Moody's Investors Service has upgraded the ratings on Newark, Del.-based Christiana Care Health Services' outstanding bonds to "Aa2" and "Aa2/VMIG 1" and revised the system’s outlook to stable at the higher rating level.
The rating upgrade affects $253 million of outstanding debt issued by the Delaware Health Facilities Authority.
The rating upgrade was supported by a number of factors, including Christiana Care's consistently strong financial performance. The system's margins have been strong with double digit operating cash flow margins of 11.9 percent, 11.2 percent and 11.3 percent in fiscal years 2012, 2013 and 2014, respectively.
The rating upgrade was also supported by the system's dominant market position in its service area and its strengthened debt coverage.
Christiana Care faces some challenges, which were considered for the rating upgrade, such as having a highly concentrated payer mix in which one payer accounts for the majority of the system's commercial business.