Additionally, S&P assigned its “BBB+” rating to Flagler Hospital’s series 2017A revenue bonds, affecting $32.6 million of debt.
“The lower rating reflects an increase in debt, coupled with weaker-than-expected operating results that began in fiscal 2016 and accelerated through the nine month interim period ended June 30, 2017,” said Stephen Infranco, an S&P Global Ratings credit analyst.
S&P also acknowledged the hospital’s declining patient volume.
The outlook is stable, reflecting S&P’s expectation that Flagler Hospital’s operating margin will improve in fiscal year 2018 due in part to a Medicaid modifier that took effect July 1, which enables Flagler to be designated as a rural hospital.
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