Moody's Investors Service today downgraded West Penn Allegheny Health System's bond rating to Ca from Caa1, citing "the severity of the financial status of the System and our belief that there is a high likelihood of a restructuring or bankruptcy."
The rating affects $726 million of Series 2007 fixed rate bonds. WPAHS is currently in discussions with Highmark, Inc. officials about their affiliation agreement which is awaiting approval by the Pennsylvania Insurance Department.
Highmark officials on Monday said they had spoken to West Penn Allegheny bondholders recently, and expected to talk to them again, although they did not disclose any specifics about the discussions.
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