CHICAGO-- Moody's Investors Service revised its outlook on Iowa-based St. Anthony Regional Hospital's Baa2 rating to negative.
The action impacts $10.8 million of rated debt issued by the city of Carroll and Carroll County.
The outlook shift "is based on St. Anthony's variability in operating performance despite the hospital's participation in Medicare's Rural Community Hospital Demonstration Act, highlighting the risks associated with a smaller sized acute care hospital," Moody's wrote.
The hospital saw volume soften in fiscal 2013 due to the departure of two physicians.
"Continued softer performance in the next two fiscal years would likely result in negative rating action," Moody's wrote.
The rating reflects St. Anthony's position as the dominant provider in a broad six county service area and good balance sheet measures.
St. Anthony participates in Medicare's Rural Community Hospital Demonstration Act, which runs for a five year period, beginning in fiscal 2012 and will reimburse St. Anthony at cost for its Medicare population.
