Toledo, Ohio-based ProMedica has had its ratings on various bonds and its default grade downgraded to "BB-" from "BB+," Fitch Ratings said May 9.
The move reflected the "precipitous decline in liquidity" in fiscal 2022, Fitch said. In addition, the 11-hospital system was placed on "Negative Watch" amid uncertainty over the planned $710 million sale of much of its hospice and home health units.
"Fitch believes that ProMedica remains in a precarious position given its very thin liquidity, uncertainty of the current operating environment and risks related to certain financial covenants," the research note said.
Sustained operating losses are also driving much of the downgrade.
ProMedica reported an almost $400 million operating loss in 2022.