Moody’s assigns ‘Aa3’ rating to MultiCare Health System’s bonds

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Moody’s Investors Service assigned its “Aa3” rating to Tacoma, Wash.-based MultiCare Health System’s proposed $318 million series 2017A and 2017B revenue bonds.

Additionally, Moody’s affirmed the “Aa3” rating on MultiCare Health’s parity debt, affecting $847 million of rated debt.

The affirmation and assignment are a result of several factors, including the health system’s strong market position, greater revenue diversity and recent acquisition of two hospitals in Spokane, Wash. Moody’s also acknowledged MultiCare Health’s weaker operating performance in fiscal year 2016 and more than 30 percent increase in debt and risks associated with integrating into the Spokane market.

The outlook was revised to negative from stable, reflecting the health system’s increased debt burden and anticipated decreases in profitability as the health system integrates into a new market.

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