High labor and supply expenses in addition to inflationary pressures will continue to batter nonprofit hospitals this year, contributing to a ‘deteriorating’ outlook for systems, Fitch Ratings said.
The outlook is a continuation of the ‘deteriorating’ nonprofit sector outlook that Fitch Ratings released in August last year, when the ratings agency downgraded the sector from a ‘neutral’ rating, Healthcare Dive reports.
Still, Fitch sees some signs “that we are beginning to come out of the worst of it,” said Kevin Holloran, senior director at the agency.
Nonprofit hospitals that posted operating losses during the COVID-19 pandemic have been hit by higher labor and supply costs in addition to investment losses and declining or neutral admission volumes.
Last year was one of the “worst years ever” for nonprofit hospitals, Holloran said.
Labor will remain the largest hurdle for hospitals this year even as they struggle with inflation and spiking COVID-19 admissions that can dent revenue, he added. Read more.
