Moody's Investors Service affirmed its "Aa2" long-term rating and "Aa2/VMIG 1" short-term rating on Children's Healthcare of Atlanta's bonds issued though the Fulton County Development and DeKalb Private Hospital Authorities, affecting $430 million of debt.
The long-term affirmation is a result of several factors, including the health system's healthy operating margins, solid liquidity measures, leading market position and advantageous leverage metrics. Moody's also acknowledged CHOA's dependency on supplemental payment sources such as Medicaid, increasing the system's vulnerability to potential cutbacks.
The short-term affirmation is attributed to bank standby bond purchase agreements that support CHOA's variable rate debt.
The outlook is stable, reflecting Moody's expectation that CHOA will manage their capital spending properly, while maintaining strong operating margins and liquidity metrics.