Almost 20% of hospitals in the US are in bad shape, according to Morgan Stanley

A range of factors have squeezed hospital profit margins, including new competition from alternative sites of care such as UnitedHealth and CVS-Aetna, as well as so-called “merger indigestion” after a wave of deal activity in the hospital sector following the passage of the Affordable Care Act. Higher healthcare costs are also putting pressure on hospital systems from patients, insurance companies and policymakers, as is a rise in the uninsured population.

Of the hospitals in the “at risk” pool, the highest concentration were found in the states of Texas, Oklahoma, Louisiana, Kansas, Tennessee, and Pennsylvania.

“While potential disruption from the new Amazon venture has been grabbing headlines, we think closures will enter the narrative on hospitals during the next 12-18 months,” the report said.

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