Fitch upgrades rating for Newport Hospital

NEW YORK – Fitch Ratings announced last week that it had upgraded the rating on the Rhode Island Health and Educational Building Corporation’s approximately $25.6 million hospital financing revenue bonds issued to Newport Hospital in 1999 to “A+” from “A,” adding that the company’s rating outlook is stable.
The “A+” rating upgrade is supported by Newport Health Care Corporation’s strong debt service coverage and excellent liquidity, which includes a guarantee of debt-service payment from the Newport Hospital, Fitch said in a news release.
At Fiscal Year 2007, days with cash on hand stood at 768.8 days of operating expenses and the cash-to-debt ratio at 642.3 percent, figures well above Fitch’s ‘A’ medians of 185.2 days and 111.6 percent, respectively.
The strength of Newport Hospital offset concerns regarding a history of negative operating margins, an increase in uncompensated care and physician recruitment needs, Fitch said.