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Moody’s: Health Reform Will Drive Consolidation, Hinder Credit for Nonprofit Hospitals
Health Leaders Media

Healthcare reform will have a long-term negative credit effect on not-for-profit hospitals, even though it will reduce bad debt expenses and charity care, Moody’s Investors Service said in a new report. “The key longer-term challenge for the not-for-profit hospital sector is the reform’s reliance on extracting long-term cost efficiencies from hospitals, probably resulting in diminished hospital revenues,” said Moody’s Vice President Mark Pascaris, author of the report, Long-term Credit Challenges of Healthcare Reform Outweigh Benefits for Not-for-Profit Hospitals. “The trend will become more pronounced over time as key provisions of the law do not become effective until 2014.”

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