WASHINGTON - Marking the 10th anniversary of Allegheny Health, Education, and Research Foundation's historic bankruptcy filing and payment default, Moody's Investors Service issued a report yesterday on the lessons learned from that debacle and the challenges still facing nonprofit hospitals.

With $2 billion in revenue and $555 million of outstanding debt, the Pittsburgh-based chain of hospitals declared bankruptcy on July 21, 1998, a move that was triggered by both external, industry-wide forces as well as the organization's poor management and governance failures following its vast expansion, Moody's said. The Securities and Exchange Commission later sanctioned AHERF for overstating net income by millions of dollars and masking a seriously deteriorating financial condition.

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