GE Capital: Global Hospital Sector Investing in New Equipment

According to GE Capital’s inaugural Hospital Sentiment Research report, Hospitals across the globe are becoming increasingly confident about their growth prospects for the year ahead, despite rising costs and ongoing economic uncertainty. The report was based on interviews with more than 380 senior hospital executives with responsibility for budget decisions over eight international markets.

In the backdrop of ongoing austerity measures and enhanced scrutiny of global healthcare systems, the report highlights specific areas of positivity for the hospital industry, finding hospitals are delivering more than ever before, often with insufficient resources. It also finds hospitals are making clear efficiency gains to enhance competitiveness, but that the need to invest in new equipment is becoming ever more crucial to sustain this efficiency.

The research finds both private and public hospitals report bullish growth profiles over the next 36 months: 90% of private hospitals expect to grow in this time period, with 15% expecting to see rapid growth. 84% of public hospitals expect to see growth, with 15% citing rapid growth. 46% of private hospitals expect this to translate to future profitability, vs. a more conservative 27% of public hospitals.

Investment and purchasing decisions of hospital managers are being driven mainly in order to replace deteriorating existing equipment (16%) and for the pursuit of efficiency gains (17%) reflecting a sector that is adapting to a challenging environment but remaining optimistic about its ability to meet patients’ needs. Perhaps unsurprisingly, the top reason for not investing is the economic environment (30%).

Peter Krause, head of GE Capital’s Healthcare Financial Services team, commented: “Hospitals are under immense strain, dealing with ongoing spending pressure and the pressing need for improved quality of care. It is encouraging, however, that hospitals are keen to adopt crucial new technologies that can not only advance treatments to patients but also enable them to continue to achieve quality and efficiency gains that are necessary to win in this environment.”

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