Moody's affirms Genoa Healthcare

Moody's Investors Service said it affirmed Genoa Healthcare Group, LLC's B2 corporate family and probability of default ratings and Ba3 rating on the company's $20 million revolving credit facility due 2010 with LGD rate changed to LGD2, 23% from LGD2, 27%; and its $100 million ($86 million outstanding) first-lien term loan, due 2012 with LGD rate changed to LGD2, 23% from LGD2, 27%. Its $50 million second-lien term loan due 2013 was upgraded to B3 (LGD4, 64%) from Caa1 (LGD5, 78%).

The outlook remains negative.

The ratings consider Genoa's state revenue concentration, as all of the company's facilities are located in Florida, Moody's said. This is of particular concern due to the company's reliance on Medicaid reimbursement, which is set each year as part of states' budgets, the agency said.

Balancing this risk is the company's moderate leverage and solid interest coverage metrics, the agency added.

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