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Nonprofit hospitals at a tipping point from mounting challenges

Reuters, August 14, 2014
Small and stand-alone nonprofit hospitals are facing mounting pressure from weak operating margins and lower patient volumes, with more signals of stress on the way, according a report released Wednesday from Standard & Poor's Rating Services. The rating agency warned the healthcare sector was at "a tipping point where negative forces have started to outweigh many providers' ability to implement sufficient countermeasures." Beginning in 2013 and continuing into this year, credit downgrades outpaced upgrades at an accelerating rate. In particular, stand-alone providers are under greater pressure from physician departures, rising bad debt, and higher employee benefit costs.