The downgrade to “BB+” from “BBB” reflects widening operating losses and unrestricted reserves continuing to decline from its last review, S&P said. The outlook is negative.
The deteriorating financial performance of the 133-bed public hospital is in contrast to management assertions that initiatives underway would help improve operations by the end of September, the agency added. The system has also violated its debt coverage agreement, further adding to negative sentiment.
“The negative outlook reflects the swift deterioration of NHDSC’s financial profile, with an uncertain future trajectory given improvement initiatives have so far taken longer to mature and yield material benefit,” S&P said. “We believe covenant compliance will remain relevant and challenging over the outlook period and this supports the negative outlook.”
