Fitch Raings on Thursday downgraded Einstein Healthcare Network’s credit rating to “junk” bond status.
The rating downgrade to ‘BB+’ from ‘BBB’ reflects the nonprofit’s “challenging operating environment, which leads to modest market position in a highly competitive and economically challenged area,” Fitch said. “Further, EHN’s is confronted with operating cost pressures” from its high reliance on government insurance programs, which pay less than commercial plans, and the unionization of 1,000 nurses.
Einstein said it has several initiatives underway to improve financial results. “We believe these efforts will put the organization in a stronger financial position moving forward,” said Gerard Blaney, Einstein’s chief financial officer.
Einstein’s largest facility is the Einstein Medical Center Philadelphia, in the city’s Logan neighborhood. Its facilities also include Einstein Medical Center Montgomery in East Norriton, Einstein Medical Center in Elkins Park and Moss Rehab, a neck and spinal injury rehabilitation facility.