Citrus Memorial Hospital, Fla., Downgraded to B3 by Moody's

Moody's Investors Service said it has downgraded Citrus Memorial Hospital, Fla.'s (d.b.a Citrus Memorial Health System) bond rating to B3 from Ba3 affecting $38.5 million of outstanding bonds issued by the Citrus County Hospital Board.

The outlook remains negative.

The downgrade to B3 from Ba3 reflects Citrus' material decline in liquidity as of January 31, 2013 following problems stemming from the hospital's information technology system and physician billing system; very weak operating performance in FY 2012 and ongoing legal dispute regarding hospital governance that continues to consume management's time and resources. The negative outlook reflects the upcoming March 31, 2013 test date for the liquidity covenant on the bank notes and the current level of days cash on hand which is below the 65 day covenant.

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