JOHNSON CITY, Tenn., April 23, 2021 (GLOBE NEWSWIRE) -- S&P Global Ratings announced today it has affirmed Ballad Health’s credit rating as “A-” with a stable outlook. This announcement follows the recent upgrade to A3 from Baa1 by Moody’s Investor Services and a recent report by Fitch Credit Ratings affirming Ballad Health’s “A” rating.
This is the first time in its history Ballad Health, or either of its predecessor organizations, received “A” ratings from all three credit reporting agencies.
“In our opinion, Ballad Health has an experienced management team that has responded well to the challenges of the pandemic, taken a proactive and purposeful approach to the merger that includes developing a strong strategic vision, setting explicit financial and non-financial goals, aligning executive and functional leadership, integrating cultures, and leveraging integration best practices,” said S&P in its report. “Furthermore, we believe management is making some difficult decisions around the need for consolidation of services across the system, to improve quality and performance, while maintaining access across the region.”
The report states S&P expects lingering effects of the pandemic will impact earnings in the near future as volumes continue to be mixed and as expenses for labor, supplies and testing add stress to the system. As with health systems throughout the nation, the report cites an expectation that staffing and labor shortages will continue to impact Ballad Health.
“We are grateful for the diligence of S&P Global Ratings as they reviewed our operations and our quality performance,” said Ballad Health Chairman and Chief Executive Officer Alan Levine. “We have been transparent with the challenges we face, and we are pleased to learn Ballad Health’s resilience stands out as so many health systems continue to struggle. This is a testament to our Board of Directors, our team members and our physicians, who work so hard each day to serve our region.”
Levine pointed to a Washington Post-Kaiser Family Foundation poll released on Wednesday, April 21, that predicts roughly three in 10 healthcare workers have weighed leaving the profession, citing burnout and stress from the novel coronavirus (COVID-19) pandemic. He expressed concern for the healthcare workforce in the region, which continues to struggle with the burden of the pandemic and the national shortage of nurses.
“Our No. 1 concern right now is for the safety and well-being of our team members and providers,” Levine said. “They have endured the burden of this pandemic, and they continue to work so hard to serve the people in our region. They are tired, and many are burned out; yet they continue to show up.
“The looming shortage of nurses is going to be a major concern for the entire healthcare industry going forward, and Ballad Health is working to prepare for this.”
In releasing their rating report, S&P further cited other factors weighing in its decision.
“The rating reflects our opinion of Ballad’s strong enterprise profile….good size and scale, and experienced management team,” it added. “Management continues to execute on key strategies following the 2018 merger of Mountain States Health Alliance and Wellmont Health System, some of which include enhancing its digital and information technology capabilities, focusing on opportunistic growth initiatives, with increased access and expansion of services in its core markets, and continued consolidation where necessary to gain efficiencies and improve patient quality.”
S&P also cited specific challenges that are credit risks, including near-term operating stress caused by the pandemic, a challenging payor mix with a modestly declining privately insured population and increased reliance on governmental payors, as well as the complexities and level of regulatory oversight to comply with terms of the Certificate of Public Advantage in Tennessee and Cooperative Agreement in Virginia.
More information about Ballad Health is available at www.balladhealth.org.
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About Ballad Health
Ballad Health is an integrated healthcare system serving 29 counties of Northeast Tennessee, Southwest Virginia, Northwest North Carolina and Southeast Kentucky. Our system was created to improve the health of the people we serve. Ballad Health operates a family of 21 hospitals, including three tertiary medical centers, a dedicated children’s hospital, community hospitals, three critical access hospitals, a behavioral health hospital, an addiction treatment facility, long-term care facilities, home care and hospice services, retail pharmacies, outpatient services and a comprehensive medical management corporation. At Ballad Health, we’re completely invested in our communities because we’re your neighbors, and this is our community too. We’re here to listen to you and address your unique needs – and we’ll always be accountable. Learn more at www.BalladHealth.org.