Moody’s Investors Service changed its outlook on Decatur Memorial Hospital’s A2 rating to negative from stable due to a downturn in its operating performance. The action applies to nearly $40 million of debt.
The downturn in the hospital’s operating performance is due mainly to losses in cardiology services to its main competitor, St. Mary’s Hospital. DMH’s recent operating losses began in fiscal 2010 and are projected to continue through fiscal 2011, which ends Sept. 30. “Should this trend continue through fiscal year 2012, DMH’s credit rating would likely be affected,” analysts warned.