Health care is usually deemed more or less recession proof. Maybe not this time, according to a recent Chicago Tribune article that analyzed several Moody’s Investor Service reports on sectors including hospitals, medical devices and insurance companies. Bottom line: Moody's revised the health care industry’s 12- to 18-month outlook from "stable" to "negative."

The analysts expected more uninsured people, because of growing joblessness, and postponement of nonemergency surgeries. Nonprofit hospitals are also expected to feel the pinch of less access to financing through the tax-exempt debt market. A survey by the American Hospital Association (hat tip to Jane Sarasohn-Kahn at Health Populi) found that 40 percent of US hospitals have seen a drop in inpatient admissions, in the third quarter of this year compared to the same time period in 2007. Meanwhile, uncompensated care rose, and it got harder to borrow money. (Health Populi also speculated, however, that people with employer-sponsored insurance who are worried about losing their job might speed up discretionary health spending while they are still covered, despite the much higher deductibles workers now face—$1000 is now not uncommon for an individual.)

"The current uncertainty surrounding political solutions with respect to health care at both the state and federal levels hinders insurers' ability to develop focused strategic plans," the Tribune quoted Moody's Vice President Stephen Zaharuk as saying. "More urgently, reimbursement cuts to insurers for Medicare Advantage programs and pressure on state budgets for Medicaid spending are threatening the growth and profitability of these segments."

Democrats have long complained of the extra costs to the government from payments to Medicare Advantage (privately-operated managed care plans for seniors.) Today’s New York Times reports on two new studies appearing in Health Affairs that show that the plans are increasing Medicare’s costs and complexities without improving care of the elderly. President-elect Barack Obama and Congressional Democrats are already expected to consider cutting MA payments.