Many for-profit hospital companies have created their 2013 budgets as if sequestration would have gone into effect. For example, Franklin, Tenn.-based Community Health Systems said it expected sequestration would cut 0.3 percent to 0.8 percent of its net revenue this year.
S&P said the Medicare cuts are a cause for concern, but many of the for-profits have been “actively manag[ing] their operations to lessen the effects of reimbursement cuts.”
“Reimbursement risk is one of the most important credit factors in our analysis of healthcare companies that rely on third-party sources of revenue,” David Peknay, an S&P credit analyst, said in a news release. “The majority of our ratings allow for some variability in results, and so we do not anticipate rating changes as a result of the Medicare cut.”
More Articles on Hospitals and Sequestration:
Was Sequestration the Best Option for Hospitals?
7 Healthcare Leaders Share Thoughts on Sequestration
Sequestration Set to Kick in, Cut Medicare by Billions
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