Fitch Ratings last week upgraded Aurora Health Care Inc. to A from A-minus in recognition of its strong credit profile and establishment as a fully integrated health care delivery system.

The action impacts about $510 million of debt sold through the Wisconsin Health and Educational Facilities Authority. Portions of the bonds carry insurance from MBIA Insurance Corp., which has lost its triple-A status, and Financial Security Assurance, which is under review by one rating agency for a possible downgrade.

Fitch analysts said the upgrade is based on Aurora’s low operating risk profile gained via its large and integrated delivery system, its consistent improvement in operating profitability, and excellent management practices.

The system has nearly completed a decade-long expansion strategy to create a fully integrated health care delivery system. With 13 hospitals located throughout eastern Wisconsin, Aurora is the largest health care provider in the state.

Remaining credit concerns including the system’s light liquidity levels, competition in the Milwaukee market where it holds the leading share of 35%, and future capital spending. The system is considering building a 110-bed hospital in Summit and expects to build an 89-bed, $189 million facility in Grafton beginning this fall.

Fitch said the rating action incorporates the expected issuance of $160 million in September for various capital projects. Aurora had total operating revenues of $3.2 billion in fiscal 2007.

Standard & Poor’s rates the system BBB-plus.

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