Hospital stocks managed to post a 2010 gain of 8 percent despite a sluggish economy and as lower numbers of patients as consumers delay elective procedures and have fewer babies in the downturn, the Tennessean reports.
Heading into 2011, hospitals will need to confront state cuts to Medicaid budgets. They also will see more push-back from insurers that resist paying higher rates in the face of more uncertainty related to the healthcare reform.
Sheryl Skolnick, an analyst with CRT Capital Group in Stamford, Conn., said she expects upcoming Q4 reports from hospital chains to be consistent with the first three quarters of 2010, with weak volumes "offset by strong cost control and improvements in efficiency and quality that leads to earnings in line with analysts' expectations."
Into Q3 2011, Skolnick predicts hospital systems will gear up to find new ways to deliver care more efficiently to compensate for the anticipated loss of stimulus-related increases in federal Medicaid funding.
To learn more:
- here's the Tennessean story
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