Fitch Downgrades Presbyterian Healthcare Services' Credit Rating

Ratings agency cites weak operating performance and fiscal 2025 losses despite Medicaid revenue growth.

Published on Feb. 24, 2026

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Fitch Ratings has downgraded the credit rating of Albuquerque-based Presbyterian Healthcare Services from 'AA' to 'AA-', citing several years of weak operating performance that 'consistently fell short of management's expectations'. The health system's losses grew in fiscal 2025, even after incorporating additional funds from New Mexico's State Directed Payment Program.

Why it matters

The downgrade reflects ongoing financial challenges for Presbyterian Healthcare Services, a major integrated health system and insurance provider in New Mexico. Despite its market-leading position, the system has struggled with pressures like a tight labor market and rising medical costs that have outpaced state Medicaid reimbursement rates.

The details

Fitch said Presbyterian expects to see a significant increase in revenue from higher Medicaid rates, which should help support improvement. However, the system's outlook remains negative as it continues to face headwinds. Presbyterian's financial profile remains healthy despite persistently weak cash flow, and Fitch believes the health plan business provides long-term operational stability.

  • Presbyterian Healthcare Services' credit rating was downgraded on February 24, 2026.
  • The health system saw losses grow in fiscal year 2025.

The players

Presbyterian Healthcare Services

An integrated health system and insurance provider based in Albuquerque, New Mexico, and the market share leader for acute care services in the Albuquerque metro area.

Fitch Ratings

A global rating agency that downgraded Presbyterian Healthcare Services' credit rating from 'AA' to 'AA-'.

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The takeaway

This downgrade highlights the ongoing financial challenges facing major healthcare providers, even those with a dominant market position, as they grapple with rising costs, labor shortages, and reimbursement rates that fail to keep pace. Presbyterian's situation underscores the importance of health systems diversifying their revenue streams and carefully managing their operations to weather these headwinds.