Moody's lowers Elevate

Moody's Investors Service said it downgraded Elevate's corporate family and senior secured bank credit facility ratings to Caa1 from B3 and its probability of default rating to Caa1-PD from B3-PD. The corporate family rating and PDR are assigned to FH MD Parent, Inc. and the debt ratings are assigned to FH MD Buyer, Inc. Together the two companies are Elevate.

“The ratings downgrade reflects the deterioration of Elevate's liquidity profile, underpinned by decaying levels of cash, lack of free cash flow generation and heavy reliance on its revolving credit facility. The weak liquidity is a symptom of the longer-than-expected public health emergency (PHE) period, that prevented the redetermination of eligibility for Medicaid enrollees (eligibility segment drives approximately 60% of Elevate's revenue). And although PHE has expired, Moody's expects a slow return of eligibility volumes, which will continue to pressure the company's ratings,” the agency said in a press release.

The outlook remains stable.

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