Rationale for the rating included the hospital’s significant cash and investments available for operating expenditures and debt service. Available funds defined as all cash and investments less restricted net assets total $97.6 million and cover operating expenses by 3.2 times and outstanding debt of $42.9 million by 2.2 times, according to the release.
While the charitable hospital remains unprofitable, its financial position has improved recently due to increased outpatient volume and cost-cutting efforts. Outpatient volume grew from 48,900 visits in 2009 to 50,900 thousand visits in 2010. However, subsidization of operating losses with investment earnings is required for the hospital to achieve operating balance.
Read the Fitch release on Los Angeles Orthopaedic Hospital.
Read more coverage on Los Angeles Orthopaedic Hospital:
– CEO Spotlight: Q & A With Dr. James Luck, Jr., of Los Angeles Orthopaedic Hospital
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