Health Care Bill Poses Credit Risk for Nonprofits

(Reuters) — The U.S. health care overhaul bill will provide insurance coverage for millions of Americans and possibly lower healthcare cost inflation, but it poses an increased credit risk for nonprofit providers, Standard & Poor's said on Thursday.

"We expect that the expanded insurance coverage will create winners and losers among providers, based on their existing and future payor mix, their ability to meet demand from newly insured patients, the impact on disproportionate share funding, and the impact on commercial health care insurance availability and rates," said S&P analyst Liz Sweeney in a new report.

The outlook for 2010 remains one of stable credit quality after a period of deterioration from 2007 to 2009. But risk will increase in the next three to five years as many of the key provisions of the bill go into effect, S&P said.