Ratings service sees steady growth in nonprofit sector

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Fitch Ratings disclosed that its outlook for 2006 in the nonprofit hospital and healthcare system sector is stable.

The continued implementation of management best practices and relatively stable revenues will offset pressures related to rising expenses, competition with physicians and inadequate Medicaid reimbursement, according to Fitch.

But due to potential declines in Medicare reimbursement, growing capital needs in the sector and a downward shift in growth rates on payor contracts, Fitch is skeptical about financial sustainability in the sector beyond this year.