Summary: Northern Hospital District of Surry County, North Carolina; Hospital

S&P Global Ratings' long-term rating on Northern Hospital District of Surry County (NHDSC), N.C.'s revenue bonds is 'BBB'. The outlook is stable. The rating reflects our view of NHDSC's healthy margins, robust unrestricted reserves, and stable market position. Despite the solid operations, NHDSC operates in a small, economically challenged area with a limited revenue base that relies on governmental payers for a large majority of net patient revenue. As of March 2019, NHDSC lost its designation as a 340b hospital, leading to lower-than-expected margins in interim 2019. To remediate this NHDSC has applied for sole community hospital status, which would allow the hospital to receive 340b funding as well as improve Medicare reimbursement. The application was initially denied, but NHDSC

...S&P Global Ratings' long-term rating on Northern Hospital District of Surry County (NHDSC), N.C.'s revenue bonds is '###'. The outlook is stable. The rating reflects our view of NHDSC's healthy margins, robust unrestricted reserves, and stable market position. Despite the solid operations, NHDSC operates in a small, economically challenged area with a limited revenue base that relies on governmental payers for a large majority of net patient revenue. As of March 2019, NHDSC lost its designation as a 340b hospital, leading to lower-than-expected margins in interim 2019. To remediate this NHDSC has applied for sole community hospital status, which would allow the hospital to receive 340b funding as well as improve Medicare reimbursement. The application was initially denied, but NHDSC is going through the appeals process and management expects to ultimately win approval. With the approval, we would expect margins to improve through the remainder of the fiscal year. However, if the approval...

Summary