St. Luke’s University Health Network has been awarded an A- bond rating by S&P Global Ratings and an A3 rating by Moody’s Investor Services, bucking a downward trend in the nonprofit hospital industry both nationally and locally.
“The 'A-' rating reflects our opinion of SLUHN's increasing market share in its primary service area, healthy volume growth, and very strong leadership team that has demonstrated operational success and strong project management,” S&P said in its report on St. Luke’s Northampton County General Purpose Authority 2018A and 2018B bonds, as well as to other debt issued in prior years for St. Luke's.
Moody’s also lauded St. Luke’s leadership, citing its “proven track record of integration and ability to manage multiple strategies.”
“Management has a demonstrated ability to manage multiple initiatives, execute large construction projects and operationalize clinical facilities,” Moody’s said.
Nationally, the ratio of nonprofit hospital and health system credit downgrades to upgrades rose in 2017, according to a recent analysis by Moody's. There were 41 downgrades and 12 upgrades in 2017 – a higher ratio than in 2008 and 2009 during the height of the economic downturn.
In its assessment of St. Luke’s, S&P said its outlook for St. Luke’s is stable, reflecting “our opinion of SLUHN's strong enterprise profile and solid and experienced management team. The outlook also reflects the network's improved operating performance and solid coverage.”
Earlier this year, St. Luke’s merged with Blue Mountain Health System in Carbon County and Sacred Heart HealthCare System in Lehigh County.
“Management has had early success with its turnaround plans at both systems, with a small operating gain at [Blue Mountain],” S&P said. “Management expects continued profitability at [Blue Mountain] and expects [Sacred Heart] to improve to achieve positive earnings in 2019.”
Moody’s said St. Luke's “broad geographic reach, strong market position as well as size and scope of operations will continue to fuel robust operating momentum as the System's financial leverage rises.”
In March, St. Luke’s was designated an IBM Watson Health (formerly Truven) 100 Top Hospital for a sixth time and the fourth year in a row – widely regarded as one of the highest honors in the health care industry.
For copies of the S&P and Moody’s reports, news media may contact Sam Kennedy, Corporate Communications Director, 484-526-4134, email@example.com
About St. Luke’s
Founded in 1872, St. Luke’s University Health Network (SLUHN) is a fully integrated, regional, non-profit network of 14,000 employees providing services at 10 hospitals and over 300 outpatient sites. With annual net revenue of $1.9 billion, the Network’s service area includes 10 counties: Lehigh, Northampton, Berks, Bucks, Carbon, Montgomery, Monroe and Schuylkill counties in Pennsylvania and Warren and Hunterdon counties in New Jersey. Dedicated to advancing medical education, St. Luke’s is the preeminent teaching hospital in central-eastern Pennsylvania. In partnership with Temple University, St. Luke’s created the region’s first and only regional medical school campus. It also operates the nation’s longest continuously operating School of Nursing, established in 1884, and 28 fully accredited graduate medical educational programs with 226 residents and fellows. St. Luke’s is the only health care system in central-eastern Pennsylvania to earn Medicare’s five-star rating (the highest) for quality, efficiency and patient satisfaction. St. Luke’s has earned the 100 Top Major Teaching Hospital designation from IBM Watson Health (formerly Truven Health Analytics) repeatedly – six times total and four years in a row including 2018. It has also been cited by IBM Watson Health as a 50 Top Cardiovascular Program. Utilizing the EPIC electronic medical record (EMR) system for both inpatient and outpatient services, the Network is a multi-year recipient of the Most Wired award recognizing the breadth of the SLUHN’s information technology applications such as telehealth, online scheduling and online pricing information. St. Luke’s is also recognized as one of the state’s lowest cost providers.