Moody's Says Healthcare Reform May Harm Hospital Credit

Moody's Investors Service said high-cost hospitals could experience downgrades in their debt-rating due to large cuts to Medicare funding planned by healthcare reform, according to a report by ABC News Health.

The Senate and House healthcare reform bills both seek to reduce Medicare reimbursements to hospitals, which would have a greater effect on hospitals that enjoy the highest reimbursements, most of which are in large urban areas.  

While high-cost hospitals in large networks would be protected from downgrades, "the most vulnerable hospitals will be stand-alone hospitals dependent on high cost referral practices and which do not gain many new paying patients," Moody's stated.

Read ABC News Health's report on hospitals' debt ratings

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