Markets received an early Christmas present last Tuesday when the November Consumer Price Index report came in below market expectations, signaling that inflation continues to cool. However, Fed Chair Jerome Powell ended the merriment on Wednesday by announcing a 50 bp increase to the fed funds rate, bringing the target range to 4.25% - 4.50%, and more importantly (and jarring) to markets was the Fed forecast that showed the fed funds rate peaking at 5.1% in 2023, which is 50 bps higher than their last forecast.

Over the last 20+ years, healthcare providers have often engaged third party developers to build outpatient or support facilities or have sold these assets to third party investors and development entities like healthcare real estate investment trusts. Today, several factors ought to compel hospitals to rethink the traditional lease v. own solutions: 1) changes to lease accounting rules; 2) continued increase in physician and hospital consolidation; and 3) long-term facility control and site control of key ambulatory care locations.