...The rating upgrade to 'A+' for the outstanding hospital revenue bonds of Benefis Health System (Benefis) is driven by its continued trend of strong operating profitability, which has resulted in significant growth in balance sheet resources over the past two years, driving Fitch Ratings' expectations for sustained solid core operations and a strong net leverage position through the cycle. The 'A+' rating acknowledges that the strength of Benefis' market position is balanced somewhat by its weakened payor mix, with Medicaid growing considerably as a percentage of gross revenues over the past three years to just under 25% as of the third quarter of 2018 (including self-pay). While this percentage is still adequate for a midrange assessment of its revenue source characteristics, Fitch believes that Benefis' service area displays certain unfavorable demographic and economic characteristics that could marginally pressure its payor mix, especially during times of economic stress. Fitch also expects...
