Hospital Earns Upgrade

Moody’s Investors Service raised its rating to Baa1 from Baa2 on Wheaton Franciscan Services in recognition of several years of improved operations at the Wisconsin hospital and the strong results expected this year.

The action affects a total of $742 million of rated debt.

The system last year marked three consecutive yeas of profitable operations. It generated $1.7 billion of operating revenues last year.

The health care system’s credit also benefits from Wisconsin’s hospital assessment charge, which provides $50 million to $60 million in annual matching federal funds.

Its challenges include unfunded pension liabilities, losses suffered by physician operations and competitive pressures.

“We believe that the system is in a transition period, that while intentional, has resulted in a smaller platform that bears the risk of being centric to a competitive market with a weaker payer mix,” Moody’s analysts wrote.

The hospital recently shed its stake in Affinity Health System.

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Healthcare industry Wisconsin
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