Stable outlook for healthcare in 2014
The healthcare industry will continue to face challenges in 2014, but the industry overall will be stable, said Fitch Ratings.
The industry faces challenges from weak organic growth in healthcare products and services as consumers and insurers continue to make efforts to control spending, Fitch noted in a press release.
However, the industry will be able to keep a high level of financial flexibility because topline growth will be supported by factors such as implementation of the Affordable Care Act, favorable demographic trends and strong growth in emerging markets.
In the long-term, Fitch noted in the press release, if the industry wants to preserve margins, it will have to look beyond traditional cost cutting and restructuring.
Fitch said it is unlikely it will revise its positive outlook for 2014 because the industry is slowly transitioning its business strategies from a focus on cost cutting and restructuring to a focus on long-range value strategies.
