Nonprofit Hospitals Face Downgrades As Revenues Fall: Moody's

A dwindling number of patients, combined with oncoming Medicare and Medicaid cuts, are making more likely the prospect of nonprofit hospitals being issued credit rating downgrades, according to a report released Wednesday.

Hospital revenues grew at an average rate of only 4 percent in 2010, a 20-year low, according to the rating agency Moody’s, which issued the report. Moreover, the rate of revenue growth is expected to keep dropping. Federal cuts in Medicare, and state efforts to save money in Medicaid spending, will hurt hospitals’ bottom line.