St. Louis-based Ascension, one of the largest hospital systems in the country, had "AA+" ratings confirmed but remains in danger of being downgraded as operating losses persist, S&P Global said Oct. 4.
The 140-hospital system's outlook is negative. Fitch revised the system's outlook to negative Sept. 26 amid similar concerns.
"The negative outlook on the long-term rating reflects Ascension's weakening financial profile, including persistent operating losses and lighter liquidity and financial flexibility, which could lead to a lower rating without meaningful improvement in fiscal 2024," S&P said.
Ascension reported a $3 billion operating loss Sept. 14 on fiscal year revenues of $28.35 billion. There is "very limited flexibility" within the current rating level to absorb continuing operating losses, S&P said.
As well as improvements in balance sheet metrics over the next couple of years, Ascension is expected to reshape its portfolio to aid recovery, S&P said.