Hospitals represent the largest category of healthcare spending in the U.S., and their profitability will be at risk for the foreseeable future as Medicare and Medicaid are a “perennial focus of deficit reduction negotiations,” according to the report.
However, hospitals and other providers are looking at various strategies to preserve their operating and EBITDA margins. Fitch said operational strategies — increased physician employment, investment in outpatient service lines and joint ventures with other providers in the continuum of care — require “minimal capital investment” and could help credit ratings. But as capital requirements and strategic complexity increase, so does risk to a provider’s credit profile, Fitch analysts said.
To read the rest of the article, visit Becker’s Hospital Review.
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