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Any Supreme Court ruling hurts nonprofit hospitals
Source: Reuters  ·  June 14, 2012  ·  Excerpt

No matter how the Supreme Court decides on the national healthcare law, nonprofit hospitals will face a rocky future, Moody's Investors Service said in a study published on Thursday.

Within the next two weeks the highest court in the country is expected to rule on the constitutionality of the healthcare reform law, known as the Patient Protection and Affordable Care Act, that has inspired both political and legal battles from the moment President Barack Obama signed it into law more than two years ago.

"Regardless of the court's ruling and the result of the November elections, policymakers will be faced with addressing the steep federal budget deficit, which almost certainly will include altering federal funding for Medicare and Medicaid," says the study.

The Wall Street rating agency has a negative outlook for non-profit hospitals and expects rating downgrades for the sector to outpace upgrades this year. The median average ratings for the 500 institutions in the sector is A3.

Moody's says that the total not-for-profit hospital bonds outstanding is $155 billion.

All non-profit hospital bonds are considered expensive by analysts who predict some price correction.

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Our take
One consistent theme that Compass Pointe is continually addressing is the need to keep a wide perspective. As the above article illustrates, nonprofits (and in this case, hospitals) are required to keep close tabs not only on day-to-day operations, staffing and financial stability, but also on larger environmental factors that are completely out of their control.

As with so many other things, the only constant in the area of government legislation and regulation is change. Our job is to research and stay current on shifting laws so you don't have to. Contact us now for answers to these and other questions:

  • Is my organization in compliance with existing laws and regulations? If not, what can be done to bring it up to speed?
  • How can my organization prepare for future shifts in legislation? What representation is available for my industry or area in government advocacy?


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