Standard & Poor’s Upgrades UC Health

Standard & Poor’s Ratings Services has upgraded UC Health’s long-term bond rating to A, up from A- and cited UC Health’s “very strong enterprise profile” and a strong financial profile in Cincinnati’s highly competitive market.

This positive evaluation of its financial and operational strength follows a recent upgrade by Moody’s Investors Service, which changed UC Health’s outlook to positive from stable. Additionally, both Moody’s and Standard & Poor’s upgraded UC Health’s long-term bond rating in 2014. A rating upgrade two years in a row is very unusual in this competitive healthcare environment.

S&P noted that UC Health is the region’s only academic medical center, with a sound and growing inpatient market share, strong physician recruitment, and improvement in overall payor mix.

Richard P. Lofgren, MD, president and chief executive officer of UC Health, said “This upgrade from Standard & Poor’s, one of the major bond-ratings agencies in the U.S., following an upgrade in outlook from Moody’s, reflects the positive momentum we are building at UC Health. They recognize that as the region’s only academic health system, we have a unique role and responsibilities to serve the Greater Cincinnati community and beyond, and that we are executing from a solid business plan to meet those responsibilities. In our leadership role as the health system that cares for the sickest of the sick and for vulnerable populations, we are focusing on patient outcomes and doing so in an efficient, cost-effective way.”

“Our long-term strategies along with the successful integration of our governance and clinical operations as well as our strong and productive partnership with the University of Cincinnati and the UC College of Medicine, enable us to make the necessary investments to remain the premiere provider of advanced specialty care in this region,” Lofgren added.

S&P highlighted a number of factors that contributed to the upgrade:

  • Re-establishing and strengthening key tertiary series lines such as cardiology and bone marrow transplant;
  • Successful integration of University of Cincinnati Physicians Inc., the University of Cincinnati College of Medicine’s faculty practice plan, into UC Health’s operations;
  • Strong physician recruitment, with 74 physicians added in 2013, 64 in 2014, and 97 of 2015’s target of 113 already on board;
  • Expansion of UC Health’s ambulatory care business with two new large ambulatory centers;
  • Expansion of UC Health’s primary service area, a reflection of its strength in tertiary care;
  • Continued success of UC Health’s West Chester suburban satellite hospital;
  • “Sharp improvement in operations,” beginning in 2014, improved unrestricted cash and investment that is sound, and a capital and facilities plan that is manageable in scope without any additional borrowing.
  • Appointments of a new Chief Medical Officer, Chief Operating Officer and Head of Physician Services.

Dr. Lofgren concluded, “We continue to move forward securing the financial health of the institution, with necessary capital projects to improve our system, and positioning it for success, now and in the future.”

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