Fitch: U.S. Health Care Rating Actions For 3 Months Ended March 31, 2005.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Through the three months ended March 31, 2005, Fitch Ratings' U.S. health care group assigned ratings to 11 new issues, affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. 25 ratings, upgraded 5 ratings, downgraded 3 ratings, and placed two ratings on Rating Watch Negative. In Fitch's acute care portfolio, upgrades outpaced downgrades for the first time since Fitch's health care group began its quarterly rating actions in 2000. However, due to industry pressures, Fitch does not expect this to continue and believes downgrades will outpace out·pace tr.v. out·paced, out·pac·ing, out·pac·es To surpass or outdo (another), as in speed, growth, or performance. outpace Verb [-pacing, upgrades in the acute care sector in 2005. The acute care sector forecast is supported by sound management and business strategies, the continuation of a relatively low cost of capital, and stable near-term Medicare funding. However, mounting capital needs, increased competition, labor shortages A Labor shortage is an economic condition in which there are insufficient qualified candidates (employees) to fill the market-place demands for employment at any price. This condition is sometimes referred to by Economists as "an insufficiency in the labor force. , upcoming revenue constraints from Medicare, Medicaid, and managed care, and rising bad debt expense are likely to lead to stress and instability throughout the sector beginning in 2006. In Fitch's non-acute care portfolio, one long-term care long-term care (LTC), n the provision of medical, social, and personal care services on a recurring or continuing basis to persons with chronic physical or mental disorders. rating was downgraded. In addition, there were five affirmations: three long-term care ratings and two other non-acute care ratings. Among the rating affirmations, one Rating Outlook was revised to Negative from Stable, and one Rating Outlook was revised to Stable from Negative. For the rating downgrade Downgrade A negative change in the rating of a security. Notes: For example, an analyst may downgrade a stock from strong buy to buy, or a bond rating agency may downgrade a bond from AAA to AA. , Fitch revised the Rating Outlook to Stable from Negative. Improvement is anticipated in the long-term care sector, driven by strong demand for independent living units and an improving economy. Capital needs and the expansion of communities may place short-term pressure on financial performance. Fitch expects downgrades to continue to outpace upgrades in 2005. Health care bond issuance in the first quarter of 2005 totaled approximately $6.5 billion, a 3.2% increase from 2004's $6.3 billion. For a copy of "Health Care Rating Actions for the Three Months Ended March 31, 2005" visit the Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. web site at www.fitchratings.com. |
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