The downgrade is a result of CMHS’ weakened operating performance, especially as the health system experiences an expense increase as it completes and moves into its new 250-bed patient tower.
“We view this weakness in financial performance and unrestricted reserves during a period where CMHS will undergo ramp-up costs associated with its new tower as bringing additional risk to the already vulnerable financial profile,” S&P credit analyst Melanie Her said.
The outlook is stable at the lower rating level.
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