NEW YORK--(BUSINESS WIRE)-- Fitch Ratings' 2011 outlook for the U.S. Nonprofit Hospitals and Healthcare Systems sector is stable as Fitch-rated issuers should continue to maintain their operating margins and operating cash flow through meticulous labor management and ongoing operating efficiency initiatives. Fitch expects that affirmations will be the predominant rating action for the sector in 2011, reflecting the preponderance of high-performing borrowers in the company's portfolio compared to the overall industry.
'Throughout the recession, most of our rated nonprofit hospitals and healthcare systems adjusted their operations, expense profiles and capital spending to preserve their creditworthiness,' said Jim LeBuhn, Senior Director at Fitch. 'However, hospitals and healthcare systems will continue to face a continuing weak economy and negative pressure on reimbursement rates, which could lead to negative rating activity.'
Fitch expects the credit impacts of healthcare reform changes to be relatively modest and anticipates moderate credit benefits to be realized by many providers through closer integration with medical staffs, enhanced information technology, and improvements in quality and safety. Fitch also believes profitability pressure, capital access, and the evolution of accountable care organizations will increasingly drive merger activity in the sector, as smaller stand-alone providers come to terms with their resource limitations.
Fitch will host a teleconference on its 2011 U.S. Public Finance Healthcare outlooks on Wednesday, Jan. 26th at 2:00pm EST. Jim LeBuhn, head of the group, will lead the call along with other senior members of the team. There will be a Q&A session for participants after the analysts' presentation. Both senior living and non-profit hospitals and healthcare systems outlooks are available on Fitch's website, www.fitchratings.com.
To participate in the healthcare teleconference, interested parties should call +1-877-713-4667 (domestic) or +1-706-634-1958 (international) five minutes prior to the 2pm EST start time and give the conference ID# '39097581'.
A replay of the teleconference will be available starting two hours after the teleconference is completed and will be available until Feb. 26th close of business. To listen to the teleconference replay, participants should call +1-800-642-1687 (domestic) or +1-706-645-9291 (international). The conference ID number for the replay is '39097581'.
Fitch's special report titled '2011 Outlook: Nonprofit Hospitals and Healthcare Systems' is available on Fitch's website at 'www.fitchratings.com'.
Additional information is available at www.fitchratings.com.
Applicable Criteria and Related Research: 2011 Outlook: Nonprofit Hospitals and Healthcare Systems
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