Rating and Investment
services classify healthcare entities in the broad category
of U. S. Public Finance. Within public finance sector, public
utilities (especially nuclear power plants) are considered
slightly more risky than a tax-exempt security for healthcare
entities. There are no AAA bonds in healthcare that are based
on the financial viability of the hospital. Many hospitals
that issue bonds have debt insurance that may guarantee the
principal and interest so that a AAA bond-rating is given
for the issue based on the "creditworthiness" of
the insurance company or commercial bank.
corporations providing healthcare debt insurance coverage
are FGIC (Financial
Guaranty Insurance Company) and MBIA
principal bond rating services are Standard & Poor's,
Investors Service, and Fitch IBCA, Inc. Standard & Poor's
Investors Service are much more restrictive in the types of
they will review versus Fitch IBCA, Inc.
IBCA, Inc. provides ratings of healthcare bonds for hospitals,
health systems, academic medical centers, continuing care
retirement communities, nursing homes, assisted living facilities,
physician practice groups, faculty practice plans, social
service providers, health maintenance organizations, and medical
Investors Service has recently modified their Internet
addresses. Healthcare is part of the U. S. Public Finance
sector. Within Public Finance, the options are research, rating
actions, special reports, watchlist, ratings definitions,
rating methodologies, and key contacts. For information on
a specific hospital use "Quick Search" at top of page. For
example, search by "Issuer Name" and for "Northwestern Memorial
Hospital" will result in information on four bond issues.
& Poor's has also modified their Internet Web site.
You can also see their Ratings
Ratings page, there are several choices, including Public
Finance, Search, or Criteria. Under Search, if you enter "Health
care bond ratings", the Web site will direct you to two manuals.
Chapter 3 in the first of these references contains several
sections on healthcare entities beginning with "Health Care,
Higher Education and Other 501 (C) (3) Financing" and continuing
through "Academic Medical Centers." See also their Focus on
Best Company, Inc. provides
ratings for about 99 percent of insurance companies; A.M.
Best also performs some ratings of healthcare entities (including
health maintenance organizations).