S&P Global Ratings maintained 22 ratings without revising the outlooks, took one positive rating action, three negative rating actions, and revised two outlooks favorably without changing the ratings in the U.S. not-for-profit health care sector in April. In addition, we placed two issuers on CreditWatch--one positive and one negative--with the positive listing reflecting potential rating uplift due to a merger.
There were four new debt issuances in the month, one of which was accompanied by a downgrade on a system in the 'A' category.
The six rating actions and outlook revisions consisted of the following:
- One upgrade on a stand-alone hospital in the 'A' category due to positive operations and improved balance-sheet metrics;
- Three downgrades on two systems and one stand-alone hospital, with the stand-alone being speculative grade; and
- Two outlook revisions on stand-alone hospitals; one to stable from negative and the other to positive from stable.
Chart 1
Chart 2
April 2024, U.S. not-for-profit health care rating actions | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
State | Rating | Outlook | Entity Type | Action | Description | |||||||||
Cabell Huntington Hospital |
WV | BBB | Stable | System | Downgrade | Operating losses leading to degradation of the balance sheet | ||||||||
CaroMont Health |
NC | AA- | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Cone Health |
NC | AA- | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
East Tennessee Children's Hospital |
TN | A | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Eskaton Properties |
CA | BBB- | Negative | Long-term care | Maintained | Credit quality consistent with existing rating | ||||||||
Essentia Health |
MN | A- | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Fairview Health Services |
MN | BBB+ | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Greater Fairbanks Community Hospital Foundation |
AK | A | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Hoag Memorial Hospital Presbyterian |
CA | AA | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Marin General Hospital |
CA | BBB | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Mercy Health Services |
MD | A- | Stable | Stand-alone | Upgrade | Positive operations and solid cash flows increased cushion in balance sheet metrics and unrestricted reserves | ||||||||
Novant Health Inc. |
NC | A+ | Stable | System | Downgrade; New sale | Substantial increase in leverage following acquisition of three hospitals | ||||||||
OSF Healthcare System |
IL | A | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Palomar Health |
CA | BB+ | Negative | Stand-alone | Downgrade | Operating losses resulting in significantly weakened balance sheets; at risk of breaching bond covenants | ||||||||
Penn Highlands Healthcare |
PA | A- | CreditWatch Negative | System | Placed on CreditWatch negative | Persistent negative operating performance and continually weakening unrestricted reserves | ||||||||
Providence St. Joseph Health |
WA | A | Negative | System | Maintained | Credit quality consistent with existing rating | ||||||||
RWJ Barnabas Health |
NJ | AA- | Stable | System | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
RWJ Barnabas Health* |
NJ | AA- | Stable | System | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
Salem Health |
OR | A+ | Stable | Stand-alone | Favorable outlook revision | Improvement in operating performance and reserves with solid balance sheet metrics in FY24 | ||||||||
Samaritan Health Services |
OR | BBB+ | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Seven Hills Foundation |
MA | BBB- | Stable | Human service provider | Maintained | Credit quality consistent with existing rating | ||||||||
South Shore Hospital |
MA | BBB | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
St. Lukes Hospital of Duluth |
MN | BB+ | CreditWatch Positive | Stand-alone | Placed on CreditWatch positive | St. Luke's joining Aspirus' obligated group and Aspirus now being responsible for all of St. Luke's Debt | ||||||||
Stanford Health Care |
CA | AA- | Positive | Stand-alone | Favorable outlook revision | Sustained strong financials metrics and consistent operating performance | ||||||||
Temple University Health System |
PA | BBB | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
UAB Health System |
AL | AA- | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
United Health Services Hospitals |
NY | BBB- | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
University of Vermont Medical Center |
VT | A | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Vernon Memorial Hospital |
WI | BBB- | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Virginia Commonwealth University Health System Authority |
VA | AA- | Stable | System | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
*The second action relates to a new sale rating later in the month for a commercial paper program. |
This report does not constitute a rating action.
Primary Credit Analyst: | Blake C Fundingsland, Englewood + 1 (303) 721 4703; blake.fundingsland@spglobal.com |
Secondary Contacts: | Cynthia S Keller, Augusta + 1 (212) 438 2035; cynthia.keller@spglobal.com |
Suzie R Desai, Chicago + 1 (312) 233 7046; suzie.desai@spglobal.com | |
Amy He, New York +1 2124380381; amy.he@spglobal.com |
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