Fitch Rates HFG Healthco-4, LLC Series 2002-1.

Business Editors

CHICAGO--(BUSINESS WIRE)--June 6, 2002

Fitch Ratings has assigned the HFG Healthco-4, LLC, series 2002-1 (HFG 2002-1) $70,000,000 class A notes an 'AA' rating. In addition, Fitch rates the $23,500,000 class B notes 'AA-' and $6,500,000 class C notes 'A'. The ratings address the timely payment of interest and ultimate payment of principal on the notes by the legal final maturity date in June, 2007.

HFG 2002-1 is structured with a four-year revolving period during which investors receive interest on a monthly basis. Subsequent to the revolving period, principal will be repaid to noteholders through a bullet payout. The rights of the class B and class C noteholders to receive payments of principal and interest are subordinated to the holders of the class A, series 2002-1 notes. In addition, all classes benefit from credit enhancement provided by a minimum 14.00% dynamic overcollateralization.

The underlying pool backing the HFG 2002-1 notes consists of receivables originated by health care service providers due from third-party payors. Third-party payors include, but are not limited to, Medicaid, Medicare, Blue Cross/Blue Shield, and commercial insurers.

Fitch took the following factors into consideration in rating the 2002-1 notes:

--Origination and servicing procedures of the master servicer,

Healthcare Finance Group, Inc. (HFG);

--Diversified pool of payors;

--Short average life of the receivables;

--Early amortization events and other protection features; and,

--Morgan Stanley Asset Funding, Inc. (MSAFI) support letter.

In the support letter, MSAFI, a subsidiary of Morgan Stanley & CO., guarantees to provide HFG with the resources necessary to perform its obligations under the program manager agreement and servicing agreement as long as any notes issued under the Indenture and rated by Fitch remain outstanding. MSAFI also owns a 50% interest in HFG.

Headquartered in New York, N.Y., HFG was established in May 2000 by former employees of Daiwa Securities America, Inc. This is HFG's first healthcare receivable-backed securitization.