Federal cuts, tariffs could be bad news for credit ratings: Fitch
Read Article: Modern Healthcare
Article Summary: Federal budget cuts and new tariffs may negatively impact healthcare companies’ financial stability, according to a Fitch Ratings report. Medicaid funding reductions could lower credit ratings for providers, while FDA budget cuts may slow drug and device approvals, affecting manufacturers. Additionally, tariffs on medical devices and pharmaceuticals could increase supply costs despite industry pushback for exemptions.
The Risks:
Medicaid Cuts: Proposed Medicaid funding reductions could significant affect healthcare reimbursement, particularly those relying on supplemental payment programs. (Area: Finance) (Category: Reimbursement)
Medical Supply Cost Increases: New tariffs on medical devices, pharmaceuticals, and diagnostic equipment may increase supply costs for healthcare providers, potentially squeezing hospital budgets, reducing profitability, and limiting access to critical medical equipment. (Area: Finance) (Category: Balance Sheet)