UPDATE (March 29, 2024): This story was updated after new information was released from Moody's median rating distributions.

By Leigh Farmer

Most hospitals and health systems struggled financially during the COVID-19 pandemic, and many are still struggling to recover. While VCU Health endured similar financial hardship, it has recovered quickly as seen in the release of the latest bond ratings from two top credit rating agencies in the United States.

Moody’s and Standard & Poor’s (S&P) recently released scores for health systems across the nation to identify growing, high-quality hospitals with a strong financial portfolio. VCU Health received an excellent level bond rating from of Aa3 from Moody’s and AA - from S&P’s. These rankings both mean the same thing to financial lenders: VCU Health is in strong financial standing and has potential to grow.

But to health care workers and patients, this rating has deeper implications.

“This rating doesn’t just mean we are financially strong, it’s also a testament to VCU Health’s unending commitment to providing the highest level of care to each patient,” said Marlon Levy, M.D., interim CEO of VCU Health and interim vice president of VCU Health Sciences. “Our credit is strong at the bank, and our reputation is strong in the community. We are eternally grateful to our team members for both.”

For a health system that is expanding facilities in central Virginia and is experiencing an increase in demand for its services, this rating will allow for more improvements, faster. Additionally, a high rating is an indicator of a strong market presence, unique service offerings and strong management teams. Patients and their families who turn to VCU Health trust us to provide exceptional care in a variety of specialized fields.

The affirmed and strong bond ratings secure VCU Health among the top 22% of health systems, median rating distributions from Moody’s. In S&P’s most recent review, representatives stated their findings are indicative of a health system with good strategic investments and creates partnerships that support its position in the community as the only academic medical center.

“This latest rating is a direct result of the undeniable hard work of every person at VCU Health,” said James Siegel, senior vice president and chief financial officer of VCU Health. “Our engaged leadership team, staff, providers, and clinicians have navigated historic challenges over the past four years. This rating is an indicator of success.”

When determining this latest rating, the S&P noted several positive attributes that moved the needle in the right direction. In particular, the S&P reviewed balance sheet ratios – specifically unrestricted reserves to long-term debt, leverage and debt burden. They also observed a “sizeable improvement” in operating performance through the first six months of this fiscal year and expressed full confidence that VCU Health will remain on budget for the full year.

Capital improvements and an increased footprint in the community continue to strengthen the financial standing of VCU Health. The health system is working on service line enhancements, which will allow more patients to have access to top-quality care closer to where they live and work.