Trigger Alert: This post could be depressing.
Morgan Stanley recently commented that 18% of American hospitals are at risk of closure.
Moody's recently predicted that 8% (about 480) of the 6,000 hospitals they reviewed are "apt to close". I understand that Moody's would only be reviewing those hospitals that pay Moody's the fee to form an opinion of their credit-worthiness.
Any time I care to read about a hospital in dire straits, I will read Becker's Hospital Review on-line. It is usually a rural hospital with declining admissions, or a hospital that cannot cope with reductions in Medicare reimbursement.
The coming 10 years will be hard on hospitals, because
A. There currently are about 53,500,000 Americans over 65. Except for those who are incarcerated, virtually all are enrolled in some form of Medicare for their hospitalization insurance.
B. According to the Census Bureau, over the coming 10 years, approximately 10,000 Americans will turn 65 every day, and I believe they will be eager to enroll in Medicare.
C. Some Medicare beneficiaries certainly will die every day too. But the actuaries seem to all agree that the number of beneficiaries will go up continually, to approximately 83,000,000 by 2050.
D. (This is the most depressing part.) Notwithstanding the promises he stated during the election campaign, President Trump's budget proposal for fiscal year 2020 is to CUT Medicare spending by $800 billion over the coming 10 years. Although some mystery surrounds the details, it seems obvious that the President is urging that Medicare reimbursements to hospitals be cut.
As hospitals consolidate (the more solvent hospitals acquiring their weaker sisters) or escape their creditors by filing Chapter 11 bankruptcy, it seems inevitable there will be job loss, and facility closures... More Americans may have no alternative other than to travel further for hospital care. It could be good for hotels located adjacent to the campuses of the hospitals that survive, because families of patients (or their drivers) may need overnight accommodation until the patient is discharged.
Also poised to benefit are CVS and WalMart. I believe CVS plans to scale up their walk-in/urgent care capacity. And WalMart's new "Town Center" concept includes healthcare services in WalMart parking lots.