Moody’s Investors Service placed the Baa1 rating of UMass Memorial Health Care on review for downgrade, affecting $299 million in rated debt outstanding.

Moody’s cited “further deterioration in operating performance” during fiscal 2013, an extremely thin operating cash flow, a decline in liquidity partly due to delayed receipt of supplemental Medicaid funding for fiscal 2013, and ongoing negative pressure on patient volumes.

“Further, receipt of Medicaid supplemental funding has been delayed, although management is accruing for a portion of it in year-to-date financials,” Moody’s said Sept. 16. “However, even if the full amount of supplemental funding is recognized in [fiscal] 2013, the operating margin and cash flow margin will still be very thin.”

UMass Memorial Health Care is the largest health care system in central and western Massachusetts, and the clinical partner of the University of Massachusetts Medical School in Worcester. The system has several new members of its senior leadership team, including Eric Dickson, who became president and chief executive on Feb. 25.

Moody’s said its review will concentrate on operating-performance strategies, including the fiscal 2014 budget, and expense and benefit containment initiatives. Moody’s will also continue to monitor receipt of fiscal 2013 supplemental Medicaid funding.

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