Bangkok--20 Aug--Standard & Poor's
Standard & Poor's Ratings Services revised its rating outlook on Antelope Valley Healthcare District (AVHD), Calif.'s million revenue bonds, series 1997 A and B to stable from negative. At the same time, Standard & Poor's affirmed its 'BB' underlying rating (SPUR) on the bonds.
"The outlook revision reflects our view of AVHD's continued improvement in operating performance," said Standard & Poor's credit analyst Emily Wong.
AVHD's operating performance has improved since fiscal 2007 (year ended June 30) with a negative $18.5 million operating loss to a $8.2 million operating loss in fiscal 2008 and an operating gain of $2.2 million for fiscal 2009 (unaudited). The improved profitability has been driven by reduced labor and supplies expense and enhanced revenue through better contracting, increased volume, and improved revenue cycle management. In addition, AVHD has maintained what we consider solid liquidity for the rating level with 121.5 days' cash on hand as of June 30, 2009.
AVHD's operating improvement has been driven in our view by the financial turnaround plan that was implemented by the management team in late 2007. In fiscal 2009, AVHD posted its first operating gain in the past five years. Fiscal 2009's total operating revenue increased 4.6% to $328.5 million driven by increased volume. Other initiatives implemented by management include increased physician recruitment and alignment, improved coding and documentation, and enhancing services. AVHD expects to receive Level II trauma status designation by the end of calendar year 2009, which should improve reimbursement.
RELATED RESEARCH
USPF Criteria: "Not-For-Profit Health Care," June 14, 2007
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Emily Wong, New York (1) 212-438-6489
Geraldine Poon, San Francisco (1) 415-371-5078
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_ [email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]