Despite stable hospital finances, pressures remain

Moody's Investors Service has declared that not-for-profit hospitals are financially stable for now, but the fiscal realities of the Affordable Care Act could darken that picture in the future.

Moody's noted most nonprofit hospital balance sheets are in good shape and their portfolios remain "highly liquid." However, equity returns have been relatively flat over the past year, portending other difficulties ahead.

"For FY 2013 and beyond, we expect lower payments for inpatient procedure from all payers and a continued shift to outpatient modalities as healthcare reform rewards hospitals that operate more efficiently and deliver high-quality care," Moody's analyst Sarah Vennekotter said yesterday in a statement.

"Reimbursement changes under reform and looming federal deficits will inevitably result in more Medicare and Medicaid reductions to hospitals on a per-patient basis," she added.

Fitch Ratings issued a similar evaluation of the not-for-profit hospital finance scene last week, Reuters reported. It noted that economies of scale will work best for those providers moving forward.

"Providers with size and scale are best positioned in the changing landscape as they have the ability to generate increased operating efficiencies and better resource allocation," Fitch Director Michael Burger said in a statement.

For more:
- here's the Moody's statement
- read the Reuters article
- read the Fitch statement