Moody's Investors Service has affirmed the "Baa1" long-term rating assigned to $76 million of outstanding bonds issued on behalf of Butler (Pa.) Health System by the Butler County Hospital Authority.
The rating affirmation was supported by a number of factors, including Butler's fairly isolated geographic isolation, modest comprehensive debt, growing operating performance and cash, and a deleveraged balance sheet from fiscal year 2013 to unaudited FY 2014.
In addition, Butler maintains a leading market share, dominating 63.7 percent of volumes in its primary service area.
The health system also faces some challenges, such as having a weaker payer mix, with Medicare/Medicaid representing 62 percent of its gross revenues.
Moody's also revised the health system's rating outlook from stable to positive. The outlook revision was based on the belief that the Butler will maintain its dominant market position and favorable operating margins.