- The Washington Times - Tuesday, May 27, 2003

SANTA BARBARA, Calif. (AP) — Tenet Healthcare Corp. Chief Executive Jeffrey C. Barbakow has resigned, effective immediately, the nation’s second-largest for-profit hospital chain announced yesterday.

The company’s board of directors appointed Trevor Fetter, 43, who returned to Tenet as president in November, as acting CEO.

Tenet has been trying to regain investor confidence after it was revealed last year that the company relied more heavily than most on Medicare outlier payments. Outliers are payments to reimburse hospitals for extra care given to the sickest patients beyond fixed charges set by Medicare.

Tenet has undergone extensive changes by revamping senior management, announcing a $100 million cost-cutting plan and establishing a new policy for fair treatment of uninsured patients.

The company had announced in April that Mr. Barbakow, 59, would step down as chairman after Tenet’s annual meeting of shareholders July 23.

“As Tenet begins a new chapter in its history, I consider this step a part of my personal commitment to do anything I can to restore Tenet to its rightful place of leadership in our industry,” Mr. Barbakow said yesterday in a company news release.

A committee made up of Tenet directors is conducting a search for a permanent replacement for Mr. Barbakow; Mr. Fetter will be considered.

“It’s the right time for Tenet to have new top leadership with a demonstrated ability to address issues facing the company and restore the confidence of our investors,” said Director Edward A. Kangas. “We have a strong balance sheet, incredibly dedicated employees and a talented management team led by Trevor Fetter.”

Mr. Fetter returned to the company in the fall after serving for three years as chairman and chief executive of Broadlane Inc., which was spun off from Tenet in late 1999.

Shares of Tenet rose 59 cents, or more than 3 percent, on the news, closing at $16.47 on the New York Stock Exchange.

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