S&P Global Ratings lowered its long-term rating on Northern Hospital District of Surry County (NHDSC), N.C.'s (d.b.a. Northern Regional Hospital) series 2017 revenue bonds to 'BB+' from 'BBB'. The outlook is negative. The lower rating is driven by continued deterioration in NHDSC's financial profile, with operating losses widening and unrestricted reserves continuing to decline from our last review. This contrasts with management's expectation for its financial improvement initiatives and accounts receivable (AR) normalization to improve key financial measures by fiscal 2022 year-end (ended Sept. 30). NHDSC finished the year in violation of its 1.0x debt service coverage covenant and, though a waiver is expected to be formally granted imminently, this also underpins the downgrade and negative outlook. Pledged revenue of
