In the first quarter of 2014, hospitals and health systems issued $3.2 billion in bonds — a 50 percent drop from the first quarter of last year, according to a report from HFA Partners.
The slow first quarter builds off a sluggish 2013, which was the second-slowest bond issuance year of the past decade for healthcare groups. The "anemic" quarter also flies in the face of historically low interest rates, which continue to hover around 3.5 percent in the tax-exempt market.
HFA Partners said as hospitals continue to avoid large-scale capital projects — especially as the sector transitions away from the expensive inpatient model and toward the outpatient setting — the slowdown in issuing debt will likely continue in the near term.
"Hospitals seem to be doing what many households are doing these days: cutting back on big-ticket purchases, paying down debt and building liquidity," the article reads.
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