Johnson City, Tennessee, Feb. 11, 2025 (GLOBE NEWSWIRE) — Ballad Health announced today that, despite cited industry challenges for hospitals and health systems, the nation’s major ratings agencies have affirmed “A” ratings with “Stable” outlook for Ballad Health.
These independent credit rating agencies cited Ballad Health’s experienced management team, favorable balance sheet, delivery on promised efficiencies, and access and quality gains as drivers of their ratings. Both note this performance despite industry-wide headwinds from national healthcare labor shortages, increased supply and drug costs, and increasing denials and payment delays experienced with many national insurers, as well as the negative impact of Hurricane Helene on Ballad Health’s operations.
“In our opinion, Ballad has an experienced management team that has responded well to the industry challenges and taken a proactive approach to the merger that includes developing a strong strategic vision, setting explicit financial and non-financial goals, aligning executive and functional leadership, integrating cultures, and leveraging integration best practices,” wrote S&P Global Ratings. “Furthermore, we believe management is making some difficult decisions around the need to consolidate services across the system, and to improve quality and performance, while maintaining access across the region.”
In its report, Fitch Ratings cited Ballad Health’s “… progress in stabilizing its workforce through initiatives like increasing salaries and wages and offering more favorable benefits. These investments have resulted in a steady reduction in turnover rates and a decrease in contract labor costs, which have fallen to approximately $4 million per month from a peak of nearly $15 million in April 2022.”
“No organizations have a better perspective on the issues facing the hospital industry than these national rating agencies,” said Alan Levine, chairman and chief executive officer of Ballad Health. “The performance of Ballad Health compared to its peers on quality, access and financial management is strong, and I am proud of the team members and physicians of Ballad Health who work hard every day to deliver these results.”
Despite a national nursing labor shortage, Ballad Health has reduced nursing turnover at the health system to 13.8% annually, the lowest in the history of either of the systems two predecessors, Wellmont Health System and Mountain States Health Alliance, and materially lower than the national average. This is the result of multiple strategies, including investing nearly $200 million annually in wages and salaries since 2021, quadrupling the capacity of team member childcare, investing in new nurse education and management support, and enhancing partnerships with local high schools, community colleges, and universities to locally produce more nursing and allied health graduates.
Ballad Health has also continued to expand access across the Appalachian Highlands to new technology and new services. It recently announced the creation of the Quillen Center for Urological Services at Johnston Memorial Hospital in Abingdon, which will attract new physicians to the area in this much needed specialty. In 2024 the health system broke ground on an expansion of the Niswonger Children’s Hospital, the addition of 20 new hospital beds at Franklin Woods Community Hospital and a new emergency department at Johnson City Medical Center. Investing millions of dollars, Ballad Health has expanded robotic-assisted surgery across Tennessee and Virginia; recently announced the implementation of a $100 million state of the art radiation oncology expansion across its hospitals; expanded outpatient adult, child and adolescent behavioral health services regionwide; and was granted a Certificate of Need for 16 new child and adolescent inpatient psychiatric beds in Southwest Virginia.
These programs and others continue to garner quality recognitions from across the nation. For example, Bristol Regional Medical Center was recognized for their excellence in acute stroke care by the American Heart Association and American Stroke Association through the prestigious Get With The Guidelines® Stroke quality awards, Holston Valley Medical Center was recently ranked as the #1 hospital in Tennessee for vascular surgery by Healthgrades, Johnson City Medical Center was ranked #1 in the state by CareChex for patient safety in trauma care for 2025, and Smyth County Community Hospital and Lonesome Pine Hospital were selected as two of the best performing rural and community hospitals in the country by the Chartis Center for Rural Health for 2024.
The reports note that Ballad Health’s liquidity remains strong, with favorable cash reserves supporting the organization’s ability to weather industry challenges.
David Lester, former lead independent director of the board and current chair of the board’s Finance Committee, recognized the difficulty of maintaining this level of financial performance in a challenging national environment while continuing to meet the needs of patients in the region regardless of ability to pay.
“Even as we continue to invest hundreds of millions of dollars in staff and new technology, all while providing free care to almost half of the local population, we have successfully executed a five-year debt reduction plan that has allowed us to moderate debt levels, and we continue to implement measures that will enhance our operational performance,” said Lester. “These ratings reflect the effectiveness of our integration and synergy efforts, which have generated significant savings which we reinvest in increased access to care and improved quality. The perseverance and hard work of our team members continues to produce better health for the region.”
For more information about Ballad Health’s financial performance and strategic initiatives, visit www.balladhealth.org.
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About Ballad Health
Ballad Health is an integrated community health improvement organization serving 29 counties of the Appalachian Highlands in Northeast Tennessee, Southwest Virginia, Northwest North Carolina and Southeast Kentucky. Our system of 20 hospitals, post-acute care and behavioral health services, and a large multi-specialty group physician practice works closely with an active independent medical community and community stakeholders to improve the health and well-being of close to one million people. By leading in the adoption of value-based payments, addressing health-related social needs, funding clinical and health systems research and committing to long-term investments in strong children and families in our region, Ballad Health is striving to become a national model for rural health and healthcare. Learn more at www.BalladHealth.org.
Ballad Health marketing and communications Ballad Health 423-427-1356 media@balladhealth.org
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