A hospital’s cash-to-debt ratio essentially shows a hospital’s ability to cover its debt with its yearly cash flow from operations. If a hospital has a high percentage of cash to debt, that means the hospital is better positioned to handle its debt load. Here are 13 statistics on average hospital cash-to-debt ratios from Moody’s Investors Service’s recent fiscal year 2011 report.
Note: The following data are based on audited financial statements for 400 hospitals and single-state health systems within Moody’s database.
• Overall median cash-to-debt ratio: 117.7 percent
• Overall mean cash-to-debt ratio: 141.4 percent
• Maximum recorded cash-to-debt ratio in Moody’s sample: 936.8 percent
• Minimum recorded cash-to-debt ratio in Moody’s sample: 12 percent
• Median cash-to-debt ratio for “Aa2”-rated hospitals: 214.5 percent
• Median cash-to-debt ratio for “Aa3”-rated hospitals: 185.8 percent
• Median cash-to-debt ratio for “A1”-rated hospitals: 146.9 percent
• Median cash-to-debt ratio for “A2”-rated hospitals: 143 percent
• Median cash-to-debt ratio for “A3”-rated hospitals: 104 percent
• Median cash-to-debt ratio for “Baa1”-rated hospitals: 91.6 percent
• Median cash-to-debt ratio for “Baa2”-rated hospitals: 74.6 percent
• Median cash-to-debt ratio for “Baa3”-rated hospitals: 93 percent
• Median cash-to-debt ratio for hospitals with ratings below “Baa”: 107 percent
More Articles on Hospital Cash-to-Debt Ratios:
Credit Downgrades: How Could They Impact a Hospital’s Capital Structure?
Moody’s: 118 Statistics on Non-Profit Hospital Medians
Why Cash is King: Q&A With Dawn Javersack, CFO of Boca Raton Regional Hospital
