Managed care puts some hospitals in a credit squeeze.

f healthcare reform is not a political activity, it's going to be an economic o n e , " predic ted James Bentley, American Hospi ta l Association (AHA) senior vice president for policy, in a conversation. A look at recent hospital trends and an analysis from Wall Street bears this out. As competitive economic pressures increase in the healthcare system, in large part fueled by the growth of managed care, the way healthcare institutions operate is undergoing dramatic reform. Last mon th ' s column examined the growth, diversity, and new trends in managed care. This month I look at how the increasingly competitive managed care environment has affected and will continue to affect hospitals' financial situation, with particular emphasis on the view from Wall Street.