Fitch Ratings, Moody's Investors Service and S&P Global Ratings have all revised their credit outlook for Boston-based Partners HealthCare from stable to negative. If Partners doesn't shore up its finances, the major debt ratings may downgrade the system's credit rating, according to the Boston Globe.
Moody's and S&P both revised Partners' outlook in January. Regarding the revision, S&P analyst Jennifer Soule said, "The negative outlook reflects our view of Partners' weakened financial profile, including volatile financial operating performance in recent years and a sizeable operating loss reported for fiscal 2016."
Partners ended fiscal year 2016 with an operating loss of $108 million — the biggest operating loss in the system's history. The largest portion of the system's losses — $104 million — came from Neighborhood Health Plan, Partners' insurance subsidiary that provides coverage to more than 430,000 commercial and Medicaid members.
When Moody's revised Partners' outlook to negative, the debt rating agency said it expects Partners will face continued losses on its insurance division.
Last week, Fitch downgraded the rating on about $3.9 million of bonds issued by Partners or on behalf of the system to "AA-" from "AA" and revised Partners' outlook to negative. "Failure to stabilize profitability will likely lead to further negative rating pressure," said Fitch.
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