The group’s revenue bond rating declined to “A1” from “Aa3,” and its outlook has been revised to stable from negative at the lower rating. The hospital group has approximately $651 million of debt outstanding, Moody’s said.
Main Line, which has hired consultants to help recover margins, still enjoys strong balance sheet metrics, which provides for some cushion, Moody’s said. There is an expectation that performance improvement plans will allow for better, albeit still weak, profit margins in fiscal 2023, and continued improvement thereafter, the rating agency added.
The rating, which follows on the heels of a similar move by Fitch in November, comes at a time when so many hospital systems are in crisis, according to Main Line CEO Jack Lynch. Main Line could face annual losses of $100 million for the second straight year.
Main Line Health System operates in southeastern Pennsylvania in a suburban region outside of Philadelphia with four acute care hospitals including Bryn Mawr Hospital, Lankenau Medical Center, Paoli Hospital and Riddle Memorial Hospital. The system also operates Bryn Mawr Rehabilitation Hospital and Mirmont Treatment Center.
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