Moody's Investors Service has assigned an "Aa3" rating to Renton, Wash.-based Providence Health and Services’ $210 million of series 2014D fixed rate revenue bonds to be issued by the Washington Health Care Facilities Authority.
The rating assignment was supported by a number of factors, including Providence's geographic diversification and good market concentration. The system is the leading provider in seven of its nine markets.
The rating assignment was also supported by Seattle-based Swedish Health Services integration with Providence.
Providence also faces a number of challenges, which were considered for the rating assignment, such as producing relatively poor operating results in fiscal year 2013. The system's operating cash flow margin dropped to 6.9 percent in FY 2013, down from 8.3 percent the prior year.