Fitch downgraded Beaver, Pa.-based Heritage Valley Health System's rating from "A+" to "A."
The downgrade reflects ongoing operating and excess losses that have persisted over the past four years, Fitch said in a July 9 report. The ratings agency said the system's struggles have been driven by a variety of issues that have been compounded by staffing shortages, inflation, and supply chain disruption.
Heritage Valley also has a negative outlook with Fitch.
Fitch said it believes that many of the challenges that have emerged post-pandemic are not temporary and "likely represent a new normal for the health system." The agency expects operational pressure will continue to impact cash flow and limit the recovery of key balance sheet metrics, which is reflected in the negative outlook.
"While Fitch believes that initiatives being implemented by the management team should lead to improvement, the path may take longer than anticipated," the agency said in the report.