nothing in this ERA will be construed as preventing the Company or any of its Affiliates from establishing anyother or different plans providing for current or deferred compensation for employees. Unless otherwise specifically providedin any plan of the Company intended to "qualify” under section 401 of the Code, Compensation made under this ERA willconstitute earnings or compensation for purposes of determining contributions or benefits under such qualified plan. End of Article IX 33 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE XAMENDMENT AND TERMINATION OF THE PLAN 10.1 Continuation. The Company intends to continue this ERA indefinitely, but nevertheless assumes no contractual obligationbeyond the promise to pay the benefits described in this ERA. 10.2 Amendment of ERA. The Company, through an action of the Human Resources Committee, reserves the right in its soleand absolute discretion to amend this ERA in any respect at any time, except that upon or during the two (2) year periodafter any Change of Control of the Company, (a) ERA benefits cannot be reduced, (b) Articles VIII and X and Section 7.1(b)cannot be changed, and (c) (except as provided in Section 10.3) no prospective amendment that adversely affects the rightsor obligations of a Participant may be made unless the affected Participant receives at least one (1) year's advance writtennotice of such amendment. Moreover, no amendment may ever be made that retroactively reduces or diminishes the rights of any Participant to thebenefits described herein that have been accrued or earned through the date of such amendment, even if a Termination ofEmployment has not yet occurred with respect to such Participant. In addition to the Human Resources Committee, the RPAC has the right to make non-material amendments to the ERA tocomply with changes in the law or to facilitate ERA administration; provided, however, that each such proposed non¬-materialamendment must be discussed with the Chairperson of the Human Resources Committee in order to determine whether suchchange would constitute a material amendment to the ERA. The provisions of this Section 10.2 will not restrict the right of the Company to terminate this ERA under Section 10.3 belowor the termination of an Affiliate’s participation under Section 10.4 below. 10.3 Termination of ERA. The Company, through an action of the Human Resources Committee, may terminate or suspend thisERA in whole or in part at any time, provided that no such termination or suspension will deprive a Participant, or personclaiming benefits under this ERA through a Participant, of any amount credited to his Account under this ERA up to the dateof suspension or termination. Except as required by applicable law and pursuant to the valuation of such Account pursuant toSection 4.4, the Human Resources Committee may decide to liquidate the ERA upon termination under the followingcircumstances: (a)Corporate Dissolution or Bankruptcy. The Human Resources Committee may terminate and liquidate the ERAwithin twelve (12) months of a corporate dissolution taxed under section 331 of the Code or with the approval of abankruptcy court pursuant to 11 U.S.C. § 503(b)(1)(A); provided, that the amounts deferred under the ERA areincluded in Participants' gross income in the latest of the following years (or if earlier, the taxable year in which theamount is actually or constructively received): (i) The calendar year in which the ERA termination and liquidation occurs.34 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (ii) The first calendar year in which the amount is no longer subject to a substantial risk of forfeiture. (iii) The first calendar year in which the payment is administratively practicable. (b) Change in Control. The Human Resources Committee may terminate and liquidate the ERA within the thirty (30)days preceding or the twelve (12) months following a Change in Control (except on account of a liquidation ordissolution of the Company), provided that all plans or arrangements that would be aggregated with the ERA undersection 409A of the Code are also terminated and liquidated with respect to each Participant that experienced theChange in Control event so that under the terms of the ERA and all such arrangements the Participant is required toreceive all amounts of compensation deferred under such arrangements within twelve (12) months of the terminationof the ERA or arrangement, as applicable. In the case of a Change of Control event which constitutes a sale ofassets, the termination of the ERA pursuant to this Section 10.3(b) may be made with respect to the Employer that isprimarily liable immediately after the Change of Control transaction for the payment of benefits under the ERA. (c) Termination of ERA. The Human Resources Committee may terminate and liquidate the ERA provided that (i) thetermination and liquidation does not occur by reason of a downturn of the financial health of the Company or anEmployer, (ii) all plans all plans or arrangements that would be aggregated with the ERA under section 409A of theCode are also terminated and liquidated, (iii) no payments in liquidation of the ERA are made within twelve (12)months of the date of termination of the ERA other than payments that would be made in the ordinary courseoperation of the ERA, (iv) all payments are made within twenty-four (24) months of the date the ERA is terminatedand (v) the Company or the Employer, as applicable depending on whether the ERA is terminated with respect tosuch entity, do not adopt a new plan that would be aggregated with the ERA within three (3) years of the date of thetermination of the ERA. 10.4 Termination of Affiliate's Participation. An Affiliate may terminate its participation in the ERA at any time by an action of itsgoverning body and providing written notice to the Company. Likewise, the Company may terminate an Affiliate's participationin the ERA at any time by an action of the Human Resources Committee and providing written notice to the Affiliate. Theeffective date of any such termination will be the later of the date specified in the notice of the termination of participation orthe date on which the RPAC can administratively implement such termination. In the event that an Affiliate's participation inthe ERA is terminated, unless declared otherwise by the Company and specified in Exhibit A each Participant employed bysuch Affiliate will continue to participate in the ERA as an inactive Participant and will be entitled to a distribution of his entireAccount or a portion thereof upon his Termination of Employment pursuant to Section 5.3. End of Article X35 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE XIMISCELLANEOUS 11.1 No Reduction of Employer Rights. Nothing contained in this ERA will be construed as a contract of employment betweenthe Employer and an Employee, or as a right of any Employee to continue in the Employment of the Employer, or as alimitation of the right of the Employer to discharge any of its Employees, with or without cause. 11.2 Provisions Binding. All of the provisions of this ERA will be binding upon all persons who will be entitled to any benefithereunder, their heirs and personal representatives. End of Article XI 36 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. IN WITNESS WHEREOF, this Sixth Amended and Restated Tenet Executive Retirement Account has been executed on this 18thday of December, 2015, effective as of November 30, 2015, except as specifically provided otherwise herein. TENET HEALTHCARE CORPORATION By:/s/ Paul Slavin Paul Slavin, Vice President, Compensation, Benefits and Corporate HR Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. EXHIBIT AGRANDFATHERED CONIFER EMPLOYEES Section 2.1(s) of the Sixth Amended and Restated Tenet Executive Retirement Account (the "ERA") provides that certain Employeesof Conifer Health Solutions, LLC will continue to participate in the ERA after December 31, 2013, the date that Conifer HealthSolutions, LLC ceased to be an Employer. NameTitle(includes any Successor Title)Daniel M. KarnutaSenior Vice President, Chief Financial OfficerMatthew C. MichaelsSenior Vice President, CHI Revenue CycleMegan H. NorthPresident, VBCJanie PattersonSenior Vice President, Revenue Cycle ManagementJames M. ThatcherSenior Vice President, Business DevelopmentNorma A. ZeringueSenior Vice President, Chief HR Officer A-1 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. EXHIBIT BLIMITS ON ELIGIBILITY AND PARTICIPATION Section 3.1 of the Tenet Executive Retirement Account (the ''Prior ERA'') provided the Retirement Plans Administration Committee,formerly the Pension Administration Committee (the “RPAC”), with the authority to limit the classification of employees of TenetHealthcare Corporation or its participating affiliates (collectively the "Employer") eligible to participate in the ERA and/or to limit orterminate an Eligible Person's participation in the ERA at any time and states that any such limitation will be set forth in this ExhibitB. This provision has been continued in this Sixth Amended and Restated Tenet Executive Retirement Account. This Exhibit Bidentifies the employees excluded from ERA participation pursuant to this provision. NameTitleEffective Date AndApplicable Modification B-1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 10(h) FIRST AMENDMENT TO STOCK PLEDGE AGREEMENT This First Amendment to Stock Pledge Agreement (this “Amendment”) is entered into as of May 8,2009, by and among Tenet Healthcare Corporation, a Nevada corporation (the “Company”), each of theother entities listed on the signature pages hereof as Pledgors, and The Bank of New York Mellon TrustCompany, N.A. (“BoNY”), as collateral trustee for the Secured Parties (as defined in the Stock PledgeAgreement referred to below) (in such capacity, the “Collateral Trustee”). RECITALS WHEREAS, reference is made to that certain Stock Pledge Agreement, dated as of March 3, 2009(as amended, restated, supplemented or otherwise modified from time to time, the “Stock PledgeAgreement”; unless otherwise indicated, capitalized terms used herein without definition have the meaningsascribed to such terms i n the Stock Pledge Agreement), by the Company and the Pledgors in favor of theCollateral Trustee; WHEREAS, pursuant to that certain letter agreement related to exchange offer, dated as of May 8,2009, between the Company and PNC Bank, National Association, the Company is issuing on the datehereof (a) $14,469,500 of additional 6-year notes (the “Additional 6-Year Notes”) pursuant to anIndenture, dated as of November 6, 2001 (the “Base Indenture”), between the Company and BoNY, assuccessor trustee to The Bank of New York (the “Trustee”), as supplemented by a Ninth SupplementalIndenture, dated as of March 3, 2009 (the “Ninth Supplemental Indenture”), among the Company, theGuarantors from time to time party thereto and the Trustee (together with the Base Indenture, the “6-yearIndenture”) and (b) $14,469,500 of additional 9-year notes (the “Additional 9-Year Notes” and togetherwith the Additional 6-year Notes, the “Additional Notes”) pursuant to the Base Indenture, as supplementedby a Tenth Supplemental Indenture, dated as of March 3, 2009 (the “Tenth Supplemental Indenture” and,together with the Ninth Supplemental Indenture, the “Supplemental Indentures”), among the Company, theGuarantors from time to time party thereto and the Trustee (together with the Base Indenture, the “‘9-yearIndenture” and, collectively with the 6-year Indenture, the “Indentures”, as the same may be amended,restated, supplemented or otherwise modified from time to time); WHEREAS, the Secured Obligations in respect of which a security interest in the Collateral wascreated by the Stock Pledge Agreement is limited to only the Obligations in respect of the New Notesissued by the Company on March 3, 2009; WHEREAS, subject to the terms and conditions hereof, the parties hereto desire to and have agreedto amend the Stock Pledge Agreement to include within the Secured Obligations the Obligations in respectof the Additional Notes and any other 6-year notes and 9-year notes issued and authenticated under theIndentures; and WHEREAS, the sole effect of this Amendment is to secure additional debt of the Company that ispermitted by the terms of the Indentures to be secured by the Collateral, and that Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.as such, pursuant to Section 7.1 of the Stock Pledge Agreement, Article VII of the SupplementalIndentures and Section 7.1 of the Collateral Trust Agreement, this Amendment may be entered into by theCompany, the other Pledgors and the Collateral Trustee without (i) the consent of 75% of the holders of the6-year notes, (ii) the consent of 75% of the holders of the 9-year notes or (ii i) direction to the CollateralTrustee by an Act of Required Stock Secured Debtholders (as defined in the Collateral Trust Agreement). Now, THEREFORE, in consideration of the premises and the mutual covenants herein contained,and to induce the Holders of the Old Notes to exchange their Old Notes for Additional Notes, each Pledgorhereby agrees with the Collateral Trustee as follows: 1. Section References. Unless otherwise expressly stated herein, all Section references hereinshall refer to Sections of the Stock Pledge Agreement. 2. Amendments to Section 1.1. Section 1.1 is hereby amended by: (a) adding the following definitions i n the proper alphabetical order: “Ninth Supplemental Indenture Notes” means al l 9.0% Senior Secured Notes due 2015 issued bythe Company and authenticated by the Trustee under the 6-year Indenture. “Notes” means the Ninth Supplemental Indentures Notes and the Tenth Supplemental IndentureNotes. “Tenth Supplemental Indenture Notes” means all 10.0% Senior Secured Notes due 201 8 issued bythe Company and authenticated by the Trustee under the 9-year Indenture. (b) amending the definitions of “Pledged Stock”, “Related Document”, “Secured Obligations”and “Secured Parties” by deleting each reference to “New Notes” therein and replacing itwith “Notes”. 3. Amendment to Section 5.1. Section 5.1 is hereby amended by deleting the reference to“New Notes” therein and replacing it with “Notes”. 4. Conditions Precedent. The effectiveness of this Amendment is subject to the CollateralTrustee’s receipt of each of the following: (a) this Amendment, duly executed and delivered by the Company, each other Pledgor and theCollateral Trustee; (b) an Officers’ Certificate (as defined in the Collateral Trust Agreement) to the effect that thisAmendment will not result in a breach of any provision or covenant contained in any of the SecuredDebt Documents (as defined in the Collateral Trust Agreement); and (c) an opinion of counsel of the Company to the effect that the Collateral Trustee’s execution ofthis Amendment is permitted by the Collateral Trust Agreement.2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.5. Reference to Stock Pledge Agreement. The Stock Pledge Agreement and the RelatedDocuments, including the Indentures and the Collateral Trust Agreement, and any and all otheragreements, documents or instruments now or hereafter executed and/or delivered pursuant to the termshereof, pursuant to the terms of the Related Documents or pursuant to the terms of the Stock PledgeAgreement as amended hereby, are hereby amended so that any reference in the Stock Pledge Agreement,the Related Documents or such other agreements, documents or instruments to the Stock PledgeAgreement, whether direct or indirect, shall mean a reference to the Stock Pledge Agreement as amendedhereby. 6. Counterparts. This Amendment may be executed by one or more of the parties to thisAmendment on any number of separate counterparts (including by telecopy), each of which whenso executed shall be deemed to be an original and all of which taken together shall constitute one and thesame agreement. Signature pages may be detached from multiple counterparts and attached to a singlecounterpart so that all signature pages are attached to the same document. Delivery of an executedcounterpart by telecopy shall be effective as delivery of a manually executed counterpart. 7. Severability. Any provision of this Amendment that is prohibited or unenforceable in anyjurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibitions or unenforceabilitywithout invalidating the remaining provisions hereof, and any such prohibition or unenforceability in anyjurisdiction shall not invalidate or render unenforceable such provision i n any other jurisdiction. 8. Governing Law. This Amendment and the rights and obligations of the parties hereto shallbe governed by, and construed and interpreted in accordance with, the law of the State of New York. 9. Limited Effect. Except to the extent specifically amended or modified hereby, the provisionsof the Stock Pledge Agreement shall not be amended, modified, impaired or otherwise affected hereby. 10. The Collateral Trustee is not responsible for the validity or sufficiency of this Amendmentor the recitals contained herein. [Signature Pages Follow] 3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be dulyexecuted and delivered as of the date first above written. TENET HEALTHCARE CORPORATION, as aPledgor By:/s/ Biggs C. Porter Name: Biggs C. Porter Title: Chief Financial Officer Signature Page to First Amendment to Stock Pledge Agreement Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. American Medical (Central), Inc., AMI Information Systems Group, Inc., Amisub (Heights), Inc., Amisub (Hilton Head), Inc., Amisub (Twelve Oaks), Inc., Amisub of Texas, Inc., Brookwood Health Services, Inc., Coral Gables Hospital, Inc., Cypress Fairbanks Medical Center, Inc., Fmc Acquisition, Inc., Fmc Medical, Inc., Lifemark Hospitals, Inc., MCF, Inc., Ornda Hospital Corporation, Tenet California, Inc., Tenet Florida, Inc., Tenet Healthsystem CFMC, Inc., Tenet Healthsystem Healthcorp, Tenet Healthsystem Holdings, Tenet Healthsystem Medical, Inc., Tenet Healthsystem Philadelphia, Inc., Tenet Hospitals, Inc., Tenet Louisiana, Inc., Tenet Missouri, Inc., Tenet Physician Services -Hilton Head, Inc., Tenet Texas, Inc., Tenetsub Texas, Inc., each as a Pledgor By:/s/ Kristina A. Mack Name: Kristina A. Mack Title: Sole Director Accepted and Agreedas of the date first above written: The Bank of New York Mellon Trust Company, N.A.,as Collateral Trustee By:/s/ Teresa Petta Name: Teresa Petta Title: Authorized Signatory Signature Page to First Amendment to Stock Pledge AgreementSource: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 10(j) THIRD AMENDMENT TO STOCK PLEDGE AGREEMENT This Third Amendment to Stock Pledge Agreement (this “Amendment”) is entered into as ofMarch 7, 2014, among Tenet Healthcare Corporation, a Nevada corporation (the “Company”), each of theother entities listed on the signature pages hereof as Pledgors, and The Bank of New York Mellon TrustCompany, N.A., as collateral trustee for the Secured Parties (in such capacity, the “Collateral Trustee”). RECITALS WHEREAS, reference is made to that certain Stock Pledge Agreement, dated as of March 3, 2009,by the Company and the other Pledgors in favor of the Collateral Trustee, as amended by that certain FirstAmendment to Stock Pledge Agreement, dated as of May 8, 2009, among the Company, the otherPledgors and the Collateral Trustee, as amended by that certain Second Amendment to Stock PledgeAgreement, dated as of June 15, 2009, among the Company, the other Pledgors and the Collateral Trustee,as amended by that certain Joinder Agreement to the Stock Pledge Agreement, dated as of May 15, 2013and executed by the pledgors party thereto, as amended by that certain Pledge Amendment to the StockPledge Agreement, dated as of May 15, 2013, between the Company and the Collateral Trustee, asamended by that certain Joinder Agreement to the Stock Pledge Agreement, dated as of October 1, 2013and executed by the pledgors party thereto, as amended by that certain Pledge Amendment to the StockPledge Agreement, dated as of October 1, 2013, by the Company and the Collateral Trustee (as soamended, the “Stock Pledge Agreement”); WHEREAS, pursuant to that certain Letter of Credit Facility Agreement (the “LC FacilityAgreement”), dated as of March 7, 2014, among the Company, certain financial institutions party thereto asletter of credit participants and letter of credit issuers (in such capacity, the “LC Issuers”) and BarclaysBank PLC, as administrative agent, the LC Issuers have agreed to issue letters of credit for the account ofthe Company on the terms set forth in such LC Facility Agreement; WHEREAS, the Secured Obligations in respect of which a security interest i n the Collateral wascreated by the Stock Pledge Agreement is limited to only the obligations in respect of the: (a)Fourteenth Supplemental Indenture to the Base Indenture, dated as of November 21, 2011,by and among the Company, The Bank of New York Mellon Trust Company, N.A., as trustee (the“Trustee”) and the guarantors party thereto and relating to the Company’s 6.250% Senior Secured Notesdue 2018 (the “2018 Notes” and, as supplemented by the Nineteenth Supplemental Indenture, dated as ofMay 15, 2013, between the Company, the Trustee and the guarantors party thereto, and the TwentySecond Supplemental Indenture, dated as of October 1, 2013, between the Company, the Trustee and theguarantors party thereto, the “Fourteenth Supplemental Indenture”); (b)Fifteenth Supplemental Indenture to the Base Indenture, dated as of October 16, 2012, byand among the Company, the Trustee and the guarantors party thereto and relating to Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.the Company’s 4.75% Senior Secured Notes due 2020 (the “2020 Notes” and, as supplemented by theNineteenth Supplemental Indenture, dated as of May 15, 2013, between the Company, the Trustee and theguarantors party thereto, and the Twenty Second Supplemental Indenture, dated as of October 1, 2013,between the Company, the Trustee and the guarantors party thereto, the “Fifteenth SupplementalIndenture”); (c)Seventeenth Supplemental Indenture to the Base Indenture, dated as of February 5, 2013,by and among the Company, the Trustee and the guarantors party thereto and relating to the Company’s4.500% Senior Secured Notes due 2021 (the “4.500% 2021 Notes” and, as supplemented by theNineteenth Supplemental Indenture, dated as of May 15, 2013, between the Company, the Trustee and theguarantors party thereto, and the Twenty Second Supplemental Indenture, dated as of October 1, 2013,between the Company, the Trustee and the guarantors party thereto, the “Seventeenth SupplementalIndenture”); (d)Twentieth Supplemental Indenture to the Base Indenture, dated as of May 30, 2013, by andamong the Company, the Trustee and the guarantors party thereto and relating to the Company’s 4.375%Senior Secured Notes due 2021 (the “4.375% 2021 Notes” and, as supplemented by the NineteenthSupplemental Indenture, dated as of May 15, 2013, between the Company, the Trustee and the guarantorsparty thereto, and the Twenty Second Supplemental Indenture, dated as of October 1, 2013, between theCompany, the Trustee and the guarantors party thereto, the “Twentieth Supplemental Indenture”); (e)Indenture dated as of September 27, 2013 (the “2013 Base Indenture”), between THCEscrow Corporation and the Trustee (as supplemented on October 1, 2013 by the first supplementalindenture thereto by and among the Company , the Trustee, and the guarantors party thereto (collectively,the “2013 Indenture”)), pursuant to which the 6.00% Senior Secured Notes due 2020 were issued (the“6.000% 2020 Notes” and, together with the 4.375% 2021 Notes, the 4.500% 2021 Notes, the 2020 Notesand the 2018 Notes are collectively referred to herein as the “Notes”); and (f)the Guarantees i n respect of the Notes, WHEREAS, subject to the terms and conditions hereof, the parties hereto desire to and have agreedto amend the Stock Pledge Agreement to include within the Secured Obligations the obligations in respectof the LC Facility Agreement, in each case to be designated as and entitled to the benefits of being First-Priority Stock Secured Debt (as defined in the Collateral Trust Agreement) under the Collateral TrustAgreement in accordance with the requirements set forth in Section 3.8 thereof. WHEREAS, the sole effect of this Amendment is to secure additional debt of the Company that ispermitted by the terms of the Collateral Trust Agreement to be secured by the Collateral and to addreferences to such debt and the documents governing such debt, and that as such, pursuant to: (a)Section 7.1 of the Stock Pledge Agreement; (b)Section 7.1 of the Collateral Trust Agreement;2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(c)Article VII of each of the Fourteenth Supplemental Indenture, Fifteenth SupplementalIndenture, Seventeenth Supplemental Indenture and Twentieth Supplemental Indenture, and Section 902 ofthe 2013 Indenture, this Amendment may be entered into by the Company, the other pledgors party heretoand the Collateral Trustee without (i) the consent of the holders of the Notes or (ii) direction to theCollateral Trustee by an Act of Required Stock Secured Debtholders (as defined in the Collateral TrustAgreement); and WHEREAS, unless otherwise indicated, capitalized terms used herein without definition have themeanings ascribed to such terms in the Stock Pledge Agreement. NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained,the Company and each other Pledgor signatory hereto hereby agrees with the Collateral Trustee as follows: 1.Section References. Unless otherwise expressly stated herein, all Section referencesherein shall refer to Sections of the Stock Pledge Agreement. 2.Amendments to Section 1.1. Section 1.1 of the Stock Pledge Agreement is herebyamended by amending and restating the defined terms “Secured Obligations” and “Secured Parties” in theirentirety and by adding the defined terms “Event of Default”, “LC Facility Agreement”, “GuaranteeAgreement”, “LC Obligations”, “LC Guarantees” and “2013 Indentures” to Section 1.1 in alphabeticalorder, in each case as set forth below (all other defined terms contained therein remain unchanged and tothe extent that definitions contained in this Section 2 conflict with definitions contained in the Stock PledgeAgreement, the definitions contained in this Section 2 shall control): “Event of Default” means an Event of Default, as such term is defined in any Indenture, any 2013Base Indenture, the LC Facility Agreement or any other First-Priority Stock Lien Document (assuch term is defined in the Collateral Trust Agreement). “Guarantee Agreement” means that certain Guarantee Agreement, dated as of March 7, 2014,among the Company, the guarantors party thereto, the LC Participants, the LC Issuers and theAdministrative Agent, as the same may be amended, restated, supplemented or otherwise modifiedfrom time to time. “LC Facility Agreement” means that certain Letter of Credit Facility Agreement, dated as of March7, 2014, among the Company, certain financial institutions party thereto from time to time as LCParticipants (the “LC Participants”) and Issuers (the “LC Issuers”) and Barclays Bank PLC, asadministrative agent (in such capacity, the “Administrative Agent”), as the same may be amended,restated , supplemented or otherwise modified from time to time. “LC Obligations” means the “Obligations” as defined in the LC Facility Agreement. “LC Guarantees” means guarantees in respect of the LC Obligations pursuant to the GuaranteeAgreement.3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.“Secured Obligations” means (i) Obligations in respect the Notes and the Note Guarantees and (ii)LC Obligations and obligations under the LC Guarantees. “Secured Parties” means the (i) Holders of the Notes, (ii) the LC Participants, LC Issuers andAdministrative Agent under the LC Facility Agreement and any other holders of LC Obligations,(iii) the Trustee under each Indenture and each 2013 Indenture and (iv) the Collateral Trustee. “2013 Indentures” means the Indenture dated as of September 27, 2013 (the “2013 BaseIndenture”), between THC Escrow Corporation and the Trustee (as supplemented on October 1,2013 by the first supplemental indenture thereto by and among the Company, the Trustee, and theguarantors party thereto) and all other indentures supplemental to the 2013 Base Indenture that aredesignated as and entitled to the benefits of being FirstPriority Stock Secured Debt under theCollateral Trust Agreement in accordance with the requirements set forth in Section 3.8 thereof. 3.Amendments to Section 5.3. Section 5.3(b) of the Stock Pledge Agreement is herebyamended by deleting the words “under the Indentures” at the end thereof. 4.Amendments to Section 7.1. Section 7.1 of the Stock Pledge Agreement is herebyamended and restated in its entirety as follows: None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwisemodified except in accordance with Article Nine of the Base Indenture, as supplemented by Article Sevenof each Supplemental Indenture, Section 9.02 of the 2013 Base Indenture, Section 11.1 of the LC FacilityAgreement and corresponding provisions of any First-Priority Stock Lien Document (as such term isdefined in the Collateral Trust Agreement); provided, however, that annexes to this Agreement may besupplemented (but no existing provisions may be modified and no Collateral may be released) throughPledge Amendments and Joinder Agreements, in substantially the form of Annex I (Form of PledgeAmendment) and Annex 2 (Form of Joinder Agreement) respectively, i n each case duly executed by theCol lateral Trustee and each Pledgor directly affected thereby. 5.Amendments to Section 7.11. Section 7.11(b) of the Stock Pledge Agreement is herebyamended by adding the words “, the 2013 Indentures, the LC Facility Agreement and each First-PriorityStock Lien Document (as such term is defined in the Collateral Trust Agreement)” at the end thereof. 6.Conditions Precedent. The effectiveness of this Amendment is subject to the CollateralTrustee’s receipt of each of the following: (a)this Amendment, duly executed and delivered by the Company, each other Pledgorparty hereto and the Collateral Trustee; (b)an Officers’ Certificate (as defined in the Collateral Trust Agreement) to the effectthat this Amendment will not result in a breach of any provision or covenant contained in any of theSecured Debt Documents (as defined in the Collateral Trust Agreement); and4 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(c)an opinion of counsel of the Company to the effect that the Collateral Trustee’sexecution of this Amendment is authorized and permitted by the Collateral Trust Agreement. 7.Reference to Stock Pledge Agreement. The Stock Pledge Agreement and the RelatedDocuments, and any and all other agreements, documents or instruments now or hereafter executed and/ordelivered pursuant to the terms hereof or pursuant to the terms of the Stock Pledge Agreement or theRelated Documents, are hereby amended so that any reference therein to the Stock Pledge Agreement,whether direct or indirect, shall mean a reference to the Stock Pledge Agreement as amended hereby. 8.Counterparts. This Amendment may be executed by one or more of the parties to thisAmendment on any number of separate counterparts (including by telecopy), each of which when soexecuted shall be deemed to be an original and all of which taken together shall constitute one and the sameagreement. Signature pages may be detached from multiple counterparts and attached to a singlecounterpart so that all signature pages are attached to the same document. Delivery of an executedcounterpart by telecopy shall be effective as delivery of a manually executed counterpart. 9.Severability. Any provision of this Amendment that is prohibited or unenforceable in anyjurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibitions or unenforceabilitywithout invalidating the remaining provisions hereof, and any such prohibition or unenforceability in anyjurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 10.Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALLGOVERN AND BE USED TO CONSTRUE THIS AMENDMENT WITHOUT GIVING EFFECTTO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THEAPPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIREDTHEREBY. 11.Limited Effect. Except to the extent specifically amended or modified hereby, theprovisions of the Stock Pledge Agreement shall not be amended, modified, impaired or otherwise affectedhereby. 12.Responsibility of the Collateral Trustee. The Collateral Trustee is not responsible for thevalidity or sufficiency of this Amendment or the recitals contained herein. [Signature Pages Follow] 5 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be dulyexecuted and delivered as of the date first above written. TENET HEALTHCARE CORPORATION, as aPledgor By:/s/ Tyler C. Murphy Name: Tyler C. Murphy Title: Treasurer [Signature Page to Third Amendment to Stock Pledge Agreement] Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. American Medical (Central), Inc., AMI Information Systems Group, Inc., Amisub (Heights), Inc., Amisub (Hilton Head), Inc., Amisub (Twelve Oaks), Inc., Amisub of Texas, Inc., Brookwood Health Services, Inc., Coral Gables Hospital, Inc., Cypress Fairbanks Medical Center, Inc., Fmc Medical, Inc., Lifemark Hospitals, Inc., Ornda Hospital Corporation SRRMC Management, Inc. Tenet California, Inc., Tenet Florida, Inc., Tenet Healthsystem CFMC, Inc., Tenet Healthsystem Healthcorp, Tenet Healthsystem Holdings, Tenet Healthsystem Medical, Inc., Tenet Healthsystem Philadelphia, Inc., Tenet Hospitals, Inc., Tenet Louisiana, Inc., Tenet Missouri, Inc., Tenet Physician Services -Hilton Head, Inc., Tenet Texas, Inc., Tenetsub Texas, Inc., VHS Of Phoenix, Inc. Vanguard Health Financial Company, LLC Vanguard Health Holding Company I, LLC Vanguard Health Holding Company II, LLC Vanguard Health Management, Inc. Vanguard Health Systems, Inc. VHS Of Michigan, Inc. each as a Pledgor By:/s/ Tyler C. Murphy Name: Tyler C. Murphy Title: Treasurer [Signature Page to Third Amendment to Stock Pledge Agreement] Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Accepted and Agreedas of the date first above written: The Bank of New York Mellon Trust Company, N.A.,as Collateral Trustee By:/s/ Melonee Young Name: Melonee Young Title: Vice President [Signature Page to Third Amendment to Stock Pledge Agreement]Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 10(k)FOURTH AMENDMENT TO STOCK PLEDGE AGREEMENTThis Fourth Amendment to Stock Pledge Agreement (this “Amendment”) is entered into as ofMarch 23, 2015, among Tenet Healthcare Corporation, a Nevada corporation (the “Company”), each ofthe other entities listed on the signature pages hereof as Pledgors, and The Bank of New York MellonTrust Company, N.A., as collateral trustee for the Secured Parties (in such capacity, the “CollateralTrustee”).RECITALSWHEREAS, reference is made to that certain Stock Pledge Agreement, dated as of March 3, 2009,by the Company and the other Pledgors in favor of the Collateral Trustee, as amended by that certain FirstAmendment to Stock Pledge Agreement, dated as of May 8, 2009, among the Company, the otherPledgors and the Collateral Trustee, as amended by that certain Second Amendment to Stock PledgeAgreement, dated as of June 15, 2009, among the Company, the other Pledgors and the Collateral Trustee,as amended by that certain Joinder Agreement to the Stock Pledge Agreement, dated as of May 15, 2013and executed by the pledgors party thereto, as amended by that certain Pledge Amendment to the StockPledge Agreement, dated as of May 15, 2013, between the Company and the Collateral Trustee, asamended by that certain Joinder Agreement to the Stock Pledge Agreement, dated as of October 1, 2013and executed by the pledgors party thereto, as amended by that certain Pledge Amendment to the StockPledge Agreement, dated as of October 1, 2013, by the Company and the Collateral Trustee, as amendedby that certain Third Amendment to Stock Pledge Agreement, dated as of March 7, 2014, as amended bythat certain Joinder Agreement to the Stock Pledge Agreement, dated as of March 23, 2015 and executedby the pledgors party thereto, and as amended by that certain Pledge Amendment to the Stock PledgeAgreement, dated as of March 23, 2015, by the Company and the Collateral Trustee (as so amended, the“Stock Pledge Agreement”);WHEREAS, pursuant to that that certain Interim Loan Agreement, dated as of the date hereof, byand among the Company, Barclays Bank PLC, as administrative agent (in such capacity, together with itssuccessors and assigns in such capacity, the “Administrative Agent”) and each Person from time to timeparty thereto as a lender (collectively, the “Lenders” and individually, a “Lender”) (as amended, amendedand restated or otherwise modified from time to time, the “Interim Loan Agreement”), the Lenders haveagreed to provide a term loan credit facility to the Company on the terms set forth in such Interim LoanAgreement; WHEREAS, the Secured Obligations in respect of which a security interest in the Collateral wascreated by the Stock Pledge Agreement is limited to only the obligations in respect of the:(a) Fourteenth Supplemental Indenture to the Base Indenture, dated as of November 21, 2011, byand among the Company, The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”)and the guarantors party thereto and relating to the Company’s 6.250% Senior Secured Notes due 2018(the “2018 Notes” and, as supplemented by the Nineteenth Supplemental Indenture, dated as of May 15,2013, between the Company, the Trustee and the Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.guarantors party thereto, and the Twenty Second Supplemental Indenture, dated as of October 1, 2013,between the Company, the Trustee and the guarantors party thereto, the “Fourteenth SupplementalIndenture”);(b) Fifteenth Supplemental Indenture to the Base Indenture, dated as of October 16, 2012, by andamong the Company, the Trustee and the guarantors party thereto and relating to the Company’s 4.75%Senior Secured Notes due 2020 (the “2020 Notes” and, as supplemented by the Nineteenth SupplementalIndenture, dated as of May 15, 2013, between the Company, the Trustee and the guarantors party thereto,and the Twenty Second Supplemental Indenture, dated as of October 1, 2013, between the Company, theTrustee and the guarantors party thereto, the “Fifteenth Supplemental Indenture”);(c) Seventeenth Supplemental Indenture to the Base Indenture, dated as of February 5, 2013, byand among the Company, the Trustee and the guarantors party thereto and relating to the Company’s4.500% Senior Secured Notes due 2021 (the “4.500% 2021 Notes” and, as supplemented by theNineteenth Supplemental Indenture, dated as of May 15, 2013, between the Company, the Trustee and theguarantors party thereto, and the Twenty Second Supplemental Indenture, dated as of October 1, 2013,between the Company, the Trustee and the guarantors party thereto, the “Seventeenth SupplementalIndenture”);(d) Twentieth Supplemental Indenture to the Base Indenture, dated as of May 30, 2013, by andamong the Company, the Trustee and the guarantors party thereto and relating to the Company’s 4.375%Senior Secured Notes due 2021 (the “4.375% 2021 Notes” and, as supplemented by the NineteenthSupplemental Indenture, dated as of May 15, 2013, between the Company, the Trustee and the guarantorsparty thereto, and the Twenty Second Supplemental Indenture, dated as of October 1, 2013, between theCompany, the Trustee and the guarantors party thereto, the “Twentieth Supplemental Indenture”);(e) Indenture dated as of September 27, 2013 (the “2013 Base Indenture”), between THC EscrowCorporation and the Trustee (as supplemented on October 1, 2013 by the first supplemental indenturethereto by and among the Company, the Trustee, and the guarantors party thereto (collectively, the “2013Indenture”)), pursuant to which the 6.00% Senior Secured Notes due 2020 were issued (the “6.000% 2020Notes” and, together with the 4.375% 2021 Notes, the 4.500% 2021 Notes, the 2020 Notes and the 2018Notes are collectively referred to herein as the “Notes”);(f) the Guarantees in respect of the Notes; and(g) the obligations under that certain Letter of Credit Facility Agreement, dated as of March 7,2014, among the Company, certain financial institutions party thereto from time to time as letter of creditparticipants and issuers and Barclays Bank PLC, as administrative agent (the “LC Facility Agreement”),and the guarantees in respect thereof,WHEREAS, subject to the terms and conditions hereof, the parties hereto desire to and have agreedto amend the Stock Pledge Agreement to secure the obligations in respect of the Loan Agreement, in eachcase to be designated as and entitled to the benefits of being Junior2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Stock Secured Debt (as defined in the Collateral Trust Agreement) under the Collateral Trust Agreement inaccordance with the requirements set forth in Section 3.8 thereof.WHEREAS, the sole effect of this Amendment is to secure additional debt of the Company that ispermitted by the terms of the Collateral Trust Agreement to be secured by the Collateral and to addreferences to such debt and the documents governing such debt, and that as such, pursuant to:(a) Section 7.1 of the Stock Pledge Agreement; (b) Section 7.1 of the Collateral Trust Agreement; (c) Article VII of each of the Fourteenth Supplemental Indenture, Fifteenth SupplementalIndenture, Seventeenth Supplemental Indenture and Twentieth Supplemental Indenture, and Section 902 ofthe 2013 Indenture; and(d) Section 10.8 and 11.1 of the LC Facility Agreement, this Amendment may be entered into bythe Company, the other pledgors party hereto and the Collateral Trustee without (i) the consent of theholders of the Notes or the holders of LC Obligations (as defined below) or (ii) direction to the CollateralTrustee by an Act of Required Stock Secured Debtholders (as defined in the Collateral Trust Agreement);andWHEREAS, unless otherwise indicated, capitalized terms used herein without definition have themeanings ascribed to such terms in the Stock Pledge Agreement.NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained,the Company and each other Pledgor signatory hereto hereby agrees with the Collateral Trustee as follows:1. Section References. Unless otherwise expressly stated herein, all Section references hereinshall refer to Sections of the Stock Pledge Agreement.2. Amendments to Section 1.1. Section 1.1 of the Stock Pledge Agreement is herebyamended by amending and restating the defined terms “Event of Default”, “Related Document”, “SecuredObligations” and “Secured Parties” in their entirety and by adding the defined terms “First Lien SecuredObligations,” “First Lien Secured Parties, “Interim Loan Agreement”, “Interim Loan Agreement GuarantyAgreement”, “Interim Loan Agreement Obligations”, “Junior Lien Secured Obligations”, “Junior LienSecured Parties”, and “Loan Guarantees” to Section 1.1 in alphabetical order, in each case as set forthbelow (all other defined terms contained therein remain unchanged and to the extent that definitionscontained in this Section 2 conflict with definitions contained in the Stock Pledge Agreement, thedefinitions contained in this Section 2 shall control):“Event of Default” means an Event of Default, as such term is defined in any Indenture, any 2013Base Indenture, the LC Facility Agreement, the Interim Loan Agreement or any other First-PriorityStock Lien Document or Junior Stock Lien Document (as such terms are defined in the CollateralTrust Agreement).3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.“First Lien Secured Obligations” means all Secured Obligations described in clause (i) and (ii) ofthe definition of Secured Obligations.“First Lien Secured Parties” means all Secured Parties described in clauses (i), (ii), (iv) and (v) ofthe definition of Secured Parties.“Interim Loan Agreement” means that certain Interim Loan Agreement, dated as of March 23,2015, among the Company, Barclays Bank PLC, as administrative agent (in such capacity, togetherwith its successors and assigns in such capacity, the “Administrative Agent”) and each Person fromtime to time party thereto as a lender (collectively, the “Lenders” and individually, a “Lender”), asthe same may be amended, amended and restated or otherwise modified from time to time.“Interim Loan Agreement Guaranty Agreement” means that certain Guaranty Agreement, dated asof March 23, 2015, among the Company, the guarantors party thereto, the lenders party thereto andBarclays Bank PLC, as administrative agent, as the same may be amended, restated, supplementedor otherwise modified from time to time.“Interim Loan Agreement Obligations” means the “Obligations” as defined in the Interim LoanAgreement.“Junior Lien Secured Obligations” means all Secured Obligations described in clause (iii) of thedefinition of Secured Obligations.“Junior Lien Secured Parties” means all Secured Parties described in clauses (iii) and (v) of thedefinition of Secured Parties.“Loan Guarantees” means guarantees in respect of the Interim Loan Agreement Obligationspursuant to the Interim Loan Agreement Guaranty Agreement.“Related Document” means the Indentures, the 2013 Indentures, the Notes, the Note Guarantees, the Collateral Trust Agreement, the LC Facility Agreement, Guarantee Agreement, the InterimLoan Agreement, and the Interim Loan Agreement Guaranty Agreement.“Secured Obligations” means (i) Obligations in respect the Notes and the Note Guarantees, (ii) LCObligations and obligations under the LC Guarantees and (iii) Interim Loan Agreement Obligationsand obligations under the Loan Guarantees.“Secured Parties” means the (i) Holders of the Notes, (ii) the LC Participants, LC Issuersand Administrative Agent under the LC Facility Agreement and any other holders of LCObligations, (iii) the Lenders and administrative agent under the Interim Loan Agreement and anyother holders of Interim Loan Agreement Obligations, (iv) the Trustee under each Indenture andeach 2013 Indenture and (v) the Collateral Trustee.3. Amendments to Section 2.2. Section 2.2 of the Stock Pledge Agreement is herebyamended by (i) changing the words “Secured Obligations” to “First Lien Secured Obligations,”4 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(ii) by changing the words “Secured Parties” to “First Lien Secured Parties” and (iii) by adding thefollowing language at the end:“Each Pledgor, as collateral security for the full, prompt and complete payment and performancewhen due (whether at Stated Maturity, by acceleration or otherwise) of the Junior Lien SecuredObligations of such Pledgor, hereby mortgages, pledges and hypothecates to the Collateral Trusteefor the benefit of the Junior Lien Secured Parties, and grants to the Collateral Trustee for the benefitof the Junior Lien Secured Parties a lien on and security interest in, all of its right, title and interestin, to and under the Collateral of such Pledgor. Notwithstanding anything herein to the contrary, thelien and security interest granted to the Collateral Trustee pursuant to this Agreement for the benefitof the Junior Lien Secured Parties is expressly subject and subordinate to the liens and securityinterests granted in favor of the holders of First Lien Secured Obligations on the terms set forth inthe Collateral Trust Agreement. In the event of any conflict between the terms of the CollateralTrust Agreement and this Agreement, the terms of the Collateral Trust Agreement shall govern andcontrol.”4. Amendments to Section 5.3. Section 5.3(b) of the Stock Pledge Agreement is herebyamended by deleting the words “under the Indentures” at the end thereof.5. Amendments to Section 7.1. Section 7.1 of the Stock Pledge Agreement is herebyamended and restated in its entirety as follows:“None of the terms or provisions of this Agreement may be waived, amended, supplemented orotherwise modified except in accordance with Article Nine of the Base Indenture, as supplementedby Article Seven of each Supplemental Indenture, Section 9.02 of the 2013 Base Indenture, Section11.1 of each of the LC Facility Agreement and corresponding provisions of any First-Priority StockLien Document and, solely to the extent such amendment affects any Junior Lien SecuredObligations or Junior Lien Secured Parties, Section 11.1 of the Interim Loan Agreement andcorresponding provisions of any Junior Stock Lien Document (as such terms are defined in theCollateral Trust Agreement); provided, however, that annexes to this Agreement may besupplemented (but no existing provisions may be modified and no Collateral may be released)through Pledge Amendments and Joinder Agreements, in substantially the form of Annex 1 (Formof Pledge Amendment) and Annex 2 (Form of Joinder Agreement) respectively, in each case dulyexecuted by the Collateral Trustee and each Pledgor directly affected thereby.” 6. Amendments to Section 7.11. Section 7.11(b) of the Stock Pledge Agreement is herebyamended by adding the words “, the 2013 Indentures, the LC Facility Agreement, the Interim LoanAgreement and each First-Priority Stock Lien Document and Junior Stock Lien Document (as suchterms are defined in the Collateral Trust Agreement)” at the end thereof.7. Conditions Precedent. The effectiveness of this Amendment is subject to the CollateralTrustee’s receipt of each of the following:5 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(a) this Amendment, duly executed and delivered by the Company, each other Pledgorparty hereto and the Collateral Trustee;(b) an Officers’ Certificate (as defined in the Collateral Trust Agreement) to the effectthat this Amendment will not result in a breach of any provision or covenant contained in any of theSecured Debt Documents (as defined in the Collateral Trust Agreement); and(c) an opinion of counsel of the Company to the effect that the Collateral Trustee’sexecution of this Amendment is authorized and permitted by the Collateral Trust Agreement.8. Reference to Stock Pledge Agreement. The Stock Pledge Agreement and the RelatedDocuments, and any and all other agreements, documents or instruments now or hereafter executed and/ordelivered pursuant to the terms hereof or pursuant to the terms of the Stock Pledge Agreement or theRelated Documents, are hereby amended so that any reference therein to the Stock Pledge Agreement,whether direct or indirect, shall mean a reference to the Stock Pledge Agreement as amended hereby.9. Counterparts. This Amendment may be executed by one or more of the parties to thisAmendment on any number of separate counterparts (including by telecopy), each of which when soexecuted shall be deemed to be an original and all of which taken together shall constitute one and thesame agreement. Signature pages may be detached from multiple counterparts and attached to a singlecounterpart so that all signature pages are attached to the same document. Delivery of an executedcounterpart by telecopy shall be effective as delivery of a manually executed counterpart.10. Severability. Any provision of this Amendment that is prohibited or unenforceable in anyjurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibitions or unenforceabilitywithout invalidating the remaining provisions hereof, and any such prohibition or unenforceability in anyjurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.11. Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALLGOVERN AND BE USED TO CONSTRUE THIS AMENDMENT WITHOUT GIVING EFFECTTO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THEAPPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIREDTHEREBY.12. Limited Effect. Except to the extent specifically amended or modified hereby, theprovisions of the Stock Pledge Agreement shall not be amended, modified, impaired or otherwise affectedhereby.13. Responsibility of the Collateral Trustee. The Collateral Trustee is not responsible for thevalidity or sufficiency of this Amendment or the recitals contained herein. In no event shall the CollateralTrustee or Registrar (as defined in the Appointment of Registrar Letter dated March 23, 2015 between TheBank of New York Mellon Trust Company, N.A., as registrar (the “Registrar”) and Barclays Bank PLC,as Administrative Agent under the Interim Loan6 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Agreement) be charged with knowledge of the terms of, be subject to, or be required to comply with theInterim Loan Agreement or LC Facility Agreement. All such responsibilities of the Collateral Trustee shallbe as set forth in the Collateral Trust Agreement. [Signature Pages Follow] 7 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be dulyexecuted and delivered as of the date first above written. TENET HEALTHCARE CORPORATION, as aPledgor By:/s/ Tyler C. Murphy Name:Tyler C. Murphy Title:Vice President and Treasurer Signature Page to Fourth Amendment to Stock Pledge Agreement Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. AMERICAN MEDICAL (CENTRAL), INC. AMI INFORMATION SYSTEMS GROUP, INC. AMISUB (HEIGHTS), INC. AMISUB (HILTON HEAD), INC. AMISUB (TWELVE OAKS), INC. AMISUB OF TEXAS, INC. BROOKWOOD HEALTH SERVICES, INC. CORAL GABLES HOSPITAL, INC. CYPRESS FAIRBANKS MEDICAL CENTER, INC. FMC MEDICAL, INC. HEALTHCARE NETWORK CFMC, INC. HEALTHCARE NETWORK HOLDINGS, INC. HEALTHCARE NETWORK LOUISIANA, INC. HEALTHCARE NETWORK MISSOURI, INC. HEALTHCARE NETWORK TEXAS, INC. HEALTHCORP NETWORK, INC. HEALTH SERVICES NETWORK HOSPITALS, INC. HEALTH SERVICES NETWORK TEXAS, INC. LIFEMARK HOSPITALS, INC. ORNDA HOSPITAL CORPORATION SRRMC MANAGEMENT, INC. TENET CALIFORNIA, INC. TENET FLORIDA, INC. TENET HEALTHSYSTEM MEDICAL, INC. TENET HEALTHSYSTEM PHILADELPHIA, INC. TENET PHYSICIAN SERVICES – HILTON HEAD,INC. VANGUARD HEALTH FINANCIAL COMPANY,LLC VANGUARD HEALTH HOLDING COMPANY I,LLC VANGUARD HEALTH HOLDING COMPANY II,LLC VANGUARD HEALTH MANAGEMENT, INC. VANGUARD HEALTH SYSTEMS, INC. VHS OF MICHIGAN, INC. VHS OF PHOENIX, INC. VHS VALLEY MANAGEMENT COMPANY, INC., each as a Pledgor By:/s/ Tyler C. Murphy Name:Tyler C. Murphy Title:TreasurerSignature Page to Fourth Amendment to Stock Pledge Agreement Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. VHS VALLEY HEALTH SYSTEM, LLC By: VHS VALLEY MANAGEMENT COMPANY,INC., its sole member as a Pledgor By:/s/ Tyler C. Murphy Name:Tyler C. Murphy Title:Treasurer Signature Page to Fourth Amendment to Stock Pledge Agreement Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ACCEPTED AND AGREED as of the date first above written: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Collateral Trustee By:/s/ Teresa Petta Name:Teresa Petta Title:Vice President Signature Page to Fourth Amendment to Stock Pledge AgreementSource: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 10(u) TENET HEALTHCARE CORPORATIONNINTH AMENDED AND RESTATEDSUPPLEMENTAL EXECUTIVE RETIREMENT PLAN As Amended and Restated Effective as of November 30, 2015 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. TENET HEALTHCARE CORPORATIONNINTH AMENDED AND RESTATEDSUPPLEMENTAL EXECUTIVE RETIREMENT PLANtable of contents PageARTICLE I PREAMBLE AND PURPOSE4 1.1Preamble.4 1.2Purpose.5 ARTICLE II DEFINITIONS6 2.1Actuarial Equivalent or Actuarial Equivalence6 2.2Acquisition6 2.3Affiliate6 2.4Agreement6 2.5Alternate Payee6 2.6AMI SERP6 2.7Board6 2.8Bonus6 2.9Cause7 2.10Change of Control7 2.11Code7 2.12Company7 2.13Date of Employment7 2.14Date of Enrollment7 2.15Deferred Vested Retirement Benefit7 2.16Disability7 2.17Disability Retirement Benefit7 2.18DRO7 2.19Early Retirement8 2.20Early Retirement Age8 2.21Early Retirement Benefit8 2.22Earnings8 2.23Effective Date8 2.24Eligible Children9 2.25Eligible Employee9 2.26Employee9 2.27Employer9 2.28Employment9 2.29ERA9 2.30ERISA9 2.31Executive Severance Plan9 2.32Final Average Earnings9 2.33Five Percent Owner10 2.34Good Reason10 2.35Human Resources Committee10 2.36Initial Election Period10 2.37Key Employee10 2.38Normal Retirement11 (i) Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 2.39Normal Retirement Age11 2.40Normal Retirement Benefit11 2.41Normal Retirement Date11 2.42One Percent Owner11 2.43Participant11 2.44Plan Administrator11 2.45Plan Year11 2.46Prior Service Credit Percentage12 2.47Retirement Benefit12 2.48Retirement Plans12 2.49Retirement Benefit Plans Adjustment Factor12 2.50RPAC13 2.51SERP13 2.52Severance Plan13 2.53Surviving Spouse13 2.54Termination of Employment13 2.55Termination Without Cause14 2.56Trust14 2.57Trustee14 2.58Year14 2.59Year of Service14 ARTICLE III ELIGIBILITY AND PARTICIPATION15 3.1Determination of Eligibility.15 3.2Early Retirement Election.15 3.3Loss of Eligibility Status.15 3.4Initial ERA Participation.15 3.5Subsequent ERA Participation.15 3.6Initial AMI SERP Participation.16 ARTICLE IV RETIREMENT BENEFITS17 4.1Normal Retirement Benefit.17 4.2Early Retirement Benefit.18 4.3Vesting of Retirement Benefit.19 4.4Deferred Vested Retirement Benefit.19 4.5Deferral of Distributions.21 4.6Duration of Benefit Payment.21 4.7Recipients of Benefit Payments.21 4.8Disability.22 4.9Change of Control.23 4.10Golden Parachute Limitation.24 4.11Executive Severance Plan.24 ARTICLE V PAYMENT26 5.1Commencement of Payments.26 5.2Withholding; Unemployment Taxes.26 5.3Recipients of Payments.26 5.4No Other Benefits.26 5.5No Lump Sum Form of Payment.26 (ii) Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VI PAYMENT LIMITATIONS27 6.1Spousal Claims.27 6.2Legal Disability.27 6.3Assignment.27 ARTICLE VII ADMINISTRATION OF THE PLAN29 7.1The RPAC.29 7.2Powers of the RPAC.29 7.3Appointment of Plan Administrator.29 7.4Duties of Plan Administrator.29 7.5Indemnification of the RPAC and Plan Administrator.30 7.6Claims for Benefits.31 7.7Arbitration.34 7.8Receipt and Release of Necessary Information.35 7.9Overpayment and Underpayment of Benefits.35 7.10Change of Control.36 ARTICLE VIII AMENDMENT AND TERMINATION OF THE PLAN37 8.1Continuation.37 8.2Amendment of SERP.37 8.3Termination of SERP.37 8.4Termination of Affiliate’s Participation.38 ARTICLE IX CONDITIONS RELATED TO BENEFITS39 9.1No Right to Assets.39 9.2No Employment Rights.39 9.3Indebtedness.40 9.4Conditions Precedent.40 ARTICLE X MISCELLANEOUS41 10.1Gender and Number.41 10.2Notice.41 10.3Validity.41 10.4Applicable Law.41 10.5Successors in Interest.41 10.6No Representation on Tax Matters.41 10.7Provisions Binding.41 EXHIBIT A1 TENET HEALTHCARE CORPORATION SUPPLEMENTAL EXECUTIVERETIREMENT PLAN AGREEMENT FOR PARTICIPANTS NAMED ON ANDAFTER AUGUST 3, 2011- AMI SERP BENEFITSA1-1 EXHIBIT A2 TENET HEALTHCARE CORPORATION SUPPLEMENTAL EXECUTIVERETIREMENT PLAN AGREEMENT FOR PARTICIPANTS NAMED ON ANDAFTER AUGUST 3, 2011A2-1 EXHIBIT B UPDATE TO TENET HEALTHCARE CORPORATION SUPPLEMENTALEXECUTIVE RETIREMENT PLAN AGREEMENT WITH PARTICIPANTB-1 (iii) Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. TENET HEALTHCARE CORPORATIONNINTH AMENDED AND RESTATEDSUPPLEMENTAL EXECUTIVE RETIREMENT PLANARTICLE IPREAMBLE AND PURPOSE1.1 Preamble. Tenet Healthcare Corporation (the "Company") adopted the SupplementalExecutive Retirement Plan (the "SERP") effective November 1, 1984 to attract, retain,motivate and provide financial security to highly compensated or management employees(the "Participants") who render valuable services to the Company and its "Subsidiaries,"as defined in Article II. The SERP was amended on various occasions and most recentlyamended and restated effective as of May 9, 2012, to make certain changes relating to aChange of Control and other termination event provisionsEffective November 6, 2013 the SERP was amended and restated to delegate authority todetermine the employees eligible to participate in the SERP and clarify that the modificationsmade to the Retirement Benefit Plans Adjustment Factor apply in calculating a Participant’sbenefit irrespective of a Change of Control. Effective May 7, 2014, the Compensation Committee froze participation in the SERP,meaning no new employees may become participants in the SERP on and after such date.Effective August 28, 2014 the Retirement Plans Administrative Committee (“RPAC”) issuedan administrative clarification regarding the determination of Final Average Earnings underthe SERP when a participant continues employment past age sixty-five (65).Effective March 2, 2015 the RPAC amended the SERP to delegate to the Senior VicePresident, Human Resources and the Plan Administrator the authority to determine if andwhen earnings paid by an Affiliate who has not adopted the SERP as an Employer will betreated as Earnings for purposes of calculating Final Average Earnings under the SERP;By this instrument the RPAC desires to amend and restate the SERP generallyeffective November 30, 2015, to (i) reflect that the SERP is closed to new Participantseffective May 7, 2014, (ii) document the RPAC’s prior administrative clarification thatFinal Average Earnings continue to accrue in accordance with the terms of the SERPin the event a participant continues working past age sixty-five (65), (iii) incorporatethe March 2, 2015 amendment providing that the Senior Vice President, HumanResources and Plan Administrator have the authority to determine if and whenearnings paid by an Affiliate who has not adopted the SERP as an Employer will betreated as Earnings for purposes of calculating Final Average Earnings under theSERP, (iv) delegate to the Senior Vice President, Human Resources and the PlanAdministrator the authority to provide continued age and service credit for anyParticipant who transfers to an Affiliate who has not adopted the SERP as anEmployer without the need for adoption of the SERP by such Affiliate, and (v) reflectthat the name of the Compensation Committee has changed to the “HumanResources Committee.” This amended and restated SERP will be known as theTenet Healthcare Corporation Ninth Amended and Restated Supplemental ExecutiveRetirement Plan.4 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. The Company or its Subsidiaries may adopt one or more domestic trusts to serve as apossible source of funds for the payment of benefit under this SERP.1.2 Purpose. It is intended that this SERP will not constitute a "qualified plan" subject to thelimitations of section 401(a) of the Code, nor will it constitute a "funded plan," for purposes ofsuch requirements. It also is intended that this SERP will be exempt from the participationand vesting requirements of Part 2 of Title I of the Employee Retirement Income Security Actof 1974, as amended ("ERISA"), the funding requirements of Part 3 of Title I of ERISA, andthe fiduciary requirements of Part 4 of Title I of ERISA by reason of the exclusions affordedplans that are unfunded and maintained by an employer primarily for the purpose of providingdeferred compensation for a select group of management or highly compensatedemployees.End of Article I 5 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IIDEFINITIONSWhen a word or phrase appears in this SERP with the initial letter capitalized, and the word orphrase does not commence a sentence, the word or phrase will generally be a term defined in thisArticle II. The following words and phrases with the initial letter capitalized will have the meaning setforth in this Article II, unless a different meaning is required by the context in which the word orphrase is used.2.1 Actuarial Equivalent or Actuarial Equivalence means an amount equal in value to theaggregate amounts to be received under different forms of and/or times of payment, asdetermined by the SERP actuary, calculated using factors based on six percent (6%)interest and a fifty/fifty (50/50) blend of the RP-2000 sex distinct mortality tables. ActuarialEquivalent factors will be used for calculating Retirement Benefit amounts to be receivedunder different times and/or forms of payment, for converting different forms and times ofpayment of Retirement Benefits and for determining the present value of RetirementBenefits.2.2 Acquisition refers to a company of which substantially all of its assets or a majority of itscapital stock are acquired by, or which is merged with or into, the Company or an Affiliate.2.3 Affiliate means a corporation that is a member of a controlled group of corporations (asdefined in section 414(b) of the Code) that includes the Company, any trade or business(whether or not incorporated) that is in common control (as defined in section 414(c) of theCode) with the Company, or any entity that is a member of the same affiliated service group(as defined in section 414(m) of the Code) as the Company; provided, however, that forpurposes of determining if an entity is an Affiliate under sections 414(b) or (c) of the Codeownership will be determined based on an ownership percentage of greater than fifty percent(50%):2.4 Agreement means a written agreement substantially in the form of Exhibit A between theCompany and a Participant. Each Agreement will form a part of the SERP with respect to theaffected Participant. Once a Participant enters into an Agreement, such Agreement may beupdated by the Company to reflect changes in the SERP made by the Company. Any suchupdate will be attached to and form a part of the Participant’s Agreement. In addition, anysection references in such Agreement that change due to future amendments of the SERPwill be deemed to be updated to reflect the revised Section number.2.5 Alternate Payee means any spouse, former spouse, child, or other dependent of aParticipant who is recognized by a DRO as having a right to receive all, or a portion of, thebenefits payable under the SERP with respect to such Participant.2.6 AMI SERP means the American Medical International Inc. Supplemental ExecutiveRetirement Plan or any successor or substitute for such plan.2.7 Board means the Board of Directors of the Company.2.8 Bonus means any annual cash award paid under the Company's annual incentive plan.6 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 2.9 Cause has the meaning set forth in the Executive Severance Plan.2.10 Change of Control has the meaning set forth in the Executive Severance Plan.2.11 Code means the Internal Revenue Code of 1986, as amended, and the regulations andrulings issued thereunder.2.12 Company means Tenet Healthcare Corporation.2.13 Date of Employment means the date on which a person began to perform services directlyfor the Employer as a result of an Acquisition or becoming an employee. In the event of anAcquisition, the Date of Employment may mean the date on which a person began toperform services directly for the acquired entity as provided in the Participant’s offer letter orother communication.2.14 Date of Enrollment means the date on or after June 1, 1984 on which an Eligible Employeefirst became a Participant in the SERP, provided that any Eligible Employee who becomes aParticipant before June 1, 1984 will be deemed to have a Date of Enrollment of the later ofthe Participant’s Date of Employment or June 1, 1984.2.15 Deferred Vested Retirement Benefit means the benefit payable pursuant to Section 4.4.2.16 Disability means the inability of a Participant to engage in any substantial gainful activity byreason of a mental or physical impairment expected to result in death or last for at leasttwelve (12) months, or the Participant, because of such a condition, is receiving incomereplacement benefits for at least three (3) months under an accident or health plan coveringthe Employer’s employees.2.17 Disability Retirement Benefit means the benefit payable pursuant to Section 4.8.2.18 DRO means a domestic relations order that is a judgment, decree, or order (including onethat approves a property settlement agreement) that relates to the provision of child support,alimony payments or marital property rights to a spouse, former spouse, child or otherdependent of a Participant and is rendered under a state (within the meaning of section7701(a)(10) of the Code) domestic relations law (including a community property law) andthat:(a) Creates or recognizes the existence of an Alternate Payee’s right to, or assigns to anAlternate Payee the right to receive all or a portion of the benefits payable withrespect to a Participant under the SERP;(b) Does not require the SERP to provide any type or form of benefit, or any option, nototherwise provided under the SERP;(c) Does not require the SERP to provide increased benefits (determined on the basis ofactuarial value);(d) Does not require the payment of benefits to an Alternate Payee that are required to bepaid to another Alternate Payee under another order previously determined to be aDRO; and7 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (e) Clearly specifies: (i) the name and last known mailing address of the Participant and ofeach Alternate Payee covered by the DRO; (ii) the amount or percentage of theParticipant’s benefits to be paid by the SERP to each such Alternate Payee, or themanner in which such amount or percentage is to be determined; (iii) the number ofpayments or payment periods to which such order applies; and (iv) that it isapplicable with respect to this SERP.2.19 Early Retirement means any Termination of Employment during the life of a Participantbefore the attainment of Normal Retirement Age and after attaining Early Retirement Age.2.20 Early Retirement Age means the date the Participant attains age fifty-five (55) and hascompleted ten (10) Years of Service or attains age sixty-two (62) with no minimum Years ofService. To the extent provided by the Senior Vice President, Human Resources or PlanAdministrator, a Participant will continue to be credited with age and Years of Service foremployment with an Affiliate who has not adopted the SERP as an Employer.For Eligible Employees who become Participants before August 3, 2011, a Participant will becredited with age and Years of Service during his severance period under the SeverancePlan in effect as of the date in which the Participant commences participation in this SERPfor purposes of determining if he satisfies the age and service conditions for EarlyRetirement Age as of the date of his Termination of Employment; provided, however, that,except as provided in Section 4.9(b), payment of Early Retirement Benefits under this SERPwill not commence until the Participant has actually attained the requisite age and serviceconditions (e.g., if the Participant who timely elected an Early Retirement Age of age fifty-five(55) and ten (10) Years of Service will satisfy such conditions during the Severance Period,he will be deemed to have satisfied such conditions as of his Termination of Employment buthis Early Retirement Benefits will not commence until he actually attains age fifty-five (55)and completed ten (10) Years of Service). Furthermore, if after the date the Participantcommences participation in this SERP, the applicable Severance Plan is amended to modifythe severance period, such modification will not apply to the Participant for purposes ofdetermining his Early Retirement Age under this SERP. As provided in Sections 3.2 and4.2(b), a Participant will elect during the Initial Election Period which definition of EarlyRetirement Age will apply to him under the SERP. If the Participant fails to make suchelection, the Participant will be deemed to have elected age sixty-two (62) as his EarlyRetirement Age under the SERP. The additional age and service crediting for this severanceperiod under the Severance Plan will not apply to any Eligible Employee who becomes aParticipant on or after August 3, 2011.2.21 Early Retirement Benefit means the benefit payable pursuant to Section 4.2.2.22 Earnings means the base salary and any Bonus paid by the Employer or, to the extentdetermined by the Senior Vice President, Human Resources or the Plan Administrator, anAffiliate, to such Participant, but will exclude car and other allowances and other cash andnon-cash compensation. The determination of Earnings will continue past NormalRetirement Age for a Participant who works beyond such date until the Participant’sTermination of Employment as provided in the definition of Final Average Earnings. 2.23 Effective Date means November 30, 2015, except as specifically provided otherwise herein.8 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 2.24 Eligible Children means all natural or adopted children of a Participant under the age oftwenty-one (21), including any child conceived before the death of a Participant.2.25 Eligible Employee means an Employee who is employed in a position designated as eligibleto participate in this SERP by the Senior Vice President, Human Resources or the PlanAdministrator and approved by the Board or who satisfied the definition of Eligible Employeeunder the terms of a prior SERP document and who is not a Participant in the ERA. Effectiveon and after May 7, 2014 no additional Eligible Employees may become Participants in theSERP.2.26 Employee means each select member of management or highly compensated employeereceiving remuneration, or who is entitled to remuneration, for services rendered to theEmployer, in the legal relationship of employer and employee. The term "Employee" will notinclude any person who is employed by the Employer in the capacity of an independentcontractor, an agent or a leased employee even if such person is determined by the InternalRevenue Service, the Department of Labor or a court of competent jurisdiction to be acommon law employee of the Employer.2.27 Employer means the Company and each Affiliate who with the consent of the Senior VicePresident, Human Resources or Plan Administrator has adopted the SERP as a participating employer. An Affiliate may evidence its adoption of the SERP either by a formalaction of its governing body or by taking other administrative actions with respect to thisSERP on behalf of its Eligible Employees. An entity will cease to be an Employer as of thedate such entity ceases to be an Affiliate or the date specified by the Company.2.28 Employment means any continuous period during which an Eligible Employee is activelyengaged in performing services for the Employer or, to the extent determined by the SeniorVice President, Human Resources or the Plan Administrator, an Affiliate, plus the term ofany leave of absence approved by the Employer or such Affiliate.2.29 ERA means the Tenet Executive Retirement Account as amended from time to time.2.30 ERISA means the Employee Retirement Income Security Act of 1974, as amended, and theregulations and rulings thereunder.2.31 Executive Severance Plan or ESP means the Tenet Executive Severance Plan, asamended from time to time.2.32 Final Average Earnings means the Participant’s highest average monthly Earnings for anysixty (60) consecutive months during the ten (10) years, or actual Employment period if less,preceding Termination of Employment. The determination of Final Average Earnings willcontinue past Normal Retirement Age for a Participant who works beyond such date until theParticipant’s Termination of Employment; provided, however, that with respect to thoseParticipants who joined the Tenet SERP before August 3, 2011, the determination of FinalAverage Earnings will continue after their Termination of Employment and during theirseverance period, if any, under the Executive Severance Plan. Effective on and after March2, 2015, the Senior Vice President, Human Resources and the Plan Administrator have theauthority to determine if and when earnings paid by an Affiliate who has not adopted theSERP will be treated as Earnings for purposes of calculating Final Average Earnings underthe SERP.9 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 2.33 Five Percent Owner means any person who own (or is considered as owning within themeaning of section 318 of the Code (as modified by section 416(i)(1)(B)(iii) of the Code))more than five percent (5%) of the outstanding stock of the Company, or an Affiliate or stockpossessing more than five percent (5%) of the total combined voting power of all stock of theCompany or an Affiliate. The rules of sections 414(b), (c) and (m) of the Code will not applyfor purposes of applying these ownership rules. Thus, this ownership test will be appliedseparately with respect to the Company and each Affiliate.2.34 Good Reason has the meaning set forth in the Executive Severance Plan.2.35 Human Resources Committee means the Human Resources Committee of the Board(including any predecessor or successor to such committee in name or form) which has theauthority to amend and terminate the SERP as provided in Article VIII.2.36 Initial Election Period the thirty (30) day period immediately following the Participant’s Dateof Enrollment during which a Participant may elect the time at which to receive a distributionof Early Retirement Benefits pursuant to Section 4.2(b).2.37 Key Employee means any employee or former employee including any deceased employeewho at any time during the Plan Year was:(a) an officer of the Company or an Affiliate having compensation of greater than onehundred thirty thousand dollars ($130,000) (as adjusted under section 416(i)(1) of theCode for Plan Years beginning after December 31, 2002) (such limit is one hundredseventy thousand dollars ($170,000) for 2015);(b) a Five Percent Owner; or(c) One Percent Owner having compensation of more than one hundred fifty thousanddollars ($150,000).For purposes of the preceding paragraphs, the Company has elected to determine thecompensation of an officer or One Percent Owner in accordance with section 1.415(c)-. 2(d)(4) of the Treasury Regulations (i.e., W-2 wages plus amounts that would be includible inwages except for an election under section 125(a) of the Code (regarding cafeteria planelections) under section 132(f) of the Code (regarding qualified transportation fringe benefits)or section 402(e)(3) of the Code (regarding section 401(k) plan deferrals)) without regard tothe special timing rules and special rules set forth, respectively, in sections 1.415(c)-2(e) and2(g) of the Treasury Regulations.The determination of Key Employees will be based upon a twelve (12) month period endingon December 31 of each year (i.e., the identification date). Employees that are KeyEmployees during such twelve (12) month period will be treated as Key Employees for thetwelve (12) month period beginning on the first day of the fourth month following the end ofthe twelve (12) month period (i.e., since the identification date is December 31, then thetwelve (12) month period to which it applies begins on the next following April 1).The determination of who is a Key Employee will be made in accordance with section 416(i)(1) of the Code and other guidance of general applicability issued thereunder. For purposesof determining whether an employee or former employee is an officer, a Five10 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Percent Owner or a One Percent Owner, the Company and each Affiliate will be treated as aseparate employer (i.e., the controlled group rules of sections 414(b), (c), (m) and (o) of theCode will not apply). Conversely, for purposes of determining whether the one hundred thirtythousand dollar ($130,000) adjusted limit on compensation is met under the officer testdescribed in Section 2.37(a), compensation from the Company and all Affiliates will be takeninto account (i.e., the controlled group rules of sections 414(b), (c), (m) and (o) of the Codewill apply). Further, in determining who is an officer under the officer test described in Section2.37(a), no more than fifty (50) employees of the Company or its Affiliates (i.e., thecontrolled group rules of sections 414(b), (c), (m) and (o) of the Code will apply) will betreated as officers. If the number of officers exceeds fifty (50), the determination of whichemployees or former employees are officers will be determined based on who had thelargest annual compensation from the Company and its Affiliates for the Plan Year. For theavoidance of doubt, for purposes of this Section 2.37 the controlled group rules undersections 414(b) and (c) of the Code will be applied based on the normal ownershippercentage of greater than eighty percent (80%) rather than the fifty percent (50%) standardused in the definition of Affiliate.2.38 Normal Retirement means any Termination of Employment during the life of a Participanton or after attaining Normal Retirement Age. To the extent a Participant continuesEmployment beyond Normal Retirement Age, he will continue to be credited with Earningspursuant to the terms of the SERP.2.39 Normal Retirement Age means the date on which the Participant attains age sixty-five (65)while employed by the Employer, or to the extent provided by the Senior Vice President,Human Resources or Plan Administrator, an Affiliate who has not adopted the SERP as anEmployer.2.40 Normal Retirement Benefit means the benefit payable pursuant to Section 4.1.2.41 Normal Retirement Date means the first day of the calendar month following theParticipant’s attainment of Normal Retirement Age.2.42 One Percent Owner means any person who would be described in Section 2.37 if "onepercent (1%)" were substituted for "five percent (5%)" each place where it appears therein.2.43 Participant means any Eligible Employee selected to participate in this SERP by the SeniorVice President, Human Resources or the Plan Administrator, each in its sole and absolutediscretion, or an Eligible Employee who satisfied the definition of Participant under the termsof a prior SERP document and who, in each case, has entered into an Agreement andwhose participation has not terminated.2.44 Plan Administrator means the individual or entity appointed by the RPAC to handle the day-to-day administration of the SERP, including but not limited to, determining the eligibility of anEligible Employee to be a Participant, the amount of a Participant’s benefits and complyingwith all applicable reporting and disclosure obligations imposed on the SERP. If the RPACdoes not appoint an individual or entity as Plan Administrator, the RPAC will serve as thePlan Administrator.2.45 Plan Year means the fiscal year of this SERP, which will begin on January 1 each year andend on December 31 of such year.11 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 2.46 Prior Service Credit Percentage means the percentage to be applied to a Participant’sYears of Service with the Employer before his Date of Enrollment in the SERP, inaccordance with the following formula:Years of ServiceAfter Date of EnrollmentPrior Service Credit PercentageDuring 1st year25During 2nd year35During 3rd year45During 4th year55During 5th year75After 5th year100In the event of the death or Disability of a Participant while an employee at any age or theNormal Retirement or Early Retirement of a Participant after age sixty (60), the Participant’sPrior Service Credit Percentage will be one hundred (100).2.47 Retirement Benefit means an Early Retirement Benefit, Normal Retirement Benefit,Disability Retirement Benefit, or Deferred Vested Retirement Benefit payable pursuant toArticle IV.2.48 Retirement Plans means a qualified or nonqualified defined contribution plan, other than theERA which is addressed in Article III, maintained by the Employer, including, if applicable,any such plan maintained by an Employer before an Acquisition. In the event a Participanthas an accrued benefit under a qualified or nonqualified defined benefit plan, the treatment ofthat benefit will be set forth in his Agreement.2.49 Retirement Benefit Plans Adjustment Factor means the percentage calculated each yearpursuant to administrative procedures adopted with respect to the SERP that is derived fromthe assumed benefit the Participant would be eligible for under Social Security and theEmployer contribution portion of all Retirement Plans measured from the Participant’s date ofhire until the Participant’s projected retirement regardless of whether the Participantparticipates in such plans; provided, however, that the Retirement Benefit Plans AdjustmentFactor for a Participant who was covered by the SERP immediately before the EffectiveDate, will not be greater than the factor calculated with respect to such Participant as ofDecember 31, 2013. The Retirement Benefits Plan Adjustment Factor will be applied only tothe base salary component of Final Average Earnings and is a projection of the benefitspayable under the Social Security regulations and Retirement Plans in effect at the time thebenefit calculation is performed. For any Participant actively employed by the Employer upon a Change of Control whosubsequently has a Termination of Employment, the Retirement Benefit Plans AdjustmentFactor for each such Participant will be adjusted to reflect the impact of the occurrence of theTermination of Employment at an age earlier than assumed under the initial calculation of theassumed benefit described above and will (i) be eliminated if the12 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Participant is younger than age forty-five (45) upon such Termination of Employment, and (ii)if the Participant is age forty-five (45) or above, will be reduced by multiplying it by thefollowing fraction:1- [(65- Participant’s age at Termination of Employment) /20].For purpose of determining a Participant’s age for calculating the above adjustments to theRetirement Benefit Plans Adjustment Factor, such age will be expressed in whole monthsand a Participant will receive credit for any fractional months rounded up to the next wholemonth. In addition, a Participant may be credited with age for periods of employment with anAffiliate who has not adopted the SERP as an Employer, to the extent provided by the SeniorVice President, Human Resources or Plan Administrator.2.50 RPAC means the Retirement Plans Administration Committee of the Company establishedby the Human Resources Committee, and whose members have been appointed by theHuman Resources Committee. The RPAC will have the responsibility to administer theSERP and make final determinations regarding claims for benefits, as described in Article VI.In addition, the RPAC has limited amendment authority over the SERP as provided inSection 8.2.2.51 SERP means the Ninth Amended and Restated Tenet Supplemental Executive RetirementPlan as set forth herein and as the same may be amended from time to time.2.52 Severance Plan means the Tenet Executive Severance Plan, the Tenet ExecutiveSeverance Protection Plan or any or any similar, successor or replacement plan to suchplans.2.53 Surviving Spouse means the person legally married to a Participant (including effectiveAugust 3, 2011 a Participant's Domestic Partner as defined under the Criteria for DomesticPartnership Status under the Tenet Employee Benefit Plan and September 16, 2013 a samesex spouse) for at least one (1) year prior to the earlier of the Participant’s death orTermination of Employment. If the Participant is not married at the time he incurs aTermination of Employment and marries (or enters into a domestic partnership) after thatdate, such spouse or domestic partner will not qualify as a Surviving Spouse for purposes ofthe SERP. Likewise, if the Participant is married (or in domestic partnership) at the time heincurs a Termination of Employment, divorces (or terminates such domestic partnership)after that date and remarries, his subsequent spouse (or domestic partner) will not qualify asa Surviving Spouse for purposes of the SERP.2.54 Termination of Employment means the ceasing of the Participant’s Employment orreduction in employment or other provision of services for any reason whatsoever, whethervoluntarily or involuntarily, including by reason of Normal Retirement or Early Retirement,that qualifies as a separation from service under section 409A of the Code. For this purposea Participant who is on a leave of absence that exceeds six (6) months and who does nothave statutory or contractual reemployment rights with respect to such leave, will bedeemed to have incurred a Termination of Employment on the first day of the seventh (7th)month of such leave. A Participant who transfers employment from an Employer to anAffiliate, regardless of whether such Affiliate has adopted the SERP as an Employer, will notincur a Termination of Employment; however, the extent to which such Participant willcontinue to accrue age and/or service for employment with such non-participating Affiliatewill be determined by the Senior Vice President, Human13 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Resources or Plan Administrator. A Participant who experiences a Qualifying Terminationunder the Severance Plan will incur a Termination of Employment under the SERP, subjectto the special provisions regarding Early Retirement Age under Section 2.20.2.55 Termination Without Cause means, for purposes of Section 4.9, the termination of aParticipant by the Employer or an Affiliate without Cause or a voluntary Termination ofEmployment by the Participant for Good Reason within two (2) years of a Change of Control.2.56 Trust means the rabbi trust established with respect to the SERP the assets of which are tobe used for the payment of Retirement Benefits under this SERP.2.57 Trustee means the individual or entity appointed as trustee under the Trust. After theoccurrence of a Change of Control, the Trustee must be independent of any successor tothe Company or any affiliate of such successor. 2.58 Year means a period of twelve (12) consecutive calendar months.2.59 Year of Service means each complete year (up to a maximum of twenty (20)) of continuousservice (up to age sixty-five (65)) as an employee of the Employer beginning with the Date ofEmployment with the Employer. The Senior Vice President, Human Resources or the PlanAdministrator may also credit a Participant who transfers to an Affiliate that is not anEmployer with age and/or service for his period of employment with such entity without theneed for such Affiliate to adopt the SERP as an Employer. Years of Service will be deemedto have begun as of the first day of the calendar month of Employment and to have ceasedon the last day of the calendar month of Employment. In the event a Participant incurs aTermination of Employment and is reemployed by the Employer, Service completed beforesuch reemployment will be treated as Years of Service under the SERP to the extentprovided in the Company’s Rehire and Reinstatement Policy or any successor thereto, theprovisions of which are incorporated herein by this reference. Years of Service before anemployee’s Date of Enrollment in the SERP will be credited for benefit accrual purposes on apro-rated basis pursuant to Section 2.46.End of Article II 14 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IIIELIGIBILITY AND PARTICIPATION3.1 Determination of Eligibility. Effective May 7, 2014 no new Eligible Employees maybecome Participants in the SERP. Each Eligible Employee who became a Participant in theSERP before May 7, 2014 will continue to participate in the SERP pursuant to the terms ofthis document.3.2 Early Retirement Election. Before May 7, 2014, each Eligible Employee was required toelect during the Initial Election Period to commence the distribution of his Retirement Benefitson the first day of the calendar month following his Early Retirement as provided pursuant toSection 4.2. In making this election the Participant was required to specify the EarlyRetirement Age that will apply to him under the SERP (i.e., age fifty-five (55) and ten (10)Years of Service or age sixty-two (62)). If the Eligible Employee failed to make this electionduring the Initial Election Period, he will be deemed to have affirmatively elected tocommence the distribution of his Retirement Benefits on the first day of the calendar monthfollowing the date of his Retirement on or after attaining age sixty-two (62). Once made (ordeemed made), this election cannot be revoked; however, the Participant may elect to deferpayment of his Retirement Benefits pursuant to Section 4.5. Payment of such EarlyRetirement Benefit will be subject to the six (6) month restriction applicable to KeyEmployees, described in Section 5.1 of this SERP.3.3 Loss of Eligibility Status. A Participant under this SERP who incurs a Termination ofEmployment, who ceases to be an Eligible Employee, or whose participation is terminatedby the Senior Vice President, Human Resources or the Plan Administrator will continue asan inactive Participant under this SERP until the Participant has received the completepayment of his Retirement Benefits under this SERP. The Senior Vice President, HumanResources and the Plan Administrator have the authority to determine if and when earningspaid by an Affiliate who has not adopted the SERP as an Employer will be treated asEarnings for purposes of calculating Final Average Earnings under the SERP. Likewise, theSenior Vice President, Human Resources and the Plan Administrator have the authority todetermine if age and service earned while working for an Affiliate who has not adopted theSERP as an Employer will be counted under this SERP as provided in Section 2.54.3.4 Initial ERA Participation. A Participant who participated in the ERA before becoming aParticipant in the SERP will be given credit for his Years of Service while a participant in theERA for purposes of determining the amount of his Retirement Benefit under this SERP, butsuch Retirement Benefit will be reduced on an Actuarial Basis by his benefit under the ERA.The Participant’s benefit under the ERA will be paid pursuant to the terms of the ERA and hisRetirement Benefit under this SERP, if any, will be paid pursuant to the terms hereof.3.5 Subsequent ERA Participation. A Participant’s participation in this SERP will be frozenupon being named to the ERA. The Participant’s Retirement Benefit under the SERPaccrued as of the date his participation was frozen will commence pursuant to the termshereof. Distribution of the Participant’s ERA benefit will be made pursuant to the terms of theERA. In the event such Participant subsequently resumes participation in the SERP, subjectto the provisions of Section 3.1, he will be given credit for his Years of Service while aparticipant in the ERA for purposes of determining the amount of his15 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Retirement Benefit under this SERP, but such Retirement Benefit will be reduced on an ActuarialEquivalent basis by his benefit under the ERA.3.6 Initial AMI SERP Participation. A Participant who participated in the AMI SERP beforebecoming a Participant in the SERP will be entitled to a benefit under this SERP, if any, equalto the amount of his accrued benefit (as determined using the Actuarial Equivalent factorsset forth in Section 2.1 of this SERP) less his prior accrued benefit under the AMI SERP (asdetermined using the actuarial equivalent factors set forth in the AMI SERP). TheParticipant’s accrued benefit under the AMI SERP will be paid pursuant to the terms of theAMI SERP and his benefit under this SERP, if any, will be paid pursuant to the terms hereof.End of Article III 16 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IVRETIREMENT BENEFITS4.1 Normal Retirement Benefit.(a) Calculation of Normal Retirement Benefit. Upon a Participant’s NormalRetirement, the Participant will be entitled to receive a monthly Normal RetirementBenefit for the Participant’s lifetime which is determined in accordance with the benefitformula set forth below, adjusted by the vesting percentage in Section 4.3. Payment ofsuch Normal Retirement Benefit will commence as of the Participant’s NormalRetirement Date, subject to the six (6) month restriction applicable to Key Employees,described in Section 5.1 of the SERP. Except as provided below, the amount of suchmonthly Normal Retirement Benefit will be determined by using the following formula:X = [Al x [B1 + [B2 x C]] x [2.7% - D] x E] + [A2 x [B1 +[B2 x C] x 2.7% x E]X = Normal Retirement BenefitAl = Final Average Earnings (From Base Salary)A2 = Final Average Earnings (From Bonus)B1 = Years of Service After Date of EnrollmentB2 = Years of Service Prior to Date of EnrollmentC = Prior Service Credit PercentageD = Retirement Benefit Plans Adjustment FactorE = Vesting PercentageNote: B1 and B2 Years of Service combined cannot exceed twenty (20) years.To the extent that a Participant incurred a Termination of Employment before theEffective Date, such Participant’s Normal Retirement Benefit, Early RetirementBenefit, Disability Retirement Benefit or Deferred Vested Retirement Benefit, asapplicable, will be determined under the benefit formula as in effect at the time theParticipant’s Termination of Employment. However, the remaining provisions of thisSERP, including but not limited to, the distribution provisions of Article IV and theclaims procedures set forth in Section 7.6, will apply to such Participant.(b) Death After Commencement of Normal Retirement Benefits. If a Participantwho is receiving a Normal Retirement Benefit dies, his Surviving Spouse or EligibleChildren will be entitled to receive (in accordance with Sections 4.6 and 4.7) a benefitequal to fifty percent (50%) of the Participant’s Normal Retirement Benefit.(c) Death After Normal Retirement Age But Before Normal Retirement. If aParticipant who is eligible for Normal Retirement dies while an employee after attainingage sixty-five (65), his Surviving Spouse or Eligible Children will be entitled to receive(in accordance with Sections 4.6 and 4.7) the installments of the Normal RetirementBenefit which would have been payable to the Surviving Spouse or Eligible Children inaccordance with Section 4.1(b) as if the Participant had retired from the Employer onthe day before he died. Distribution of such17 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. benefits will not be subject to the six (6) month restriction applicable to Key Employees.4.2 Early Retirement Benefit.(a) Calculation of Early Retirement Benefit. Upon a Participant’s EarlyRetirement, the Participant will be entitled to receive a monthly Early Retirement Benefitfor the Participant’s lifetime commencing on the Participant’s Normal Retirement Date,calculated in accordance with Section 4.1 and Section 4.3 with the followingadjustments:(i) Only the Participant’s actual Years of Service, adjusted appropriately for thePrior Service Credit Percentage, as of the date of Early Retirement will beused.(ii) For purposes of determining Final Average Earnings, only the Participant’sEarnings as of the date of Early Retirement will be used.(iii) To arrive at the payments to commence at Normal Retirement, the amountcalculated under Section 4.2(a)(i) and Section 4.2(a)(ii) will be reduced by0.25% for each month Early Retirement occurs before age sixty-two (62).(b) Early Payment of Benefits. A Participant may elect during the Initial Election Periodto receive a distribution of his Early Retirement Benefit on the first day of the calendarmonth following the date of his Early Retirement rather than on his NormalRetirement Date as specified in Section 4.2(a). Payment of such Early RetirementBenefit will be subject to the six (6) month restriction applicable to Key Employees,described in Section 5.1 of the SERP. A Participant who makes this election, willhave the amount calculated under Section 4.2(a) further reduced by 0.25% for eachmonth that the date of commencement of payment precedes the date on which theParticipant will attain age sixty-two (62).(c) Death After Early Retirement Benefits Commence. If a Participant dies aftercommencement of the payment of his Early Retirement Benefit, his SurvivingSpouse or Eligible Children will be entitled to receive (in accordance with Sections 4.6and 4.7) a benefit equal to fifty percent (50%) of the Participant’s Early RetirementBenefit.(d) Death After Early Retirement But Before Benefit Commencement. If a Participantdies after his Early Retirement but before benefits have commenced his SurvivingSpouse or Eligible Children will be entitled to receive (in accordance with Sections 4.6and 4.7) a benefit equal to fifty percent (50%) of the benefit that would have beenpayable on the date of the Participant’s death had he elected to have benefitscommence on that date. Distribution of such benefits will not be subject to the six (6)month restriction applicable to Key Employees.(e) Death of Employee After Attainment of Early Retirement Age but Before EarlyRetirement. If a Participant dies after attaining Early Retirement Age but beforetaking Early Retirement, his Surviving Spouse or Eligible Children will be18 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. entitled to receive (in accordance with Sections 4.6 and 4.7) a benefit equal to fiftypercent (50%) of the Participant’s Early Retirement Benefit determined as if theParticipant had retired on the day before his death with payments commencing on thefirst of the month following the Participant’s death. The benefits payable to a SurvivingSpouse or Eligible Children under this Section 4.2(e) will be no less than the benefitspayable to a Surviving Spouse or Eligible Children under Section 4.4 (regarding theDeferred Vested Retirement Benefit) as if the Participant had died immediately beforeage fifty-five (55).4.3 Vesting of Retirement Benefit. A Participant’s interest in his Retirement Benefit will, subjectto Section 9.4 (regarding Conditions Precedent), vest in accordance with the followingschedule:Years of ServiceVesting PercentageLess than 505 but less than 6256 but less than 7307 but less than 8358 but less than 9409 but less than 104510 but less than 115011 but less than 125512 but less than 136013 but less than 146514 but less than 157015 but less than 167516 but less than 178017 but less than 188518 but less than 199019 but less than 209520 or more100 Notwithstanding the foregoing, a Participant who is at least sixty (60)years old and who hascompleted at least five (5) Years of Service will be fully vested, subject to Section 9.4(regarding Conditions Precedent), in his Retirement Benefit. Except as required otherwise byapplicable law, no Years of Service will be credited for Service after age sixty-five (65) or formore than twenty (20) years.4.4 Deferred Vested Retirement Benefit. Upon any Termination of Employment of theParticipant before Normal Retirement or Early Retirement for reasons other than death orDisability, such Participant will be entitled to a Deferred Vested Retirement Benefit,19 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. commencing on the Participant’s Normal Retirement Date, calculated under Section 4.1 and4.3 but with the following adjustments:(a) Calculation of Years of Service. Only the Participant’s actual Years of Service,adjusted appropriately for the Prior Service Credit Percentage, as of the date of hisTermination of Employment will be used.(b) Calculation of Earnings. For purposes of determining Final Average Earnings, asused in Section 4.1, only the Participant’s Earnings before the date of his Terminationof Employment will be used.(c) Early Termination Reduction. Subject to the maximum reduction under Section4.4(g), to arrive at the payments to commence at the Participant’s Normal RetirementDate, the amount calculated under Section 4.1(a) will be reduced by 0.25% for eachmonth the Participant’s Termination of Employment occurs before age sixty-two (62).(d) Death After Commencement of Payments. If a Participant dies aftercommencement of the payment of his Deferred Vested Retirement Benefit under thisSection 4.4, his Surviving Spouse or Eligible Children will be entitled at Participant’sdeath to receive (in accordance with Sections 4.6 and 4.7) a benefit equal to fiftypercent (50%) of the Participant’s Deferred Vested Retirement Benefit.(e) Death after Termination of Employment. If a Participant, who has a vested interestunder Section 4.3, dies after Termination of Employment but at death is not receivingany Deferred Vested Retirement Benefits under this SERP and was not eligible for anEarly Retirement Benefit pursuant to Section 4.2, his Surviving Spouse or EligibleChildren will be entitled to receive (in accordance with Sections 4.6 and 4.7)commencing on the date that would have been the Participant’s Normal RetirementDate, a benefit equal to fifty percent (50%) of the Deferred Vested Retirement Benefitwhich would have been payable to the Participant at his Normal Retirement Date.(f) Death While an Employee. If a Participant, who has a vested interest under Section4.3, dies while still actively employed by the Employer or, to the extent provided bythe Senior Vice President, Human Resources or Plan Administrator, anAffiliate, before he was eligible for Early Retirement, his Surviving Spouse or EligibleChildren will be entitled at the Participant’s death to receive a benefit equal to fiftypercent (50%) of the Participant’s Retirement Benefit (in accordance with Sections4.6 and 4.7) calculated as if the Participant was age fifty-five (55) and eligible for EarlyRetirement on the day before the Participant’s death; provided, however, that thecombined reductions for Early Retirement and early payment will not exceed twenty-one percent (21%) of the amount calculated under Sections 4.2(a)(i) and (ii).Distribution of such benefits will not be subject to the six (6) month restrictionapplicable to Key Employees.(g) Early Termination Reduction Limit. To arrive at the amount of the Deferred VestedRetirement Benefit payments to commence at the Participant’s Normal RetirementDate, the Early Termination reduction calculated under Section 4.4(c) (and indirectlyunder Section 4.4(d), and Section 4.4(e)) will be limited to the20 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. maximum percentage reduction for Early Retirement at age fifty-five (55) (i.e.,twenty-one percent (21%)).4.5 Deferral of Distributions. A Participant may elect to defer payment of his NormalRetirement Benefit payable pursuant to Section 4.1, his Early Retirement Benefit payablepursuant to Section 4.2 or his Deferred Vested Retirement Benefit payable pursuant toSection 4.4 for a period of at least five (5) years by making an election to defer suchdistribution at least twelve (12) months before the date that the Normal Retirement Benefit,Early Retirement Benefit or Deferred Vested Retirement Benefit would otherwise be paid(i.e., at least twelve (12) months before a Termination of Employment). In the event that theParticipant becomes entitled to a distribution pursuant to Section 4.1, Section 4.2 or Section4.4 during this twelve (12) month period, the deferral election will be of no effect and paymentof the Participant’s benefits will commence at the time specified in Section 4.1, Section 4.2 orSection 4.4, as applicable. A Participant who becomes entitled to distribution of a DisabilityRetirement Benefit pursuant to Section 4.9 may not elect to defer payment of suchdistribution pursuant to this Section 4.5 and any deferral election made by such Participantwill be null and of no effect.4.6 Duration of Benefit Payment.(a) Participant Benefit Payments. The Normal Retirement Benefit, Early RetirementBenefit, Disability Retirement Benefit or Deferred Vested Retirement Benefit underthe SERP will be payable to the Participant in the form of a monthly benefit payablefor life.(b) Surviving Spouse Benefit Payments. The benefit payable to a Surviving Spouseunder the SERP will be paid in the form of a monthly benefit payable for life; provided,that all benefits payable to the Surviving Spouse are subject to actuarial reductionbased on the factors in Section 2.1 if the Surviving Spouse is more than three (3)years younger than the Participant.(c) Eligible Children Benefit Payments. The benefit payable to a Participant’s EligibleChildren under the SERP will be paid in the form of a monthly benefit payable untileach such child reaches age twenty-one (21).4.7 Recipients of Benefit Payments.(a) Death without Surviving Spouse. If a Participant dies without a Surviving Spousebut is survived by any Eligible Children, then the Participant’s Retirement Benefit willbe paid to his Eligible Children. The total monthly benefit payable will be equal to themonthly benefit that a Surviving Spouse would have received without actuarialreduction. This benefit will be paid in equal shares to all Eligible Children until theyoungest of the Eligible Children attains age twenty-one (21). When any of the EligibleChildren reaches twenty-one (21), his share of the total monthly benefit will bereallocated equally to the remaining Eligible Children.(b) Death of Surviving Spouse. If the Surviving Spouse dies after the death of theParticipant but is survived by Eligible Children then the total monthly benefitpreviously paid to the Surviving Spouse will be paid in equal shares to all EligibleChildren until the youngest of the Eligible Children attains age twenty-one (21).21 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. When any of the Eligible Children reaches twenty-one (21), his share of the totalmonthly benefit will be reallocated equally to the remaining Eligible Children.(c) Death Without Surviving Spouse or Eligible Children. If the Participant dieswithout a Surviving Spouse or Eligible Children, no additional benefits will be paidunder this SERP with respect to that Participant.4.8 Disability.(a) Disability Retirement Benefit. Any Participant who incurs a Disability will uponreaching Normal Retirement Age be paid, as a Disability Retirement Benefit, theNormal Retirement Benefit in accordance with Section 4.1 based on his vestedinterest as determined under Section 4.3 and Section 4.8(b). Payment of theDisability Retirement Benefit will begin as of the Participant’s Normal RetirementDate. A Participant who is entitled to a Disability Retirement Benefit may not elect todefer payment of such distribution pursuant to Section 4.5. Unless otherwise requiredunder Code Section 409A, amounts payable pursuant to this Section 4.8(a) will not besubject to the six (6) month restriction applicable to Key Employees.(b) Continued Accrual of Vesting Service. Upon a Participant’s Disability whilean employee of the Employer, or to the extent provided by the Senior Vice President,Human Resources or the Plan Administrator, an Affiliate, the Participant will continue toaccrue Years of Service for purposes of vesting under Section 4.3 of this SERP duringhis Disability until the earliest of his:(i) Recovery from Disability;(ii) Attainment of Normal Retirement Age; or(iii) Death.(c) Not Eligible for Early Retirement Benefit. A Participant who is Disabled will not beentitled to receive an Early Retirement Benefit under this SERP.(d) Calculation of Earnings. For purposes of calculating the amount of the DisabilityRetirement Benefit, the Participant’s Final Average Earnings will be determined usinghis Earnings up to the date of Disability.(e) Death Before Attainment of Early Retirement Age. If a Participant, who has avested interest as determined under this Section 4.8 and Section 4.3, dies while onDisability before he attained Early Retirement Age, his Surviving Spouse or EligibleChildren will be entitled at the Participant’s death to receive a benefit equal to fiftypercent (50%) of the Participant’s Retirement Benefit (in accordance with Sections4.6 and 4.7) calculated under Section 4.2 as if the Participant was age fifty-five (55)and eligible for Early Retirement on the day before the Participant’s death; provided,however, that the combined reductions for Early Retirement and early payment willnot exceed twenty-one percent (21%) of the amount calculated under Sections 4.2(a)(i) and (ii). Distribution of such benefits will not be subject to the six (6) monthrestriction applicable to Key Employees.22 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (f) Death After Attainment of Early Retirement Age. If a Participant dies after attainingEarly Retirement Age while on Disability, his Surviving Spouse or Eligible Childrenwill be entitled to receive (in accordance with Sections 4.6 and 4.7) a benefit equal tofifty percent (50%) of the Participant’s Early Retirement Benefit determined as if theParticipant had retired on the day before his death with payments commencing on thefirst of the month following the Participant’s death. The benefits payable to a SurvivingSpouse or Eligible Children under this Section 4.8(f) will be no less than the benefitspayable to a Surviving Spouse or Eligible Children under Section 4.4 (regarding theDeferred Vested Retirement Benefit) as if the Participant had died immediately priorto age fifty-five (55). Distribution of such benefits will not be subject to the six (6)month restriction applicable to Key Employees.(g) Death after Commencement of Payments. If a Participant dies after hiscommencement of Disability Retirement Benefits under this Section 4.8, hisSurviving Spouse or Eligible Children will be entitled at the Participant’s death toreceive (in accordance with Sections 4.6 and 4.7) a benefit equal to fifty percent(50%) of the Participant’s Disability Retirement Benefit.4.9 Change of Control.(a) Calculation of Benefits.(i) Post-April 1994 Employees. In the event of a Change of Control while thisSERP remains in effect, each Participant will be fully vested in his RetirementBenefit, without regard to the Participant’s Years of Service and the amount ofsuch benefit will be calculated by granting the Participant Prior Service Creditunder Sections 4.1, 4.2 and 4.4 for all Years of Service prior to his Date ofEnrollment, plus, for Eligible Employees who become Participants beforeAugust 3, 2011, crediting of additional Years of Service at the end of theSeverance Period and crediting of age during the Severance Period asdetermined under Section 3.1(h) of the ESP. Moreover, the RetirementBenefit Plans Adjustment Factor will be adjusted as set forth in Section2.49. In addition, with respect to a Participant who (A) is an active employee,(B) has not yet begun to receive benefit payments under the SERP, and (C)incurs a Termination without Cause within two (2) years following a Change ofControl, the provisions of Section 9.4(b) (Regarding Conditions Precedent) willnot apply.(ii) Employees as of April 1, 1994. With respect to a Participant who is anemployee actively at work on April 1, 1994, with the corporate office or adivision of the Employer which has not been declared to be a discontinuedoperation, who has not yet begun to receive benefit payments under theSERP and who incurs a Termination without Cause within two (2) yearsfollowing a Change of Control, the provisions of Section 4.9(a)(i) above will notapply and instead a Participant’s Retirement Benefit under this SERP will bedetermined by:(A) granting the Participant full Prior Service Credit under Sections 4.1, 4.2and 4.4 for all Years of Service prior to his Date of23 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Enrollment; plus, for Eligible Employees who become Participantsbefore August 3, 2011, crediting of additional Years of Service at theend of the Severance Period and crediting of age during theSeverance Period as determined under Section 3.1(h) of the ESP.(B) with respect to a covered Participant who incurs a Termination withoutCause within two (2) years following a Change of Control, crediting theParticipant with three (3) additional Years of Service (with total Yearsof Service not to exceed twenty (20) years), which will be in lieu of anyadditional Years of Service and age provided under Section 3.1 of theESP;(C) The benefit formula in Section 4.1(a) will be applied by defining A1 as"the greater of current monthly Earnings (from Base Salary) or FinalAverage Earnings (from Base Salary)," and A2 as "the greater ofcurrent monthly Earnings (from Bonus) or Final Average Earnings(from Bonus)";(D) The Retirement Benefits Plan Adjustment Factor will be adjusted asset forth in Section 2.49;(E) The provisions of Section 9.4(b) (regarding Conditions Precedent) willnot apply; and(F) Further, the Participant will be fully vested in such Retirement Benefitwithout regard to his Years of Service.(b) Payment of Benefits. Upon the Participant's Termination of Employment within two(2) years following the occurrence of a Change of Control (except on account of aliquidation or dissolution of the Company), the Participant will begin to receive suchRetirement Benefit (notwithstanding the payout timing rules in Sections 2.21, 3.2,4.2(a), 4.2(b), and 4.4) commencing on the first day of the calendar month followingthe date of such Termination of Employment without reduction by virtue of Sections4.2(a), 4.2(b) or 4.4(c), taking into account the crediting of the additional severanceperiod under ESP Section 3.1(h) and SERP Section 4.9(a). In the event that theParticipant does not incur a Termination of Employment within such two (2) yearperiod or in the event of a Change of Control on account of the liquidation ordissolution of the Company, the Participant will begin to receive the RetirementBenefit described in Section 4.9(a) as of his Normal Retirement Date or EarlyRetirement Date, as the case may be, with no reduction by virtue of Section 4.2(a),Section 4.2(b) or Section 4.4(c), subject to the six (6) month restriction applicable toKey Employees described in Section 5.1. 4.10 Golden Parachute Limitation. The calculation and administration of any liability that mayarise out of the "golden parachute" provisions of sections 280G and 4999 of the Code will beaddressed as set forth in the Executive Severance Plan.4.11 Executive Severance Plan. A Participant who is entitled to receive benefits under thisSERP following a Termination of Employment, will to the extent applicable have suchbenefits calculated under the provisions of this SERP and Section 3.1(h) of the ESP. In24 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. the event of any direct conflict between the terms of this SERP and the ESP with respect tothe calculation of benefits, the ESP will control.End of Article IV25 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VPAYMENT5.1 Commencement of Payments. Benefit payments under this SERP generally will begin onthe Participant’s Normal Retirement Date; provided, that in the case of a benefit payable onaccount of Early Retirement, a Termination of Employment within two (2) years following aChange of Control or death, benefit payments will begin not later than the first day of thecalendar month following the occurrence of the event which entitles the Participant (or aSurviving Spouse or Eligible Children) to benefits under this SERP. Benefit payments underthis SERP that are payable to a Key Employee on account of a Termination of Employmentwill be delayed for a period of six (6) months following such Participant’s Termination ofEmployment. On the day following the expiration of such six (6) month period, the Participantwill receive a catch-up payment equal to the amount of benefits that would have been paidduring such six (6) month period but for the provisions of this Section 5.1 and the remainderof such payments will be paid according to the terms of the SERP.5.2 Withholding; Unemployment Taxes. Any taxes required to be withheld from a Participant’sbenefit by the Federal or any state or local government will be withheld from payments underthis SERP to the extent required by the law in effect at the time payments are made.5.3 Recipients of Payments. All Retirement Benefit payments to be made by the Employerunder the SERP will be made to the Participant during his lifetime. All subsequent paymentsunder the SERP will be made by the SERP to the Participant’s Surviving Spouse or EligibleChildren.5.4 No Other Benefits. No other benefits will be payable under this SERP to the Participant orhis Surviving Spouse or Eligible Children by reason of the Participant’s Termination ofEmployment or otherwise, except as specifically provided herein.5.5 No Lump Sum Form of Payment. Except with respect to permitted SERP terminationsunder Section 8.3, no lump sum form of payment will be payable from the SERP withrespect to any Participant regardless of when such Participant incurs a Termination ofEmployment.End of Article V26 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VIPAYMENT LIMITATIONS6.1 Spousal Claims. (a) An Alternate Payee may be awarded all or a portion of the Participant’s RetirementBenefits pursuant to the terms of a DRO, in which case such benefits will be payableto the Alternate Payee at the same time and in the same form of payment as theParticipant’s.(b) The Alternate Payee will be responsible for payment of any federal, state and localtaxes.(c) The Plan Administrator has sole and absolute discretion to determine whether ajudgment, decree or order is a DRO, to determine whether a DRO will be acceptedfor purposes of this Section 6.1 and to make interpretations under this Section 6.1,including determining who is to receive benefits, all calculations of benefits anddeterminations of the form of such benefits, and the amount of taxes to be withheld.The decisions of the Plan Administrator will be binding on all parties with an interest.(d) Any benefits payable to an Alternate Payee pursuant to the terms of a DRO will besubject to all provisions and restrictions of the SERP and any dispute regarding suchbenefits will be resolved pursuant to the SERP claims procedure in Article VII.6.2 Legal Disability. If a person entitled to any payment under this SERP will, in the solejudgment of the Plan Administrator, be under a legal disability, or otherwise will be unable toapply such payment to his own interest and advantage, the Plan Administrator, in theexercise of its discretion, may direct the Company or payor of the benefit to make any suchpayment in any one or more of the following ways:(a) Directly to such person;(b) To his legal guardian or conservator; or(c) To his spouse or to any person charged with the duty of his support, to be expendedfor his benefit and/or that of his dependents.The decision of the Plan Administrator will in each case be final and binding upon all personsin interest, unless the Plan Administrator will reverse its decision due to changedcircumstances.6.3 Assignment. Except as provided in Section 6.1, no Participant, Surviving Spouse or EligibleChild will have any right to assign, pledge, transfer, convey, hypothecate, anticipate or in anyway create a lien on any amounts payable hereunder. No amounts payable hereunder will besubject to assignment or transfer or otherwise be alienable, either by voluntary or involuntaryact, or by operation of law, or subject to attachment, execution, garnishment, sequestrationor other seizure under any legal, equitable or other process, or be liable in any way for thedebts or defaults of Participants or their27 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Surviving Spouses or Eligible Children. The Company may assign all or a portion of thisSERP to any Affiliate which employs any Participant.End of Article VI28 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VIIADMINISTRATION OF THE PLAN7.1 The RPAC. The overall administration of the SERP will be the responsibility of the RPAC.7.2 Powers of the RPAC. The RPAC will have the sole and absolute discretion regarding theexercise of its powers and duties under this SERP. In order to effectuate the purposes of theSERP, the RPAC will have the following powers and duties:(a) To appoint the Plan Administrator;(b) To review and render decisions respecting a denial of a claim for benefits under theSERP;(c) To construe the SERP and to make equitable adjustments for any mistakes or errorsmade in the administration of the SERP;(d) To carry out the duties expressly reserved to it under the SERP; and(e) To determine and resolve, in its sole and absolute discretion, all questions relating tothe administration of the SERP and the Trust (i) when differences of opinion arisebetween the Company, an Affiliate, the Plan Administrator, the Trustee, a Participant,or any of them, and (ii) whenever it is deemed advisable to determine such questionsin order to promote the uniform and nondiscriminatory administration of the SERP forthe greatest benefit of all parties concerned.The foregoing list of express powers is not intended to be either complete or conclusive, andthe RPAC will, in addition, have such powers as it may reasonably determine to benecessary or appropriate in the performance of its powers and duties under the SERP.7.3 Appointment of Plan Administrator. The RPAC will appoint the Plan Administrator, whowill have the responsibility and duty to administer the SERP on a daily basis. The RPACmay remove the Plan Administrator with or without cause at any time. The PlanAdministrator may resign upon written notice to the RPAC.7.4 Duties of Plan Administrator. The Plan Administrator will have sole and absolute discretionregarding the exercise of its powers and duties under this SERP. The Plan Administrator willhave the following powers and duties:(a) To direct the administration of the SERP in accordance with the provisions herein setforth;(b) To adopt rules of procedure and regulations necessary for the administration of theSERP, provided such rules are not inconsistent with the terms of the SERP;(c) To determine all questions with regard to rights of Participants under the SERPincluding, but not limited to, questions involving who is an Eligible Employee and theamount of a Participant’s benefits;29 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (d) To enforce the terms of the SERP and any rules and regulations adopted by theRPAC;(e) To review and render decisions respecting a claim for a benefit under the SERP;(f) To furnish the Employer with information required for tax or other purposes;(g) To engage the service of counsel (who may, if appropriate, be counsel for theEmployer), actuaries, and agents whom it may deem advisable to assist it with theperformance of its duties;(h) To prescribe procedures to be followed by distributees in obtaining benefits;(i) To receive from the Employer and from Participants such information as is necessaryfor the proper administration of the SERP;(j) To create and maintain such records and forms as are required for the efficientadministration of the SERP;(k) To make all determinations and computations concerning the benefits to which anyParticipant is entitled under the SERP;(l) To give the Trustee specific directions in writing with respect to:(i) the making of distribution payments, giving the names of the payees, theamounts to be paid and the time or times when payments will be made; and(ii) the making of any other payments which the Trustee is not by the terms of thetrust agreement authorized to make without a direction in writing by the PlanAdministrator or the Company;(m) To comply with all applicable lawful reporting and disclosure requirements of ERISA;(n) To comply (or transfer responsibility for compliance to the Trustee) with all applicablefederal income tax withholding requirements for benefit distributions; and(o) To construe the SERP, in its sole and absolute discretion, and make equitableadjustments for any mistakes and errors made in the administration of the SERP.The foregoing list of express duties is not intended to be either complete or conclusive, andthe Plan Administrator will, in addition, exercise such other powers and perform such otherduties as it may deem necessary, desirable, advisable or proper for the supervision andadministration of the SERP.7.5 Indemnification of the RPAC and Plan Administrator. To the extent not covered byinsurance, or if there is a failure to provide full insurance coverage for any reason, and to theextent permissible under corporate by-laws and other applicable laws and regulations, theCompany agrees to hold harmless and indemnify the RPAC and Plan30 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Administrator against any and all claims and causes of action by or on behalf of any and allparties whomsoever, and all losses therefrom, including, without limitation, costs of defenseand reasonable attorneys’ fees, based upon or arising out of any act or omission relating toor in connection with the SERP other than losses resulting from the RPAC’s, or any suchperson’s fraud or willful misconduct.7.6 Claims for Benefits.(a) Initial Claim. In the event that an Employee, Eligible Employee, Participant, SurvivingSpouse, or Eligible Child claims to be eligible for benefits, or claims any rights underthis SERP, such claimant must complete and submit such claim forms andsupporting documentation as will be required by the Plan Administrator, in its sole andabsolute discretion. Likewise, any Participant, Surviving Spouse, or Eligible Child whofeels unfairly treated as a result of the administration of the SERP must file a writtenclaim, setting forth the basis of the claim, with the Plan Administrator. In connectionwith the determination of a claim, or in connection with review of a denied claim, theclaimant may use representation and may examine this SERP, and any otherpertinent documents generally available to Participants that are specifically related tothe claim.Different claims procedures apply to claims for benefits on account of Disability,referred to as "Disability claims," and all other claims for benefits, referred to as "non-Disability claims."(b) Non-Disability Claims.(i) Initial Decision. If a claimant files a non-Disability claim, written notice of thedisposition of such claim will be furnished to the claimant within ninety (90)days after the claim is filed with the Plan Administrator. Such notice will refer,if appropriate, to pertinent provisions of this SERP, will set forth in writing thereasons for denial of the claim if a claim is denied (including references to anypertinent provisions of this SERP) and, where appropriate, will describe anyadditional material or information necessary for the claimant to perfect theclaim and an explanation of why such material or information is necessary. Ifthe claim is denied, in whole or in part, the claimant will also be notified of theSERP’s claim review procedure and the time limits applicable to suchprocedure, including the claimant’s right to arbitration following an adversebenefit determination on review as provided below. All benefits provided in thisSERP as a result of the disposition of a claim will be paid as soon aspracticable following receipt of proof of entitlement, if requested.(ii) Request for Review. Within ninety (90) days after receiving written notice ofthe Plan Administrator’s disposition of the claim, the claimant may file with theRPAC a written request for review of his claim. In connection with the requestfor review, the claimant will be entitled to be represented by counsel and willbe given, upon request and free of charge, reasonable access to all pertinentdocuments for the preparation of his claim. If the claimant does not file awritten request for review within ninety (90) days after receiving written noticeof the Plan Administrator’s disposition of the claim, the claimant will bedeemed to have accepted the31 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Plan Administrator’s written disposition, unless the claimant was physically ormentally incapacitated so as to be unable to request review within the ninety(90) day period.(iii) Decision on Review. After receipt by the RPAC of a written application forreview of his claim, the RPAC will review the claim taking into account allcomments, documents, records and other information submitted by theclaimant regarding the claim without regard to whether such information wasconsidered in the initial benefit determination. The RPAC will notify theclaimant of its decision by delivery or by certified or registered mail to his lastknown address. A decision on review of the claim will be made by the RPACat its next meeting following receipt of the written request for review. If nomeeting of the RPAC is scheduled within forty-five (45) days of receipt of thewritten request for review, then the RPAC will hold a special meeting to reviewsuch written request for review within such forty-five (45) day period. If specialcircumstances require an extension of the forty-five (45) day period, theRPAC will so notify the claimant and a decision will be rendered within ninety(90) days of receipt of the request for review. In any event, if a claim is notdetermined by the RPAC within ninety (90) days of receipt of writtensubmission for review, it will be deemed to be denied.The decision of the RPAC will be provided to the claimant as soon as possiblebut no later than five (5) days after the benefit determination is made. Thedecision will be in writing and will include the specific reasons for the decisionpresented in a manner calculated to be understood by the claimant and willcontain references to all relevant SERP provisions on which the decision wasbased. Such decision will also advise the claimant that he may receive uponrequest, and free of charge, reasonable access to and copies of alldocuments, records and other information relevant to his claim and will informthe claimant of his right to arbitration in the case of an adverse decisionregarding his appeal. The decision of the RPAC will be final and conclusive.(c) Disability Claims.(i) Initial Decision. If a claimant files a Disability claim, written notice of thedisposition of such claim will be furnished to the claimant within forty-five (45)days after the claim is filed with the Plan Administrator. This period may beextended by the Plan Administrator for up to thirty (30) days provided that thePlan Administrator determines that such an extension is necessary due tomatters beyond its control and the claimant is notified before the expiration ofthe initial forty-five (45) day period of the circumstances requiring theextension of time and the date by which the Plan Administrator expects torender a decision. If, before the first thirty (30) day extension period, the PlanAdministrator determines that, due to matters beyond its control, a decisioncannot be made within that extension period, the period for making thedetermination may be extended for up to an additional thirty (30) daysprovided that the claimant is notified before the expiration of the first thirty (30)day extension period of the circumstances requiring the extension and thedate as of which the32 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Plan Administrator expects to issue a decision. In the case of any extension,the notice of extension will specifically explain the standards on whichentitlement to a benefit on account of Disability is based, the unresolvedissues that prevent a decision on the claim, and the additional informationneeded to resolve those issues and the claimant will be given at least forty-five (45) days within which to provide the specified information.Written notice of the disposition of the claim will refer, if appropriate, topertinent provisions of this SERP, will set forth in writing the reasons for denialof the claim if a claim is denied (including references to any pertinentprovisions of this SERP), the protocol relied upon in denying the claim or astatement that such protocol is available on request and, where appropriate,will describe any additional material or information necessary for the claimantto perfect the claim and an explanation of why such material or information isnecessary. If the claim is denied, in whole or in part, the claimant will also benotified of the SERP’s claim review procedure and the time limits applicable tosuch procedure, including the claimant’s right to arbitration following anadverse benefit determination on review as provided below.(ii) Request for Review. Within one hundred and eighty (180) days afterreceiving written notice of the Plan Administrator’s denial of the claim, theclaimant may file with the RPAC a written request for review of his claim. Inconnection with the request for review, the claimant will be entitled to berepresented by counsel and will be given, upon request and free of charge,reasonable access to all pertinent documents for the preparation of his claim.If the claimant does not file a written request for review within this one hundredand eighty (180) day period, the claimant will be deemed to have accepted thePlan Administrator’s written disposition, unless the claimant was physically ormentally incapacitated so as to be unable to request review within the onehundred and eighty (180) day period.If the benefit denial is based in whole or in part on a medical judgment, theclaimant will be entitled to a review by the RPAC based on the RPAC’sconsultation with a health care professional who has appropriate training andexperience in the field of medicine involved in the medical judgment wherebysuch professional is neither an individual who was consulted in connectionwith the benefit denial that is the subject of the request for review nor thesubordinate of any such individual. The claimant will also be provided with theidentity of any medical or vocational experts whose advice was obtained onbehalf of the SERP in connection with the benefit denial, without regard towhether the advice was relied upon in making the initial benefit determination.The RPAC’s review will take into account all comments, documents, recordsand other information submitted by the claimant relating to the claim withoutregard to whether such information was submitted or considered in the initialbenefit determination. In addition, the RPAC’s review will not give deference tothe initial adverse benefit determination.33 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. If the Plan Administrator is a member of the RPAC, he will not participate inthe RPAC’s review of the request for review(iii) Decision on Review. The claimant will be provided with written notice of theRPAC’s benefit determination on review within a reasonable period of time;provided, however, that such period will not last more than forty-five (45) daysor ninety (90) days if an extension is required and proper notice is given to theclaimant. In any event, if a claim is not determined by the RPAC within ninety(90) days of receipt of written submission for review, it will be deemed to bedenied.The decision of the RPAC will be in writing and will include the specificreasons for the decision presented in a manner calculated to be understoodby the claimant and will contain references to all relevant SERP provisions onwhich the decision was based. Such decision will also advise the claimantthat he may receive upon request, and free of charge, reasonable access toand copies of all documents, records and other information relevant to hisclaim and will inform the claimant of his right to arbitration in the case of anadverse decision regarding his appeal. In addition, the notice will set forth thefollowing additional information, to the extent applicable:(A) the protocol relied upon in making the adverse decision;(B) if the adverse decision is based on a medical necessity or similarexclusion or limit, either an explanation of the scientific or clinicaljudgment for the decision, applying the terms of the SERP to theclaimant’s medical circumstances, or a statement that suchexplanation will be provided free of charge upon request; and(C) the following statement: You and your SERP may have othervoluntary alternative dispute resolution options, such as mediation.One way to find out what may be available is to contact your local U.S.Department of Labor Office.The decision of the RPAC will be final and conclusive.7.7 Arbitration. In the event the claims review procedure described in Section 7.6 of the SERP(regarding non-Disability claims) does not result in an outcome thought by the claimant to bein accordance with the SERP document, he may appeal to a third party neutral arbitrator.The claimant must appeal to an arbitrator within sixty (60) days after receiving the RPAC’sdenial or deemed denial of his request for review and before bringing suit in court. Thearbitration will be conducted pursuant to the American Arbitration Association ("AAA") Ruleson Employee Benefit Claims.The arbitrator will be mutually selected by the claimant and the RPAC from a list ofarbitrators who are experienced in nonqualified deferred compensation plan benefit mattersthat is provided by the AAA. If the parties are unable to agree on the selection of an arbitratorwithin ten (10) days of receiving the list from the AAA, the AAA will appoint an arbitrator. Thearbitrator’s review will be limited to interpretation of the SERP document in the context of theparticular facts involved. The claimant, the RPAC and the34 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Company agree to accept the award of the arbitrator as binding, and all exercises of powerby the arbitrator hereunder will be final, conclusive and binding on all interested parties,unless found by a court of competent jurisdiction, in a final judgment that is no longer subjectto review or appeal, to be arbitrary and capricious. The claimant, RPAC and the Companyagree that the venue for the arbitration will be in Dallas, Texas. The costs of arbitration willbe paid by the Company; the costs of legal representation for the claimant or witness costsfor the claimant will be borne by the claimant; provided, that, (i) if the claimant prevails insuch arbitration, the Company will reimburse the claimant for his reasonable legal fees andexpenses incurred in bringing the arbitration, and (ii) in all other cases, as part of his award,the Arbitrator may require the Company to reimburse the claimant for all or a portion of suchamounts.The following discovery may be conducted by the parties: interrogatories, demands toproduce documents, requests for admissions and oral depositions. The arbitrator willresolve any discovery disputes by such pre hearing conferences as may be needed. TheCompany, RPAC and claimant agree that the arbitrator will have the power of subpoenaprocess as provided by law. Disagreements concerning the scope of depositions ordocument production, its reasonableness and enforcement of discovery requests will besubject to agreement by the Company and the claimant or will be resolved by thearbitrator. All discovery requests will be subject to the proprietary rights and rights ofprivilege and other protections granted by applicable law to the Company and the claimantand the arbitrator will adopt procedures to protect such rights. With respect to any dispute,the Company, RPAC and the claimant agree that all discovery activities will be expresslylimited to matters directly relevant to the dispute and the arbitrator will be required to fullyenforce this requirement.The arbitrator will have no power to add to, subtract from, or modify any of the terms of theSERP, or to change or add to any benefits provided by the SERP, or to waive or fail to applyany requirements of eligibility for a benefit under the SERP. Nonetheless, the arbitrator willhave absolute discretion in the exercise of its powers in this SERP. Arbitration decisions willnot establish binding precedent with respect to the administration or operation of the SERP.7.8 Receipt and Release of Necessary Information. In implementing the terms of this SERP,the RPAC and Plan Administrator, as applicable, may, without the consent of or notice to anyperson, release to or obtain from any other insuring entity or other organization or person anyinformation, with respect to any person, which the RPAC or Plan Administrator deems to benecessary for such purposes. Any person claiming benefits under this SERP will furnish tothe RPAC or Plan Administrator, as applicable, such information as may be necessary todetermine eligibility for and amount of benefit, as a condition of claiming and receiving suchbenefit.7.9 Overpayment and Underpayment of Benefits. The Plan Administrator may adopt, in itssole and absolute discretion, whatever rules, procedures and accounting practices areappropriate in providing for the collection of any overpayment of benefits. If a Participant,Surviving Spouse or Eligible Child receives an underpayment of benefits, the PlanAdministrator will direct that payment be made as soon as practicable to make up for theunderpayment. If an overpayment is made to a Participant, Surviving Spouse or EligibleChild, for whatever reason, the Plan Administrator may, in its sole and absolute discretion,(a) withhold payment of any further benefits under the SERP until the overpayment has beencollected provided that the entire amount of reduction in any35 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. calendar year does not exceed five thousand dollars ($5,000), and the reduction is made atthe same time and in the same amount as the debt otherwise would have been due andcollected from the Participant or (b) may require repayment of benefits paid under this SERPwithout regard to further benefits to which the Participant, Surviving Spouse or Eligible Childmay be entitled.7.10 Change of Control. Upon a Change of Control and for the following three (3) years thereafter,if any arbitration arises relating to an event occurring or a claim made within three (3) yearsof a Change of Control, (i) the arbitrator will not decide the claim based on an abuse ofdiscretion principle or give the previous RPAC decision any special deference, but rather willdetermine the claim de novo based on its own independent reading of the SERP; and (ii) theCompany will pay the Participant's reasonable legal and other related fees and expenses byapplying Section 3.1(f) of the ESP (except that if the Participant is not entitled to severancebenefits under the ESP on account of the Termination of Employment that entitles theParticipant to receive benefits under this SERP, the reference to the "shorter of theSeverance Period or the Reimbursement Period" in the ESP will be changed to the"Reimbursement Period" only).End of Article VII36 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE VIIIAMENDMENT AND TERMINATION OF THE PLAN8.1 Continuation. The Company intends to continue this SERP indefinitely, but neverthelessassumes no contractual obligation beyond the promise to pay the benefits described in thisSERP.8.2 Amendment of SERP. Except as provided below, the Company, through an action of theHuman Resources Committee, reserves the right in its sole and absolute discretion toamend this SERP in any respect at any time, except that upon or during the two (2) yearperiod after any Change of Control of the Company, (a) SERP benefits cannot be reduced,(b) Articles VII, VIII and Section 9.1(b) of the SERP cannot be changed and (c) noprospective amendment that adversely affects the rights or obligations of a Participant maybe made unless the affected Participant receives at least one (1) year's advance writtennotice of such amendment.Moreover, no amendment may ever be made that retroactively reduces or diminishes therights of a Participant to the benefits described herein that have been accrued or earnedthrough the date of such amendment, even if a Termination of Employment has not yetoccurred with respect to such Participant.In addition to the Human Resources Committee, the RPAC has the right to make non-material amendments to the SERP to comply with changes in the law or to facilitate SERPadministration; provided, however, that each such proposed nonmaterial amendment mustbe discussed with the Chairperson of the Human Resources Committee in order todetermine whether such change would constitute a material amendment to the SERP.The provisions of this Section 8.2 will not restrict the right of the Company to terminate thisSERP under Section 8.3 below or the termination of an Affiliate’s participation under Section8.4 below.8.3 Termination of SERP. Except upon or during the two (2) year period after any Change ofControl of the Company, the Company, through an action of the Human ResourcesCommittee, may terminate or suspend this SERP in whole or in part at any time or mayterminate an Agreement with any Participant at any time. In the event of termination of theSERP or of a Participant’s Agreement, a Participant will be entitled to only the vested portionof his accrued benefits under Article IV of the SERP as of the time of the termination of theSERP or his Agreement. All further vesting and benefit accrual will cease on the date ofSERP or Agreement termination. Benefit payments would be in the amounts specified andwould commence at the time specified in Article IV as appropriate.Notwithstanding the foregoing, the Human Resources Committee may decide to terminateand liquidate the SERP under the following circumstances:(a) Corporate Dissolution or Bankruptcy. The Human Resources Committee mayterminate and liquidate the SERP within twelve (12) months of a corporate dissolutiontaxed under section 331 of the Code or with the approval of a bankruptcy courtpursuant to 11 U.S.C. § 503(b)(1)(A), provided that the amounts deferred under theSERP are included in Participants’ gross income in the latest of the following years(or if earlier, the taxable year in which the amount is actually or constructivelyreceived):37 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. (i) The calendar year in which the SERP termination and liquidation occurs.(ii) The first calendar year in which the amount is no longer subject to asubstantial risk of forfeiture.(iii) The first calendar year in which the payment is administratively practicable.(b) Change of Control. The Human Resources Committee may terminate and liquidatethe SERP within the thirty (30) days preceding a Change of Control (except onaccount of a liquidation or dissolution of the Company) provided that all plans orarrangements that would be aggregated with the SERP under section 409A of theCode are also terminated and liquidated with respect to each Participant thatexperienced the Change of Control event so that under the terms of the SERP and allsuch arrangements the Participant is required to receive all amounts ofcompensation deferred under such arrangements within twelve (12) months of thetermination of the SERP or arrangement, as applicable. In the case of a Change ofControl event which constitutes a sale of assets, the termination of the SERPpursuant to this Section 8.3(b) may be made with respect to the Employer that isprimarily liable immediately after the Change of Control transaction for the payment ofbenefits under the SERP.(c) Termination of SERP. Except upon or during the two (2) year period after anyChange of Control of the Company, the Human Resources Committee mayterminate and liquidate the SERP provided that (i) the termination and liquidation doesnot occur by reason of a downturn of the financial health of the Company or anEmployer, (ii) all plans or arrangements that would be aggregated with the SERPunder section 409A of the Code are also terminated and liquidated, (iii) no paymentsin liquidation of the SERP are made within twelve (12) months of the date oftermination of the SERP other than payments that would be made in the ordinarycourse operation of the SERP, (iv) all payments are made within twenty-four (24)months of the date the SERP is terminated and (v) the Company or the Employer, asapplicable depending on whether the SERP is terminated with respect to such entity,do not adopt a new plan that would be aggregated with the SERP within three (3)years of the date of the termination of the SERP.8.4 Termination of Affiliate’s Participation. An Affiliate may terminate its participation in theSERP at any time by an action of its governing body and providing written notice to theCompany. Likewise, the Company may terminate an Affiliate’s participation in the SERP atany time by an action of the Human Resources Committee and providing written notice tothe Affiliate. The effective date of any such termination will be the later of the date specified inthe notice of the termination of participation or the date on which the RPAC canadministratively implement such termination. In the event that an Affiliate’s participation in theSERP is terminated, each Participant employed by such Affiliate will continue to participate inthe SERP as an inactive Participant and will be entitled to a distribution of his vestedRetirement Benefit pursuant to Article IV. An Affiliate’s participation in the SERP may not beterminated upon the occurrence of or during the two (2) year period after any Change ofControl.End of Article VIII38 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE IXCONDITIONS RELATED TO BENEFITS9.1 No Right to Assets.(a) SERP Unfunded. A Participant will have only an unsecured contractual right to theamounts, if any, payable under this SERP. Neither a Participant nor any other personwill acquire by reason of the SERP any right in or title to any assets, funds orproperty of the Employer whatsoever including, without limiting the generality of theforegoing, any specific funds or assets which the Employer, in its sole discretion,may set aside in anticipation of a liability under this SERP. Any rights created underthe SERP and this Agreement will be mere unsecured contractual rights of SERPparticipants and their beneficiaries against Employer. The fact that the Trust has beenestablished, to assist in the payment of benefits under this SERP will not create anypreferred claim by Participants or their beneficiaries on, or any beneficial ownershipinterest in, any assets of the Trust. The assets of the Trust and the Employer will besubject to the claims of the Employer’s general creditors under federal and state law.(b) Rabbi Trust. Upon a Change of Control, the following will occur:(i) the Trust will become (or continue to be) irrevocable;(ii) for ten (10) years following a Change of Control, the Trustee can only beremoved as set forth in the Trust;(iii) if the Trustee is removed or resigns within ten (10) years following a Changeof Control, the Trustee will select a successor Trustee as set forth in theTrust;(iv) for three (3) years following a Change of Control, the Company will beresponsible for directly paying all Trustee fees and expenses, together with allfees and expenses incurred under Article VII relating to the RPAC, PlanAdministrator, and SERP administrative expenses; and(v) any amendments to the Trust Agreement will be subject to the followingrestrictions: (i) certain Trust Agreement provisions may not be amended forten (10) years following a Change of Control, as set forth in the Trust; and (ii)no such amendment will (A) change the irrevocable nature of the Trust; (B)adversely affect a Participant's rights to Retirement Benefits without theconsent of the Participant; (C) impair the rights of the Company's creditorsunder the Trust; or (D) cause the Trust to fail to be a "grantor trust" pursuantto Code sections 671 through 679.9.2 No Employment Rights. Nothing in this SERP will constitute a contract of continuingEmployment or in any manner obligate the Employer or an Affiliate to continue the service ofa Participant, or obligate a Participant to continue in the service of the Employer, and nothingin this SERP will be construed as fixing or regulating the compensation paid to a Participant.39 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 9.3 Indebtedness. If at the time payments or installments of payments are to be madehereunder, any Participant or his Surviving Spouse or both are indebted to the Employer oran Affiliate, then the payments remaining to be made to the Participant or his SurvivingSpouse or both may, at the discretion of the RPAC, be reduced by the amount of suchindebtedness; provided, that the entire amount of reduction in any calendar year does notexceed five thousand dollars ($5,000), and the reduction is made at the same time and in thesame amount as the debt otherwise would have been due and collected from the Participant.An election by the RPAC not to reduce any such payment or payments will not constitute awaiver of any claim for such indebtedness.9.4 Conditions Precedent. No Retirement Benefits will be payable hereunder to any Participant:(a) whose Employment with the Employer or an Affiliate, is terminated for Cause; or(b) except as provided in Sections 4.9(a)(i) and 4.9(a)(ii), who within three (3) years afterTermination of Employment becomes an employee with or consultant to any thirdparty engaged in any line of business in competition with the Employer or, to theextent determined by the Senior Vice President, Human Resources or PlanAdministrator, an Affiliate (i) in a line of business in which Participant has performedservices for the Employer or such Affiliate, or (ii) that accounts for more than tenpercent (10%) of the gross revenues of the Employer or such Affiliate taken as awhole.End of Article IX 40 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. ARTICLE XMISCELLANEOUS10.1 Gender and Number. Wherever appropriate herein, the masculine may mean the feminineand the singular may mean the plural or vice versa.10.2 Notice. Any notice or filing required to be given or delivered to the RPAC or PlanAdministrator will include delivery to or filing with a person or persons designated by theRPAC or Plan Administrator, as applicable, for the disbursement and the receipt ofadministrative forms. Delivery will be deemed to have occurred only when the form or othercommunication is actually received. Headings and subheadings are for the purpose ofreference only and are not to be considered in the construction of this SERP.10.3 Validity. In the event any provision of this SERP is held invalid, void or unenforceable, thesame will not affect, in any respect whatsoever, the validity of any other provision of thisSERP.10.4 Applicable Law. This SERP will be governed and construed in accordance with the laws ofthe State of Texas.10.5 Successors in Interest. This SERP will inure to the benefit of, be binding upon, and beenforceable by, any corporate successor to the Company or successor to substantially all ofthe assets of the Company.10.6 No Representation on Tax Matters. The Company makes no representation toParticipants regarding current or future income tax ramifications of the SERP.10.7 Provisions Binding. All of the provisions of this SERP will be binding upon all persons whowill be entitled to any benefit hereunder, their heirs and personal representatives.End of Article X 41 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. IN WITNESS WHEREOF, this Ninth Amended and Restated Tenet Healthcare CorporationSupplemental Executive Retirement Plan has been executed effective as of the date set forthabove, except as specifically provided otherwise herein. TENET HEALTHCARE CORPORATION By:/s/ Paul Slavin Paul Slavin, Vice President, Compensation, Benefits and Corporate HR Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. EXHIBIT A1TENET HEALTHCARE CORPORATIONSUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AGREEMENTFOR PARTICIPANTS NAMED ON AND AFTER AUGUST 3, 2011- AMI SERP BENEFITSTHIS AGREEMENT is made as of __________________, _____ and supersedes [any previousagreement] [the previous agreement dated ___________, _________,] by and between TENETHEALTHCARE CORPORATION, a Nevada corporation ("Tenet"), and _____________("Participant"). WHEREAS, Tenet has adopted the Tenet Healthcare Corporation Supplemental Executive RetirementPlan (the "Tenet SERP") for a select group of highly compensated or management employees of Tenetand its Subsidiaries (as defined in the Tenet SERP); andWHEREAS, Tenet has determined that Participant is currently eligible to participate in the Tenet SERP;WHEREAS, the Tenet SERP requires that an agreement be entered into between Tenet and Participantsetting out certain terms and benefits of the SERP as they apply to the Participant;WHEREAS, Participant has also been a participant in the American Medical International, Inc.Supplemental Executive Retirement Plan (the "AMI SERP") and the American Medical International,Inc. Pension Plan (the "AMI Pension Plan") and has a frozen benefit under both plans as of December31, 1995; andWHEREAS, the amount of the benefits payable to Participant under the Tenet SERP will be reduced oroffset by the benefits payable to Participant under the AMI SERP and the AMI Pension Plan.NOW, THEREFORE, Tenet and Participant hereby agree as follows:1. Calculation of Benefits. The Tenet SERP is hereby incorporated into and made a part of thisAgreement as though set forth in full herein. The parties will be bound by and have the benefit ofeach and every provision of the Tenet SERP, as amended from time to time, EXCEPT that whenbenefits become payable under the Tenet SERP, the amount of benefits calculated under theTenet SERP will include an offset of the benefits earned under the AMI SERP and AMI PensionPlan as of December 31, 1995, in addition to offset provided by the Retirement BenefitsAdjustment Factor shown in item 3 below. For purposes of determining the offset attributable tothe AMI SERP and the AMI Pension Plan, the amount of Participant’s benefits under the TenetSERP, the AMI SERP and the AMI Pension Plan will be calculated as of Participant’s normalretirement date, as defined in such plans, and the offset will be determined accordingly using theactuarial factors and assumptions specified in the applicable plans.In addition, the provisions of Section 2.20 regarding the crediting of age and Years of Serviceduring the severance period under the Severance Plan will not apply (i.e., the Participant will notbe credited with age and Years of Service during the severance period and instead his eligibilityfor an Early Retirement Benefit will be determined as of the date of his Termination ofEmployment). The parties will be bound by and have the benefit of each and every applicableprovision of the Tenet SERP. Participant’s benefitsA1-1 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. under the AMI SERP and AMI Pension Plan will be paid to Participant pursuant to the terms ofsuch plans. Participant’s benefits under the Tenet SERP, as calculated pursuant to this item 1,will be paid in accordance with the terms of the Tenet SERP and this Agreement.2.Participant Data for Benefit Calculation Purposes. Participant was bornon____________________, and his or her present employment with Tenet or an Employer, (i)for purposes of determining "Years of Service," under the Tenet SERP began on_________________, (ii) for purposes of determining vesting under Section 4.3 of the TenetSERP began on ______________. [In addition, Participant will be credited with [earnings forFinal Average Earnings purposes][age and service for vesting purposes] for his employmentwith _______________________ who is an Affiliate who has not adopted the SERP as anEmployer.]A "Domestic Partner," as defined under the Criteria for Domestic Partnership Status under theTenet Employee Benefit Plan, will be treated as the Participant’s spouse for purposes of theTenet SERP.Participant's spouse/Domestic Partner (please circle which applies):______________________________________ was born on _____________. Participant's Eligible Children under the age of 21 and their dates of birth are as follows:Name Birth Date Participant agrees to notify the Vice President, Compensation, Benefits and Corporate HR ofTenet promptly from time to time of any change in his or her spouse, Domestic Partner orEligible Children.3.Retirement Benefit Plans Adjustment Factor. Participant's "Retirement Benefit PlansAdjustment Factor" under Article II of the Tenet SERP as of the date of this Agreement is_________ percent. The Retirement Benefit Plans Adjustment Factor will be recalculated eachyear and may differ from the percent set forth in this item 3.4. Payment of Tenet SERP Benefits. Except as provided in the SERP, payments under the TenetSERP will begin not later than the first day of the calendar month following the occurrence of anevent which entitles Participant (or his or her Surviving Spouse (including a Domestic Partnerpursuant to item 2 herein) or Eligible Children) to payments under the Tenet SERP. Any benefitspayable to a Participant by reason of a Termination of Employment will be subject to the six (6)month delay applicable to Key Employees.5.Dispute Resolution. Any dispute or claim for benefits under the Tenet SERP must be resolvedthrough the claims procedure set forth in Article VII of the Tenet SERP which procedureculminates in binding arbitration. By accepting the benefits provided underA1-2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. the Tenet SERP, Participant hereby agrees to binding arbitration as the final means of disputeresolution with respect to the Tenet SERP.6. Successors and Assigns. This Agreement will inure to the benefit of and be binding upon Tenetand its successors and assigns and Participant and his or her beneficiaries. IN WITNESS WHEREOF, the parties hereto have entered into this Agreement on___________________, 20__. PARTICIPANT TENET HEALTHCARE CORPORATION By: A1-3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. EXHIBIT A2TENET HEALTHCARE CORPORATIONSUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AGREEMENTFOR PARTICIPANTS NAMED ON AND AFTER AUGUST 3, 2011THIS AGREEMENT is made as of __________________, _____ [and supersedes] [any previousagreement] [the previous agreement dated ___________, _________,] by and between TENETHEALTHCARE CORPORATION, a Nevada corporation ("Tenet"), and _____________("Participant"). WHEREAS, Tenet has adopted the Tenet Healthcare Corporation Supplemental Executive RetirementPlan (the "Tenet SERP") for a select group of highly compensated or management employees of Tenetand its Subsidiaries (as defined in the Tenet SERP); andWHEREAS, Tenet has determined that Participant is currently eligible to participate in the Tenet SERP;andWHEREAS, the Tenet SERP requires that an agreement be entered into between Tenet and Participantsetting out certain terms and benefits of the SERP as they apply to the Participant.NOW, THEREFORE, Tenet and Participant hereby agree as follows: 1.Incorporation of Tenet SERP Terms. The Tenet SERP is hereby incorporated into and madea part of this Agreement as though set forth in full herein; provided, however, that the provisionsof Section 2.20 regarding the crediting of age and Years of Service during the severance periodunder the Severance Plan will not apply (i.e., the Participant will not be credited with age andYears of Service during the severance period and instead his eligibility for an Early RetirementBenefit will be determined as of the date of his Termination of Employment). The parties will bebound by and have the benefit of each and every applicable provision of the TenetSERP. Participant’s benefits under the Tenet SERP will be calculated and paid pursuant to theterms of the Tenet SERP and this Agreement. 2.Participant Data for Benefit Calculation Purposes. Participant was bornon____________________, and his or her present employment with Tenet or an Employer, (i) forpurposes of determining "Years of Service," under the Tenet SERP began on_________________, (ii) for purposes of determining vesting under Section 4.3 of the TenetSERP began on ______________. [In addition, Participant will be credited with [earnings forFinal Average Earnings purposes][age and service for vesting purposes] for his employmentwith _______________________ who is an Affiliate who has not adopted the SERP as anEmployer.]A "Domestic Partner," as defined under the Criteria for Domestic Partnership Status under theTenet Employee Benefit Plan, will be treated as the Participant’s spouse for purposes of theTenet SERP.Participant's spouse/Domestic Partner (please circle which applies):______________________________________ was born on _____________. A2-1 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Participant's Eligible Children under the age of 21 and their dates of birth are as follows:Name Birth Date Participant agrees to notify the Vice President, Compensation, Benefits and Corporate HR ofTenet promptly from time to time of any change in his or her spouse, Domestic Partner orEligible Children.3.Retirement Benefit Plans Adjustment Factor. Participant's "Retirement Benefit PlansAdjustment Factor" under Article II of the Tenet SERP as of the date of this Agreement is_________ percent. The Retirement Benefit Plans Adjustment Factor will be recalculated eachyear and may differ from the percent set forth in this item 3.4.Payment of Tenet SERP Benefits. Except as provided in the SERP, payments under theTenet SERP will begin not later than the first day of the calendar month following the occurrenceof an event which entitles Participant (or his or her Surviving Spouse (including a DomesticPartner pursuant to item 2 herein) or Eligible Children) to payments under the Tenet SERP. Anybenefits payable to a Participant by reason of a Termination of Employment will be subject to thesix (6) month delay applicable to Key Employees.5.Dispute Resolution. Any dispute or claim for benefits under the Tenet SERP must be resolvedthrough the claims procedure set forth in Article VII of the Tenet SERP which procedureculminates in binding arbitration. By accepting the benefits provided under the Tenet SERP,Participant hereby agrees to binding arbitration as the final means of dispute resolution withrespect to the Tenet SERP.6.Successors and Assigns. This Agreement will inure to the benefit of and be binding uponTenet and its successors and assigns and Participant and his or her beneficiaries. IN WITNESS WHEREOF, the parties hereto have entered into this Agreement on___________________, 20__. PARTICIPANT TENET HEALTHCARE CORPORATION By: A2-2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. EXHIBIT BUPDATE TO TENET HEALTHCARE CORPORATIONSUPPLEMENTAL EXECUTIVE RETIREMENT PLANAGREEMENT WITH PARTICIPANT[This Update is to be provided and apply to each Active Participant who has an existing Agreement onDecember 31, 2013]THIS UPDATE ("Update") amends the Agreement ("Agreement") previously entered into between_______________________ ("Participant") and Tenet Healthcare Corporation ("Tenet") with respect toParticipant's benefits under the Tenet Healthcare Corporation Supplemental Executive Retirement Plan(the "SERP"). Capitalized terms used in this Update that are not defined herein or in Participant'sAgreement will have the meaning set forth in the SERP.1. Tenet recently updated the SERP provisions regarding calculation of the Existing RetirementBenefit Plans Adjustment Factor to provide for the annual calculation of such factor using aprojection of the benefits payable to participants under the Social Security regulations andRetirement Plans in effect at the time the benefit calculation is performed. Further, for purposesof determining a participant's benefits under the Retirement Plans, the projected benefit will bemeasured from the participant's date of hire. In connection with this update, the name of suchfactor was changed to the "Retirement Benefit Plans Adjustment Factor."2.In order to avoid any reduction in Participant’s benefits accrued under the SERP as ofDecember 31, 2013 application of the updated calculation will be done on a grandfathered basisso that the factor will never be greater (but could be less) than the Existing Retirement BenefitPlans Adjustment Factor set forth in Participant’s Agreement.3.The provisions of this Update are effective December 31, 2013. In all other respects the terms ofParticipant’s Agreement remain in effect. B-1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 10(w) TENET FOURTH AMENDED AND RESTATEDTENET 2006 DEFERREDCOMPENSATIONPLAN As Amended and Restated Effective as of November 30, 2015 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. FOURTH AMENDED AND RESTATEDTENET 2006 DEFERRED COMPENSATION PLAN TABLE OF CONTENTS ARTICLE I PREAMBLE AND PURPOSE1 1.1Preamble.1 1.2Purpose.2 ARTICLE II DEFINITIONS AND CONSTRUCTION3 2.1Definitions.3 2.2Construction.14 ARTICLE III PARTICIPATION AND FORFEITABILITY OF BENEFITS15 3.1Eligibility and Participation.15 3.2Forfeitability of Benefits.16 ARTICLE IV DEFERRAL, COMPANY CONTRIBUTIONS, ACCOUNTING AND INVESTMENT CREDITINGRATES17 4.1General Rules Regarding Deferral Elections.17 4.2Compensation and Bonus Deferrals.17 4.3RSU Deferrals.19 4.4Company Contributions.20 4.5Accounting for Deferred Compensation.20 4.6Investment Crediting Rates.22 ARTICLE V DISTRIBUTION OF BENEFITS24 5.1Distribution Election.24 5.2Termination Distributions to Key Employees.25 5.3Scheduled In-Service Withdrawals.25 5.4Unforeseeable Emergency.25 5.5Death of a Participant.26 5.6Withholding.26 5.7Impact of Reemployment on Benefits.26 ARTICLE VI PAYMENT LIMITATIONS27 6.1Spousal Claims.27 6.2Legal Disability.28 6.3Assignment.28 ARTICLE VII FUNDING29 7.1Funding.29 7.2Creditor Status.29 ARTICLE VIII ADMINISTRATION30 8.1The RPAC.30 8.2Powers of RPAC.30 8.3Appointment of Plan Administrator.30 8.4Duties of Plan Administrator.30 8.5Indemnification of RPAC and Plan Administrator.32 8.6Claims for Benefits.32 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. 8.7Receipt and Release of Necessary Information.34 8.8Overpayment and Underpayment of Benefits.34 8.9Change of Control.34 ARTICLE IX OTHER BENEFIT PLANS OF THE COMPANY36 9.1Other Plans.36 ARTICLE X AMENDMENT AND TERMINATION OF THE PLAN37 10.1Continuation.37 10.2Amendment of Plan.37 10.3Termination of Plan.37 10.4Termination of Affiliate's Participation.38 ARTICLE XI MISCELLANEOUS39 11.1No Reduction of Employer Rights.39 11.2Provisions Binding.39 EXHIBIT A LIMITS ON ELIGIBILITY AND PARTICIPATIONA-1 (ii) Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.FOURTH AMENDED AND RESTATEDTENET 2006 DEFERRED COMPENSATION PLANARTICLE IPREAMBLE AND PURPOSE1.1 Preamble. Tenet Healthcare Corporation (the "Company") previously adopted the Tenet 2006 DeferredCompensation Plan (the "Plan") to permit the Company and its participating Affiliates, as defined herein(collectively, the "Employer"), to attract and retain a select group of management or highly compensatedemployees and Directors, as defined herein. The Plan replaced the Tenet 2001 Deferred CompensationPlan (the "2001 DCP") and compensation and bonus deferrals and employer contributions made to the 2001DCP during the 2005 Plan Year (i.e., January 1, through December 31) were transferred to the Plan and willbe administered pursuant to its terms.Pursuant to the First Amended and Restated Plan, the Company amended and restated the Plan effectiveDecember 31, 2008 to (a) reflect that compensation and bonus deferrals and employer contributions madeto the 2001 DCP have been transferred to the Plan and will be administered pursuant to its terms, (b) permitparticipants to elect before December 31, 2008 pursuant to transition relief issued under section 409A of theInternal Revenue Code of 1986, as amended (the "Code") to receive an in-service withdrawal of amountsdeemed invested in stock units in 2009 or a subsequent year, (c) modify the fixed return investment optionto provide that interest will be credited based on one hundred and twenty percent (120%) of the long-termapplicable federal rate as opposed to the current provision which credits interest based on the prime rate ofinterest less one percent (1%), (d) reduce the employer matching contribution effective January 1, 2009, (e)comply with final regulations issued under section 409A of the Code and (f) make certain other designchanges. This amended and restated Plan was known as the First Amended and Restated Tenet 2006Deferred Compensation Plan.The Company further amended the Plan, through the adoption of the Second Amended and Restated Plan,effective as of May 9, 2012, to add certain Change of Control provisions and revise certain termination eventdefinitions. The Company amended and restated the Plan to increase the employer matching contribution under thePlan to conform with the matching contribution provided under the Company’s tax-qualified section 401(k)plan and to incorporate certain administrative changes adopted with respect to the Plan since its priorrestatement. That amended and restated Plan was known as the Third Amended and Restated Tenet 2006Deferred Compensation Plan.The Retirement Plans Administration Committee (“RPAC”) subsequently amended the Plan effectiveJanuary 1, 2015 to provide that an “Affiliate” will be determined based on an ownership percentage of greaterthan fifty percent (50%). By this instrument, the RPAC desires to amend and restate the Plan effective November 30, 2015 toincorporate the terms of its prior amendment, clarify that only physicians and A-Team members that provideservices to Baptist Health Centers LLC (“BHC”) and are paid from a Tenet payroll will be eligible toparticipate in the Plan and reflect that the name of the Compensation Committee has changed to the“Human Resources Committee.” This amended and restated Plan will be known as the Fourth Amendedand Restated Tenet 2006 Deferred Compensation Plan.1 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The Employer may adopt one or more domestic trusts to serve as a possible source of funds for thepayment of benefits under this Plan.1.2 Purpose. Through this Plan, the Employer intends to permit the deferral of compensation and to provideadditional benefits to Directors and a select group of management or highly compensated employees of theEmployer. Accordingly, it is intended that this Plan will not constitute a "qualified plan" subject to thelimitations of section 401(a) of the Code, nor will it constitute a "funded plan," for purposes of suchrequirements. It also is intended that this Plan will be exempt from the participation and vestingrequirements of Part 2 of Title I of the Employee Retirement Income Security Act of 1974, as amended (the"Act"), the funding requirements of Part 3 of Title I of the Act, and the fiduciary requirements of Part 4 of TitleI of the Act by reason of the exclusions afforded plans that are unfunded and maintained by an employerprimarily for the purpose of providing deferred compensation for a select group of management or highlycompensated employees.End of Article I2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE IIDEFINITIONS AND CONSTRUCTION2.1 Definitions. When a word or phrase appears in this Plan with the initial letter capitalized, and the word orphrase does not commence a sentence, the word or phrase will generally be a term defined in this Section2.1. The following words and phrases with the initial letter capitalized will have the meaning set forth in thisSection 2.1, unless a different meaning is required by the context in which the word or phrase is used.(a) "Account" means one or more of the bookkeeping accounts maintained by the Company or its agenton behalf of a Participant, as described in more detail in Section 4.5. A Participant's Account may bedivided into one or more "Cash Accounts" or "Stock Unit Accounts" as defined in Section 4.5.(b) "Act" means the Employee Retirement Income Security Act of 1974, as amended from time to time.(c) "Affiliate" means a corporation that is a member of a controlled group of corporations (as defined insection 414(b) of the Code) that includes the Company, any trade or business (whether or notincorporated) that is in common control (as defined in section 414(c) of the Code) with the Company,or any entity that is a member of the same affiliated service group (as defined in section 414(m) ofthe Code) as the Company; provided, however that for purposes of determining if an entity is anAffiliate under sections 414(b) or (c) of the Code ownership will be determined based on anownership percentage of greater than fifty percent (50%).(d) "Alternate Payee" means any spouse, former spouse, child, or other dependent of a Participant whois recognized by a DRO as having a right to receive all, or a portion of, the benefits payable under thePlan with respect to such Participant.(e) "Annual Incentive Plan Award" means the amount payable to an employee each year, if any, underthe Company's Annual Incentive Plan, as the same may be amended, restated, modified, renewedor replaced from time to time.(f) "Base Deferral" means the Compensation deferral made by a Participant pursuant to Section 4.2(a).(g) "Base with Match Deferral" means the Base with Match Deferral made pursuant to Section 4.2(c).(h) "Beneficiary" means the person designated by the Participant to receive a distribution of his benefitsunder the Plan upon the death of the Participant. If the Participant is married, his spouse will be hisBeneficiary, unless his spouse consents in writing to the designation of an alternate Beneficiary. Inthe event that a Participant fails to designate a Beneficiary, or if the Participant's Beneficiary does notsurvive the Participant, the Participant's Beneficiary will be his surviving spouse, if any, or if theParticipant does not have a surviving spouse, his estate. The term "Beneficiary" also will mean aParticipant's spouse or former spouse who is entitled to all or a portion of a Participant's benefitpursuant to Section 6.1.3 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(i) "Board" means the Board of Directors of the Company.(j) "Bonus" means (i) a bonus paid to a Participant in the form of an Annual Incentive Plan award, (ii)a performance-based bonus payment to a Participant pursuant to an employment or similaragreement, or (iii) any other bonus payment designated by the RPAC as an eligible bonus under thePlan.(k) "Bonus Deferral" means the Bonus deferral made by a Participant pursuant to Section 4.2(b). AParticipant may also defer a portion of his Bonus as a Bonus with Match Deferral pursuant to Section4.2(c).(l) "Bonus with Match Deferral" means the Bonus with Match Deferral made pursuant to Section4.2(d).(m) "Cause" means(i) with respect to any event not occurring on or within two (2) years after a Change of Control,except as provided otherwise in a separate severance agreement or plan in which theParticipant participates:(A) dishonesty,(B) fraud,(C) willful misconduct,(D) breach of fiduciary duty,(E) conflict of interest,(F) commission of a felony,(G) material failure or refusal to perform his job duties in accordance with Companypolicies,(H) a material violation of Company policy that causes harm to the Company or anAffiliate, or(I) other wrongful conduct of a similar nature and degree.A failure to meet or achieve business objectives, as defined by the Company, will not beconsidered Cause so long as the Participant has devoted his best efforts and attention to theachievement of those objectives.(ii) With respect to any event occurring on or within two (2) years after a Change of Control,except as provided otherwise in a separate severance agreement or plan in which theParticipant participates:(A) any intentional act or misconduct materially injurious to the Company or any Affiliate,financial or otherwise, but not limited to, misappropriation or fraud, embezzlement orconversion by the4 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Participant of the Company’s or any Affiliate’s property in connection with theParticipant’s employment with the Company or an Affiliate,(B) Any willful act or omission constituting a material breach by the Participant of afiduciary duty,(C) A final, non-appealable order in a proceeding before a court of competent jurisdictionor a final order in an administrative proceeding finding that the Participant committedany willful misconduct or criminal activity (excluding minor traffic violations or otherminor offenses), which commission is materially inimical to the interests of theCompany or any Affiliate, whether for his personal benefit or in connection with hisduties for the Company or an Affiliate,(D) The conviction (or plea of no contest) of the Participant for any felony,(E) Material failure or refusal to perform his job duties in accordance with Companypolicies (other than resulting from the Participant’s disability as defined by Companypolicies), or(F) A material violation of Company policy that causes material harm to the Company oran Affiliate.A failure to meet or achieve business objectives, as defined by the Company, will not beconsidered Cause so long as the Participant has devoted his reasonable efforts and attentionto the achievement of those objectives. For purposes of this Section, no act or failure to acton the part of the Participant will be deemed "willful", "intentional" or "knowing" if it wasundertaken in reasonable reliance on the advice of counsel or at the instruction of theCompany, including but not limited to the Board, a committee of the Board or the ChiefExecutive Officer ("CEO") of the Company, or was due primarily to an error in judgment ornegligence, but will be deemed "willful", "intentional" or "knowing" only if done or omitted to bedone by the Participant not in good faith and without reasonable belief that the Participant’saction or omission was in the best interest of the Company.(iii) A Participant will not be deemed to have been terminated for Cause, under either thisSection 2.1(m)(i) or 2.1(m)(ii) above, as applicable, unless and until there has been deliveredto the Participant written notice that the Participant has engaged in conduct constitutingCause. The determination of Cause will be made by the Human Resources Committee withrespect to any Participant who is employed as the CEO, by the CEO (or an individual actingin such capacity or possessing such authority on an interim basis) with respect to any otherParticipant except a Hospital Chief Executive Officer ("Hospital CEO") and by the ChiefOperating Officer of the Company (the "COO") with respect to any Participant who isemployed as a Hospital CEO. A Participant who receives written notice that he has engagedin conduct constituting5 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Cause, will be given the opportunity to be heard (either in person or in writing as mutuallyagreed to by the Participant and the Human Resources Committee, CEO or COO, asapplicable) for the purpose of considering whether Cause exists. If it is determined either ator following such hearing that Cause exists, the Participant will be notified in writing of suchdetermination within five (5) business days. If the Participant disagrees with suchdetermination, the Participant may file a claim contesting such determination pursuant toArticle VIII within thirty (30) days after his receipt of such written determination finding thatCause exists.(n) "Change of Control" means the occurrence of one of the following:(i) A "change in the ownership of the Company" which will occur on the date that any oneperson, or more than one person acting as a group within the meaning of section 409A of theCode, acquires, directly or indirectly, whether in a single transaction or series of relatedtransactions, ownership of stock in the Company that, together with stock held by suchperson or group, constitutes more than fifty percent (50%) of the total fair market value ortotal voting power of the stock of the Company ("Ownership Control"). However, if any oneperson or more than one person acting as a group, has previously acquired ownership ofmore than fifty percent (50%) of the total fair market value or total voting power of the stock ofthe Company, the acquisition of additional stock by the same person or persons will not beconsidered a "change in the ownership of the Company" (or to cause a "change in theeffective control of the Company" within the meaning of Section 2.1(n)(ii) below). Further, anincrease in the effective percentage of stock owned by any one person, or persons acting asa group, as a result of a transaction in which the Company acquires its stock in exchange forcash or property will be treated as an acquisition of stock for purposes of this paragraph;provided, that for purposes of this Section 2.1(n)(i), the following acquisitions of Companystock will not constitute a Change of Control:(A) any acquisition, whether in a single transaction or series of related transactions, byany employee benefit plan (or related trust) sponsored or maintained by the Companyor an Affiliate which results in such employee benefit plan obtaining "OwnershipControl" of the Company or(B) any acquisition, whether in a single transaction or series of related transactions, bythe Company which results in the Company acquiring stock of the Companyrepresenting "Ownership Control" or(C) any acquisition, whether in a single transaction or series of related transactions, afterwhich those persons who were owners of the Company’s stock immediately beforesuch transaction(s) own more than fifty percent (50%) of the total fair market value ortotal voting power of the stock of the Company (or if after the consummation of suchtransaction(s) the Company (or another6 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.entity into which the Company is merged into or otherwise combined, such theCompany does not survive such transaction(s)) is a direct or indirect subsidiary ofanother entity which itself is not a subsidiary of an entity, then the more than fiftypercent (50%) ownership test will be applied to the voting securities of such otherentity) in substantially the same percentages as their respective ownership of theCompany immediately before such transaction(s).This Section 2.1(n)(i) applies either when there is a transfer of the stock of the Company (orissuance of stock) and stock in the Company remains outstanding after the transaction orwhen there is a transfer of the stock of the Company (including a merger or similartransaction) and stock in the Company does not remain outstanding after the transaction.(ii) A "change in the effective control of the Company" which will occur on the date that either (A)or (B) occurs:(A) any one person, or more than one person acting as a group within the meaning ofsection 409A of the Code, acquires (taking into consideration any prior acquisitionsduring the twelve (12) month period ending on the date of the most recent acquisitionby such person or persons), directly or indirectly, ownership of stock of the Companypossessing thirty-five percent (35%) or more of the total voting power of the stock ofthe Company (not considering stock owned by such person or group before suchtwelve (12) month period) (i.e., such person or group must acquire within a twelve(12) month period stock possessing at least thirty-five percent (35%) of the totalvoting power of the stock of the Company) ("Effective Control"), except for (i) anyacquisition by any employee benefit plan (or related trust) sponsored or maintained bythe Company or an Affiliate which results in such employee benefit plan obtaining"Effective Control" of the Company or (ii) any acquisition by the Company. Theoccurrence of "Effective Control" under this Section 2.1(n)(ii)(A) may be nullified by avote of that number of the members of the Board of Directors of the Company("Board"), that exceeds two-thirds (2/3) of the independent members of the Board,which vote must occur before the time, if any, that a "change in the effective control ofthe Company" has occurred under Section 2.1(n)(ii)(B) below. In the event of such asupermajority vote, such transaction or series of related transactions will not betreated as an event constituting "Effective Control". For avoidance of doubt, the Planprovides that in the event of the occurrence of the acquisition of ownership of stock ofthe Company that reaches or exceeds the thirty-five percent (35%) ownershipthreshold described above, if more than two-thirds (2/3) of the independent membersof the Board take action to resolve that such an acquisition is not a "change in theeffective control of the Company" and a majority of the members of the Board havenot been replaced as provided under Section 2.1(n)(ii)(B) below, then such Boardaction will be final and no7 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results."Effective Control" will be deemed to have occurred for any purpose under the Plan.(B) a majority of the members of the Board are replaced during any twelve (12) monthperiod by directors whose appointment or election is not endorsed by a majority of themembers of the Board before the date of the appointment or election.For purposes of a "change in the effective control of the Company," if any one person, ormore than one person acting as a group, is considered to effectively control the Companywithin the meaning of this Section 2.1(n)(ii), the acquisition of additional control of theCompany by the same person or persons is not considered a "change in the effective controlof the Company," or to cause a "change in the ownership of the Company" within themeaning of Section 2.1(n)(i) above.(iii) A sale, exchange, lease, disposition or other transfer of all or substantially all of the assets ofthe Company.(iv) A liquidation or dissolution of the Company that is approved by a majority of the Company'sstockholders. For purposes of this Section 2.1(n), the provisions of section 318(a) of the Code regarding theconstructive ownership of stock will apply to determine stock ownership; provided, that, stockunderlying unvested options (including options exercisable for stock that is not substantially vested)will not be treated as owned by the individual who holds the option.(o) "Code" means the Internal Revenue Code of 1986, as amended from time to time.(p) "Company" means Tenet Healthcare Corporation.(q) "Compensation" means base salaries, commissions, and certain other amounts of cashcompensation payable to the Participant during the Plan Year Compensation will exclude cashbonuses, foreign service pay, hardship withdrawal allowances and any other pay intended toreimburse the employee for the higher cost of living outside the United States, Annual Incentive PlanAwards, automobile allowances, housing allowances, relocation payments, deemed income, incomepayable under stock incentive plans, insurance premiums, and other imputed income, pensions,retirement benefits, and contributions to and payments from the 401(k) Plan and this Plan or anyother nonqualified retirement plan maintained by the Employer. The term "Compensation" forDirectors will mean any cash compensation from retainers, meeting fees and committee fees paidduring the Plan Year.(r) "Compensation and Bonus Deferrals" means the Base Deferrals, Bonus Deferrals, Base withMatch Deferrals, Bonus with Match Deferrals, and/or Discretionary Deferrals made pursuant toSection 4.2 of the Plan.(s) "Director" means a member of the Board who is not an employee.8 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(t) "Discretionary Contribution" means the contribution made by the Employer on behalf of aParticipant as described in Section 4.4(b).(u) "Discretionary Deferral" means the Compensation deferral described in Section 4.2(d) made by aParticipant.(v) "DRO" means a domestic relations order that is a judgment, decree, or order (including one thatapproves a property settlement agreement) that relates to the provision of child support, alimonypayments or marital property rights to a spouse, former spouse, child or other dependent of aParticipant and is rendered under a state (within the meaning of section 7701(a)(10) of the Code)domestic relations law (including a community property law) and that:(i) Creates or recognizes the existence of an Alternate Payee's right to, or assigns to anAlternate Payee the right to receive all or a portion of the benefits payable with respect to aParticipant under the Plan;(ii) Does not require the Plan to provide any type or form of benefit, or any option, not otherwiseprovided under the Plan;(iii) Does not require the Plan to provide increased benefits (determined on the basis of actuarialvalue);(iv) Does not require the payment of benefits to an Alternate Payee that are required to be paid toanother Alternate Payee under another order previously determined to be a DRO; and(v) Clearly specifies: the name and last known mailing address of the Participant and of eachAlternate Payee covered by the DRO; the amount or percentage of the Participant's benefitsto be paid by the Plan to each such Alternate Payee, or the manner in which such amount orpercentage is to be determined; the number of payments or payment periods to which suchorder applies; and that it is applicable with respect to this Plan.(w) "Effective Date" means November 30, 2015, except as provided otherwise herein.(x) "Election" means the Participant’s written, on-line or telephonic elections with respect to deferrals,requested investment crediting rates and distributions under this Plan. (y) "Eligible Person" means (i) each Employee who is paid from a Tenet payroll and eligible for a Bonusas defined in Section 2.1(j) for the applicable Plan Year, and (ii) each Director. In addition, the term"Eligible Person" will include any Employee designated as an Eligible Person by the RPAC. Asprovided in Section 3.1, the RPAC or Plan Administrator may at any time, in its sole and absolutediscretion, limit the classification of Employees who are eligible to participate in the Plan for a PlanYear, limit the enrollment period during which an Eligible Person may enroll in the Plan to the OpenEnrollment Period and/or modify or terminate an Eligible Person's participation in the Plan without theneed for an amendment to the Plan. 9 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(z) "Employee" means each select member of management or highly compensated employee receivingremuneration, or who is entitled to remuneration, for services rendered to the Employer, in the legalrelationship of employer and employee.(aa) "Employer" means the Company and each Affiliate who with the consent of the Senior VicePresident, Human Resources or Plan Administrator has adopted the Plan as a participatingemployer. An Affiliate may evidence its adoption of the Plan either by a formal action of its governingbody or by commencing deferrals and taking other administrative actions with respect to this Plan onbehalf of its employees. An entity will cease to be a participating employer as of the date such entityceases to be an Affiliate or the date specified by the Company.(bb) "Employer Contribution" means a Matching Contribution and/or Discretionary Contribution.(cc) "Fair Market Value" means the closing price of a share of Stock on the New York Stock Exchangeon the date as of which fair market value is to be determined.(dd) "Five Percent Owner" means any person who owns (or is considered as owning within themeaning of section 318 of the Code (as modified by section 416(i)(1)(B)(iii) of the Code)) more thanfive percent (5%) of the outstanding stock of the Company or an Affiliate or stock possessing morethan five percent (5%) of the total combined voting power of all stock of the Company or anAffiliate. The rules of sections 414(b), (c) and (m) of the Code will not apply for purposes of applyingthese ownership rules. Thus, this ownership test will be applied separately with respect to theCompany and each Affiliate.(ee) "401(k) Plan" means the Company’s 401(k) Retirement Savings Plan, as such plan may beamended, restated, modified, renewed or replaced from time to time.(ff) "Human Resources Committee" means the Human Resources Committee of the Board (or anypredecessor or successor to such committee in name or form), which has the authority to amendand terminate the Plan as provided in Article X. The Human Resources Committee also will beresponsible for determining the amount of the Discretionary Contribution, if any, to be made by theEmployer(gg) "Key Employee" means any employee or former employee (including any deceased employee)who at any time during the Plan Year was:(i) an officer of the Company or an Affiliate having compensation of greater than one hundredthirty thousand dollars ($130,000) (as adjusted under section 416(i)(1) of the Code for PlanYears beginning after December 31, 2002);(ii) a Five Percent Owner; or(iii) a One Percent Owner having compensation of more than one hundred fifty thousand dollars($150,000).10 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.For purposes of the preceding paragraphs, the Company has elected to determine the compensationof an officer or One Percent Owner in accordance with section 1.415(c)-2(d)(4) of the TreasuryRegulations (i.e., W-2 wages plus amounts that would be includible in wages except for an electionunder section 125(a) of the Code (regarding cafeteria plan elections) under section 132(f) of the Code(regarding qualified transportation fringe benefits) or section 402(e)(3) of the Code (regarding section401(k) plan deferrals)) without regard to the special timing rules and special rules set forth,respectively, in sections 1.415(c)-2(e) and 2(g) of the Treasury Regulations.The determination of Key Employees will be based upon a twelve (12) month period ending onDecember 31 of each year (i.e., the identification date). Employees that are Key Employees duringsuch twelve (12) month period will be treated as Key Employees for the twelve (12) month periodbeginning on the first day of the fourth month following the end of the twelve (12) month period (i.e.,since the identification date is December 31, then the twelve (12) month period to which it appliesbegins on the next following April 1).The determination of who is a Key Employee will be made in accordance with section 416(i)(1) of theCode and other guidance of general applicability issued thereunder. For purposes of determiningwhether an employee or former employee is an officer, a Five Percent Owner or a One PercentOwner, the Company and each Affiliate will be treated as a separate employer (i.e., the controlledgroup rules of sections 414(b), (c), (m) and (o) of the Code will not apply). Conversely, for purposesof determining whether the one hundred thirty thousand dollar ($130,000) adjusted limit oncompensation is met under the officer test described in Section 2.1(gg)(i), compensation from theCompany and all Affiliates will be taken into account (i.e., the controlled group rules of sections414(b), (c), (m) and (o) of the Code will apply). Further, in determining who is an officer under theofficer test described in Section 2.1(gg)(i), no more than fifty (50) employees of the Company or itsAffiliates (i.e., the controlled group rules of sections 414(b), (c), (m) and (o) of the Code will apply) willbe treated as officers. If the number of officers exceeds fifty (50), the determination of whichemployees or former employees are officers will be determined based on who had the largest annualcompensation from the Company and Affiliates for the Plan Year. For the avoidance of doubt, forpurposes of this Section 2.1(gg) the controlled group rules under sections 414(b) and (c) of the Codewill be applied based on the normal ownership percentage of greater than eighty percent (80%) ratherthan the fifty percent (50%) standard used in the definition of Affiliate.(hh) "Matching Contribution" means the contribution made by the Employer pursuant to Section 4.4(a)on behalf of a Participant who makes Base with Match Deferrals and/or Bonus with Match Deferralsto the Plan as described in Section 4.2(c).(ii) "One Percent Owner" means any person who would be described as a Five Percent Owner if "onepercent (1%)" were substituted for "five percent (5%)" each place where it appears therein.(jj) "Open Enrollment Period" means the period occurring each year during which an Eligible Personmay make his elections to defer his Compensation, Bonus11 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.and RSUs for a subsequent Plan Year pursuant to Article IV. Open Enrollment Periods will occur inaccordance with section 409A of the Code (i.e., no later than December 31st of each year withrespect to Compensation, no later than June 30 of each year with respect to Bonus and either beforeor within thirty (30) days after the date of grant with respect to RSUs). Different Open EnrollmentPeriods may apply with respect to different groups of Eligible Persons. An Employee who is not anEligible Person at the time of the Open Enrollment Period, but who is expected to become an EligiblePerson during the next Plan Year, may be permitted to enroll in the Plan during the Open EnrollmentPeriod with his Election becoming effective at the time he becomes an Eligible Person with respectto Compensation, Bonus and RSUs earned after such date.(kk) "Participant" means each Eligible Person who has been designated for participation in this Plan andhas made an Election and each Employee or former Employee (or Director or former Director)whose participation in this Plan has not terminated (i.e., the individual still has amounts credited to hisAccount).(ll) "Participant Deferral" means a Base Deferral, Base with Match Deferral, Bonus Deferral, Bonuswith Match Deferral, RSU Deferral and/or Discretionary Deferral.(mm) "Plan" means the Fourth Amended and Restated Tenet 2006 Deferred Compensation Plan as setforth in this document and as the same may be amended from time to time.(nn) "Plan Administrator" means the individual or entity appointed by the RPAC to handle the day-to-day administration of the Plan, including but not limited to determining a Participant's eligibility forbenefits and the amount of such benefits and complying with all applicable reporting and disclosureobligations imposed on the Plan. If the RPAC does not appoint an individual or entity as PlanAdministrator, the RPAC will serve as the Plan Administrator.(oo) "Plan Year" means the fiscal year of this Plan, which will commence on January 1 each year andend on December 31 of such year.(pp) "RPAC" means the Retirement Plans Administration Committee of the Company established by theHuman Resources Committee of the Board, and whose members have been appointed by suchHuman Resources Committee. The RPAC will have the responsibility to administer the Plan andmake final determinations regarding claims for benefits, as described in Article VIII. In addition, theRPAC has limited amendment authority over the Plan as provided in Section 10.2.(qq) "RSU Deferral" means the RSU deferral made by a Participant pursuant to Section 4.3.(rr) "RSU" means the restricted stock units awarded under the SIP.(ss) "Scheduled In-Service Withdrawal" means a distribution elected by the Participant pursuant toSection 4.2 or Section 4.3 for an in-service withdrawal of amounts of Base Deferrals, BonusDeferrals and/or RSU Deferrals made in a12 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.given Plan Year, and earnings or losses attributable to such amounts, as reflected in the Participant’sElection for such Plan Year. (tt) "Scheduled Withdrawal Date" means the distribution date elected by the Participant for a ScheduledIn-Service Withdrawal.(uu) "SIP" means the Company’s Stock Incentive Plan.(vv) "Special Enrollment Period" means, subject to Section 3.1(b) and Section 3.1(c), a period of nomore than thirty (30) days after an Employee is employed by the Employer (or a Director is electedto the Board) or an Employee is transferred to the status of an Eligible Person provided that suchEmployee does not already participate in another plan of the Employer that would be aggregated withthe Plan and advised of his eligibility to participate in the Plan during which the Eligible Person maymake an Election to defer Compensation and RSUs earned after such Election pursuant to ArticleIV. If the Employee becomes an Eligible Person before June 30, he may make an Election to deferBonus earned after such Election to the extent permitted by the Plan Administrator. For purposes ofdetermining an Eligible Person's initial eligibility, an Eligible Person, who incurs a Termination ofEmployment and is reemployed and eligible to participate in the Plan at a date which is more thantwenty-four (24) months after such Termination of Employment, will be treated as being initiallyeligible to participate in the Plan on such reemployment. The Plan Administrator may also designatecertain periods as Special Enrollment Periods to the extent permitted under section 409A of theCode.(ww) "Stock" means the common stock, par value $0.05 per share, of the Company.(xx) "Stock Unit" means a non-voting, non-transferable unit of measurement that is deemed forbookkeeping and distribution purposes only to represent one outstanding share of Stock.(yy) "Termination of Employment" means (i) with respect to an Employee, the date that suchEmployee ceases performing services for the Employer and its Affiliates in the capacity of anemployee or a reduction in employment or other provision of services that qualifies as a separationfrom service under Code section 409A and (ii) with respect to a Director, the date that such Directorceases to provide services to the Company as a member of the Board or otherwise or a reduction inemployment or other provision of services that qualifies as a separation from service under Codesection 409A. For this purpose an Employee who is on a leave of absence that exceeds six (6)months and who does not have statutory or contractual reemployment rights with respect to suchleave, will be deemed to have incurred a Termination of Employment on the first day of the seventh(7th) month of such leave. An Employee who transfers employment from an Employer to anAffiliate, regardless of whether such Affiliate has adopted the Plan as a participating employer, willnot incur a Termination of Employment. (zz) "Trust" means the rabbi trust established with respect to the Plan, the assets of which are to beused for the payment of benefits under the Plan.13 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(aaa) "Trustee" means the individual or entity appointed to serve as trustee of any trust established as apossible source of funds for the payment of benefits under this Plan as provided in Section 7.1. Afterthe occurrence of a Change of Control, the Trustee must be independent of any successor to theCompany or any affiliate of such successor.(bbb) "2001 DCP" means the Tenet 2001 Deferred Compensation Plan which was in effect before theenactment of section 409A of the Code. All pre-2005 employee deferrals and employer contributionsunder the 2001 DCP were fully vested as of January 31, 2004 and as such are not subject to theprovisions of section 409A of the Code. All 2005 employee deferrals and employer contributionsunder the 2001 DCP are subject to, and were made in accordance with, the requirements of section409A of the Code and such employee deferrals and employer contributions were transferred to andwill be administered under this Plan. No employee deferrals or employer contributions will be madeto the 2001 DCP after 2005.(ccc) "Unforeseeable Emergency" means (i) a severe financial hardship to the Participant resulting froman illness or accident of the Participant, his spouse or his dependent (as defined under section152(a) of the Code), (ii) a loss of the Participant's property due to casualty, or (iii) other similarextraordinary and unforeseeable circumstances arising as a result of events beyond the control ofthe Participant, as determined by the Plan Administrator in its sole and absolute discretion inaccordance with the requirements of section 409A of the Code.2.2 Construction. If any provision of this Plan is determined to be for any reason invalid or unenforceable, theremaining provisions of this Plan will continue in full force and effect. All of the provisions of this Plan will beconstrued and enforced in accordance with the laws of the State of Texas and will be administeredaccording to the laws of such state, except as otherwise required by the Act, the Code or other applicablefederal law. The term "delivered to the RPAC or Plan Administrator," as used in this Plan, will include delivery to aperson or persons designated by the RPAC or Plan Administrator, as applicable, for the disbursement andthe receipt of administrative forms. Delivery will be deemed to have occurred only when the form or othercommunication is actually received. Headings and subheadings are for the purpose of reference only and are not to be considered in theconstruction of this Plan. The pronouns "he," "him" and "his" used in the Plan will also refer to similarpronouns of the female gender unless otherwise qualified by the context.End of Article II14 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE IIIPARTICIPATION AND FORFEITABILITY OF BENEFITS3.1 Eligibility and Participation.(a) Determination of Eligibility. It is intended that eligibility to participate in the Plan will be limited toEligible Persons, as determined by the RPAC, in its sole and absolute discretion. During the OpenEnrollment Period, each Eligible Person will be contacted and informed that he may elect to deferportions of his Compensation, Bonus and/or RSUs by making an Election. An Eligible Person willbecome a Participant by completing an Election during an Open Enrollment Period pursuant toSection 4.1. Eligibility to become a Participant for any Plan Year will not entitle an Eligible Person tocontinue as an active Participant for any subsequent Plan Year.(b) Limits on Eligibility. The RPAC or Plan Administrator may at any time, in its sole and absolutediscretion, limit the classification of Employees eligible to participate in the Plan and/or limit the periodof such Employee’s enrollment to an Open Enrollment Period and to not permit such Employee toenroll during a Special Enrollment Period. In addition, the RPAC may limit or terminate an EligiblePerson's participation in the Plan; provided, that no such termination will result in a cancellation ofCompensation and Bonus Deferrals or RSU Deferrals for the remainder of a Plan Year in which anElection to make such deferrals is in effect. Any action taken by the RPAC or Plan Administratorthat limits the classification of Employees eligible to participate in the Plan, limits the time of anEmployee’s enrollment in the Plan or modifies or terminates an Eligible Person’s participation in thePlan will be set forth in Exhibit A attached hereto. Exhibit A may be modified from time to timewithout a formal amendment to the Plan, in which case a revised Exhibit A will be attached hereto.An Employee who takes an Unforeseeable Emergency distribution pursuant to Section 5.4 of thisPlan will have his Compensation and Bonus Deferrals and RSU Deferrals under this Plan suspendedfor the remainder of the Plan Year in which such distribution occurs. This mid-year suspensionprovision will also apply with respect to an Unforeseeable Emergency distribution made pursuant to5.4 of the 2001 DCP. In addition, an Employee who takes an Unforeseeable Emergency distributionunder either the 2001 DCP or this Plan will be ineligible to participate in the Plan for purposes ofmaking Compensation and Bonus Deferrals and RSU Deferrals and receiving a MatchingContribution for the Plan Year following the year in which such distribution occurs.(c) Initial Eligibility. If an Eligible Person is employed or elected to the Board during the Plan Year orpromoted or transferred into an eligible position and designated by the RPAC to be a Participant forsuch year, such Eligible Person will be eligible to elect to participate in the Plan during a SpecialEnrollment Period, unless determined otherwise by the Plan Administrator pursuant to Section3.1(b), in which case, such Eligible Person will be permitted to enroll in the Plan during the next OpenEnrollment Period. For purposes of determining an Eligible Person's initial eligibility, an EligiblePerson, who incurs a Termination of Employment and is reemployed and eligible to participate in thePlan at a date which is more than twenty-four (24) months after such Termination of15 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Employment, will be treated as being initially eligible to participate in the Plan on suchreemployment. Designation as a Participant for the Plan Year in which he is employed or elected tothe Board or promoted will not entitle the Eligible Person to continue as an active Participant for anysubsequent Plan Year.(d) Loss of Eligibility Status. A Participant under this Plan who separates from employment with theEmployer, or who ceases to be a Director, or who transfers to an ineligible employment position willcontinue as an inactive Participant under this Plan until the Participant has received payment of allamounts payable to him under this Plan. In the event that a Participant ceases to be an EligiblePerson during the Plan Year, such Participant's Compensation and Bonus Deferrals and RSUDeferrals will continue through the remainder of the Plan Year, but the Participant will not bepermitted to make such deferrals for the following Plan Year unless he again becomes an EligiblePerson and makes a deferral Election pursuant to Section 3.1(a). An Eligible Person who ceasesactive participation in the Plan because the Eligible Person is no longer described as a Participantpursuant to this Section 3.1, or because he ceases making deferrals of Compensation, Bonuses orRSUs, will continue as an inactive Participant under this Plan until he has received payment of allamounts payable to him under this Plan. An inactive Participant will continue to have his Accountsadjusted pursuant to Section 4.6 based on his investment crediting rate elections until such Accountshave been paid in full. 3.2 Forfeitability of Benefits. Except as provided in Section 6.1, a Participant will at all times have anonforfeitable right to amounts credited to his Account pursuant to Section 4.5. As provided in Section 7.2,however, each Participant will be only a general creditor of the Company and/or his Employer with respectto the payment of any benefit under this Plan. End or Article III 16 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE IVDEFERRAL, COMPANY CONTRIBUTIONS, ACCOUNTINGAND INVESTMENT CREDITING RATES4.1 General Rules Regarding Deferral Elections. An Eligible Person may become a Participant in the Plan forthe applicable Plan Year by making an Election during the Open Enrollment Period to defer hisCompensation, Bonus and/or RSUs pursuant to the terms of this Section 4.1. Such Election will be madeby the date specified by the Plan Administrator and will be effective with respect to:(a) Compensation and/or Bonus paid for services performed on or after the following January 1; and(b) RSUs that are awarded under the SIP, either before or within thirty (30) days after the grant date asrequired by section 409A of the Code.An Eligible Person who is employed by the Employer or elected to the Board during the PlanYear may make an Election during the Special Enrollment Period with respect to Compensation, Bonusand/or RSUs earned after the date of such Election to the extent permitted under Section 2.1(vv).A Participant's Election will only be effective with respect to a single Plan Year and will be irrevocable for theduration of such Plan Year. Deferral elections for each applicable Plan Year of participation will be madeduring the Open Enrollment Period pursuant to a new Election. Deferrals will not be required to be takenfrom each paycheck during the applicable Plan Year so long as the total Compensation and Bonus electedto be deferred for the Plan Year has been captured by December 31 of such Plan Year. 4.2 Compensation and Bonus Deferrals. Five types of Compensation and Bonus Deferrals may be madeunder the Plan:(a) Base Deferral. Each Eligible Person may elect to defer a stated dollar amount, or designated fullpercentage, of Compensation to the Plan up to a maximum percentage of seventy five percent(75%) (one hundred percent (100%) for Directors) of the Eligible Person's Compensation for theapplicable Plan Year until either (i) the Participant's Termination of Employment or (ii) a future year inwhich the Participant is still employed by the Employer (or providing services as a member of theBoard) and that is at least two (2) calendar years after the end of the Plan Year in which theCompensation would have otherwise been paid (i.e., as a Scheduled In-Service Withdrawal subjectto the provisions of Section 5.3).Base Deferrals will be made pursuant to administrative procedures established by the PlanAdministrator. Such procedures will provide that Base Deferrals will be subject to a "withholdinghierarchy" for purposes of determining the amount of such contributions that may be contributed onbehalf of a Participant. The Plan Administrator (or its delegatee) will determine the order ofwithholdings taken from a Participant's Compensation (e.g., for federal, state and local taxes, socialsecurity, wage garnishments, welfare plan contributions, 401(k) deferrals, and similar withholdings)and Base Deferrals will be subject to such withholding17 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.hierarchy. As a result, Base Deferrals may be effectively limited to Compensation available after theapplication of such withholding hierarchy.The Employer will not make any Matching Contributions with respect to any Base Deferrals made tothe Plan.(b) Bonus Deferral. Each Eligible Person may elect to defer a stated dollar amount, or designated fullpercentage, of his Bonus to the Plan up to a maximum percentage of one hundred percent (100%)(ninety four percent (94%) if a Bonus with Match Deferral is elected pursuant to Section 4.2(d)) of theEmployee's Bonus for the applicable Plan Year until either (i) the Eligible Person's Termination ofEmployment or (ii) a future year in which the Eligible Person is still employed by the Employer (orproviding services as a member of the Board) and that is at least two (2) calendar years after theend of the Plan Year in which the Bonus would have otherwise been paid (i.e., as a Scheduled In-Service Withdrawal subject to the provisions of Section 5.3).Bonus Deferrals will be made pursuant to administrative procedures established by the PlanAdministrator. Such procedures will provide that Bonus Deferrals will be subject to a "withholdinghierarchy" for purposes of determining the amount of such contributions that may be contributed onbehalf of a Participant. The Plan Administrator (or its delegatee) will determine the order ofwithholdings taken from a Participant's Bonus (e.g., for federal, state and local taxes, social security,wage garnishments, welfare plan contributions, and similar withholdings) and Bonus Deferrals will besubject to such withholding hierarchy. As a result, Bonus Deferrals may be effectively limited toBonus available after the application of such withholding hierarchy.Bonus Deferrals generally will be made in the form of cash; provided, however, that if the Companymodifies the Annual Incentive Plan to provide for the payment of awards in Stock, Bonus Deferralsmay be made in the form of Stock. Any Bonus Deferrals made in the form of Stock will be convertedto Stock Units, based on the number of shares so deferred, credited to the Stock Unit Account anddistributed to the Participant at the time specified herein in an equivalent number of whole shares ofStock as provided in Section 4.5(b).The Employer will not make any Matching Contributions with respect to any Bonus Deferrals madeto the Plan.(c) Base with Match Deferral. Each Eligible Person who is a participant in the 401(k) Plan may electto have one percent (1%) to six percent (6%) of his Compensation deferred under the Plan as aBase with Match Deferral with respect to the pay period in which he reaches any of the followingstatutory limitations under the 401(k) Plan:(i) the limitation on Compensation under section 401(a)(17) of the Code, as such limit is adjustedfor cost of living increases, or(ii) the limitation imposed on elective deferrals under section 402(g) of the Code, including thelimit applicable to catch-up contributions to the extent18 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.the Eligible Person is eligible to make such contributions, as such limit is adjusted for cost ofliving increases.All Base with Match Deferrals will be payable upon Termination of Employment (i.e., Scheduled In-Service Withdrawals are not available with respect to Base with Match Deferrals). A Participant whoearns more than Four Hundred Thousand Dollars ($400,000) in Compensation (excluding Bonus), orsuch other amount as the Plan Administrator deems necessary to satisfy the requirements ofsection 409A of the Code, and elects to make Base with Match Deferrals under this Section 4.2(c)will not be permitted to modify his 401(k) Plan deferral elections during the Plan Year in which suchBase with Match Deferral Election is in effect.The Employer will make Matching Contributions with respect to Base with Match Deferrals made tothe Plan as provided in Section 4.4.(d) Bonus with Match Deferral. Each Eligible Person may elect to automatically have six percent(6%) of his Bonus deferred under the Plan as a Bonus with Match Deferral whether or not the EligiblePerson is a participant in the 401(k) Plan or has reached the statutory limitations under the 401(k)Plan described in Section 4.2(c). This Bonus with Match Deferral will be applied to that portion of theEligible Person's Bonus in excess of that deferred as a Bonus Deferral under Section 4.2(b). Forexample, if the Eligible Person elects to defer fifty percent (50%) of his Bonus under Section 4.2(b)and also elects to make a Bonus with Match Deferral under this Section 4.2(d), fifty percent (50%) ofthe Eligible Person's Bonus will be deferred under Section 4.2(b) and six percent (6%) of the EligiblePerson's Bonus will be deferred under this Section 4.2(d). All Bonus with Match Deferrals will bepayable upon Termination of Employment (i.e., Scheduled In-Service Withdrawals are not availablewith respect to Bonus with Match Deferrals).The Employer will make Matching Contributions with respect to Base with Match Deferrals andBonus with Match Deferrals made to the Plan as provided in Section 4.4.(e) Discretionary Deferral. The RPAC may authorize an Eligible Person to defer a stated dollaramount, or designated full percentage, of Compensation to the Plan as a Discretionary Deferral. TheRPAC, in its sole and absolute discretion, may limit the amount or percentage of Compensation anEligible Person may defer to the Plan as a Discretionary Deferral and may prohibit Scheduled In-Service Withdrawals with respect to such Discretionary Deferral. The Employer will not make anyMatching Contributions pursuant to Section 4.4(a) with respect to any Discretionary Deferrals, butmay elect to make a Discretionary Contribution to the Plan with respect to such DiscretionaryDeferrals in the form of a discretionary matching contribution as described in Section 4.4(b).4.3 RSU Deferrals. To the extent authorized by the RPAC, an Eligible Person may make an Election to defer adesignated full percentage, up to one hundred percent (100%) of his RSUs until either (a) the EligiblePerson's Termination of Employment or (b) a future year while the Eligible Person is still employed by theEmployer and that is at least two (2) calendar years after the end of the Plan Year in which the RSU isgranted (i.e., as a19 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Scheduled In-Service Withdrawal subject to the provisions of 5.3. A deferral Election made pursuant to thisSection 4.3 will apply to the entire RSU grant (i.e., a Participant may not elect to make a separate Electionwith respect to each portion of the RSU award based on the award's vesting schedule). Such RSUDeferrals will be converted to Stock Units, based on the number of shares so deferred, credited to the StockUnit Account and distributed to the Participant at the time specified in his Election in an equivalent numberof whole shares of Stock as provided in Section 4.5(b).The Employer will not make any Matching Contributions with respect to any RSU Deferrals made to thePlan.4.4 Company Contributions.(a) Matching Contribution. The Employer will make a Matching Contribution to the Plan each PlanYear on behalf of each Participant who makes Base with Match Deferrals and Bonus with MatchDeferrals to the Plan for such Plan Year. Such Matching Contribution will equal fifty percent (50%) ofthe first six percent (6%) of the Participant's Base with Match and/or six percent (6%) of theParticipant’s Bonus with Match Deferrals for such Plan Year. Matching Contributions and earningsand losses thereon will be distributed upon the Participant's Termination of Employment in themanner elected by the Participant (or deemed elected by the Participant) for the Plan Year to whichthe Matching Contribution relates as provided in Section 5.1.(b) Discretionary Contribution. The Employer may elect to make a Discretionary Contribution to aParticipant's Account in such amount, and at such time, as will be determined by the HumanResources Committee. Any Discretionary Contribution made by the Employer, plus earnings andlosses thereon, will be paid to the Participant upon his Termination of Employment with the Employerin the manner elected by the Participant (or deemed elected by the Participant) for the Plan Year towhich the Discretionary Contribution relates as provided in Section 5.1.4.5 Accounting for Deferred Compensation.(a) Cash Account. If a Participant has made an Election to defer his Compensation and/or Bonus andhas made a request for amounts deferred to be deemed invested pursuant to Section 4.5(a), theCompany may, in its sole and absolute discretion, establish and maintain a Cash Account for theParticipant under this Plan. Each Cash Account will be adjusted at least quarterly to reflect the BaseDeferrals, Bonus Deferrals, Base with Match Deferrals, Bonus with Match Deferrals, DiscretionaryDeferrals, Matching Contributions and Discretionary Contributions credited thereto, earnings orlosses credited thereon, and any payment of such Base Deferrals, Bonus Deferrals, Base withMatch Deferrals, Bonus with Match Deferrals, Discretionary Deferrals, Matching Contributions andDiscretionary Contributions pursuant to Article V. The amounts of Base Deferrals, Bonus Deferrals,Base with Match Deferrals, Bonus with Match Deferrals, Discretionary Deferrals and MatchingContributions will be credited to the Participant's Cash Account within five (5) business days of thedate on which such Compensation and/or Bonus would have been paid to the Participant had theParticipant not elected to defer such amount pursuant to the terms and20 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.provisions of the Plan. Any Discretionary Contributions will be credited to each Participant's CashAccount at such times as determined by the Human Resources Committee. In the sole andabsolute discretion of the Plan Administrator, more than one Cash Account may be established foreach Participant to facilitate record-keeping convenience and accuracy. Each such Cash Accountwill be credited and adjusted as provided in this Plan.(b) Stock Unit Account. If a Participant has made an Election to defer his Compensation and/or Bonusand has made a request for such deferrals to be deemed invested in Stock Units pursuant to Section4.5(b), the Plan Administrator may, in its sole and absolute discretion, establish and maintain a StockUnit Account and credit the Participant's Stock Unit Account with a number of Stock Unitsdetermined by dividing an amount equal to the Base Deferrals, Bonus Deferrals, Base with MatchDeferrals, Bonus with Match Deferrals, and associated Matching Contributions, and DiscretionaryDeferrals made as of such date by the Fair Market Value of a share of Stock on the date suchCompensation and/or Bonus otherwise would have been payable. Such Stock Units will be creditedto the Participant's Stock Unit Account as soon as administratively practicable after thedetermination of the number of Stock Units is made pursuant to the preceding sentence.If the Participant is entitled to a Discretionary Contribution and has elected to have amounts creditedto his Account to be deemed invested in Stock Units pursuant to Section 4.6(b), the PlanAdministrator may, in its sole discretion, establish and maintain a Stock Unit Account and credit theParticipant's Stock Unit Account with a number of Stock Units determined by dividing an amountequal to the Discretionary Contribution made as of such date by the Fair Market Value of a share ofStock on the date such Discretionary Contribution would have otherwise been made. Such StockUnits will be credited to the Participant's Stock Unit Account as soon as administratively practicableafter the determination of the number of Stock Units has been made pursuant to the precedingsentence.Bonus Deferrals made in Stock and RSU Deferrals will be credited to the Stock Unit Account asprovided in Section 4.2(b).In the sole and absolute discretion of the Plan Administrator, more than one Stock Unit Account maybe established for each Participant to facilitate record​ keeping convenience and accuracy.(i) The Stock Units credited to a Participant's Stock Unit Account will be used solely as a devicefor determining the number of shares of Stock eventually to be distributed to the Participant inaccordance with this Plan. The Stock Units will not be treated as property of the Participantor as a trust fund of any kind. No Participant will be entitled to any voting or other stockholderrights with respect to Stock Units credited under this Plan.(ii) If the outstanding shares of Stock are increased, decreased, or exchanged for a differentnumber or kind of shares or other securities, or if additional shares or new or different sharesor other securities are distributed with respect to such shares of Stock or other securities,21 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.through merger, consolidation, spin-off, sale of all or substantially all the assets of theCompany, reorganization, recapitalization, reclassification, stock dividend, stock split,reverse stock split or other distribution with respect to such shares of Stock or othersecurities, an appropriate and proportionate adjustment in a manner consistent with section409A of the Code will be made by the Human Resources Committee in the number and kindof Stock Units credited to a Participant's Stock Unit Account.(c) Accounts Held in Trust. Amounts credited to Participants' Accounts may be secured by one ormore trusts, as provided in Section 7.1, but will be subject to the claims of the general creditors ofeach such Participant's Employer. Although the principal of such trust and any earnings or lossesthereon will be separate and apart from other funds of the Employer and will be used for thepurposes set forth therein, neither the Participants nor their Beneficiaries will have any preferredclaim on, or any beneficial ownership in, any assets of the trust before the time such assets are paidto the Participant or Beneficiaries as benefits and all rights created under this Plan will be unsecuredcontractual rights of Plan Participants and Beneficiaries against the Employer. Any assets held inthe trust with respect to a Participant will be subject to the claims of the general creditors of thatParticipant's Employer under federal and state law in the event of insolvency. The assets of anytrust established pursuant to this Plan will never inure to the benefit of the Employer and the samewill be held for the exclusive purpose of providing benefits to that Employer's Participants and theirbeneficiaries.4.6 Investment Crediting Rates. At the time the Participant makes an Election under Section 4.1, he mustspecify the type of investment crediting rate option with which he would like the Company, in its sole andabsolute discretion, to credit his Account as described in this Section 4.6. Such investment crediting rateElection will apply to all deferrals and contributions under the Plan, except for Bonus Deferrals made inStock and RSU Deferrals which will automatically be credited to the Stock Unit Account as provided inSection 4.2(b) and Section 4.3.(a) Cash Investment Crediting Rate Options. A Participant may make an Election as to the type ofinvestment in which the Participant would like Compensation and Bonus Deferrals to be deemedinvested for purposes of determining the amount of earnings to be credited or losses to be debited tohis Cash Account. The Participant will specify his preference from among the following possibleinvestment crediting rate options:(i) An annual rate of interest equal to one hundred and twenty percent (120%) of the long-termapplicable federal rate, compounded daily; or(ii) One or more benchmark mutual funds.A Participant may make elect, on a daily basis, to modify the investment crediting rate preferenceunder this Section 4.6(a) by making a new Election with respect to such investment creditingrate. Notwithstanding any request made by a Participant, the Company, in its sole and absolutediscretion, will determine the investment rate with which to credit amounts deferred by Participantsunder this Plan, provided, however, that if the Company chooses an investment crediting22 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.rate other than the investment crediting rate requested by the Participant, such investment creditingrate cannot be less than (i) above.(b) Stock Units. A Participant may make an Election to have all or a portion of his Compensation andBonus Deferrals to be deemed invested in Stock Units. Any request to have Compensation andBonus Deferrals to be deemed invested in Stock Units is irrevocable with respect to suchCompensation and Bonus Deferrals and such amounts will be distributed in an equivalent wholenumber of shares of Stock pursuant to the provisions of Article V. Any fractional share interests willbe paid in cash with the last distribution.(c) Deemed Election. In his request(s) pursuant to this Section 4.6, the Participant may request that allor any portion of his Account (in whole percentage increments) be deemed invested in one or moreof the investment crediting rate preferences provided under the Plan as communicated from time totime by the RPAC. Although a Participant may express an investment crediting rate preference, theCompany will not be bound by such request. If a Participant fails to set forth his investment creditingrate preference under this Section 4.6, he will be deemed to have elected an annual rate of interestequal to the rate of interest set forth in Section 4.6(a)(i) (i.e., one hundred and twenty percent (120%)of the long-term applicable federal rate, compounded daily). The RPAC will select from time to time,in its sole and absolute discretion, the possible investment crediting rate options to be offered underthe Plan.(d) Employer Contributions. Matching Contributions to the Plan made by the Employer and allocatedto a Participant's Account pursuant to Section 4.3 will be credited with the same investment creditingrate as the Participant's associated Base with Match Deferrals and/or Bonus with Match Deferralsfor the relevant Plan Year. Discretionary Contributions, if any, made by the Employer and allocatedto a Participant's Account pursuant to Section 4.4 will be credited with the investment crediting ratespecified (or deemed specified) by such Participant in his Election for the relevant Plan Year withrespect to the Participant's Base Deferrals and Bonus Deferrals.A Participant will retain the right to change the investment crediting rate applicable to MatchingContributions and Discretionary Contributions as provided in this Section 4.6.(e) Prior Plan Contributions. The Company transferred Participant 2005 employee deferrals andemployer contributions under the 2001 DCP to this Plan and permitted Participants to express aninvestment crediting rate preference with respect to such transferred amounts. Such transferredamounts will be administered pursuant to the terms of this Plan. End of Article IV23 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE VDISTRIBUTION OF BENEFITS5.1 Distribution Election. During each Open Enrollment Period, the Eligible Person must make an Election asto the time and manner in which his Base Deferrals, Bonus Deferrals, Base with Match Deferrals, Bonuswith Match Deferrals, RSU Deferrals and/or Discretionary Deferrals and any associated MatchingContributions or Discretionary Contributions will be paid. A Participant may make a separate distributionElection for each type of Participant Deferral or Employer Contribution for each Plan Year beginning on orafter January 1, 2010 in which he elects to make Participant Deferrals to the Plan. The Participant may notmodify his Election as to the manner in which such Participant Deferrals or Employer Contributions will bepaid.For Plan Years beginning before January 1, 2010, the Participant had to specify upon his initial enrollment inthe Plan the time and form in which distributions of Base Deferrals, Bonus Deferrals, Base with MatchDeferrals, Bonus with Match Deferrals, RSU Deferrals and/or Discretionary Deferrals and any associatedMatching Contributions or Discretionary Contributions would be made upon a Termination of Employmentand such termination distribution election governed all deferrals or Employer Contributions made to the Planbefore January 1, 2010 (i.e., deferrals and Employer Contributions made during the 2005, 2006, 2007, 2008and 2009 Plan Years). Alternatively, the Participant could have elected to receive a Scheduled In-ServiceWithdrawal of his Base Deferrals, Bonus Deferrals, RSU Deferrals and/or Discretionary Deferrals (if allowedby the RPAC).(a) Time of Distribution. A Participant who elects to receive a Scheduled In-Service Withdrawal withrespect to Base Deferrals, Bonus Deferrals, RSU Deferrals or Discretionary Deferrals will receivethe deferred amount, as adjusted for earnings and losses, in a lump sum at the time specified in hisElection. In the event that the Participant incurs a Termination of Employment before his ScheduledIn-Service Withdrawal date, his Scheduled In-Service Withdrawal election will be cancelled and of noeffect and such amounts will be paid according to the Participant's Termination of Employmentdistribution Election with respect to the Plan Year for which the Scheduled In-Service Withdrawalamounts relate (i.e., the Plan Year such amounts were deferred) or if no Termination of Employmentdistribution Election is on file, in a lump sum upon such Termination of Employment based on thePlan's default form of payment.A Participant who elects to receive his Base Deferrals, Bonus Deferrals, Base with Match Deferrals,Bonus with Match Deferrals, RSU Deferrals and/or Discretionary Deferrals and any associatedMatching Contributions or Discretionary Contributions made for a Plan Year upon his Termination ofEmployment, may receive such amounts at any of the following times:(i) Subject to the six (6) month delay applicable to Key Employees described in Section 5.2, assoon as practicable after the Participant's Termination of Employment;(ii) In the twelfth (12th) month following the Participant's Termination of Employment; or24 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(iii) In the twenty-fourth (24th) month following the Participant's Termination of Employment.Such amounts may be paid in the form of a lump sum or in the form of annual installments over aperiod of one (1) to fifteen (15) years. Such lump sum or installments will be made in cash or inStock, or in a combination thereof, depending on the Participant's investment crediting rates asprovided in Section 4.6. If the Participant's Account is paid in installments, such Account will berevalued during the term of such installments based on procedures established by the PlanAdministrator.A Participant who dies while an Employee or a Director, as applicable, will be deemed to haveincurred a Termination of Employment on the date of his death; provided, however, that amountspayable pursuant to the Plan on account of death will not be subject to the six (6) month delayapplicable to Key Employees.(b) Failure to Elect Distribution. In the event that a Participant fails to elect the manner in which hisAccount balance will be paid upon his Termination of Employment, such Account balance will bepaid in the form of a lump sum as soon as practicable following the Participant's Termination ofEmployment, subject to the six (6) month delay applicable to Key Employees described in Section5.2.(c) Taxation of Distributions. All distributions from the Plan will be taxable as ordinary income whenreceived and subject to appropriate withholding of income taxes. In the case of distributions inStock, the appropriate number of shares of Stock may be sold to satisfy such withholding obligationspursuant to administrative procedures adopted by the Plan Administrator.5.2 Termination Distributions to Key Employees. Distributions under this Plan that are payable to a KeyEmployee on account of a Termination of Employment will be delayed for a period of six (6) monthsfollowing such Participant's Termination of Employment. This six (6) month restriction will not apply, or willcease to apply, with respect to a distribution to a Participant's Beneficiary by reason of the death of theParticipant.5.3 Scheduled In-Service Withdrawals. A Participant who elects a Scheduled In-Service Withdrawal pursuantto Section 4.2 (regarding Compensation and Bonus Deferrals), Section 4.3 (regarding RSU Deferrals) maysubsequently elect to delay such distribution for a period of at least five (5) additional calendar years;provided, that such Election is made at least (12) twelve months before the date that such distribution wouldotherwise be made. Further, in the event that a Participant elects a Scheduled In-Service Withdrawal andincurs a Termination of Employment before the Scheduled Withdrawal Date, the Participant's Scheduled In-Service Withdrawal Election and Compensation and Bonus Deferral and/or RSU Deferral Election underSection 4.2 or Section 4.3 will be cancelled and the Participant's entire Account balance will be paidaccording to the Participant's termination distribution Election as provided in Section 5.1.5.4 Unforeseeable Emergency. Upon application by the Participant, the Plan Administrator, in its sole andabsolute discretion, may direct payment of all or a portion of the Participant's Account balance before hisTermination of Employment and any Scheduled Withdrawal Date in the event of an UnforeseeableEmergency. Any such25 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.application will set forth the circumstances constituting such Unforeseeable Emergency. The PlanAdministrator will determine whether to grant an application for a distribution on account of an UnforeseeableEmergency in accordance with guidance issued pursuant to section 409A of the Code.A Participant who takes an Unforeseeable Emergency distribution pursuant to this Section 5.4 (includingamounts attributable to 2005 employee deferrals and employer contributions made under the 2001 DCPwhich are transferred to and administered under this Plan) will have his Participant Deferrals under this Plansuspended for the remainder of the Plan Year in which such Unforeseeable Emergency distributionoccurs. In addition, such Participant will be ineligible to participate in the Plan for purposes of makingParticipant Deferrals and receiving an Employer Contribution for the Plan Year following the year in whichsuch distribution occurs.5.5 Death of a Participant. If a Participant dies while employed by the Employer, the Participant's Accountbalance will be paid to the Participant's Beneficiary in the manner elected (or deemed elected) by theParticipant pursuant to Section 5.1; provided, that the six (6) month restriction on distributions to KeyEmployees under Section 5.2 will not apply.In the event a terminated Participant dies while receiving installment payments, the remaining installmentswill be paid to the Participant's Beneficiary as such payments become due in accordance with Section 5.1.In the event a terminated Participant dies before receiving his lump sum payment or before he beginsreceiving installment payments, the lump sum payment or installment payments will be paid to theParticipant's Beneficiary as such payments become due in accordance with Section 5.1; provided, that thesix (6) month restriction on distributions to Key Employees under Section 5.2 will not apply.5.6 Withholding. Any taxes or other legally required withholdings from Compensation and Bonus Deferrals,RSU Deferrals, termination distributions, Scheduled In-Service Withdrawal payments and UnforeseeableEmergency distributions to Participants or Beneficiaries under the Plan will be deducted and withheld by theEmployer, benefit provider or funding agent as required pursuant to applicable law. To the extent amountsare payable under this Plan in Stock, the appropriate number of shares of Stock may be withheld to satisfysuch withholding obligation. A Participant or Beneficiary will be permitted to make a withholding election withrespect to any federal and state tax withholding applicable to such distribution.5.7 Impact of Reemployment on Benefits. If a Participant incurs a Termination of Employment and beginsreceiving installment payments from the Plan and such Participant is reemployed by the Employer, thensuch Participant's installment payments will continue as scheduled during the period of his reemployment. End of Article V 26 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE VIPAYMENT LIMITATIONS6.1 Spousal Claims.(a) In the event that an Alternate Payee is entitled to all or a portion of a Participant's Accounts pursuantto the terms of a DRO, such Alternate Payee will have the following distribution rights with respect tosuch Participant's Account to the extent set forth pursuant to the terms of the DRO:(i) payment of benefits in a lump sum, in cash or Stock, based on the Participant's investmentcrediting rates under the Plan as provided in Section 4.6 and the terms of the DRO, as soonas practicable following the acceptance of the DRO by the Plan Administrator;(ii) payment of benefits in a lump sum in cash or Stock, based on the Participant's investmentcrediting rates under the Plan as provided in Section 4.6 and the terms of the DRO, twelve(12) months following, or twenty four (24) months following, the acceptance of the DRO bythe Plan Administrator;(iii) payment of benefits in substantially equal annual installments, in cash and/or Stock, based onthe Participant's investment crediting rates under the Plan as provided in Section 4.6 and theterms of the DRO, over a period of not less than one (1) nor more than fifteen (15) years fromthe date the DRO is accepted by the Plan Administrator; and(iv) payment of benefits in substantially equal annual installments, in cash and/or Stock, basedon the Participant's investment crediting rates under the Plan as provided in Section 4.6 andthe terms of the DRO, over a period of not less than one (1) nor more than fifteen (15) yearsbeginning twelve (12) months following, or twenty four (24) months following, the date theDRO is accepted by the Plan Administrator.An Alternate Payee with respect to a DRO that provides for any of the distributions described insubsections (ii), (iii), or (iv) above, must complete and deliver to the Plan Administrator all requiredforms within thirty (30) days from the date the Alternate Payee is notified by the Plan Administratorthat the DRO has been accepted. Any Alternate Payee who does not complete and deliver to thePlan Administrator all required forms and/or whose DRO does not provide for any of the distributionsdescribed in subsections (ii), (iii), or (iv) above will receive his benefits in a lump sum according tosubsection (i) above. Unvested RSUs may not be transferred pursuant to a DRO.(b) Any taxes or other legally required withholdings from payments to such Alternate Payee will bededucted and withheld by the Employer, benefit provider or funding agent. To the extent amountsare payable under this Plan in Stock, the appropriate number of shares of Stock may be sold tosatisfy such withholding obligation. The Alternate Payee will be permitted to make a withholdingelection with respect to any federal and state tax withholding applicable to such payments.27 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(c) The Plan Administrator will have sole and absolute discretion to determine whether a judgment,decree or order is a DRO, to determine whether a DRO will be accepted for purposes of this Section6.1 and to make interpretations under this Section 6.1, including determining who is to receivebenefits, all calculations of benefits and determinations of the form of such benefits, and the amountof taxes to be withheld. The decisions of the Plan Administrator will be binding on all parties with aninterest.(d) Any benefits payable to an Alternate Payee pursuant to the terms of a DRO will be subject to allprovisions and restrictions of the Plan and any dispute regarding such benefits will be resolvedpursuant to the Plan claims procedure in Article VIII.6.2 Legal Disability. If a person entitled to any payment under this Plan is, in the sole judgment of the PlanAdministrator, under a legal disability, or otherwise is unable to apply such payment to his own interest andadvantage, the Plan Administrator, in the exercise of its discretion, may direct the Employer or payer of thebenefit to make any such payment in any one or more of the following ways:(a) Directly to such person;(b) To his legal guardian or conservator; or(c) To his spouse or to any person charged with the duty of his support, to be expended for his benefitand/or that of his dependents.The decision of the Plan Administrator will in each case be final and binding upon all persons in interest,unless the Plan Administrator reverses its decision due to changed circumstances.6.3 Assignment. Except as provided in Section 6.1, no Participant or Beneficiary will have any right to assign,pledge, transfer, convey, hypothecate, anticipate or in any way create a lien on any amounts payable underthis Plan. No amounts payable under this Plan will be subject to assignment or transfer or otherwise bealienable, either by voluntary or involuntary act, or by operation of law, or subject to attachment, execution,garnishment, sequestration or other seizure under any legal, equitable or other process, or be liable in anyway for the debts or defaults of Participants and their Beneficiaries. End of Article VI28 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE VIIFUNDING7.1 Funding.(a) Funding. Benefits under this Plan will be funded solely by the Employer. Benefits under this Planwill constitute an unfunded general obligation of the Employer, but the Employer may createreserves, funds and/or provide for amounts to be held in trust to fund such benefits on itsbehalf. Payment of benefits may be made by the Employer, any trust established by the Employeror through a service or benefit provider to the Employer or such trust.(b) Rabbi Trust. Upon a Change of Control, the following will occur:(i) the Trust will become (or continue to be) irrevocable;(ii) for three (3) years following a Change of Control, the Trustee can only be removed as setforth in the Trust;(iii) if the Trustee is removed or resigns within three (3) years of a Change of Control, the Trusteewill select a successor Trustee, as set forth in the Trust;(iv) for three (3) years following a Change of Control, the Company will be responsible for directlypaying all Trustee fees and expenses, together with all fees and expenses incurred underArticle VIII relating to the RPAC, Plan Administrator, and Plan administrative expenses; and(v) the Trust Agreement may be amended only as set forth in the Trust (with the Trustee'sconsent); provided, however, that no such amendment will (A) change the irrevocable natureof the Trust; (B) adversely affect a Participant's rights to benefits without the consent of theParticipant; (C) impair the rights of the Company's creditors under the Trust; or (0) cause theTrust to fail to be a "grantor trust" pursuant to Code sections 671 -- 679.7.2 Creditor Status. Participants and their Beneficiaries will be general unsecured creditors of their respectiveEmployer with respect to the payment of any benefit under this Plan, unless such benefits are providedunder a contract of insurance or an annuity contract that has been delivered to Participants, in which caseParticipants and their Beneficiaries will look to the insurance carrier or annuity provider for payment, and notto the Employer. The Employer's obligation for such benefit will be discharged by the purchase and deliveryof such annuity or insurance contract. End of Article VII29 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE VIIIADMINISTRATION8.1 The RPAC. The overall administration of the Plan will be the responsibility of the RPAC.8.2 Powers of RPAC. The RPAC will have sole and absolute discretion regarding the exercise of its powersand duties under this Plan. In order to effectuate the purposes of the Plan, the RPAC will have the followingpowers and duties:(a) To appoint the Plan Administrator;(b) To review and render decisions respecting a denial of a claim for benefits under the Plan;(c) To construe the Plan and to make equitable adjustments for any mistakes or errors made in theadministration of the Plan; and(d) To determine and resolve, in its sole and absolute discretion, all questions relating to theadministration of the Plan and the trust established to secure the assets of the Plan (i) whendifferences of opinion arise between the Company, an Affiliate, the Plan Administrator, the Trustee, aParticipant, or any of them, and (ii)whenever it is deemed advisable to determine such questions inorder to promote the uniform and nondiscriminatory administration of the Plan for the greatest benefitof all parties concerned.The foregoing list of express powers is not intended to be either complete or conclusive, and the RPAC will,in addition, have such powers as it may reasonably determine to be necessary or appropriate in theperformance of its powers and duties under the Plan.8.3 Appointment of Plan Administrator. The RPAC will appoint the Plan Administrator, who will have theresponsibility and duty to administer the Plan on a daily basis. The RPAC may remove the PlanAdministrator with or without cause at any time. The Plan Administrator may resign upon written notice tothe RPAC.8.4 Duties of Plan Administrator. The Plan Administrator will have sole and absolute discretion regarding theexercise of its powers and duties under this Plan. The Plan Administrator will have the following powers andduties:(a) To direct the administration of the Plan in accordance with the provisions herein set forth;(b) To adopt rules of procedure and regulations necessary for the administration of the Plan, providedsuch rules are not inconsistent with the terms of the Plan;(c) To determine all questions with regard to rights of Employees, Directors, Participants, andBeneficiaries under the Plan including, but not limited to, questions involving eligibility of an Employeeor Director to participate in the Plan and the value of a Participant's Accounts;(d) To enforce the terms of the Plan and any rules and regulations adopted by the RPAC;30 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(e) To review and render decisions respecting a claim for a benefit under the Plan;(f) To furnish the Employer with information that the Employer may require for tax or other purposes;(g) To engage the service of counsel (who may, if appropriate, be counsel for the Employer), actuaries,and agents whom it may deem advisable to assist it with the performance of its duties;(h) To prescribe procedures to be followed by Participants in obtaining benefits;(i) To receive from the Employer and from Participants such information as is necessary for the properadministration of the Plan;(j) To establish and maintain, or cause to be maintained, the individual Accounts described in Section4.4;(k) To create and maintain such records and forms as are required for the efficient administration of thePlan;(l) To make all determinations and computations concerning the benefits, credits and debits to which anyParticipant, or other Beneficiary, is entitled under the Plan;(m) To give the Trustee of the trust established to serve as a source of funds under the Plan specificdirections in writing with respect to:(i) making distribution payments, giving the names of the payees, specifying the amounts to bepaid and the time or times when payments will be made; and(ii) making any other payments which the Trustee is not by the terms of the trust agreementauthorized to make without a direction in writing by the Plan Administrator;(n) To comply with all applicable lawful reporting and disclosure requirements of the Act;(o) To comply (or transfer responsibility for compliance to the Trustee) with all applicable federal incometax withholding requirements for benefit distributions; and(p) To construe the Plan, in its sole and absolute discretion, and make equitable adjustments for anyerrors made in the administration of the Plan.The foregoing list of express duties is not intended to be either complete or conclusive, and the PlanAdministrator will, in addition, exercise such other powers and perform such other duties as it may deemnecessary, desirable, advisable or proper for the supervision and administration of the Plan.31 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.8.5 Indemnification of RPAC and Plan Administrator. To the extent not covered by insurance, or if there is afailure to provide full insurance coverage for any reason, and to the extent permissible under corporate by-laws and other applicable laws and regulations, the Employer agrees to hold harmless and indemnify theRPAC and Plan Administrator against any and all claims and causes of action by or on behalf of any and allparties whomsoever, and all losses therefrom, including, without limitation, costs of defense and reasonableattorneys' fees, based upon or arising out of any act or omission relating to or in connection with the Planother than losses resulting from the RPAC's, or any such person's commission of fraud or willfulmisconduct.8.6 Claims for Benefits.(a) Initial Claim. In the event that an Employee, Director, Eligible Person, Participant or his Beneficiaryclaims to be eligible for benefits, or claims any rights under this Plan, such claimant must completeand submit such claim forms and supporting documentation as will be required by the PlanAdministrator, in its sole and absolute discretion. Likewise, any Participant or Beneficiary who feelsunfairly treated as a result of the administration of the Plan, must file a written claim, setting forth thebasis of the claim, with the Plan Administrator. In connect ion with the determination of a claim, or inconnection with review of a denied claim, the claimant may examine this Plan, and any otherpertinent documents generally available to Participants that are specifically related to the claim.A written notice of the disposition of any such claim will be furnished to the claimant within ninety (90)days after the claim is filed with the Plan Administrator. Such notice will refer, if appropriate, topertinent provisions of this Plan, will set forth in writing the reasons for denial of the claim if a claim isdenied (including references to any pertinent provisions of this Plan) and, where appropriate, willdescribe any additional material or information necessary for the claimant to perfect the claim and anexplanation of why such material or information is necessary. If the claim is denied, in whole or inpart, the claimant will also be notified of the Plan's claim review procedure and the time limitsapplicable to such procedure, including the claimant's right to arbitration following an adverse benefitdetermination on review as provided below. All benefits provided in this Plan as a result of thedisposition of a claim will be paid as soon as practicable following receipt of proof of entitlement, ifrequested.(b) Request for Review. Within ninety (90) days after receiving written notice of the PlanAdministrator's disposition of the claim, the claimant may file with the RPAC a written request forreview of his claim. In connection with the request for review, the claimant will be entitled to berepresented by counsel and will be given, upon request and free of charge, reasonable access to allpertinent documents for the preparation of his claim. If the claimant does not file a written request forreview within ninety (90) days after receiving written notice of the Plan Administrator's disposition ofthe claim, the claimant will be deemed to have accepted the Plan Administrator's written disposition,unless the claimant was physically or mentally incapacitated so as to be unable to request reviewwithin the ninety (90) day period.(c) Decision on Review. After receipt by the RPAC of a written application for review of his claim, theRPAC will review the claim taking into account all32 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.comments, documents, records and other information submitted by the claimant regarding the claimwithout regard to whether such information was considered in the initial benefit determination. TheRPAC will notify the claimant of its decision by delivery or by certified or registered mail to his lastknown address. A decision on review of the claim will be made by the RPAC at its next meetingfollowing receipt of the written request for review. If no meeting of the RPAC is scheduled withinforty-five (45) days of receipt of the written request for review, then the RPAC will hold a specialmeeting to review such written request for review within such forty-five (45) day period. If specialcircumstances require an extension of the forty-five (45) day period, the RPAC will so notify theclaimant and a decision will be rendered within ninety (90) days of receipt of the request forreview. In any event, if a claim is not determined by the RPAC within ninety (90) days of receipt ofwritten submission for review, it will be deemed to be denied.The decision of the RPAC will be provided to the claimant as soon as possible but no later than five(5) days after the benefit determination is made. The decision will be in writing and will include thespecific reasons for the decision presented in a manner calculated to be understood by the claimantand will contain references to all relevant Plan provisions on which the decision was based. Suchdecision will also advise the claimant that he may receive upon request, and free of charge,reasonable access to and copies of all documents, records and other information relevant to hisclaim and will inform the claimant of his right to arbitration in the case of an adverse decisionregarding his appeal. The decision of the RPAC will be final and conclusive.(d) Arbitration. In the event the claims review procedure described in this Section 8.6 does not result inan outcome thought by the claimant to be in accordance with the Plan document, he may appeal to athird party neutral arbitrator. The claimant must appeal to an arbitrator within sixty (60) days afterreceiving the RPAC's denial or deemed denial of his request for review and before bringing suit incourt. The arbitration will be conducted pursuant to the American Arbitration Association ("AAA")Rules on Employee Benefit Claims.The arbitrator will be mutually selected by the Participant and the RPAC from a list of arbitrators whoare experienced in nonqualified deferred compensation plan benefit matters that is provided by theAAA. If the parties are unable to agree on the selection of an arbitrator within ten (10) days ofreceiving the list from the AAA, the AAA will appoint an arbitrator. The arbitrator's review will belimited to interpretation of the Plan document in the context of the particular facts involved. Theclaimant, the RPAC and the Employer agree to accept the award of the arbitrator as binding, and allexercises of power by the arbitrator hereunder will be final, conclusive and binding on all interestedparties, unless found by a court of competent jurisdiction, in a final judgment that is no longer subjectto review or appeal, to be arbitrary and capricious. The claimant, RPAC and the Company agreethat the venue for the arbitration will be in Dallas, Texas. The costs of arbitration will be paid by theEmployer; the costs of legal representation for the claimant or witness costs for the claimant will beborne by the claimant; provided, that, as part of his award, the Arbitrator may require the Employer toreimburse the claimant for all or a portion of such amounts.33 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.The following discovery may be conducted by the parties: interrogatories, demands to producedocuments, requests for admissions and oral depositions. The arbitrator will resolve any discoverydisputes by such pre hearing conferences as may be needed. The Company, RPAC and claimantagree that the arbitrator will have the power of subpoena process as provided bylaw. Disagreements concerning the scope of depositions or document production, itsreasonableness and enforcement of discovery requests will be subject to agreement by theCompany and the claimant or will be resolved by the arbitrator. All discovery requests will be subjectto the proprietary rights and rights of privilege and other protections granted by applicable law to theCompany and the claimant and the arbitrator will adopt procedures to protect such rights. Withrespect to any dispute, the Company, RPAC and the claimant agree that all discovery activities willbe expressly limited to matters relevant to the dispute and the arbitrator will be required to fullyenforce this requirement.The arbitrator will have no power to add to, subtract from, or modify any of the terms of the Plan, orto change or add to any benefits provided by the Plan, or to waive or fail to apply any requirements ofeligibility for a benefit under the Plan. Nonetheless, the arbitrator will have absolute discretion in theexercise of its powers in this Plan. Arbitration decisions will not establish binding precedent withrespect to the administration or operation of the Plan.8.7 Receipt and Release of Necessary Information. In implementing the terms of this Plan, the RPAC andPlan Administrator, as applicable, may, without the consent of or notice to any person, release to or obtainfrom any other insuring entity or other organization or person any information, with respect to any person,which the RPAC or Plan Administrator deems to be necessary for such purposes. Any Participant orBeneficiary claiming benefits under this Plan will furnish to the RPAC or Plan Administrator, as applicable,such information as may be necessary to determine eligibility for and amount of benefit, as a condition ofclaiming and receiving such benefit.8.8 Overpayment and Underpayment of Benefits. The Plan Administrator may adopt, in its sole and absolutediscretion, whatever rules, procedures and accounting practices are appropriate in providing for thecollection of any overpayment of benefits. If a Participant or Beneficiary receives an underpayment ofbenefits, the Plan Administrator will direct that payment be made as soon as practicable to make up for theunderpayment. If an overpayment is made to a Participant or Beneficiary, for whatever reason, the PlanAdministrator may, in its sole and absolute discretion, (a) withhold payment of any further benefits under thePlan until the overpayment has been collected; provided, that the entire amount of reduction in any calendaryear does not exceed five thousand dollars ($5,000), and the reduction is made at the same time and in thesame amount as the debt otherwise would have been due and collected from the Participant, or (b) mayrequire repayment of benefits paid under this Plan without regard to further benefits to which the Participantor Beneficiary may be entitled.8.9 Change of Control. Upon a Change of Control and for the following three (3) years thereafter, if anyarbitration arises relating to an event occurring or a claim made with in three (3) years of a Change ofControl, (i) the arbitrator will not decide the claim based on an abuse of discretion principle or give theprevious RPAC decision any special deference, but rather will determine the claim de novo based on itsown independent reading of the Plan; and (ii) the Company will pay the Participant's reasonable legal and34 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.other related fees and expenses upon the Participant’s provision of satisfactory documentation of suchexpenses with such reimbursement being made no later than the close of the second taxable year followingthe year in which such expenses were incurred. End of Article VIII35 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE IXOTHER BENEFIT PLANS OF THE COMPANY9.1 Other Plans. Nothing contained in this Plan will prevent a Participant before his death, or a Participant'sspouse or other Beneficiary after such Participant's death, from receiving, in addition to any paymentsprovided for under this Plan, any payments provided for under any other plan or benefit program of theEmployer, or which would otherwise be payable or distributable to him, his surviving spouse or Beneficiaryunder any plan or policy of the Employer or otherwise. Nothing in this Plan will be construed as preventingthe Company or any of its Affiliates from establishing any other or different plans providing for current ordeferred compensation for employees and/or Directors. Unless otherwise specifically provided in any planof the Company intended to "qualify" under section 401 of the Code, Compensation and Bonus Deferralsmade under this Plan will constitute earnings or compensation for purposes of determining contributions orbenefits under such qualified plan. End of Article IX36 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE XAMENDMENT AND TERMINATION OF THE PLAN10.1 Continuation. The Company intends to continue this Plan indefinitely, but nevertheless assumes nocontractual obligation beyond the promise to pay the benefits described in this Plan.10.2 Amendment of Plan. The Company, through an action of the Human Resources Committee, reserves theright in its sole and absolute discretion to amend this Plan in any respect at any time, except that upon orduring the two (2) year period after any Change of Control of the Company, (a) Plan benefits cannot bereduced, (b) Articles VIII and X and Plan Section 7.1(b) cannot be changed, and (c) (except as provided inSection 10.3) no prospective amendment that adversely affects the rights or obligations of a Participant maybe made unless the affected Participant receives at least one (1) year's advance written notice of suchamendment.Moreover, no amendment may ever be made that retroactively reduces or diminishes the rights of anyParticipant to the benefits described herein that have been accrued or earned through the date of suchamendment, even if a Termination of Employment has not yet occurred with respect to such Participant.In addition to the Human Resources Committee, the RPAC has the right to make non-material amendmentsto the Plan to comply with changes in the law or to facilitate Plan administration; provided, however, thateach such proposed non-material amendment must be discussed with the Chairperson of the HumanResources Committee in order to determine whether such change would constitute a material amendmentto the Plan.The provisions of this Section 10.2 will not restrict the right of the Company to terminate this Plan underSection 10.3 below or the termination of an Affiliate's participation under Section 10.4 below.10.3 Termination of Plan. The Company, through an action of the Human Resources Committee, mayterminate or suspend this Plan in whole or in part at any time, provided that no such termination orsuspension will deprive a Participant, or person claiming benefits under this Plan through a Participant, ofany amount credited to his Accounts under this Plan up to the date of suspension or termination, except asrequired by applicable law and pursuant to the valuation of such Accounts pursuant to Section 4.6.The Human Resources Committee may decide to liquidate the Plan upon termination under the followingcircumstances:(a) Corporate Dissolution or Bankruptcy. The Human Resources Committee may terminate andliquidate the Plan within twelve (12) months of a corporate dissolution taxed under section 331 of theCode or with the approval of a bankruptcy court pursuant to 11 U.S.C. § 503(b)(1)(A), provided thatthe amounts deferred under the Plan are included in Participants' gross income in the latest of thefollowing years (or if earlier, the taxable year in which the amount is actually or constructivelyreceived):(i) The calendar year in which the Plan termination and liquidation occurs.37 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.(ii) The first calendar year in which the amount is no longer subject to a substantial risk offorfeiture.(iii) The first calendar year in which the payment is administratively practicable.(b) Change in Control. The Human Resources Committee may terminate and liquidate the Plan withinthe thirty (30) days preceding or the twelve (12) months following a "change in control" as defined inTreasury Regulation 1.409A-3(i)(5) provided that all plans or arrangements that would be aggregatedwith the Plan under section 409A of the Code are also terminated and liquidated with respect to eachParticipant that experienced the change in control event so that under the terms of the Plan and allsuch arrangements the Participant is required to receive all amounts of compensation deferred undersuch arrangements within twelve (12) months of the termination of the Plan or arrangement, asapplicable. In the case of a Change of Control event which constitutes a sale of assets, thetermination of the Plan pursuant to this Section 10.3(b) may be made with respect to the Employerthat is primarily liable immediately after the change of control transaction for the payment of benefitsunder the Plan.(c) Termination of Plan. The Human Resources Committee may terminate and liquidate the Planprovided that (i) the termination and liquidation does not occur by reason of a downturn of thefinancial health of the Company or an Employer, (ii) all plans all plans or arrangements that would beaggregated with the Plan under section 409A of the Code are also terminated and liquidated, (iii) nopayments in liquidation of the Plan are made within twelve (12) months of the date of termination ofthe Plan other than payments that would be made in the ordinary course operation of the Plan, (iv) allpayments are made within twenty four (24) months of the date the Plan is terminated and (v) theCompany or the Employer, as applicable depending on whether the Plan is terminated with respectto such entity, do not adopt a new plan that would be aggregated with the Plan within three (3) yearsof the date of the termination of the Plan.10.4 Termination of Affiliate's Participation. An Affiliate may terminate its participation in the Plan at any timeby an action of its governing body and providing written notice to the Company. Likewise, the Companymay terminate an Affiliate's participation in the Plan at any time by an action of the Human ResourcesCommittee and providing written notice to the Affiliate. The effective date of any such termination will be thelater of the date specified in the notice of the termination of participation or the date on which the RPAC canadministratively implement such termination. In the event that an Affiliate's participation in the Plan isterminated, each Participant employed by such Affiliate will continue to make Compensation and BonusDeferrals, RSU Deferrals or Discretionary Deferrals, as applicable, in effect at the time of such terminationfor the remainder of the Plan Year in which the termination occurs. Thereafter, each Participant employedby such Affiliate will continue to participate in the Plan as an inactive Participant and will be entitled to adistribution of his entire Account or a portion thereof upon the earlier of his Scheduled Withdrawal Date, ifany, or his Termination of Employment, in the form elected (or deemed elected) by such Participantpursuant to Section 5.1.End of Article X38 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.ARTICLE XIMISCELLANEOUS11.1 No Reduction of Employer Rights. Nothing contained in this Plan will be construed as a contract ofemployment between the Employer and an Employee, or as a right of any Employee to continue in theemployment of the Employer, or as a limitation of the right of the Employer to discharge any of itsEmployees, with or without cause or as a right of any Director to be renominated to serve as a Director.11.2 Provisions Binding. All of the provisions of this Plan will be binding upon all persons who will be entitled toany benefit hereunder, their heirs and personal representatives. End of Article IX39 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.IN WITNESS WHEREOF, this Fourth Amended and Restated Tenet 2006 Deferred Compensation Plan has beenexecuted on this 18 of February 2016, effective as of November 30, 2015, except as specifically providedotherwise here TENET HEALTHCARE CORPORATION By:/s/ Paul Slavin Paul Slavin, Vice President, Executive and Corp HRServices 40 th1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.EXHIBIT ALIMITS ON ELIGIBILITY AND PARTICIPATIONSection 3.1 of the Tenet 2006 Deferred Compensation Plan (the "Plan") provides the Retirement PlansAdministration Committee ("RPAC") and Plan Administrator with the authority to limit the classification ofEmployees eligible to participate in the Plan, limit the time of an Employee’s enrollment in the Plan to an OpenEnrollment Period and/or modify or terminate an Eligible Person’s participation in the Plan and states that any suchlimitation will be set forth in this Exhibit A. Capitalized terms used in this Appendix that are not defined herein willhave the meaning set forth in Section 2.1.· The classification of Employees eligible to participate in the Plan will be limited to those employees who arepaid from a Tenet payroll (i.e., eligible employees who were previously employed by Vanguard HealthSystem will not be eligible to participate in the Plan until they transition to a Tenet payroll). · Likewise, those physicians who perform services for Baptist Health Centers, LLC (“BHC”) and are paid fromthe Baptist Health System, Inc. payroll will not be eligible to participate in the Plan. This Exhibit A may be updated from time to time without the need for a formal amendment to the Plan.A-111Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 21Subsidiaries of the Registrantas of December 31, 2015 Name of EntityState or OtherJurisdiction ofFormation601 N 30th Street I, L.L.C.Delaware601 N 30th Street II, L.L.C.Nebraska601 N 30th Street III, Inc.NebraskaThe 6300 West Roosevelt PartnershipIllinoisAbrazo Medical Group Urgent Care, LLCDelawareAdvantage Health Care Management Company, LLCDelawareAdvantage Health Network, Inc.FloridaAHM Acquisition Co., Inc.DelawareAlabama Cardiovascular Associates, L.L.C.AlabamaAlabama Hand and Sports Medicine, L.L.C.AlabamaAllegian Insurance CompanyTexasAlvarado Hospital Medical Center, Inc.CaliforniaAMC/North Fulton Urgent Care #1, L.L.C.GeorgiaAMC/North Fulton Urgent Care #2, L.L.C.GeorgiaAMC/North Fulton Urgent Care #3, L.L.C.GeorgiaAMC/North Fulton Urgent Care #4, L.L.C.GeorgiaAMC/North Fulton Urgent Care #5, L.L.C.GeorgiaAMC/North Fulton Urgent Care #6, L.L.C.GeorgiaAmerican Medical (Central), Inc.CaliforniaAMI Diagnostic Services, Inc.NevadaAMI/HTI Tarzana Encino Joint VentureDelawareAMI Information Systems Group, Inc.CaliforniaAmisub (Heights), Inc.DelawareAmisub (Hilton Head), Inc.South CarolinaAmisub (North Ridge Hospital), Inc.FloridaAmisub of California, Inc.CaliforniaAmisub of North Carolina, Inc.North CarolinaAmisub of South Carolina, Inc.South CarolinaAmisub of Texas, Inc.DelawareAmisub (SFH), Inc.TennesseeAmisub (Twelve Oaks), Inc.DelawareAnaheim Hills Medical Imaging, L.L.C.CaliforniaAnaheim MRI Holding, Inc.California Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Arizona Health Partners, LLCArizonaAsia Outsourcing US, Inc.DelawareAspen Healthcare LimitedEngland and WalesAspen Leasing LimitedEngland and WalesAtlanta Medical Billing Center, L.L.C.GeorgiaAtlanta Medical Center, Inc.GeorgiaAtlanta Medical Center Interventional Neurology Associates, L.L.C.GeorgiaAtlanta Medical Center Neurosurgical & Spine Specialists, L.L.C.GeorgiaAtlanta Medical Center Physician Group, L.L.C.GeorgiaBaptist Health Centers, LLCDelawareBaptist Medical Management Service Organization, LLCDelawareBaptist Memorial Hospital System Physician Hospital OrganizationTexasBaptist Physician Alliance ACO, LLCAlabamaBaptist Physician Alliance, LLCAlabamaBBH BMC, LLCDelawareBBH CBMC, LLCDelawareBBH DevelopmentCo, LLCDelawareBBH NP Clinicians, Inc.DelawareBBH PBMC, LLCDelawareBBH SBMC, LLCDelawareBBH WBMC, LLCDelawareBCDC EmployeeCO, LLCDelawareBHC-Talladega Pediatrics, LLCAlabamaBHS Accountable Care, LLCDelawareBHS Affinity, LLCDelawareBHS Integrated Physician Partners, LLCDelawareBHS Physicians Alliance for ACE, LLCDelawareBHS Physicians Network, Inc.TexasBHS Specialty Network, Inc.TexasBilling Center Doctors Hospital at White Rock Lake, L.L.C.TexasBilling Center Lake Pointe Medical, L.L.C.TexasBluffton Okatie Primary Care, L.L.C.South CarolinaBroad River Primary Care, L.L.C.South CarolinaBrookwood Ancillary Holdings, Inc.DelawareBrookwood Baptist Health 1, LLCDelawareBrookwood Baptist Health 2, LLCDelawareBrookwood Baptist Imaging, LLCDelawareBrookwood Cardiovascular, LLCAlabamaBrookwood Center Development CorporationAlabamaBrookwood Development, Inc.Alabama 2 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Brookwood Garages, L.L.C.AlabamaBrookwood Health Services, Inc.AlabamaBrookwood Home Health, LLCAlabamaBrookwood - Maternal Fetal Medicine, L.L.C.AlabamaBrookwood Medical Partners - ENT, L.L.C.AlabamaBrookwood Occupational Health Clinic, L.L.C.AlabamaBrookwood Parking Associates, Ltd.AlabamaBrookwood Primary Care Cahaba Heights, L.L.C.AlabamaBrookwood Primary Care - Grand River, L.L.C.AlabamaBrookwood Primary Care - Homewood, L.L.C.AlabamaBrookwood Primary Care Hoover, L.L.C.AlabamaBrookwood Primary Care - Inverness, L.L.C.AlabamaBrookwood Primary Care - Mountain Brook, L.L.C.AlabamaBrookwood Primary Care Network - McCalla, L.L.C.AlabamaBrookwood Primary Care - Oak Mountain, L.L.C.AlabamaBrookwood Primary Care - Red Mountain, L.L.C.AlabamaBrookwood Primary Care The Narrows, L.L.C.AlabamaBrookwood Primary Care - Vestavia, L.L.C.AlabamaBrookwood Primary Network Care, Inc.AlabamaBrookwood Retail Pharmacy, L.L.C.AlabamaBrookwood Specialty Care - Endocrinology, L.L.C.AlabamaBrookwood Sports and Orthopedics, L.L.C.AlabamaBrookwood Women's Care, L.L.C.AlabamaBT East Dallas JV, LLPTexasBuckhead Orthopedic Surgery Center, L.L.C.GeorgiaBurnt Church Primary and Urgent Care, L.L.C.South CarolinaBW Cardiology, LLCDelawareBW Cyberknife, LLCDelawareBW Hand Practice, LLCDelawareBW Office Buildings, LLCDelawareBW Parking Decks, LLCDelawareBW Physician Practices, LLCDelawareBW Retail Pharmacy, LLCDelawareBW Sports Practice, LLCDelawareBWP Associates, Ltd.AlabamaC7 Technologies, LLCDelawareCamp Creek Urgent Care, L.L.C.GeorgiaCancer Centre London LLPEngland and Wales 1.Subsidiaries of this entity, in which the Registrant indirectly holds a minority (non-controlling) interest, have beenomitted.3 1Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Captive Insurance Services, Inc.DelawareCardiology Physicians Associates, L.L.C.North CarolinaCardiology Physicians Corporation, L.L.C.North CarolinaCardiovascular & Thoracic Surgery Associates, L.L.C.South CarolinaCardiovascular Associates of the Southeast, L.L.C.AlabamaCardiovascular Care Network of Arizona, L.L.C.ArizonaCardiovascular Clinical Excellence at Desert Regional, LLCCaliforniaCardiovascular Clinical Excellence at Sierra Providence, LLCTexasCatawba-Piedmont Cardiothoracic Surgery, L.L.C.South CarolinaCedar Hill Primary Care, L.L.C.MissouriCenter for Advanced Research Excellence, L.L.C.FloridaCenter for the Urban Child, Inc.PennsylvaniaCentral Carolina Ambulatory Surgery Center, LLCNorth CarolinaCentral Carolina Hospital Pro Fee Billing, L.L.C.North CarolinaCentral Carolina-CIM, L.L.C.North CarolinaCentral Carolina-IMA, L.L.C.North CarolinaCentral Carolina Physicians - Sandhills, L.L.C.North CarolinaCentral Texas Corridor Hospital Company, LLCDelawareCGH Hospital, Ltd.FloridaChalon Living, Inc.ArizonaChicago Health System ACO, LLCIllinoisChildren's Hospital of Michigan Premier Network, Inc.MichiganCHN Holdings, LLCDelawareCHVI Tucson Holdings, LLCDelawareC.K. of Birmingham, LLCAlabamaClaremont Hospital Holdings LimitedEngland and WalesClaremont Hospital LLPEngland and WalesCML-Chicago Market Labs, Inc.DelawareCoast Healthcare Management, LLCCaliforniaCoastal Carolina Medical Center, Inc.South CarolinaCoastal Carolina Physician Practices, LLCDelawareCoastal Carolina Pro Fee Billing, L.L.C.South CarolinaCommonwealth Continental Health Care, Inc.FloridaCommunity Connection Health Plan, Inc.ArizonaCommunity Hospital of Los Gatos, Inc.CaliforniaConifer Care Continuum Solutions, LLCMarylandConifer Ethics and Compliance, Inc.DelawareConifer Health Solutions, LLCDelawareConifer HIM & Revenue Integrity Services, LLCTexasConifer Holdings, Inc.Delaware 4 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Conifer Patient Communications, LLCFloridaConifer Physician Services Holdings, Inc.DelawareConifer Physician Services, Inc.IllinoisConifer Revenue Cycle Solutions, LLCCaliforniaConifer Value-Based Care, LLCMarylandCoral Gables Hospital, Inc.FloridaCoral Gables Physician Services, L.L.C.FloridaCRNAs of MichiganMichiganCypress Fairbanks Medical Center Inc.TexasDelray Medical Center, Inc.FloridaDelray Medical Physician Services, L.L.C.FloridaDes Peres Hospital, Inc.MissouriDes Peres Urgent Care, L.L.C.MissouriDesert Regional Medical Center, Inc.CaliforniaDetroit Education & ResearchMichiganDigitalMed, Inc.DelawareDMC Education & ResearchMichiganDMC Huron Valley-Sinai Hospital Premier Clinical Management Services, LLCMichiganDMC Imaging, L.L.C.FloridaDMC Shared Savings ACO, LLCDelawareDoctors Hospital of Manteca, Inc.CaliforniaDoctors Medical Center of Modesto, Inc.CaliforniaEast Cobb Urgent Care, LLCGeorgiaEast Cooper Coastal Family Physicians, L.L.C.South CarolinaEast Cooper Community Hospital, Inc.South CarolinaEast Cooper Hyperbarics, L.L.C.DelawareEast Cooper OB/GYN, L.L.C.South CarolinaEast Cooper Primary Care Physicians, L.L.C.South CarolinaEastern Professional Properties, Inc.DelawareEdinburgh Medical Services LimitedEngland and WalesEl Mirador ASC, Inc.CaliforniaEPHC, Inc.TexasEuropean Surgical Partners LimitedEngland and WalesEye-Docs LimitedEngland and WalesFirst Choice Physician PartnersCaliforniaFlorida Regional Medical Center, Inc.FloridaFMCC Network Contracting, L.L.C.FloridaFMC Medical, Inc.FloridaFort Bend Clinical Services, Inc.TexasFountain Valley Regional Hospital and Medical CenterCalifornia 5 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Fountain Valley Surgery Center, LLCCaliforniaFREH Real Estate, L.L.C.FloridaFRS Imaging Services, L.L.C.FloridaFrye Heart Excellence Team, LLCNorth CarolinaFrye Physicians - Tenet NC, L.L.C.North CarolinaFrye Regional Medical Center, Inc.North CarolinaFryeCare Appalachian, L.L.C.North CarolinaFryeCare Boone, L.L.C.North CarolinaFryeCare Morganton, L.L.C.North CarolinaFryeCare Northwest Hickory, L.L.C.North CarolinaFryeCare Outpatient Imaging, L.L.C.North CarolinaFryeCare Physicians, L.L.C.North CarolinaFryeCare Specialty Center, L.L.C.North CarolinaFryeCare Valdese, L.L.C.North CarolinaFryeCare Watauga, L.L.C.North CarolinaFryeCare Women's Services, L.L.C.North CarolinaG.S. North, Ltd.FloridaGardendale Surgical Associates, LLCAlabamaGarland MOB Properties, LLCTexasGastric Health Institute, L.L.C.GeorgiaGCPG, Inc.DelawareGeorgia Gifts From Grace, L.L.C.GeorgiaGeorgia North Fulton Healthcare Associates, L.L.C.GeorgiaGeorgia Northside Ear, Nose and Throat, L.L.C.GeorgiaGeorgia Physicians of Cardiology, L.L.C.GeorgiaGeorgia Spectrum Neurosurgical Specialists, L.L.C.GeorgiaGlobal Healthcare Partners LimitedEngland and WalesGolden State Medicare Health PlanCaliforniaGood Samaritan Cardiac & Vascular Management, LLCFloridaGood Samaritan Medical Center, Inc.FloridaGood Samaritan Surgery, L.L.C.FloridaGraystone Family Healthcare - Tenet North Carolina, L.L.C.North CarolinaGreater Dallas Healthcare EnterprisesTexasGreater Northwest Houston EnterprisesTexasGreystone Internal Medicine - Brookwood, L.L.C.AlabamaGriffin Imaging, LLCGeorgiaGulf Coast Community Health Care Systems, Inc.MississippiGulf Coast Community Hospital, Inc.MississippiHallmark Family Physicians - Tenet North Carolina, L.L.C.North CarolinaHarbor Health Plan, Inc.Michigan 6 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Hardeeville Hospitalists, L.L.C.South CarolinaHardeeville Medical Group, L.L.C.South CarolinaHardeeville Primary Care, L.L.C.South CarolinaHarlingen Physician Network, Inc.TexasHCH Tucson Holdings, LLCDelawareHCN European Surgery Center Holdings LimitedEngland and WalesHCN Laboratories, Inc.TexasHCN Lake Pointe Holdings LLCDelawareHCN Physicians, Inc.TexasHCN Sunnyvale Holdings LLCDelawareHCN Surgery Center Holdings, Inc.DelawareHDMC Holdings, L.L.C.DelawareHealth & Wellness Surgery Center, L.P.CaliforniaHealthcare Compliance, LLCDistrict of ColumbiaThe Healthcare Insurance CorporationCayman IslandsHealthcare Network Alabama, Inc.DelawareHealthcare Network CFMC, Inc.DelawareHealthcare Network Georgia, Inc.DelawareHealthcare Network Holdings, Inc.DelawareHealthcare Network Hospitals (Dallas), Inc.DelawareHealthcare Network Hospitals, Inc.DelawareHealthcare Network Louisiana, Inc.DelawareHealthcare Network Missouri, Inc.DelawareHealthcare Network North Carolina, Inc.DelawareHealthcare Network South Carolina, Inc.DelawareHealthcare Network Tennessee, Inc.DelawareHealthcare Network Texas, Inc.DelawareThe Healthcare Underwriting Company, a Risk Retention GroupVermontHealthCorp Network, Inc.DelawareHealthpoint of North Carolina, L.L.C.North CarolinaHealth Services Network Care, Inc.DelawareHealth Services Network Hospitals, Inc.DelawareHealth Services Network Texas, Inc.DelawareHospital Underwriting Group, Inc.TennesseeThe Heart and Vascular Clinic, L.L.C.FloridaHeart & Vascular Institute of Texas, Inc.TexasHeart and Vascular Institute of MichiganMichiganHeritage Medical Group of Hilton Head, L.L.C.South CarolinaHialeah Hospital, Inc.Florida 7 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Hialeah Real Properties, Inc.FloridaHickory Family Practice Associates - Tenet North Carolina, L.L.C.North CarolinaHighgate Hospital LLPEngland and WalesHilton Head Health System, L.P.South CarolinaHilton Head Occupational Medicine, L.L.C.South CarolinaHilton Head Regional Anesthesia Partners, L.L.C.South CarolinaHilton Head Regional Endocrinology Associates, L.L.C.South CarolinaHilton Head Regional Healthcare, L.L.C.South CarolinaHilton Head Regional OB/GYN Partners, L.L.C.South CarolinaHitchcock State Street Real Estate, Inc.CaliforniaHNMC, Inc.DelawareHNW GP, Inc.DelawareHNW LP, Inc.DelawareHollywood Medical Center, Inc.FloridaHoly Cross Hospital, Inc.ArizonaHome Health Partners of San Antonio, LLCTexasHoover Doctors Group, Inc.AlabamaHoover Land, LLCDelawareHospital Development of West Phoenix, Inc.DelawareHospital RCM Services, LLCTexasHouston Northwest Concessions, L.L.C.TexasHouston Northwest Medical Center, Inc.DelawareHouston Northwest Operating Company, L.L.C.TexasHouston Northwest Partners, Ltd.TexasHouston Specialty Hospital, Inc.TexasHouston Sunrise Investors, Inc.DelawareHPS of PA, L.L.C.PennsylvaniaHSRM International, Inc.CaliforniaHUG Services, Inc.DelawareThe Huron CorporationDistrict of ColumbiaImaging Center at Baxter Village, L.L.C.South CarolinaInforMed Insurance Services, LLCMarylandInternational Health and Wellness, Inc.FloridaJackson Medical Associates, LLCGeorgiaJFK Memorial Hospital, Inc.CaliforniaJourney Home Healthcare of San Antonio, LLCTexasLaguna Medical Systems, Inc.CaliforniaLake Health Care Facilities Inc.DelawareLake Pointe ASC GP, Inc.Texas 8 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Lake Pointe GP, LLCDelawareLake Pointe Investments, LLCDelawareLake Pointe Operating Company, L.L.C.TexasLake Pointe Partners, Ltd.TexasLake Pointe Rockwall ASC, LPTexasLakeFront Medical Associates, LLCDelawareLakewood Regional Medical Center, Inc.CaliforniaLifemark Hospitals, Inc.DelawareLifemark Hospitals of Florida, Inc.FloridaLifemark Hospitals of Louisiana, Inc.LouisianaLos Alamitos Medical Center, Inc.CaliforniaLos Gatos Multi-Specialty Group, Inc.CaliforniaMacNeal Health Providers, Inc.IllinoisMacNeal Management Services, Inc.IllinoisMacNeal Medical Records, Inc.DelawareMacNeal Physicians Group, LLCDelawareMeadowcrest Hospital, LLCLouisianaMeadowcrest Multi-Specialty Clinic, L.L.C.LouisianaMedical Services Co-Management Collaborative @ JFK Memorial Hospital, L.L.C.CaliforniaMedplex Outpatient Medical Centers, Inc.AlabamaMemphis Urgent Care #1, L.L.C.TennesseeMemphis Urgent Care #2, L.L.C.TennesseeMetroWest Accountable Health Care Organization, LLCMassachusettsMetroWest HomeCare & Hospice, LLCMassachusettsMichigan Pioneer ACO, LLCDelawareMid-Island Primary and Urgent Care, L.L.C.South CarolinaMidwest Pharmacies, Inc.IllinoisMobile Technology Management, LLCMichiganNacogdoches ASC-LP, Inc.DelawareNational Ancillary, Inc.TexasNational ASC, Inc.DelawareNational Diagnostic Imaging Centers, Inc.TexasNational HHC, Inc.TexasNational Home Health Holdings, Inc.DelawareNational ICN, Inc.TexasNational Medical Services II, Inc.FloridaNational Medical Ventures, Inc.DelawareNational Outpatient Services Holdings, Inc.DelawareNational Urgent Care Holdings, Inc.DelawareNational Urgent Care, Inc.Florida 9 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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International (Cayman) LimitedCayman IslandsNME Properties Corp.TennesseeNME Properties, Inc.DelawareNME Property Holding Co., Inc.DelawareNME Psychiatric Hospitals, Inc.DelawareNME Rehabilitation Properties, Inc.DelawareNorth Carolina Community Family Medicine, L.L.C.North CarolinaNorth Fulton Cardiovascular Medicine, L.L.C.GeorgiaNorth Fulton GI Center, L.L.C.GeorgiaNorth Fulton Hospitalist Group, L.L.C.GeorgiaNorth Fulton Medical Center, Inc.GeorgiaNorth Fulton MOB Ventures, Inc.GeorgiaNorth Fulton Parking Deck, L.P.GeorgiaNorth Fulton Primary Care Associates, L.L.C.GeorgiaNorth Fulton Primary Care - Avalon, L.L.C.GeorgiaNorth Fulton Primary Care - Willeo Rd., L.L.C.DelawareNorth Fulton Primary Care - Windward Parkway, L.L.C.GeorgiaNorth Fulton Primary Care - Wylie Bridge, L.L.C.GeorgiaNorth Fulton Pulmonary Specialists, L.L.C.GeorgiaNorth Fulton Regional Medical Center Pro Fee Billing, L.L.C.GeorgiaNorth Fulton Women's Consultants, L.L.C.GeorgiaNorth Miami Medical Center, Ltd.FloridaNorthPoint Health System, Inc.GeorgiaNorth Shore Medical Billing Center, L.L.C.FloridaNorth Shore Medical Center, IncFloridaNorth Shore Physician Practices, L.L.C.FloridaNorthwest Houston Providers Alliance, Inc.TexasNorwood Clinic of Alabama, L.L.C.AlabamaNRMC Physician Services, L.L.C.FloridaNUCH of Connecticut, LLCConnecticutNUCH of Georgia, L.L.C.GeorgiaNUCH of Massachusetts, LLCMassachusettsNUCH of Michigan, Inc.Michigan 10 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.NUCH of TexasTexasNWSC, L.L.C.TexasOHM Services, Inc.MassachusettsOkatie Surgical Partners, L.L.C.South CarolinaOlive Branch Urgent Care #1, LLCMississippiOncology Associates of the Low Country, L.L.C.South CarolinaOrNda Hospital CorporationCaliforniaOrthopedic & Spine Clinical Co-Management, LLCGeorgiaOrthopedic Associates of the Lowcountry, L.L.C.South CarolinaPalm Beach Gardens Cardiac and Vascular Partners, LLCFloridaPalm Beach Gardens Community Hospital, Inc.FloridaPalm Valley Medical Center Campus AssociationArizonaPark Plaza Hospital Billing Center, L.L.C.TexasParkway Internal Medicine - Tenet North Carolina, L.L.C.North CarolinaPDN, L.L.C.TexasPhoenix Health Plans, Inc.ArizonaPHPS-CHM Acquisition, Inc.DelawarePhysician Performance Network, L.L.C.DelawarePhysician Performance Network of DetroitMichiganPhysician Performance Network of Georgia, L.L.C.GeorgiaPhysician Performance Network of North Carolina, Inc.North CarolinaPhysician Performance Network of Philadelphia, L.L.C.PennsylvaniaPhysicians Performance Network of HoustonTexasPhysicians Performance Network of North TexasTexasPiedmont Behavioral Medicine Associates, LLCSouth CarolinaPiedmont Cardiovascular Physicians, L.L.C.South CarolinaPiedmont Carolina OB/GYN of York County, L.L.C.South CarolinaPiedmont Carolina Vascular Surgery, L.L.C.South CarolinaPiedmont East Urgent Care Center, L.L.C.South CarolinaPiedmont Express Care at Sutton Road, L.L.C.South CarolinaPiedmont Family Practice at Baxter Village, L.L.C.South CarolinaPiedmont Family Practice at Rock Hill, L.L.C.South CarolinaPiedmont Family Practice at Tega Cay, L.L.C.South CarolinaPiedmont General Surgery Associates, L.L.C.South CarolinaPiedmont Health Alliance, Inc.North CarolinaPiedmont Internal Medicine at Baxter Village, L.L.C.South CarolinaPiedmont Medical Center Cardiovascular Clinical Co-Management, L.L.CSouth CarolinaPiedmont Pulmonology, L.L.C.South CarolinaPiedmont Surgical Specialists, L.L.C.South CarolinaPiedmont Urgent Care and Industrial Health Centers, Inc.South Carolina 11 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Piedmont Urgent Care Center at Baxter Village, L.L.C.South CarolinaPiedmont West Urgent Care Center, L.L.C.South CarolinaPlacentia-Linda Hospital, Inc.CaliforniaPMC Physician Network, L.L.C.South CarolinaPM CyFair Land Partners, LLCDelawarePractice Partners Management, L.P.TexasPremier ACO Physicians Network, LLCCaliforniaPremier Emergency Physicians, LLCMissouriPremier Health Plan Services, Inc.CaliforniaPremier Medical Specialists, L.L.C.MissouriPrimary Care Physicians Center, LLCIllinoisProfessional Healthcare Systems Licensing CorporationDelawareProfessional Liability Insurance CompanyTennesseePros Temporary Staffing, Inc.IllinoisRepublic Health Corporation of Rockwall CountyNevadaResolute Health Family Urgent Care, Inc.DelawareResolute Health Physicians Network, Inc.TexasResolute Hospital Company, LLCDelawareRHC Parkway, Inc.DelawareRheumatology Associates of Atlanta Medical Center, L.L.C.GeorgiaR.H.S.C. El Paso, Inc.TexasRio Grande Valley Indigent Health Care CorporationTexasRLC, LLCArizonaRock Bridge Surgical Institute, L.L.C.GeorgiaRoswell Georgia Surgery Center, L.L.C.GeorgiaRoswell Medical Ventures, Inc.GeorgiaSaint Francis Behavioral Health Associates, L.L.C.TennesseeSaint Francis Cardiology Associates, L.L.C.TennesseeSaint Francis Cardiovascular Surgery, L.L.C.TennesseeSaint Francis Center for Surgical Weight Loss, L.L.C.TennesseeSaint Francis Hospital-Bartlett, Inc.TennesseeSaint Francis Hospital Billing Center, L.L.C.TennesseeSaint Francis Hospital Inpatient Physicians, L.L.C.TennesseeSaint Francis Hospital Pro Fee Billing, L.L.C.TennesseeSaint Francis Medical Partners, East, L.L.C.TennesseeSaint Francis Medical Partners, General Surgery, L.L.C.TennesseeSaint Francis Medical Specialists, L.L.C.TennesseeSaint Francis Surgical Associates, L.L.C.TennesseeSaint Vincent Healthcare System, Inc.DelawareSaint Vincent Hospital, L.L.C.Massachusetts 12 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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P.CaliforniaSan Ramon Regional Medical Center, LLCDelawareSan Ramon Surgery Center, L.L.C.CaliforniaSCHC Pediatric Anesthesia Associates, L.L.C.PennsylvaniaSCHC Pediatric Associates, L.L.C.PennsylvaniaSelma Carlson, Inc.CaliforniaSFMP, Inc.TennesseeSFMPE - Crittenden, L.L.C.ArkansasSheffield Educational Fund, Inc.GeorgiaShelby Baptist Affinity, LLCAlabamaShelby Baptist Ambulatory Surgery Center, LLCAlabamaSHL/O Corp.DelawareSierra Providence Healthcare EnterprisesTexasSierra Providence Health Network, Inc.TexasSierra Vista Hospital, Inc.CaliforniaSL-HLC, Inc.MissouriSLH Physicians, L.L.C.MissouriSLH Vista, Inc.MissouriSLUH Anesthesia Physicians, L.L.C.MissouriSMSJ Tucson Holdings, LLCDelawareSouth Carolina East Cooper Surgical Specialists, L.L.C.South CarolinaSouth Carolina Health Services, Inc.South CarolinaSouth Carolina SeWee Family Medicine, L.L.C.South CarolinaSouth Fulton Health Care Centers, Inc.DelawareSouthCare Physicians Group Neurology, L.L.C.GeorgiaSouthCare Physicians Group Obstetrics & Gynecology, L.L.C.GeorgiaSoutheast Michigan Physicians’ Insurance CompanyMichiganSouthern Orthopedics and Sports Medicine, L.L.C.South CarolinaSouthern States Physician Operations, Inc.North CarolinaSouthwest Children's Hospital, LLCDelawareSpalding GI, L.L.C.GeorgiaSpalding Health System, L.L.C.GeorgiaSpalding Regional Ambulatory Surgery Center, L.L.C.GeorgiaSpalding Regional Medical Center, Inc.GeorgiaSpalding Regional OB/GYN, L.L.C.GeorgiaSpalding Regional Physician Services, L.L.C.GeorgiaSpalding Regional Urgent Care Center at Heron Bay, L.L.C.GeorgiaSpringfield Service Holding CorporationDelaware 13 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.SRRMC Management, Inc.DelawareSSC Holdings, L.L.C.CaliforniaStChris Care at Northeast Pediatrics, L.L.C.PennsylvaniaSt. Chris Onsite Pediatric Partners, L.L.CPennsylvaniaSt. Christopher's Pediatric Urgent Care Center - Allentown, L.L.CPennsylvaniaSt. Christopher's Pediatric Urgent Care Center, L.L.C.PennsylvaniaSt. Louis University Hospital Ambulatory Surgery Center, L.L.C.MissouriSt. Louis Urgent Care #2, L.L.C.MissouriSt. Louis Urgent Care #3, L.L.C.MissouriSt. Mary’s Medical Center, Inc.FloridaSt. Mary's Levee Company, LLCArizonaSunrise Medical Group I, L.L.C.FloridaSunrise Medical Group II, L.L.C.FloridaSunrise Medical Group IV, L.L.C.FloridaSunrise Medical Group VI, L.L.C.FloridaSurgical & Bariatric Associates of Atlanta Medical Center, L.L.C.GeorgiaSurgical Clinical Excellence at Desert Regional, LLCCaliforniaSurgical Services Co-Management Collaborative @ JFK Memorial Hospital, L.L.C.CaliforniaSutton Road Pediatrics, L.L.C.South CarolinaSylvan Grove Hospital, Inc.GeorgiaSyndicated Office Systems, LLCCaliforniaT.I. GPO, Inc.NevadaTate Surgery Center, L.L.C.North CarolinaTenet California, Inc.DelawareTenetCare Frisco, Inc.TexasTenet Central Carolina Physicians, Inc.North CarolinaTenet Claremont Family Medicine, L.L.C.North CarolinaTenet DISC Imaging, Inc.South CarolinaTenet EKG, Inc.TexasTenet El Paso, Ltd.TexasTenet Employment, Inc.TexasTenet EMS/Spalding 911, LLCGeorgiaTenet Finance Corp.DelawareTenet Florida, Inc.DelawareTenet Florida Physician Services II, L.L.C.FloridaTenet Florida Physician Services III, L.L.C.FloridaTenet Florida Physician Services, L.L.C.FloridaTenet Fort Mill, Inc.South CarolinaTenet Frisco, Ltd.TexasTenet Healthcare - Florida, Inc.Florida 14 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. 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Past financial performance is no guarantee of future results.Tenet HealthSystem Bucks County, L.L.C.PennsylvaniaTenet HealthSystem City Avenue, L.L.C.PennsylvaniaTenet HealthSystem Elkins Park, L.L.C.PennsylvaniaTenet HealthSystem Graduate, L.L.C.PennsylvaniaTenet HealthSystem Hahnemann, L.L.C.PennsylvaniaTenet HealthSystem Medical, Inc.DelawareTenet HealthSystem Memorial Medical Center, Inc.LouisianaTenet HealthSystem Nacogdoches ASC GP, Inc.TexasTenet HealthSystem Parkview, L.L.C.PennsylvaniaTenet HealthSystem Philadelphia, Inc.PennsylvaniaTenet HealthSystem Roxborough, LLCPennsylvaniaTenet HealthSystem Roxborough MOB, LLCPennsylvaniaTenet HealthSystem St. Christopher's Hospital for Children, L.L.C.PennsylvaniaTenet Hilton Head Heart, L.L.C.South CarolinaTenet Home Services, L.L.C.PennsylvaniaTenet Hospitals LimitedTexasTenet Medical Equipment Services, L.L.C.PennsylvaniaTenet Network Management, Inc.FloridaTenet Physician Resources, LLCDelawareTenet Physician Services - Hilton Head, Inc.South CarolinaTenet Rehab Piedmont, Inc.South CarolinaTenet Relocation Services, L.L.C.TexasTenet SC East Cooper Hospitalists, L.L.C.South CarolinaTenet South Carolina Gastrointestinal Surgical Specialists, L.L.C.South CarolinaTenet South Carolina Island Medical, L.L.C.South CarolinaTenet South Carolina Lowcountry OB/GYN, L.L.C.South CarolinaTenet South Carolina Mt. Pleasant OB/GYN, L.L.C.South CarolinaTenet Unifour Urgent Care Center, L.L.C.North CarolinaTenet Ventures, Inc.DelawareTexas Regional Medical Center, LLCTexasTFPS IV, L.L.C.FloridaTFPS V, L.L.C.FloridaTH Healthcare, Ltd.TexasTotal Accountable Care Organization, LLCDelawareTotal Health PPO, Inc.TexasTPR - The Physician Recruiters, LLCDelawareTPS II of PA, L.L.C.PennsylvaniaTPS III of PA, L.L.C.PennsylvaniaTPS IV of PA, L.L.C.PennsylvaniaTPS of PA, L.L.C.Pennsylvania 15 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.TPS V of PA, L.L.C.PennsylvaniaTPS VI of PA, L.L.C.PennsylvaniaTRMC Holdings, LLCTexasTucson Hospital Holdings, Inc.DelawareTucson Physician Group Holdings, LLCDelawareTurlock Imaging Services, LLCCaliforniaTurlock Land Company, LLCCaliforniaTwin Cities Community Hospital, Inc.CaliforniaUnifour Neurosurgery, L.L.C.North CarolinaUnited Patient Financing, Inc.DelawareUniversal Medical Care Center, L.L.C.FloridaUrgent Care Centers of Arizona, LLCArizonaU.S. Center for Sports Medicine, LLCMissouriUSPE Financing LimitedN/AUSPI Holding Company, Inc.DelawareUSVI Health and Wellness, Inc.St. CroixValley Baptist Lab Services, LLCTexasValley Baptist Physician Performance NetworkTexasValley Baptist Realty Company, LLCDelawareValley Baptist Wellness Center, LLCTexasValley Health Care NetworkTexasVanguard Health Financial Company, LLCDelawareVanguard Health Holding Company I, LLCDelawareVanguard Health Holding Company II, LLCDelawareVanguard Health Management, Inc.DelawareVanguard Health Systems, Inc.DelawareVanguard Holding Company I, Inc.DelawareVanguard Holding Company II, Inc.DelawareVanguard Home Care, LLCIllinoisVanguard Medical Specialists, LLCDelawareVanguard Physician Services, LLCDelawareVB Brownsville IMP ASC, LLCTexasVB Brownsville LTACH, LLCTexasVBOA ASC GP, LLCTexasVBOA ASC Partners, L.P.TexasVHM Services, Inc.MassachusettsVHS Acquisition CorporationDelawareVHS Acquisition Partnership Number 1, L.PDelaware 2.Subsidiaries of this entity, in which the Registrant indirectly holds a 50.1% ownership interest, are set forth in the tablebelow.16 2Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.VHS Acquisition Subsidiary Number 1, Inc.DelawareVHS Acquisition Subsidiary Number 2, Inc.DelawareVHS Acquisition Subsidiary Number 3, Inc.DelawareVHS Acquisition Subsidiary Number 4, Inc.DelawareVHS Acquisition Subsidiary Number 5, Inc.DelawareVHS Acquisition Subsidiary Number 6, Inc.DelawareVHS Acquisition Subsidiary Number 7, Inc.DelawareVHS Acquisition Subsidiary Number 8, Inc.DelawareVHS Acquisition Subsidiary Number 9, Inc.DelawareVHS Acquisition Subsidiary Number 10, Inc.DelawareVHS Acquisition Subsidiary Number 11, Inc.DelawareVHS Acquisition Subsidiary Number 12, Inc.DelawareVHS Arizona Heart Institute, Inc.DelawareVHS Brownsville Hospital Company, LLCDelawareVHS Chicago Market Procurement, LLCDelawareVHS Children's Hospital of Michigan, Inc.DelawareVHS Detroit Businesses, Inc.DelawareVHS Detroit Receiving Hospital, Inc.DelawareVHS Detroit Ventures, Inc.DelawareVHS Harlingen Hospital Company, LLCDelawareVHS Harper-Hutzel Hospital, Inc.DelawareVHS Holding Company, Inc.DelawareVHS Huron Valley-Sinai Hospital, Inc.DelawareVHS Imaging Centers, Inc.DelawareVHS New England Holding Company I, Inc.DelawareVHS of Anaheim, Inc.DelawareVHS of Arrowhead, Inc.DelawareVHS of Huntington Beach, Inc.DelawareVHS of Illinois, Inc.DelawareVHS of Michigan, Inc.DelawareVHS of Michigan Staffing, Inc.DelawareVHS of Orange County, Inc.DelawareVHS of Phoenix, Inc.DelawareVHS of South Phoenix, Inc.DelawareVHS Outpatient Clinics, Inc.DelawareVHS Phoenix Health Plan, Inc.DelawareVHS Physicians of MichiganMichiganVHS Rehabilitation Institute of Michigan, Inc.DelawareVHS San Antonio Partners, LLCDelawareVHS Sinai-Grace Hospital, Inc.Delaware 17 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. VHS University Laboratories, Inc.DelawareVHS Valley Health System, LLCDelawareVHS Valley Holdings, LLCDelawareVHS Valley Management Company, Inc.DelawareVHS West Suburban Medical Center, Inc.DelawareVHS Westlake Hospital, Inc.DelawareViewmont Internal Medicine - Tenet North Carolina, L.L.C.North CarolinaV-II Acquisition Co., Inc.PennsylvaniaWalker Baptist Affinity, LLCAlabamaWatermark Physician Services, Inc.IllinoisWest Boca Health Services, L.L.C.FloridaWest Boca Medical Center, Inc.FloridaWest Boynton Urgent Care, L.L.C.FloridaWest Palm Healthcare Real Estate, Inc.FloridaWest Suburban Radiation Therapy Center, LLCDelawareWilshire Rental Corp.DelawareYosemite Medical Clinic, Inc.California Subsidiaries of USPI Holding Company, Inc.Name of EntityState or OtherJurisdiction ofFormation12 Avenue Real Estate, LPTexas25 East Same Day Surgery, L.L.C.IllinoisAdvanced Ambulatory Surgical Care, L.P.MissouriAdvanced Surgical Concepts, LLCLouisianaAdventist Midwest Health/USP Surgery Centers, L.L.C.IllinoisAIG Holdings, LLCTexasAIGB Austin, L.P.TexasAIGB Global, LLCTexasAIGB Group, Inc.DelawareAIGB Holdings, Inc.DelawareAIGB Management Services, LLCTexasAlabama Digestive Health Endoscopy Center, L.L.C.AlabamaAlamo Heights Surgicare, L.P.TexasAlliance Greenville Texas General Partner, LLCDelawareAlliance Sterling Ridge, L.P.DelawareAlliance Surgery Birmingham, LLCDelawareAlliance Surgery, Inc.Delaware18 thSource: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Ambulatory Surgical Associates, LLCTennesseeAmbulatory Surgical Center of Somerville, LLCNew JerseyThe Ambulatory Surgical Center of St. Louis, L.P.MissouriAmerican Institute of Gastric Banding Phoenix, Limited PartnershipArizonaAmerican Institute of Gastric Banding, Ltd.TexasAnaheim Hills Medical Imaging, L.L.C.CaliforniaAnesthesia Partners of Gallatin, LLCTennesseeAnesthesia Partners of Oklahoma, LLCOklahomaAPNTexasARC Worcester Center L.P.TennesseeArlington Orthopedic and Spine Hospital, LLCTexasArlington Surgicare Partners, Ltd.TexasArrowhead Endoscopy and Pain Management Center, LLCDelawareASC Coalition, Inc.DelawareASJH Joint Venture, LLCArizonaAvita/USP Surgery Centers, L.L.C.OhioBagley Holdings, LLCOhioBaptist Plaza Surgicare, L.P.TennesseeBaptist Surgery Center, L.P.TennesseeBaptist Women's Health Center, LLCTennesseeBaptist/USP Surgery Centers, L.L.C.TexasBaylor Surgicare at Ennis, LLCTexasBaylor Surgicare at Granbury, LLCTexasBaylor Surgicare at Mansfield, LLCTexasBaylor Surgicare at North Dallas, LLCTexasBaylor Surgicare at Plano Parkway, LLCTexasBaylor Surgicare at Plano, LLCTexasBeaumont Surgical Affiliates, Ltd.TexasBellaire Outpatient Surgery Center, L.L.P.TexasBloomington ASC, LLCIndianaBluffton Okatie Surgery Center, L.L.C.South CarolinaBon Secours Surgery Center at Harbour View, LLCVirginiaBon Secours Surgery Center at Virginia Beach, LLCVirginiaBremner Duke/Mary Shiels Development, L.P.IndianaBriarcliff Ambulatory Surgery Center, L.P.MissouriBrookwood Baptist Health 3, LLCDelawareBrookwood Diagnostic Imaging Center, LLCDelawareBrookwood Women's Diagnostic Center, LLCDelawareCamp Lowell Surgery Center, L.L.C.ArizonaCascade Spine Center, LLCDelaware19 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Castle Rock Surgery Center, LLCColoradoCedar Park Surgery Center, L.L.P.TexasCentennial ASC, L.P.TexasThe Center for Ambulatory Surgical Treatment, L.P.CaliforniaCentral Jersey Surgery Center, LLCGeorgiaCentral Virginia Surgi-Center, L.P.VirginiaChandler Endoscopy Ambulatory Surgery Center, LLCArizonaChattanooga Pain Management Center, LLCDelawareChesterfield Ambulatory Surgery Center, L.P.MissouriChesterfield Anesthesia Associates of Missouri, LLCMissouriChico Surgery Center, L.P.CaliforniaThe Christ Hospital Spine Surgery Center, LLCOhioCHRISTUS Cabrini Surgery Center, L.L.C.LouisianaClarkston ASC Partners, LLCMichiganClarksville Surgery Center, LLCTennesseeCoast Surgery Center, L.P.CaliforniaConroe Surgery Center 2, LLCTexasCoral Ridge Outpatient Center, LLCFloridaCorpus Christi Surgicare, Ltd.TexasCreekwood Surgery Center, L.P.MissouriCrown Point Surgery Center, LLCColoradoCS/USP General Partner, LLCTexasCS/USP Surgery Centers, LPTexasDallas Surgical Partners, LLCTexasDenton Surgicare Partners, Ltd.TexasDenton Surgicare Real Estate, Ltd.TexasDenville Surgery Center, LLCNew JerseyDesert Ridge Outpatient Surgery, LLCArizonaDesoto Surgicare Partners, Ltd.TexasDestin Surgery Center, LLCFloridaDH UAP, LLCTexasDH/USP SJOSC Investment Company, L.L.C.ArizonaDignity/USP Folsom GP, LLCCaliforniaDignity/USP Grass Valley GP, LLCCaliforniaDignity/USP Las Vegas Surgery Centers, LLCNevadaDignity/USP Metro Surgery Center, LLCArizonaDignity/USP NorCal Surgery Centers, LLCCaliforniaDignity/USP Phoenix Surgery Centers II, LLCArizonaDignity/USP Phoenix Surgery Centers, LLCArizonaDignity/USP Redding GP, LLCCalifornia20 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Dignity/USP Roseville GP, LLCCaliforniaDoctors Outpatient Surgery Center of Jupiter, L.L.C.FloridaDoctors Outpatient Surgicenter, Ltd.TexasDreamland UAP Anesthesia, LLCMissouriEast Portland Surgery Center, LLCOregonEast West Surgery Center, L.P.GeorgiaEastgate Building Center, L.L.C.OhioEffingham Surgical Partners, LLCIllinoisEinstein Montgomery Surgery Center, LLCPennsylvaniaEinstein/USP Surgery Centers, L.L.C.PennsylvaniaEl Mirador Surgery Center, L.L.C.CaliforniaEl Paso Day Surgery, LLCTexasElite Anesthesia, LLCArizonaEncinitas Endoscopy Center, LLCCaliforniaEndoscopy Center of Hackensack, LLCNew JerseyEndoscopy Consultants, LLCGeorgiaEye Center of Nashville UAP, LLCTennesseeEye Surgery Center of Nashville, LLCTennesseeFlatirons Surgery Center, LLCColoradoFolsom Outpatient Surgery Center, L.P.CaliforniaFort Worth Hospital Real Estate, LPTexasFort Worth Surgicare Partners, Ltd.TexasFPN - Frisco Physicians NetworkTexasFranklin Endo UAP, LLCTennesseeFranklin Endoscopy Center, LLCTennesseeFrisco Medical Center, L.L.P.TexasFrontenac Ambulatory Surgery & Spine Care Center, L.P.MissouriGallatin Physician Realty Partners, LLCTennesseeGamma Surgery Center, LLCDelawareGarland Surgicare Partners, Ltd.TexasGateway Endoscopy Center, L.P.MissouriGCSA Ambulatory Surgery Center, LLCTexasGenesis ASC Partners, LLCMichiganGeorgia Endoscopy Center, LLCGeorgiaGeorgia Musculoskeletal Network, Inc.GeorgiaGeorgia Spine Surgery Center, LLCDelawareGLS UAP Sugarland, LLCTexasGrapevine Surgicare Partners, Ltd.TexasGrass Valley Outpatient Surgery Center, L.P.CaliforniaGreenville Physicians Surgery Center, LLP Texas21 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Greenwood ASC, LLCDelawareHacienda Outpatient Surgery Center, LLCCaliforniaHarvard Park Surgery Center, LLCColoradoHazelwood Endoscopy Center, LLCMissouriHCH/USP Surgery Centers, LLCFloridaHCN Surgery Center Holdings, Inc. DelawareHealth Horizons of Kansas City, Inc.TennesseeHealth Horizons of Murfreesboro, Inc.TennesseeHealth Horizons/Piedmont Joint Venture, LLCTennesseeHealthmark Partners, Inc.DelawareHeritage Park Surgical Hospital, LLCTexasHershey Outpatient Surgery Center, L.P.PennsylvaniaHinsdale Surgical Center, LLCIllinoisHMHP/USP Surgery Centers, LLCOhioHouston Ambulatory Surgical Associates, L.P.TexasHouston PSC, L.P.TexasHUMC/USP Surgery Centers, LLCNew JerseyHyde Park Surgery Center, LLCTexasICNU Rockford, LLCIllinoisImplant Solutions, LLCTennesseeIrving-Coppell Surgical Hospital, L.L.P.TexasJackson Surgical Center, LLCNew JerseyJFP UAP Sugarland, LLCTexasKHS Ambulatory Surgery Center LLCNew JerseyKHS/USP Surgery Centers, LLCNew JerseyLake Lansing ASC Partners, LLCMichiganLake Surgical Hospital Slidell, LLCLouisianaLakewood Surgery Center, LLCDelawareLansing ASC Partners, LLCMichiganLawrenceville Surgery Center, L.L.C.GeorgiaLebanon Endoscopy Center, LLCTennesseeLee's Summit Endo UAP, LLCMissouriLegacy Warren Partners, L.P.TexasLegacy/USP Surgery Centers, L.L.C.OregonLewisville Surgicare Partners, Ltd.TexasLiberty Ambulatory Surgery Center, L.P.MissouriLiberty Ambulatory Surgery Center, LLCNew JerseyLiberty/USP Surgery Centers, L.L.C.New JerseyLone Star Endoscopy Center, LLCTexasMagnetic Resonance Imaging of San Luis Obispo, Inc.California22 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Magnolia Surgery Center Limited PartnershipDelawareManchester Ambulatory Surgery Center, LPMissouriMary Immaculate Ambulatory Surgery Center, LLCVirginiaMASC Partners, LLCMissouriMason Ridge Ambulatory Surgery Center, L.P.MissouriMcLaren ASC of Flint, LLCMichiganMCSH Real Estate Investors, Ltd.TexasMedical House Staffing, LLCTexasMedical Park Tower Surgery Center, LLCTexasMedplex Outpatient Surgery Center, Ltd.AlabamaMedstar Surgery Center at Brandywine, LLCMarylandMEDSTAR/USP Surgery Centers, L.L.C.MarylandMemorial Hermann Bay Area Endoscopy Center, LLCTexasMemorial Hermann Endoscopy & Surgery Center North Houston, L.L.C.TexasMemorial Hermann Endoscopy Center North Freeway, LLCTexasMemorial Hermann Specialty Hospital Kingwood, L.L.C.TexasMemorial Hermann Sugar Land Surgical Hospital, L.L.P.TexasMemorial Hermann Surgery Center - The Woodlands, LLPTexasMemorial Hermann Surgery Center Katy, LLPTexasMemorial Hermann Surgery Center Kingsland, L.L.C.TexasMemorial Hermann Surgery Center Kirby, LLCTexasMemorial Hermann Surgery Center Memorial City, L.L.C.TexasMemorial Hermann Surgery Center Northwest LLPTexasMemorial Hermann Surgery Center Pinecroft, LLCTexasMemorial Hermann Surgery Center Preston Road, Ltd.TexasMemorial Hermann Surgery Center Richmond, LLCTexasMemorial Hermann Surgery Center Southwest, L.L.P.TexasMemorial Hermann Surgery Center Sugar Land, LLPTexasMemorial Hermann Surgery Center Texas Medical Center, LLPTexasMemorial Hermann Surgery Center Woodlands Parkway, LLCTexasMemorial Hermann Texas International Endoscopy Center, LLCTexasMemorial Hermann West Houston Surgery Center, LLCTexasMemorial Hermann/USP Surgery Centers II, L.P.TexasMemorial Hermann/USP Surgery Centers III, LLPTexasMemorial Hermann/USP Surgery Centers IV, LLPTexasMemorial Hermann/USP Surgery Centers, LLPTexasMemorial Surgery Center, LLCOklahomaMercy/USP Health Ventures, L.L.C.IowaMetro Surgery Center, LLCDelawareMetrocrest Surgery Center, L.P.Texas23 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Metroplex Surgicare Partners, Ltd.TexasMetropolitan New Jersey, LLCNew JerseyMH Memorial City Surgery, LLCTexasMH/USP Bay Area, LLCTexasMH/USP Kingsland, LLCTexasMH/USP Kingwood, LLCTexasMH/USP Kirby, LLCTexasMH/USP North Freeway, LLCTexasMH/USP North Houston, LLCTexasMH/USP Richmond, LLCTexasMH/USP Sugar Land, LLCTexasMH/USP TMC Endoscopy, LLCTexasMH/USP West Houston, L.L.C.TexasMH/USP Woodlands Parkway, LLCTexasMichigan ASC Partners, L.L.C.MichiganMid Rivers Ambulatory Surgery Center, L.P.MissouriMid State Endo UAP, LLCTennesseeMiddle Tennessee Ambulatory Surgery Center, L.P.DelawareMidland Memorial/USP Surgery Centers, LLCTexasMidland Texas Surgical Center, LLCTexasMid-State Endoscopy Center, LLCTennesseeMid-TSC Development, LPTexasMidwest Digestive Health Center, LLCMissouriMillennium Surgical Center, LLCNew JerseyModesto Radiology Imaging, Inc.CaliforniaMountain Empire Surgery Center, L.P.GeorgiaMSH Partners, LLCTexasMurdock Ambulatory Surgery Center, LLCFloridaNational Imaging Center Holdings, Inc.DelawareNational Surgery Center Holdings, Inc.DelawareNatsurg JV, LLCMissouriNew Horizons Surgery Center, LLCOhioNew Mexico Orthopaedic Surgery Center, L.P.GeorgiaNewhope Imaging Center, Inc.CaliforniaNICH GP Holdings, LLCDelawareNKCH/USP Briarcliff GP, LLCMissouriNKCH/USP Liberty GP, LLCMissouriNKCH/USP Surgery Centers II, L.L.C.MissouriNKCH/USP Surgery Centers, LLCMissouriNMC Surgery Center, L.P.Texas24 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. North Anaheim Surgery Center, LLCCaliforniaNorth Central Surgical Center, L.L.P.TexasNorth Garland Surgery Center, L.L.P. TexasNorth Haven Surgery Center, LLCConnecticutNorth Shore Same Day Surgery, L.L.C.IllinoisNorth State Surgery Centers, L.P.CaliforniaNorthern Monmouth Regional Surgery Center, L.L.C.New JerseyNorthridge Surgery Center, L.P.TennesseeNorthShore/USP Surgery Centers II, L.L.C.IllinoisNorthwest Ambulatory Surgery Center, LLCOregonNorthwest Georgia Orthopaedic Surgery Center, LLCGeorgiaNorthwest Regional ASC, LLCDelawareNorthwest Surgery Center, LLPTexasNorthwest Surgery Center, Ltd.TexasNSCH GP Holdings, LLCDelawareNSCH/USP Desert Surgery Centers, L.L.C.DelawareOCOMS Imaging, LLCOklahomaOCOMS Professional Services, LLCOklahomaOklahoma Center for Orthopedic and Multi-Specialty Surgery, LLCOklahomaOld Tesson Surgery Center, L.P.MissouriOlive Ambulatory Surgery Center, L.P.MissouriOLOL Pontchartrain Surgery Center, LLCLouisianaOLOL/USP Surgery Centers, L.L.C.TexasOrlando Health/USP Surgery Centers, L.L.C.FloridaOrthoLink ASC CorporationTennesseeOrthoLink Physicians CorporationDelawareOrthoLink Radiology Services CorporationTennesseeOrthoLink/ Georgia ASC, Inc.GeorgiaOrthoLink/Baptist ASC, LLCTennesseeOrthoLink/New Mexico ASC, Inc.GeorgiaOrthopedic and Surgical Specialty Company, LLCArizonaOrthopedic South Surgical Partners, LLCGeorgiaThe Outpatient Center, LLCFloridaPacific Endoscopy and Surgery Center, LLCCaliforniaPacific Endo-Surgical Center, L.P.CaliforniaPAHS/USP Surgery Centers, LLCColoradoPain Diagnostic and Treatment Center, L.P.CaliforniaPain Treatment Centers of Michigan, LLCDelawareParamus Endoscopy, LLCNew JerseyPark Cities Surgery Center, LLCTexas25 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Park Place Investor Group, L.P.TexasParkway Recovery Care Center, LLCNevadaParkway Surgery Center, LLCNevadaParkwest Surgery Center, L.P.TennesseePatient Partners, LLCTennesseePearland Ambulatory Surgery Center, LPTennesseePediatric Surgery Center - Odessa, LLCFloridaPediatric Surgery Centers, LLCFloridaThe Physicians' Center, L.P.TexasPhysicians Pavilion, L.P.DelawarePhysicians Surgery Center at Good Samaritan, LLCIllinoisPhysician's Surgery Center of Chattanooga, L.L.C. TennesseePhysician's Surgery Center of Knoxville, LLCTennesseePhysicians Surgical Center of Ft. Worth, LLPTexasPleasanton Diagnostic Imaging, Inc.CaliforniaProvidence/USP Santa Clarita GP, LLCCaliforniaProvidence/USP South Bay Surgery Centers, L.L.C.CaliforniaProvidence/USP Surgery Centers, L.L.C.CaliforniaPure Reference Laboratory, LLCTexasRadsource, LLCDelawareRE Plano Med, Inc.TexasReading Ambulatory Surgery Center, L.P.PennsylvaniaReading Endoscopy Center, LLCDelawareReagan Street Surgery Center, LLCCaliforniaRedmond Surgery Center, LLCTennesseeResurgens Surgery Center, LLCGeorgiaRichmond ASC Leasing Company, LLCVirginiaRiver North Same Day Surgery, L.L.C.IllinoisRiverside Ambulatory Surgery Center, LLCMissouriRock Hill Surgery Center, L.P.South CarolinaRockwall Ambulatory Surgery Center, L.L.P.TexasRockwall/Heath Surgery Center, L.L.P.TexasRoseville Surgery Center, L.P.CaliforniaRoswell Surgery Center, L.L.C.GeorgiaSacramento Midtown Endoscopy Center, LLCCaliforniaSaint Francis Surgery Center, L.L.C.TennesseeSaint Thomas Campus Surgicare, L.P.TennesseeSaint Thomas/USP - Baptist Plaza, L.L.C.TennesseeSaint Thomas/USP Surgery Centers II, LLCTennesseeSaint Thomas/USP Surgery Centers, L.L.C.Tennessee26 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Same Day Management, L.L.C.IllinoisSame Day Surgery, L.L.C.IllinoisSan Antonio Endoscopy, L.P.TexasSan Fernando Valley Surgery Center, L.P.CaliforniaSan Gabriel Valley Surgical Center, L.P.CaliforniaSan Martin Surgery Center, LLCNevadaSan Ramon Network Joint Venture, LLCDelawareSanta Clarita Surgery Center, L.P.CaliforniaScripps Encinitas Surgery Center, LLCCaliforniaScripps/USP Surgery Centers, L.L.C.CaliforniaShore Outpatient Surgicenter, L.L.C.GeorgiaShoreline Real Estate Partnership, LLPTexasShoreline Surgery Center, LLPTexasShrewsbury Surgery Center, LLCNew JerseySilicon Valley Outpatient Surgery Centers, LLCCaliforniaSiouxland Surgery Center Limited Liability PartnershipIowaSKV UAP Sugarland, LLCTexasSLPA ACO, LLCMissouriSouth County Outpatient Endoscopy Services, L.P.MissouriSouth Denver Musculoskeletal Surgical Partners, LLCColoradoThe Southeastern Spine Institute Ambulatory Surgery Center, L.L.C.South CarolinaSouth Florida Ambulatory Surgical Center, LLCFloridaSouthwest Ambulatory Surgery Center, L.L.C.OklahomaSouthwest Orthopedic and Spine Hospital Real Estate, LLCDelawareSouthwest Orthopedic and Spine Hospital, LLCArizonaSouthwestern Ambulatory Surgery Center, LLCPennsylvaniaSPC at the Star, LLCTexasSpecialty Surgery Center of Fort Worth, L.P.TexasSpecialty Surgicenters, Inc.GeorgiaSpinal Diagnostics and Treatment Centers, L.L.C.CaliforniaSSI Holdings, Inc.GeorgiaSSM St. Clare Surgical Center, L.L.C.MissouriSt. Joseph's Outpatient Surgery Center, LLCArizonaSt. Joseph’s Surgery Center, L.P.CaliforniaSt. Louis Physician Alliance, LLCMissouriSt. Louis Surgical Center, LCMissouriSt. Luke's/USP Surgery Centers, LLCMissouriSt. Mary's Ambulatory Surgery Center, LLCVirginiaSt. Mary's Surgical Center, LLCMissouriSt. Mary's/USP Surgery Centers, LLCMissouri27 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. St. Vincent Health/USP, LLCIndianaSt. Vincent/USP Surgery Centers, LLCArkansasStockton Outpatient Surgery Center, LLCCaliforniaSuburban Endoscopy Center, LLCNew JerseySummit View Surgery Center, LLCColoradoSun View Imaging, L.L.C.New MexicoSurgery Affiliate of El Paso, LLCTexasSurgery Center at University Park, LLCFloridaSurgery Center of Atlanta, LLCGeorgiaSurgery Center of Canfield, LLCOhioSurgery Center of Columbia, L.P.MissouriSurgery Center of Gilbert, L.L.C.ArizonaThe Surgery Center at Jensen Beach, LLCFloridaThe Surgery Center at Williamson, LLCTexasSurgery Center of Okeechobee, LLCFloridaSurgery Center of Pembroke Pines, L.L.C.FloridaSurgery Center of Peoria, L.L.C.OklahomaSurgery Center of Richardson Physician Partnership, L.P.TexasSurgery Center of Santa Barbara, LLCCaliforniaSurgery Center of Scottsdale, LLCOklahomaSurgery Center of Tempe Real Estate, L.L.C.ArizonaSurgery Center of Tempe, LLCOklahomaSurgery Centers of America II, L.L.C.OklahomaSurgical Elite of Avondale, L.L.C.ArizonaSurgical Health Partners, LLCTennesseeSurgical Institute Management, LLCPennsylvaniaSurgical Institute of Reading, LLCPennsylvaniaSurgical Institute of Viewmont, LLCNorth CarolinaSurgical Specialists at Princeton, LLCNew JerseySurgicare of Miramar, L.L.C.FloridaSurgiCenter of Baltimore, LLPMarylandSurginet, Inc.TennesseeSurgis Management Services, Inc.TennesseeSurgis of Chico, Inc.TennesseeSurgis of Phoenix, Inc.TennesseeSurgis of Redding, Inc.TennesseeSurgis of Victoria, Inc.TennesseeSurgis, Inc.DelawareTamarac Surgery Center, LLCFloridaTCH/USP Surgery Centers, LLCOhio28 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. Tempe New Day Surgery Center, L.P.TexasTempleton Imaging, Inc.CaliforniaTENN SM, LLCTennesseeTerre Haute Surgical Center, LLCIndianaTeton Outpatient Services, LLCWyomingTexan Ambulatory Surgery Center, L.P.TexasTexas Endoscopy Centers, LLCTexasTexas Health Venture Arlington Hospital, LLCTexasTexas Health Venture Carrollton, LLCTexasTexas Health Venture Ennis, LLCTexasTexas Health Venture Fort Worth, L.L.C.TexasTexas Health Venture Granbury, LLCTexasTexas Health Venture Heritage Park, LLCTexasTexas Health Venture Keller, LLCTexasTexas Health Venture Las Colinas, LLCTexasTexas Health Venture Mansfield, LLCTexasTexas Health Venture Plano Endo, LLCTexasTexas Health Venture Plano Parkway, LLCTexasTexas Health Venture Plano, LLCTexasTexas Health Ventures Group L.L.C.TexasTexas Orthopedics Surgery Center, LLCTexasTheda Oaks Gastroenterology & Endoscopy Center, LLCTexasTHV Park Cities, LLCTexasTHVG Arlington GP, LLCDelawareTHVG Bariatric GP, LLCTexasTHVG Bariatric, L.L.C.TexasTHVG Bedford GP, LLCDelawareTHVG Bellaire GP, LLCDelawareTHVG Denton GP, LLCDelawareTHVG DeSoto GP, LLCDelawareTHVG DSP GP, LLCDelawareTHVG Fort Worth GP, LLCDelawareTHVG Frisco GP, LLCDelawareTHVG Garland GP, LLCDelawareTHVG Grapevine GP, LLCDelawareTHVG Heritage Park, LLCTexasTHVG Irving-Coppell GP, LLCDelawareTHVG Lewisville GP, LLCDelawareTHVG North Garland GP, LLCDelawareTHVG Park Cities/Trophy Club GP, LLCDelaware29 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. THVG Rockwall 2 GP, LLCTexasTHVG Rockwall GP, LLCDelawareTHVG Valley View GP, LLCDelawareTitan Health CorporationDelawareTitan Health of Chattanooga, Inc.CaliforniaTitan Health of Hershey, Inc.CaliforniaTitan Health of Mount Laurel, LLCCaliforniaTitan Health of North Haven, Inc.CaliforniaTitan Health of Pittsburgh, Inc.CaliforniaTitan Health of Pleasant Hills, Inc.CaliforniaTitan Health of Princeton, Inc.CaliforniaTitan Health of Sacramento, Inc.CaliforniaTitan Health of Saginaw, Inc.CaliforniaTitan Health of Titusville, Inc.CaliforniaTitan Health of West Penn, Inc.CaliforniaTitan Health of Westminster, Inc.CaliforniaTitan Management CorporationCaliforniaTitusville Center for Surgical Excellence, LLCDelawareTLC ASC, LLCFloridaTMC Holding Company, LLCTexasToms River Surgery Center, L.L.C.New JerseyTOPS Specialty Hospital, Ltd.TexasTotal Joint Center of St. Louis, LPMissouriTower Road Real Estate, LLCTexasTP Specialty Surgery Center, L.P.TexasThe Tresanti Surgical Center, LLCCaliforniaTrophy Club Medical Center, L.P.TexasTrue Medical Weight Loss, L.P.TexasTrue Medical Wellness, LPTexasTrue Results Georgia, Inc.GeorgiaTrue Results HoldCo, LLCDelawareTrue Results Missouri, LLCMissouriTuscan Surgery Center at Las Colinas, LLCTexasTwin Cities Ambulatory Surgery Center, L.P.MissouriUAP Chattanooga Pain, LLCTennesseeUAP Cosmopolitan, LLCTexasUAP Keller Endo, LLCTexasUAP Las Colinas Endo, LLCTexasUAP Lebanon Endo, LLCTennesseeUAP Nashville Endoscopy, LLCTennessee30 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. UAP of Arizona, Inc.ArizonaUAP of California, Inc.CaliforniaUAP of Missouri, Inc.MissouriUAP of New Jersey, Inc.New JerseyUAP of Oklahoma, Inc.OklahomaUAP of Tennessee, Inc.TennesseeUAP of Texas, Inc.TexasUAP Sacramento, PCCaliforniaUAP San Antonio Endo, LLCTexasUAP Scopes, LLCMissouriUlysses True Results NewCo, LLCDelawareUnited Anesthesia Partners, Inc.DelawareUnited Real Estate Development, Inc.TexasUnited Real Estate Holdings, Inc.TexasUnited Surgical Partners Holdings, Inc.DelawareUnited Surgical Partners International, Inc.DelawareUniversity Surgery Center, Ltd.FloridaUniversity Surgical Partners of Dallas, L.L.P.TexasUpper Cumberland Physicians' Surgery Center, LLCTennesseeUSP 12th Ave Real Estate, Inc.TexasUSP Acquisition CorporationDelawareUSP Alexandria, Inc.LouisianaUSP Assurance CompanyVermontUSP Athens, Inc.GeorgiaUSP Atlanta, Inc.GeorgiaUSP Austin, Inc.TexasUSP Bariatric, LLCDelawareUSP Beaumont, Inc.TexasUSP Bergen, Inc.New JerseyUSP Bloomington, Inc.IndianaUSP Bridgeton, Inc.MissouriUSP Cedar Park, Inc.TexasUSP Chesterfield, Inc.MissouriUSP Chicago, Inc.IllinoisUSP Cincinnati, Inc.OhioUSP Coast, Inc.CaliforniaUSP Columbia, Inc.MissouriUSP Corpus Christi, Inc.TexasUSP Creve Coeur, Inc.MissouriUSP Denver, Inc.Colorado31 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. USP Des Peres, Inc.MissouriUSP Destin, Inc.FloridaUSP Domestic Holdings, Inc.DelawareUSP Effingham, Inc.IllinoisUSP Encinitas Endoscopy, Inc.CaliforniaUSP Fenton, Inc.MissouriUSP Festus, Inc.MissouriUSP Florissant, Inc.MissouriUSP Fort Lauderdale, Inc.FloridaUSP Fort Worth Hospital Real Estate, Inc.TexasUSP Fredericksburg, Inc.VirginiaUSP Frontenac, Inc.MissouriUSP Gateway, Inc.MissouriUSP Harbour View, Inc.VirginiaUSP Hazelwood, Inc.MissouriUSP Houston, Inc.TexasUSP Indiana, Inc.IndianaUSP International Holdings, Inc.DelawareUSP Jersey City, Inc.New JerseyUSP Kansas City, Inc.MissouriUSP Knoxville, Inc.TennesseeUSP Little Rock, Inc.ArkansasUSP Long Island, Inc.DelawareUSP Louisiana, Inc.LouisianaUSP Maryland, Inc.MarylandUSP Mason Ridge, Inc.MissouriUSP Mattis, Inc.MissouriUSP Merger Sub, Inc.DelawareUSP Michigan, Inc.MichiganUSP Midland Real Estate, Inc.TexasUSP Midland, Inc.TexasUSP Midwest, Inc.IllinoisUSP Mission Hills, Inc.CaliforniaUSP Morris, Inc.New JerseyUSP Mt. Vernon, Inc.IllinoisUSP Nevada Holdings, LLC NevadaUSP Nevada, Inc.NevadaUSP New Jersey, Inc.New JerseyUSP Newport News, Inc.VirginiaUSP North Kansas City, Inc.Missouri32 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. USP North Texas, Inc.DelawareUSP Northwest Arkansas, Inc.ArkansasUSP Office Parkway, Inc.MissouriUSP Ohio RE, Inc.OhioUSP Oklahoma, Inc.OklahomaUSP Olive, Inc.MissouriUSP Orlando, Inc.FloridaUSP Philadelphia, Inc.PennsylvaniaUSP Phoenix, Inc.ArizonaUSP Portland, Inc.OregonUSP Reading, Inc.PennsylvaniaUSP Richmond II, Inc.VirginiaUSP Richmond, Inc.VirginiaUSP Sacramento, Inc.CaliforniaUSP San Antonio, Inc.TexasUSP Securities Corporation TennesseeUSP Siouxland, Inc.IowaUSP Somerset, Inc.New JerseyUSP Southlake RE, Inc.TexasUSP St. Louis, Inc.MissouriUSP St. Peters, Inc.MissouriUSP Sunset Hills, Inc.MissouriUSP Tennessee, Inc.TennesseeUSP Texas Air, L.L.C.TexasUSP Texas, L.P.TexasUSP TJ STL, Inc.MissouriUSP Torrance, Inc.CaliforniaUSP Turnersville, Inc.New JerseyUSP Virginia Beach, Inc.VirginiaUSP Waxahachie Management, L.L.C.TexasUSP Webster Groves, Inc.MissouriUSP West Covina, Inc.CaliforniaUSP Westwood, Inc.CaliforniaUSP Winter Park, Inc.FloridaUSP/SOS Joint Venture, LLCOklahomaUSPI Group Holdings, Inc.DelawareUSPI Holdings, Inc.DelawareUSPI Physician Strategy Group, LLCTexasUSPI San Diego, Inc.CaliforniaUSPI Stockton, Inc.California33 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results. USPI Surgical Services, Inc.DelawareUtica ASC Partners, LLCMichiganUtica/USP Tulsa, L.L.C.OklahomaVeroscan, Inc.DelawareVHS San Antonio Imaging Partners, L.P. DelawareVictoria Ambulatory Surgery Center, L.P.DelawareViewmont Surgery Center, L.L.C.North CarolinaWalker Street Imaging Care, Inc.CaliforniaWarner Park Surgery Center, L.P.ArizonaWebster Ambulatory Surgery Center, L.P.MissouriWellstar/USP Joint Venture I, LLCGeorgiaWestlake Hospital, LLCTexasWHASA, L.C.TexasWillamette Spine Center Ambulatory Surgery, LLCDelawareWinter Haven Ambulatory Surgical Center, L.L.C.Florida 34Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 23 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the incorporation by reference in Registration Statement Nos. 33-57375, 333-00709, 333-01183, 333-38299,333-41903, 333-41476, 333-41478, 333-48482, 333-74216, 333-151884, 333-151887, 333-166767, 333-166768, 333-191614, and 333-196262 on Form S-8 of our reports dated February 22, 2016, relating to (1) the consolidated financialstatements and financial statement schedule of Tenet Healthcare Corporation and subsidiaries, which report expresses anunqualified opinion and includes an explanatory paragraph regarding the adoption of and (2) the effectiveness of TenetHealthcare Corporation and subsidiaries’ internal control over financial reporting, appearing inthis Annual Report on Form 10-K of Tenet Healthcare Corporation for the year ended December 31, 2015. /s/ Deloitte & Touche LLP Dallas, TexasFebruary 22, 2016 Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 31(a) Rule 13a-14(a)/15d-14(a) Certification I, Trevor Fetter, certify that: 1.I have reviewed this annual report on Form 10-K of Tenet Healthcare Corporation (the “Registrant”); 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary tomake the statements made, in light of the circumstances under which such statements were made, not misleading with respect to theperiod covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 4.The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (asdefined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules13a-15(f) and 15d-15(f)) for the Registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designedunder our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions aboutthe effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and (d)Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’smost recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the Registrant’s internal control over financial reporting; and 5.The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing theequivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’sinternal control over financial reporting. Date: February 22, 2016 /s/ TREVOR FETTER Trevor Fetter Chief Executive Officer and Chairman of the Board of Directors Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 31(b) Rule 13a-14(a)/15d-14(a) Certification I, Daniel J. Cancelmi, certify that: 1.I have reviewed this annual report on Form 10-K of Tenet Healthcare Corporation (the “Registrant”); 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary tomake the statements made, in light of the circumstances under which such statements were made, not misleading with respect to theperiod covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 4.The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (asdefined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules13a-15(f) and 15d-15(f)) for the Registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designedunder our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions aboutthe effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and (d)Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’smost recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the Registrant’s internal control over financial reporting; and 5.The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing theequivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’sinternal control over financial reporting. Date: February 22, 2016 /s/ DANIEL J. CANCELMI Daniel J. Cancelmi Chief Financial Officer Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Exhibit 32 Certifications Pursuant to Section 1350 of Chapter 63of Title 18 of the United States Code We, the undersigned Trevor Fetter and Daniel J. Cancelmi, being, respectively, the Chief Executive Officer andChairman of the Board of Directors and the Chief Financial Officer of Tenet Healthcare Corporation (the “Registrant”), doeach hereby certify that (i) the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2015 (the“Form 10-K”), to be filed with the Securities and Exchange Commission on the date hereof, fully complies with therequirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in theForm 10-K fairly presents, in all material respects, the financial condition and results of operations of the Registrant and itssubsidiaries. Date: February 22, 2016 /s/ TREVOR FETTER Trevor Fetter Chief Executive Officer and Chairman of the Board of Directors Date: February 22, 2016 /s/ DANIEL J. CANCELMI Daniel J. Cancelmi Chief Financial Officer The foregoing certification is being furnished solely pursuant to 18 U.S.C. §1350; it is not being filed for purposesof Section 18 of the Securities Exchange Act, and is not to be incorporated by reference into any filing of the Registrant,whether made before or after the date hereof, regardless of any general incorporation language in such filing.Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.Source: TENET HEALTHCARE CORP, 10-K, February 22, 2016Powered by Morningstar® Document Research℠The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.

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