Archive for May, 2011

More Excess Cash, Days Cash on Hand?

Many hospitals are showing record margins through YE2010, with historically high “excess cash.”  Investment Bankers agree, now’s the time to make a positive change for the future of your hospital or system by preserving that cash, improving your days-cash-on-hand and increasing your chances of a positive move in your investment grade.

Coming off two years of spending freezes and delayed, critical equipment and systems upgrades, means you have some spending to do.  Burning up that excess cash and not considering a revised approach to your overall capital strategy could be a costly mistake. 

 The bond market remains largely off track especially for non-rated or non-investment grade hospitals.  However, even for the highest rated hospitals and systems, longer term rates for tax exempt bonds are actually higher than commercial bond rates right now. Re-investing in your operation, expanding services and upgrading technology can all be done with mid-term financing; 3-5 year terms, …

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