Healthcare News of Note: S&P says outlook is stable for not-for-profit healthcare sector
- S&P Global Ratings recently revised its not-for-profit healthcare sector outlook from negative to stable for the first time since March 2020.
- Black, Hispanic and American Indian/Alaska Natives were more likely to be hospitalized or die from COVID-19 than their white counterparts, according to the NIHCM Foundation.
- OIG says CMS’s authority is not sufficient to fulfill the agency’s responsibility to ensure that accredited hospitals maintain quality and safety during an emerging infectious disease emergency.
Over the last few weeks, I’ve found these industry news stories that should be of interest to healthcare finance professionals.
1. S&P revises outlook to stable for the not-for-profit healthcare sector
On June 23, S&P Global Ratings revised its not-for-profit healthcare sector view (log-in required) to stable from negative, where it was placed on March 25, 2020, and reiterated on Jan. 12.
Key takeaways from the report include:
- The revision reflects a trend of revenue recovery, ongoing balance sheet strength and proactive management teams’ focus on maintaining financial stability.
- While there are still meaningful headwinds in the sector, analysts believe the risk level has declined and is consistent with prior years when the outlook was stable.
- Currently around 85% of S&P’s rated healthcare organizations carry stable or positive outlooks, which further supported the decision.
Analysts also said federal funds through the CARES Act provided significant support over the last 15 months, helping limit the negative financial impact and downside risk from the pandemic.
“For the remainder of 2021 and into 2022, we see a more balanced view of credit assuming continued COVID-19 vaccinations and no further meaningful virus surges, particularly on a national scale, although we expect that there could be regional variances depending on local vaccination rates,” analysts wrote. “With improving vaccination rates since January and declining COVID-19 cases, we do not anticipate any additional mandated shutdowns of elective services, as occurred across the country beginning in March 2020.”
2. NIHCM Foundation: How different racial and ethnic groups were impacted by COVID 19
The NIHCM Foundation released an infographic June 22 depicting how different racial and ethnic groups were impacted by COVID 19.
“Black, Hispanic and American Indian/Alaska Natives were more likely to be hospitalized or die from COVID-19 than their White counterparts,” according to the infographic, which provides specific data for each group. The infographic shows:
- American Indians/Alaska Native Americans were 3.3 times more likely to be hospitalized from COVID-19 and 2.4 times more likely to die from it than white Americans.
- Black Americans were 2.9 times more likely to be hospitalized from COVID-19 and 2.0 times more likely to die from it than white Americans.
- Hispanic and Latino Americans were 2.8 times more likely to be hospitalized and 2.3 times more likely to die from COVID-19 than their white counterparts.
Key learning experiences and opportunities for advancing health equity going forward are also explored. The infographic includes information on:
- Addressing biases ingrained in healthcare systems and medical school education
- Supporting and strengthening community resources
- Investing in infrastructure
3. OIG audit shows CMS cannot ensure accredited hospitals would maintain quality and safety during an emerging infectious disease emergency
“CMS’s controls [related to hospital preparedness for an emerging infectious disease] were well-designed and implemented, but CMS’s authority is not sufficient for it to fulfill its responsibility to ensure that accredited hospitals would maintain quality and safety during an emerging infectious disease emergency,” according to a June 24 report by the Office of the Inspector General at the U.S. Department of Health and Human Services.
“Specifically, although CMS announced in February 2019 that it was critical for all hospitals to plan for emerging infectious diseases, CMS could not determine that all accredited hospitals updated their emergency preparedness plans to include this planning until 2022 due to accreditation organizations’ quality and safety inspection cycles,” the report states.
The report also highlights the following:
- When “COVID-19 emerged in the United States, CMS requested (but could not require) accreditation organizations to perform special targeted infection control surveys to help accredited hospitals prepare for COVID-19 patients.”
- Accreditation organizations performed no such special surveys and, as of Aug. 17, 2020, state survey agencies performed these surveys at only about 13% of accredited hospitals and had not performed any in 13 states because of CMS’s limited authority over accredited hospitals.
CMS should make regulatory changes to allow it to require accreditation organizations to perform special surveys after it issues new participation requirements or guidance and during a public health emergency to address the corresponding risks, OIG recommended. CMS concurred with the recommendation, according to the report.