Scottsbluff, Neb.-based Regional West Health Services was downgraded to "BB-" and placed on a negative rating watch as "sizeable fiscal 2022 operational losses" continue to affect the health system, according to a July 31 Fitch Ratings report.
Ongoing cost pressures and problems associated with its 2018 Cerner EMR implementation have contributed to the two-notch downgrade from "BB+," Fitch said. The rating refers both to its default rating and that on a series of bonds.
The negative watch came as the system failed to meet debt service requirements. As of June 30, Regional West Health had $66.7 million of outstanding debt and $26.2 million in cash and investments, according to the research note.
While operating profitability improved in the second quarter of 2023, the system still faces "revenue pressure related to its Cerner implementation."
Regional West Medical Center, a 188-bed hospital, is the sole member of the obligated group in the system, which also includes a physician clinic and other sites of care.