S&P Global Ratings downgraded Pine Bluff, Ark.-based Jefferson Regional Medical Center's underlying rating to "A-" from "A."
"The lowered rating reflects our view of JRMC's fiscal [year] 2017 and fiscal 2018 year-to-date operating losses and management's expectations that these losses will continue in fiscal 2019," said S&P credit analyst Wendy Towber. "While management has a number of turnaround initiatives in place, the operating challenges are proving to be more persistent than expected and will likely continue through the outlook period."
The outlook is negative, reflecting the medical center's plan to move forward with a large expansion and renovation project, despite the operating losses. S&P expects the construction project to pressure JRMC's rating further by weakening its balance sheet metrics.