Fitch: U.S. Critical Access Hospitals to Withstand Pressures; Consolidation Likely

CHICAGO--(BUSINESS WIRE)-- Revenues are likely to come under pressure for U.S. critical access hospitals, though Fitch Ratings expects the ratings of these hospitals to remain stable, as discussed in a new report.

'Critical access hospitals (CAHs) often enjoy strong bipartisan legislative support that will prevent significant reimbursement changes for the foreseeable future,' said Director Emily Wadhwani. 'Additionally, though they are prolific across the country, their enhanced Medicare payments comprise a very small piece of the overall Medicare budget, making them a less likely target for cuts.'

The Affordable Care Act (ACA) could negatively affect select hospitals that are vulnerable to significant reimbursement changes brought on health reform. That said, most CAHs in Fitch's rated portfolio have healthy financial cushions that serve to largely mitigate this risk.

Another key credit risk is the shrinking rural population that CAHs were designed to serve. This is particularly evident in the Southern and Midwestern United States, which have seen more hospital closures in recent years. As such, 'a robust ambulatory service base is necessary for critical access hospitals to remain viable in these markets,' said Wadhwani.

Another interesting trend that could play out is increasing consolidation. CAHs may find it necessary to seek out partners in order to structure themselves as high-value providers. Partnership can help address a majority of inherent challenges for rural providers. However, hospitals with weaker financial profiles are less likely to find partners, which could in turn prompt more rural hospital closures.

'Rural Health Care: Credit Considerations for Critical Access Hospitals' is available at 'www.fitchratings.com' or by clicking on the above link.

Additional information is available at www.fitchratings.com.

Rural Healthcare (Credit Considerations for Critical Access Hospitals)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=862376

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150817005661/en/

Fitch Ratings
Emily Wadhwani
Director
+1-312-368-3347
Fitch Ratings, Inc., 70 West Madison Street Chicago, Illinois, 60602
or
James LeBuhn
Senior Director
+1-312-368-2059
or
Media Relations:
Alyssa Castelli, +1 212-908-0540
[email protected]

Source: Fitch Ratings

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• "China Services" Exhibition Zone to Debut at 2026 CIFTIS with Strong International Flair
• Paycode Appoints Colin Digby as Chief Revenue Officer
• Lexar Unveils Muse, the World's Thinnest Portable SSD, at IFA 2026