The downgrade is a result of several factors, including Lahey Health’s weaker than average operating performance, highly competitive market and anticipation of negative operating margins until fiscal year 2019. Fitch also acknowledged the health system’s solid liquidity metrics and integrated health system with one management board overseeing physician, clinic and hospital operations.
The bonds remain on Rating Watch Negative due to a rating pressure from Fitch’s revised rating criteria for nonprofit hospitals.
More articles on healthcare finance:
California hospital’s reporting errors cause Medicare to overpay 173 other facilities
Sen. Grassley: Tax-exempt hospitals shouldn’t need ‘herculean oversight’ to meet charitable obligations
CHI’s operating loss swells to $585.2M in FY 2017
