McLaren in Good Health

Moody’s Investors Service last week upgraded to Aa3 from A1 debt issued on behalf of McLaren Health Care Corp., and revised the outlook to stable from positive.

The upgrade affects nearly $540 million issued through the Michigan State Hospital Finance Authority.

The six-hospital system reported roughly $1.7 billion of operating revenue is fiscal 2009. McLaren continues to see strong operating results and a strong market presence despite the state’s economic pressures, Moody’s said.

The system, which operates in six markets across lower Michigan, faces challenges in some of its more competitive areas and as it attempts to integrate two new and financially struggling hospitals.

Other challenges include potentially large capital needs in the future, underfunded pension plans, a weak regional economy, and a heavily unionized workforce. McLaren plans to build a new acute-care hospital near Pontiac in the coming years.

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Healthcare industry
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