Volatile hospital spending plans will affect medical equipment manufacturers amid continuing economic pressures, Moody's said in a May 8 research note.
While nonprofit health systems are more likely to stick to raised capital spending plans in 2023, after recent declines, some for-profit systems could reduce such expenses, the note said. Those systems include Nashville, Tenn.-based HCA Healthcare and King of Prussia, Pa.-based Universal Health Services.
HCA previously expected to reduce its capital spending in 2023 by 2 percent but recently guided to a "modest increase" in such spending, Moody's said.
Ongoing uncertainty at the macroeconomic level, which is driving up hospital and health system costs, could see such pressure on medical device companies over the next 12 to 18 months, Moody's said.
"Device OEMs could see reduced order activity as some hospitals pull back on capital spending as liquidity and economic pressures mount," the note said.