The rating on New Jersey Health Care Facilities Finance Authority's bonds, issued for Beth Israel Hospital Association of Passaic, reflects a strong balance sheet, increased revenues made possible by new services, improved utilization, and positive margins. The outlook was revised to stable as concerns about decreasing state subsidies causing poor financial performance in 1996 did not materialize, and Beth Israel's intent to find a merger partner should stabilize the long-term operations. The balance sheet's strength is its liquidity, with $28.1 million cash in 1996--193% cash to debt and 204 days' cash on hand. Revenues had decreased in 1994 and 1995, but stabilized in 1996 and nine-month interims for 1997 indicate revenue growth. This is made possible both by new services
