Moody's Investors Service has affirmed the "Aa3" and "Aa3/P-1" ratings on Dallas-based Baylor Scott & White Health's outstanding bonds and revised the system's outlook to stable from negative.
The rating affirmation was supported by a number of factors, including the system's location in a service area with a well-diversified economy and its dominant market position in central Texas. The rating affirmation was also supported by Baylor Scott & White's good cash flow margin, which was 12 percent for the nine months ended June 30, 2014.
The system also faces some challenges, which were considered for the rating affirmation, such as being located in a highly competitive area.
The system's outlook being upgraded to stable reflects Moody's expectation "that the system will achieve its fiscal year 2015 operating budget, which represents stability to 2014."
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