Financial outlook is grim for not-for-profits, analyst says

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Financial outlook is grim for not-for-profits, analyst says
Financial outlook is grim for not-for-profits, analyst says

The financial outlook for not-for-profit healthcare providers will stay negative due to payment uncertainties and slow revenue growth, a Wall Street analyst said this week.

"The economic recovery will remain tepid, the transition to new payment methodologies will require significant investment, revenue growth will remain low by historical standards, and reimbursement will remain under pressure from all sources," Moody's Investor Services analyst Daniel Steingart wrote in a report published Wednesday.

The report focused on hospitals and acute care, such as the need to add physician practices to stay competitive. Of more concern to long-term care providers is that Steingart says allowing states to opt out of expanding Medicaid “blunts the impact of one of the law's few credit positive features.” The rising costs of Medicaid and Medicare mean additional cuts are likely, he advised.

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