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Morgan Stanley Says Ebola Scare Could Defer Elective Surgeries In Texas

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Hospital companies with significant operations in the Dallas-Fort Worth region could see potential patients scared away by recent reports of Ebola, an analyst said Thursday.

Potential hospital patients in the region "might exercise greater restraint on hospital visits due to fear of contracting the virus," Morgan Stanley's Andrew Schenker.

But while Ebola could hurt hospital admissions for elective surgery, "declines should be more localized" than drop-offs seen in the 2002-2004 outbreak of severe acute respiratory syndrome, or SARS, and the 2010 outbreak of H1N1 influenza, Schenker said.

Schenker calculates, however that HCA Holdings Inc (NYSE: HCA) counts 6.5 percent of its patients at hospitals within 20 miles of Dallas' Texas Health Presbyterian hospitl, which recently treated two cases of Ebola.

Tenet Healthcare Corp (NYSE: THC) has 2.4 percent of patients in hospitals within the Dallas-Fort Worth region, which counts 6.5 million residents and is the largest urban region of the South.

Although Community Health Systems (NYSE: CYH) operates one hospital in the region, Schenker said it has little exposure to the Ebola scare.

Noting that Ebola is a comparatively hard-to-catch disease, Schenker said that at the peak of the SARS outbreak in Toronto in 2003, hospitals there were told to defer elective procedures to ensure available space for potential SARS victims.

The region saw a 22 percent reduction in elective non-cardiac surgery rates.

Schenker also noted estimates that 52,000 elective hospital admissions were postponed in the U.S. during a 2009 influenza outbreak. But that bit of bad news got offset by 1 million admissions for cases of the flue.

Posted-In: Andrew Schenker Morgan StanleyAnalyst Color News Rumors

 

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