Moody's Warns Healthcare Reform Could Harm Hospital Credit Ratings
Moody's wrote hospitals that are best positioned to withstand large Medicare cuts in high-cost regions will be part of multi-state systems that can rely on broader economies of scale and import cost-efficiencies from beyond their region, and those hospital systems that can gain the most new paying patients that are newly covered by health insurance.
Conversely, the most vulnerable hospitals will be those stand-alone hospitals that are dependent upon high-cost referral practices and that don't gain many new paying patients.
"The sharp regional cost differences across the U.S. highlight the local nature of healthcare markets. Unlike many industries, including higher education, which have a national customer base, hospitals typically draw more than 90% of their patients from within 50 miles of the hospital. When referrals, practices, and/or reimbursement patterns emerge within a community, they tend to stay entrenched locally because little competition exists from providers outside the region," the report noted.
John Commins is a senior editor with HealthLeaders Media.
- Half of All Primary Care, Internal Medicine Jobs Unfilled in 2013
- How Digital Strategy Shapes Patient Engagement at Boston Children's Hospital
- CFO Exchange: Smartphones Poised to Disrupt Healthcare, Says Topol
- CNO on Hospital Redesign: 'You Can't Over-Communicate'
- Some Cancer Hospitals' Quality Data Will Soon Be Public
- CA Powers Up $80M HIE to 'Create Value in the Data'
- Carondelet to Pay $35M to Settle Fraud Allegations
- TJC Warns Hospitals of Deadly Medical Tubing Mistakes
- 3 Traits Personality Assessments Can't Reveal
- PA Ranks See 'Phenomenal Growth,' Lack of Diversity