The rating assignment was based on a number of factors, including Children’s status as the only pediatric hospital in Alabama, a history of state support via Medicaid funding and the organization’s affiliation with the “A1”-rated University of Alabama Hospital at Birmingham.
Credit challenges include limited fundraising and uncertainty concerning reimbursement changes to Medicaid.
The rating outlook is stable, reflecting Moody’s expectation that Children’s will maintain strong operating performance and strong balance sheet metrics given minimal capital investment needs.
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