The Act, expansion and the wave mergers they have triggered have made the nonprofit healthcare sector financially stronger, according to the Standard & Poor’s ratings agency.
S&P changed its evaluation of the sector from “negative” to “stable,” saying that it expects the outlook for to be positive at least through 2016.
The agency noted that AA-rated nonprofit systems saw a $2.2 billion increase in revenues in 2014, and that in all ratings classes generated higher revenues.
Mergers are creating larger networks nonprofit which enjoy economies scale and increased financial strength, said S&P. By contrast, stand-alone nonprofit hospitals in all categories saw declines in revenues.
The expansion under the is helping nonprofit, according to S&P, because it has substantially reduced the amount uncompensated or “charity.”
The sector faces “continued uncertainty,” S&P noted, because industry-specific factors as well as “the unknown effects political changes state and federal policy due to future elections.”