S&P Global Ratings maintained 21 ratings without revising the outlooks, took seven negative rating actions, and had no upgrades in December. In addition, we revised three outlooks favorably and one outlook unfavorably, all without changing the ratings in the U.S. not-for-profit health care sector.
There were seven new debt issuances in the month, with six ratings maintained. The seventh new issuance was related to a newly rated organization, Mizuho America Leasing LLC, N.Y., reflecting our view of University of Chicago Medical Center and the assessment of the lease structure in place.
The 11 rating actions and outlook revisions consisted of the following:
- Seven downgrades on three systems and four stand-alone hospitals, with two of the systems taken off CreditWatch with negative implications and downgraded to speculative-grade;
- Three favorable outlook revisions on one long-term care provider and two systems with two outlooks revised to stable from negative and the other revised to positive from stable; and
- One unfavorable outlook revision on a stand-alone hospital to negative from stable.
Chart 1
Chart 2
Table 1
U.S. not-for-profit health care rating action summary, 2024 | ||||||||
---|---|---|---|---|---|---|---|---|
First quarter | Second quarter | Third quarter | October | November | December | Fourth quarter | Full year | |
Maintained | 63 | 78 | 68 | 20 | 23 | 21 | 64 | 273 |
Downgrades | 13 | 8 | 17 | 4 | 2 | 7 | 13 | 51 |
Upgrades | 3 | 4 | 2 | 2 | 0 | 0 | 2 | 11 |
Unfavorable outlook revisions | 4 | 13 | 6 | 1 | 0 | 1 | 2 | 25 |
Favorable outlook revisions | 8 | 10 | 15 | 5 | 0 | 3 | 8 | 41 |
Table 2
December 2024, U.S. not-for-profit health care rating actions | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
State | Rating | Outlook | Entity type | Action | Description | |||||||||
Appalachian Regional Healthcare |
KY | A | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Beebe Medical Center |
DE | BBB- | Stable | Stand-alone | Downgrade | Weak underlying operations and multi-year sizable operating losses when excluding one-time grants | ||||||||
Carleton Willard Village |
MA | A- | Stable | Long-term care | Favorable outlook revision | Positive operations and healthy balance-sheet metric improvements through nine-month interim | ||||||||
Children's Health Care |
MN | AA- | Stable | Stand-alone | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
Children's Health System of Texas |
TX | AA | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Children's Hospital of Philadelphia* |
PA | AA | Stable | Stand-alone | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
Denver Health and Hospital Authority |
CO | BBB | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Duke University Health System |
NC | AA- | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
East Alabama Medical Center |
AL | A | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Grand View Hospital |
PA | B+ | Negative | Stand-alone | Downgrade | Persistent operating losses and declining liquidity and financial flexibility metrics | ||||||||
Guthrie Clinic |
PA | A | Negative | System | Maintained | Credit quality consistent with existing rating | ||||||||
Houston Methodist |
TX | AA | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Loma Linda University Medical Center |
CA | BB | Positive | System | Favorable outlook revision | Stabilized operations with further improvement expected along with a recovering balance sheet | ||||||||
Main Line Health System |
PA | AA- | Stable | System | Favorable outlook revision | Material operational improvement, with strengthening of debt service coverage and stabilization of balance sheet expected | ||||||||
Masonic Villages of the Grand Lodge of Pennsylvania |
PA | A | Stable | Long-term care | Maintained | Credit quality consistent with existing rating | ||||||||
Mercy Health |
MO | A+ | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Meritus Health |
MD | A- | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Methodist Le Bonheur Healthcare and Affiliates |
TN | A | Negative | System | Downgrade | Ongoing accelerated operating losses and diminishing unrestricted reserve metrics | ||||||||
Mizuho America Leasing LLC |
NY | A+ | Negative | Other | Rating initially assigned; New sale | Rating assigned based on our view of University of Chicago Medical Center and our assessment of the lease structure in place | ||||||||
Nash Health Care Systems |
NC | BBB | Positive | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Ochsner Health System |
LA | A | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Oregon Health & Science University |
OR | A+ | Stable | Stand-alone | Downgrade | Continual loss and weaker MADS coverage in fiscal 2024 during a period of heavy capital spending | ||||||||
Penn Highlands Healthcare |
PA | BB+ | Negative | System | Downgrade | Unexpected material operating decline and continually weakening unrestricted reserves following years of losses | ||||||||
Reid Hospital |
IN | BBB+ | Negative | Stand-alone | Unfavorable outlook revision | Significant recurring operating losses, elevated debt levels, and weakening payor mix | ||||||||
Sentara Health |
VA | AA | Stable | System | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
Shodair Children's Hospital |
MT | BB | Stable | Stand-alone | Downgrade | Weakened balance-sheet metrics providing less cushion amid staffing challenges and ongoing operating losses | ||||||||
St. Luke's Health System |
ID | A | Stable | System | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
Summit Pacific Medical Center |
WA | BB+ | Stable | Stand-alone | Maintained | Credit quality consistent with existing rating | ||||||||
Trinity Health Credit Group |
MI | AA- | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
University of Iowa Hospitals & Clinics |
IA | AA | Stable | Stand-alone | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
University of Maryland Medical System |
MD | A | Stable | System | Maintained; New sale | Credit quality consistent with existing rating | ||||||||
Virtua Health |
NJ | AA- | Stable | System | Maintained | Credit quality consistent with existing rating | ||||||||
Westchester County Health Care Corporation |
NY | BB+ | Negative | System | Downgrade | Extremely thin unrestricted reserves and another year of operating losses beyond expectations | ||||||||
*This action relates to a new sale issuance for a taxable commercial paper (CP) with the assignment of an 'A-1+' short-term rating following a review completed in September. | ||||||||||||||
DCOH--Days' cash on hand. MADS--Maximum annual debt service. |
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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