Fitch: 2013 Medians Remain Solid for Nonprofit Hospitals and Healthcare Systems

<0> Fitch: 2013 Medians Remain Solid for Nonprofit Hospitals and Healthcare Systems </0>

<0> Fitch RatingsJames LeBuhnSenior Director+1-312-368-2059Fitch Ratings, Inc.70 W. Madison StreetChicago IL 60602orMichael BurgerDirector+1-212-908-0555orEmily E. WadhwaniAssociate Director+1-312-368-3347orMedia Relations:Elizabeth Fogerty, New York, +1 212-908-0526Email: </0>

Link to Fitch Ratings' Report: 2013 Median Ratios for Nonprofit Hospitals and Healthcare Systems

Median ratios for nonprofit hospitals and healthcare systems were mostly unchanged with a slight improvement in liquidity metrics as the sector prepares for the implementation of key health care reform measures, according to a new Fitch Ratings report.

Balance sheet liquidity and overall operating profitability measures improved slightly in 2012 while leverage metrics were mostly stable. Revenue growth continued to outpace expenses. However, Fitch expects to see some narrowing of operating margins in next year's medians as expense reductions and weaker volumes produce diminishing returns. For the latter half of fiscal 2013, significant pressure remains. Through mid-July, the downgrade to upgrade ratio was nearly 2:1.

The largest concerns revolve around industry pressures, which continue to prompt consolidation activity and will pressure operating performance going forward. While continued attention to operating efficiency, revenue cycle improvement, and expense control have preserved cash flow thus far, these efforts will be less effective as reimbursement continues to tighten.

Overall debt levels remained flat, however Fitch observed the conversion of variable rate bonds to a fixed rate mode or shorter term bank placement debt and, which resulted in increased debt service requirements in many instances.

The overall credit strength in Fitch's portfolio remains healthy. Since 2003, the median rating in Fitch's portfolio has migrated up to 'A' from 'A-' with a significant increase in the percentage of 'AA-' borrowers. Since 2003, the percentage of 'AA-' has increased to 18.5% from 11.0%.

Fitch will be hosting a conference call to discuss the report on Wed. Aug. 14th at 2:00 PM eastern.

--Participant Dial-In Number(s):

--Toll-Free Dial-In Number: (877) 467-8597

--International Dial-In Number: (706) 902-0405

--Conference ID #: 26729648

Replays will be available for 30 days and are accessible through the following numbers:

--Toll-Free Dial-In Number: (855) 859-2056

--International Dial-In Number: (404) 537-3406

--Conference ID #: 26729648

For more information, a special report titled '2013 Median Ratios for Nonprofit Hospitals and Healthcare Systems' is available on the Fitch Ratings web site at .

Additional information is available at ''.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: . IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE ''. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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