Hospitals in the Financial Crisis

There was an interetsing blog post in the Wall Street Journal’s Health blog last week discussing some of the challenges hospitals are facing as a result of the nation’s financial crisis.

Lisa Martin, a senior VP on Moody’s health care ratings team told the WSJ Health Blog that hospitals have been postponing plans to sell new bonds to fund capitals improvements like renovations and new buildings.  She also said that hospitals are holding more bad debt.

The American Hospital Association CEO Rich Umbdenstock told the blog that hospitals with an existing variable-rate debt have seen a big jump in the interest–in some cases up to 10 percent or more.  He also said that higher-income patients less likely to make charitable donations to the local hospital.

PRN Funding has been following the healthcare cash flow crisis for a number of years.  Our team wanted to also point out that as hospitals face this financial crisis head on, they will continue to extend payment terms for their vendors as well.

Click here to read the blog post: The Financial Crisis Takes a Toll on Hospitals.

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