Moody's assigns 'A2' rating to Mercy Health's bonds

Moody's Investors Service assigned its "A2" rating to Cincinnati-based Mercy Health's proposed $494.5 million series 2017A, $90.3 million series 2017B and $139.6 series 2017C.

Concurrently, Moody's affirmed its "A2" rating on Mercy Health's outstanding debt, affecting 1.5 billion.

The assignment and affirmation are a result of several factors, including Mercy Health's large presence, strong market position, improving margins and conservative near-term capital spending. Moody's also acknowledged the health system's high leverage, moderate liquidity metrics, high reliance on government payers and a highly competitive market.

The outlook is stable, reflecting Moody's expectation that the health system will experience near-term margin stability and revenue cycle improvements to offset any cuts to Medicare.

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