Ames, Iowa-based Mary Greeley Medical Center’s rating was downgraded to “A3” from “A2” by Moody’s.
The downgrade is driven by the negative impact of the opening of an ASC joint venture between the hospital and an independent physician group, Moody’s said in a Feb. 25 report.
“The ASC has and will continue to significantly reduce hospital surgeries and materially impact operating revenue, exacerbating social risk in the area of customer relations, a key rating driver,” Moody’s said.
Mary Greeley Medical Center’s A3 rating reflects its exceptional balance sheet and good — though tempered — market position following the new ASC joint venture, Moody’s said. The credit rating agency expects the continued ramp-up of the ASC to meaningfully impact the hospital’s own outpatient volumes and operating revenue.
The 220-bed hospital’s margins have fallen to the mid-single digits in fiscal 2026 and could decline further, according to the report. Mary Greeley Medical Center’s management is exploring expense reduction and revenue cycle projects to offset further effects from the ASC. Iowa’s directed payment program will help bolster margins through at least 2028.
The system’s outlook was revised to stable from negative at its new rating.
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