Here are 10 hospitals and health systems with strong operational metrics and solid financial positions according to recent reports from Fitch Ratings, Moody's Investors Service and S&P Global Ratings.
Note: This is not an exhaustive list. Hospital and health system names were compiled from recent credit rating reports and are listed in alphabetical order.
1. Morristown, N.J.-based Atlantic Health System has an "Aa3" rating and stable outlook with Moody's and an "AA-" rating and stable outlook with S&P. The system has stable operating performance, balance sheet growth and a favorable market position, according to Moody's.
2. Coral Gables-based Baptist Health South Florida has an "AA-" rating and stable outlook with S&P. The system maintained key balance sheet metrics and generated better-than-projected financial results in fiscal year 2016, according to S&P.
3. Bayhealth Medical Center has an "AA-" rating and stable outlook with Fitch. The Dover, Del.-based system has solid profitability, healthy liquidity measures and a strong market position, according to Fitch.
4. Dallas-based Baylor Scott & White Health has an "Aa3" rating and stable outlook with Moody's. The health system has strong cash flow margins and a favorable business position as the largest nonprofit health system in Texas, according to Moody's.
5. Carolinas HealthCare System has an "Aa3" rating and stable outlook with Moody's. The Charlotte, N.C.-based system has a track record of good financial performance, strong balance sheet metrics and a large scope of operations with multiple hospitals. Moody's expects Carolinas HealthCare System to maintain stable leverage metrics while continuing to generate financial results at current levels.
6. Children's Healthcare of Atlanta has an "Aa2" rating and stable outlook with Moody's. CHOA is a leading provider of high acuity pediatric care in the Atlanta area and has favorable leverage metrics and a track record of strong margins and liquidity, according to Moody's.
7. Cleveland Clinic Health System has an "Aa2" rating and stable outlook with Moody's. The system has a track record of meeting operating challenges to sustain strong cash flow, exceptional fundraising capabilities, strong liquidity and a growing ability to leverage an international brand into revenue diversification, according to Moody's. The debt rating agency expects Cleveland Clinic to manage execution risks of multiple strategies, as demonstrated in the past.
8. Indianapolis-based Indiana University Health has an "Aa2" rating and stable outlook with Moody's. The system has healthy margins and a strong market position, according to Moody's.
9. Rochester, Minn.-based Mayo Clinic has an "Aa2" rating and stable outlook with Moody's. Mayo has an excellent clinical reputation and diversified revenue across multiple locations, states and types of hospitals, according to Moody's. The debt rating agency expects Mayo's cash flow to moderate over the next few years as the system completes an EMR implementation and then to return to stronger cash flow levels post implementation.
10. Broomfield, Colo.-based SCL Health has an "AA-" rating and stable outlook with Fitch and an "Aa3" rating and stable outlook with Moody's. The system's operating performance improved in fiscal year 2015, and SCL has sustained those results, according to Fitch. The system has manageable capital needs in the near term, a stable liquidity position and geographic diversity, with 12 hospitals in five markets across three states.
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