S&P cuts Tuomey Healthcare System revenue bonds to CCC

Reuters

Oct 2 (Reuters) - Standard & Poor's Ratings Services onWednesday cut Tuomey Healthcare System, South Carolina's revenuebonds to CCC from BB, after an appeals court ruled that TuomeyHealthcare was in violation of the Stark Law and False ClaimsAct.

The bonds were issued through the South Carolina JobsEconomic Development Authority.

The court ruled that Tuomey may have to pay between $237million and $277 million in damages, the rating agency said in astatement.

"Given the increasing likelihood that Tuomey may have to paya sizable settlement and the related uncertainty surrounding thesubsequent effects on Tuomey's financial profile, we believe alower rating is warranted," said S&P credit analyst MargaretMcNamara.

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