S&P Global Ratings lowered its long-term rating on Montgomery County Higher Education&Health Authority, Pa.'s revenue bonds, issued for Holy Redeemer Health System (HRHS), to 'BBB-' from 'BBB'. The outlook is negative. The downgrade reflects persistently high operating losses that are weaker than expected and below budget in fiscal years 2017 and 2018 and that are continuing into 2019. Because of the high operating losses, HRHS is reliant on nonoperating revenue and has been able to produce just adequate debt service coverage (DSC). HRHS' unrestricted reserves have historically been a credit strength, but support of operations and capital spending has depleted unrestricted reserves by $20 million since the end of fiscal 2017. Future rating action hinges on management's ability
