|[December 12, 2012]
Fitch: 2013 Outlook for Non-Profit Hospitals Stable Despite Mounting Pressures
CHICAGO --(Business Wire)--
Management's initiatives toward stable operating performance support a
stable outlook for nonprofit hospitals and healthcare systems in 2013,
according to a new Fitch Ratings report.
'A continued focus on operating efficiency, stable reimbursement levels,
modest managed care rate increases, and a higher than expected 2013
Medicare market basket increase all contribute to a stable landscape,'
said Jim Lebuhn, Senior Director. 'However, Fitch believes there is
increased uncertainty beyond 2013 as opportunities for further cost
cutting wane and a wave of expected reimbursement reductions are
realized under the full implementation of the Patient Protection and
Affordable Care Act (PPACA) beginning in 2014.'
Providers have been preparing for a move away from a fee-for-service
environment to one that is focused on quality and cost. The full
financial impact of PPACA remains uncertain as reduced reimbursement for
Medicare and Medicaid should be mitigated by the expanded coverage for
the uninsured through the creation of health insurance exchanges and
expansion of Medicaid eligibility.
The hospital industry is facing an automatic 2% reduction in Medicare
reimbursement beginning in January 2013 if the federal government fails
to avoid the fiscal cliff. Although any reimbursement reduction is
viewed negatively, Fitch believes hospitals should be able to absorb the
impact of the reduction since many use conservative assumptions
surrounding governmental reimbursement in their budgeting process.
Hoever, lower-rated credits are expected be affected to a greater
degree than higher-rated credits.
Fitch will host a conference call to discuss its 2013 U.S. Nonprofit
Hospitals outlook on Dec. 13th at 2pm EST.
Dial-in details are:
U.S. Participants: +1-877-467-8597
International Participants: +1-706-643-6296
Conference and Replay ID: 73935205
Replays will be available for 30 days. Replay dial-ins are accessible
using the following numbers:
U.S. Replay: +1-855-859-2056
International Replay: +1-404-537-3406
The full report, titled '2013 Outlook: Nonprofit Hospitals and
Healthcare Systems', is available on the Fitch Ratings web site at 'www.fitchratings.com'.
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research: 2013 Outlook: Nonprofit
Hospitals and Healthcare Systems
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