S&P cuts Tuomey Healthcare System revenue bonds to CCC

October 2, 2013

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

The bonds were issued through the South Carolina Jobs Economic Development Authority.

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

"Given the increasing likelihood that Tuomey may have to pay a sizable settlement and the related uncertainty surrounding the subsequent effects on Tuomey's financial profile, we believe a lower rating is warranted," said S&P credit analyst Margaret McNamara.