Moody's Investors Service said it has upgraded St. Charles Health System, Ore.'s (formally Cascade Healthcare Community) revenue bond rating to A2 from A3, and has revised the outlook to stable from positive.

The upgrade affects approximately $153 million of revenue bonds originally issued by the Deschutes County Hospital Facilities Authority.

The upgrade to A2 from A3 and the assignment of a stable outlook at the new rating level reflects St. Charles Health System's (SCHS) improved balance sheet, its maintenance of good operating performance measures, and the consolidation of its market position in the Bend region.

The demographics here have not improved back to their pre-2008 levels and the economy continues to underperform, nevertheless management has continued to improve organizational efficiencies, and has maintained profitability despite the lack of admissions or revenue growth.

The stable outlook reflects increased capital spending on the horizon, and the assumption that the balance sheet and profitability will remain within current parameters.

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