Moody's Investors Service has officially placed the Caa1 bond rating of West Penn Allegheny Health System under review after the Pittsburgh-based entity canceled its affiliation agreement with Highmark.
Earlier today, WPAHS announced it would no longer move forward with its merger with Pittsburgh-based health insurer Highmark. WPAHS officials claimed Highmark breached the affiliation agreement by wanting to put the health system through bankruptcy, but Highmark officials said they have not violated any terms.
Moody's analysts said WPAHS' Caa1 bond rating — already considered to be junk status — could be downgraded in light of the news. WPAHS currently has $737 million of outstanding debt that could be adversely affected by a negative credit impact.
Earlier this summer when the WPAHS-Highmark merger was still on track, Moody's said WPAHS would still need more than the $475 million in pledged funding from Highmark to survive its current financial turmoil.
Earlier today, WPAHS announced it would no longer move forward with its merger with Pittsburgh-based health insurer Highmark. WPAHS officials claimed Highmark breached the affiliation agreement by wanting to put the health system through bankruptcy, but Highmark officials said they have not violated any terms.
Moody's analysts said WPAHS' Caa1 bond rating — already considered to be junk status — could be downgraded in light of the news. WPAHS currently has $737 million of outstanding debt that could be adversely affected by a negative credit impact.
Earlier this summer when the WPAHS-Highmark merger was still on track, Moody's said WPAHS would still need more than the $475 million in pledged funding from Highmark to survive its current financial turmoil.
More Articles on West Penn Allegheny Health System Finances:
Fitch: West Penn Finances Are Improving
Moody's: West Penn Needs More Than $475M From Highmark to Survive
S&P Lowers West Penn's Credit Rating to B-