PeaceHealth sees rating downgraded as operating challenges continue and recovery distant

Vancouver, Wash.-based PeaceHealth saw its credit rating on a series of bonds downgraded to “A-” as it continues to face labor challenges and high average length-of-stay issues, S&P Global said July 7.

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A management target of turning around $240 million of financial improvements to ensure profitability by fiscal 2024 is seen as aggressive, as the agency predicted a multiyear recovery.

The 11-hospital system is expected to violate its bank debt coverage in fiscal 2023, the agency added. The outlook is negative.

PeaceHealth has debt totaling approximately $1.4 billion. 

The system said it would close five clinics and eliminated 69 positions in late May.

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