Rating And Outlook Overview
Mergers and migration to health systems continue to reduce the size of the stand-alone portfolio. The number of U.S. stand-alone hospitals rated by S&P Global Ratings continued to decline in 2025, primarily due to mergers and acquisitions, with a subset now consolidated into larger health systems and some evolving into health systems, given added acute care campuses and/or consistent revenue growth. This reflects a sustained, multiyear trend of industry consolidation. The 2025 stand-alone hospital medians reflect 95% of rated entities in this cohort.
General stability across rating categories continues with some positive movement. Stand-alone hospital rating distribution remained fairly consistent in the past year with broadly stable to slightly improving performance, and improving balance sheets, characterized by increased days’ cash on hand and low debt levels. While the number of ratings slightly increased in the ‘AA’ and ‘BBB’ categories, it dipped in the ‘A’ and speculative-grade categories but remained comparable with 2024 levels. Rated ‘A’ and ‘BBB’ category hospitals have long accounted for the majority of the stand-alone cohort, with speculative-grade holding steady between 14%-16% in recent years despite sector financial pressures. The median rating level for stand-alone hospitals remains ‘A-‘.
Despite the larger number of stand-alone hospitals than systems, the number of rated ‘AA’ category stand-alone hospitals is half that of health systems. In general, it is less common for stand-alone hospitals to be rated in the ‘AA’ category, given their comparatively smaller organizational size and less business diversification. An exception is the continued strength of children’s hospitals, which represent nearly half of all rated ‘AA’ category stand-alone hospitals.
11-Aug-2026