Grand Blanc, Mich.-based McLaren Health Care had its ratings affirmed at "AA-" as the 14-hospital system continues to enjoy strong market share and resilient profitability, Fitch Ratings said March 20.
The ratings refer both to its default rating and to that on a series of bonds. The outlook is stable.
While the system has been challenged by ongoing pressures common to much of the industry such as labor and inflationary obstacles, it has maintained sound margins compared with its historic profitability, Fitch said. There were margin declines but not as significant as many of its peers, the agency said.
McLaren is in the process of selling its St. Luke's Hospital in Maumee, Ohio, and that sale and reduced contract labor costs will help boost the system's cash flow.
The system has what Fitch calls "broad coverage" in Michigan and Indiana and is the hospital market leader in some key markets. Its 24 percent inpatient market share makes it a leader in its coverage area, Fitch said.
As well as its hospitals, McClaren also operates two health plans with membership totaling approximately 730,000 and a number of outpatient facilities. Its revenue exceeded $6.4 billion in fiscal 2022, Fitch said.