Fitch Ratings has assigned an "A+" rating to the approximately $386 million series 2015 revenue bonds issued on behalf of Washington, D.C.-based Children's National Medical Center and upgraded the rating on CNMC's outstanding debt to "A+" from "A."
Here are four things to know about the rating assignment and rating upgrade.
1. The rating assignment was based on a number of factors, including CNMC's leading and growing market position in its service area for pediatric services.
2. The rating assignment was also supported by the hospitals move toward a value-based environment. For instance, the hospital is in the process of developing an integrated network and aligning with community/independent physicians to be able to manage population health, according to Fitch.
3. CNMC faces some challenges, which were considered for the rating assignment, such as meeting the demand of volume growth that the hospital has seen.
4. The upgrade to "A+" from "A" reflects CNMC's sharp improvement in financial performance since Fitch's last rating review in December 2013. Through the nine months ended March 31, 2015, CNMC had a 5.6 percent operating margin compared to 1.1 percent the same prior year period, 3.4 percent in fiscal year 2014 and 1.2 percent in fiscal year 2013.
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