Moody's Investors Service has affirmed the "Baa3" rating assigned to Loma Linda (Calif.) University Medical Center's $329 million of debt and maintained the hospital's negative outlook.
The affirmation of the rating was based on a number of factors, including LLUMC's leading market position in its primary service area and improved operating losses at the Murrieta hospital. LLUMC-Murrieta's operating losses are expected to drop
to $10 million in FY 2014 from $50 million in FY 2012.
The hospital also faces many challenges, which were considered for the rating assignment, such as its ongoing weak and variable operating performance through FY 2013 and through the first six months of FY 2014.
LLUMC's unfavorable payer mix, modest liquidity and a very costly upcoming capital project are also potential challenges that factored into Moody's rating.
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