CHICAGO - Standard & Poor's view of the University of Wisconsin Hospital & Clinics Authority's A-plus rating has brightened.
The rating agency on Sept. 16 revised its outlook to positive from stable on the authority's 2013 healthcare revenue bonds and 2009B issuance. The authority has additional debt rated AAA based on bank support.
"The positive outlook reflects our view of UWHCA's solid enterprise profile, which is anchored by its strong business position as the state's only academic medical center and the recent execution of growth strategies in alignment with University of Wisconsin School of Medicine and Public Health and University of Wisconsin Medical Foundation, " said analyst Stephen Infranco.
Additional factors supporting the credit include the system's overall strong financial profile with revenue and geographic diversity and the acquisition this year of Swedish American Health System which gives it a presence in Winnebago County, northern Illinois, and southern Wisconsin.
"We believe that because the two organizations' service areas complement each other, the merger would support an improved competitive position, economies of scale, and the ability to further strength programmatic services and better execute population health strategies," Standard & Poor's wrote.
The rating agency said it could raise the rating over the two-year outlook period if UWHCA can successfully navigate the SAHS acquisition and recent organizational changes and strengthen the overall financial profile.
UWHCA is evaluating its long-range strategic and capital plans so future rating actions will also hinge on assessing the details around the plan and ultimately what effect it might have on the financial profile over time, analysts added.
UWHCA operates University of Wisconsin Hospital and Clinics, which consists of a 530-bed hospital and a 87-bed pediatric facility on the UW-Madison campus. It has an affiliation agreement with the University of Wisconsin School of Medicine and Public Health and so serves as its primary teaching hospital.
