Moody's Investors Service assigned its "Baa1" rating to Augusta (Ga.) University Health System's proposed $76.8 million series 2018 revenue bonds. At the same time, Moody's affirmed the health system's "Baa1" issuer rating.
The rating assignment and affirmation are based on the benefits of AU Health system's new organizational structure and financial oversight provided by the Board of Regents of the University System of Georgia and Augusta University. In addition, Moody's favorably viewed AU Health System's role as an academic medical center for the Medical College of Georgia in Augusta.
Moody's unfavorably viewed the health system's modest operating performance, challenging payer mix and narrow headroom to its liquidity covenant.
The outlook is negative, reflecting the health system's thin coverage of days cash on hand covenant and modest operating performance.