Credit analysts at Moody’s Investors Service say the giant health insurance acquisitions, now under way, could start to do serious damage to hospital’s finances in mid-2017.
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Hospitals with multi-year deals with insurers could have more time to adapt, but hospitals that fail to take steps to improve their own negotiating position could eventually face serious threats to their profitability, Lisa Martin and other Moody’s analysts say in a new commentary.
“Over half of hospital revenue is subject to negotiation with health insurers,” the Moody’s analysts say.
Smaller, stand-alone hospitals without a good way to stand out from nearby competitors could have an especially hard time, the analysts say.