logo
  Join        Login             Stock Quote

Fitch: 2014 Outlook for Nonprofit Hospitals and Healthcare Negative; Profitability Challenged

Wednesday, December 11, 2013 4:49 PM


Fitch: 2014 Outlook for Nonprofit Hospitals and Healthcare Negative; Profitability Challenged

Link to Fitch Ratings' Report: 2014 Outlook: U.S. Nonprofit Hospitals and Healthcare Systems
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=726237

The 2014 outlook for U.S. nonprofit hospitals and healthcare is negative, reflecting pressure on patient volume, continued uncertainty related to healthcare reform, and reimbursement challenges, according to a new Fitch Ratings report.

'Slowdown in revenue growth evidenced in 2013 will likely deepen in 2014, driven by the declining trend of inpatient volumes, increasing use of high-deductible health plans, the expectation for another year of Medicare sequestration cuts and lower reimbursement rate increases from both governmental and private insurers,' says Jim LeBuhn, Head of Fitch's Non-Profit Health Care group.

'Despite projected increases in the overall insured population, higher utilization may not equate to improved profitability given the general trend in the shift of services to the outpatient setting.'

The expectation for insurance coverage expansion through the federal health insurance exchange has been severely impacted by the delay and uncertainty of the federal website functionality. While the state run exchanges have had better success, the expectation that 7 million individuals will gain coverage through state and federal exchanges is highly uncertain.

Regardless of timing, Fitch believes the long-term impact to hospital providers in states not expanding Medicaid will be negative.

Given the expected pressure on volumes and reimbursement in 2014, hospital financial performance will be more impacted by management's ability and willingness to proactively control expenses, generate improved clinical efficiencies and quickly flex staffing to changes in patient volume.

Fitch expects mergers and acquisitions activity will continue to be robust, as hospitals seek partners to fulfill varying needs including improving economies of scale, expanding and deepening their market presence or bolstering service offerings across the continuum of care.

Fitch will host a conference call to discuss its 2014 Healthcare Outlook on Dec. 12th at 2:00 PM eastern.

Dial-in Numbers:
U.S. Participants: +1-877-467-8597
International Participants: +1-706-643-6296
Conference and Replay ID: 17261588
U.S. Replay: +1-855-859-2056
International Replay: +1-404-537-3406

The replay will be available for 30 days:

Fitch's special report titled '2014 Outlook: Nonprofit Hospitals and Healthcare' is available at 'www.fitchratings.com' or by clicking on the above link.

Additional information is available at 'www.fitchratings.com'.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

(Source: Business Wire )
(Source: Quotemedia)

Advertisement
Advertisement



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.