Fairview Health Services saw its credit rating from Moody's Investors Service drop one notch, and analysts said the outlook for the system is negative, in part because of the exit of its chief executive officer and turmoil over the health system's contracts with Accretive Health.
Moody's lowered Fairview's credit to an A3, a relatively strong rating, from A2. The Minneapolis-based system, which includes seven hospitals, saw its operating margin for 2011 (0.5%) squeezed by a new children's hospital and information technology installation, the rating agency said. Cash reserves declined last year. And its debt portfolio includes swaps that have strained finances across the sector since the credit crisis.