Ontario, Calif.-based Prime Healthcare has received a credit rating upgrade from two major agencies following the integration and improved performance of several recently acquired hospitals in Illinois.
Four things to know:
1. Fitch Ratings upgraded Prime’s senior secured notes to “B+,” while Moody’s raised its corporate credit rating to “B2.” S&P Global Ratings affirmed the company’s current rating and revised its outlook to positive. The moves follow Prime’s acquisition of eight Illinois hospitals from St. Louis-based Ascension in March.
2. All three agencies cited Prime’s stronger EBITDA, reduced reliance on temporary labor and effective cost management as key drivers for the upgrade. Fitch pointed to “performance improvements at the Chicago hospitals, positive trends in the base business, and leverage reduction.” Moody’s also noted a “material improvement of the company’s EBITDA and EBITDA margin in recent quarters.”
3. S&P highlighted increased patient admissions and decreased contract labor costs, alongside benefits from Prime’s growing scale due to the Illinois expansion. The agency added that the outlook could shift to an upgrade if the company meets expectations in its integration of the Ascension hospitals.
4. Prime operates 51 hospitals across 14 states and more than 360 outpatient locations, with a workforce of over 57,000 staff and affiliated physicians, according to its website. Eighteen hospitals are part of the Prime Healthcare Foundation, the health system’s nonprofit arm.
“Prime’s recent upgrades from all three major rating agencies are a direct reflection of our strong financial performance, operational discipline and strategic growth,” Prime CFO Steve Aleman said in an Aug. 12 news release “[Our] expansion into the Chicago market and continued focus on delivering high-quality care have positioned us for sustainable, long-term success.”
The post Prime’s Illinois expansion, hospital performance drives credit rating boost: 4 things to know appeared first on Becker's Hospital Review | Healthcare News & Analysis.
