Moody's Investors Service has downgraded the rating of Turnersville-based Kennedy Memorial Hospital University Medical Center to A3 from A2. The outlook remains stable at the lower level, analysts said.
The action affects $61.7 million of outstanding debt.
Moody's cited as a reason for the downgrade Kennedy's location in a crowded southern New Jersey marketplace, adjacent to Philadelphia.
In addition, the medical center's cash balance sheet, after several years of high capital spending, is inconsistent with an A2, the agency said.
While Moody's praised Kennedy's management team for its turnaround plan and its relationships with the University of Pennsylvania Health System, Thomas Jefferson Health System and the Rothman Institute, it also said that "it will take time to return the balance sheet to previous levels that support an A2 rating."
