That divestiture will leave Tenet with two Philadelphia hospitals, Hahnemann University Hospital and St. Christopher's Hospital for Children. Even with its downsizing, Tenet officials say they plan to spend $800 million this year in capital improvements at their 57 remaining hospitals.

In a prepared statement, Trevor Fetter, Tenet president and CEO, says the decision to sell the three metro Philadelphia hospitals was made so that the company could focus on improving Hahnemann and St. Christopher's facilities. Tenet officials anticipate the sale of their three local hospitals may take up to a year to complete. According to industry sources, prospective buyers could include Community Health Systems of Tennessee, which owns five area hospitals; Jefferson Health System; the University of Pennsylvania Health System; and the Temple University Health System. While there is no asking price for the individual hospital dispositions, Fetter said during a conference call, "we anticipate proceeds of $250 million to $275 million in cash…once these sales are completed."

As for the company's settlement with the government, according to a statement from the US Department of Justice, several issues in its investigation, which were resolved by the settlement, arose from lawsuits filed by whistleblowers. They involved "outlier revenues," which are additional payments made to hospitals for treating the costliest Medicare cases. The government had alleged that Tenet collected more than $700 million in such payments in 2002 alone, including $108 million by its Philadelphia-area hospitals.