Prominent health systems like Ascension and Tufts Medicine are falling short of financial targets set out in their borrowing agreements as they muddle through staff shortages and other challenges.
Credit analysts have warned this would happen since mid-2022, but some not-for-profit hospitals are just now calculating breaches along with their 2022 financial losses. Bond and credit agreements require borrowers to maintain certain amounts of money to cover their debt payments and fund operations in emergencies, but more and more hospitals are finding themselves unable to do so.
“We’re seeing a lot of these,” said Lisa Washburn, managing director with Municipal Market Analytics. “This is a new day.”
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