CHICAGO - Not-for-profit hospitals have been hard hit by recent capital markets turmoil, as providers have been forced to postpone debt sales while facing failed remarketings, negative swap valuations, and stricter covenants from a shrinking pool of credit providers, according to a pair of reports out this week.

The pressures facing the nonprofit health care industry prompted Moody's Investors Service to revise its outlook for the sector to negative from stable. Moody's analysts during the last few months have started to take a closer look at hospitals' debt structures to determine levels of risk, particularly with regard to liquidity, said analyst Lisa Martin, one of the authors of the outlook revision report.

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