LEBANON — The credit rating agency Fitch Ratings has reaffirmed its ‘A’ rating for Dartmouth-Hitchcock Obligated Group, but downgraded its outlook from “positive” to “stable” amid the COVID-19 pandemic, according to a news release.

The D-H group includes Dartmouth-Hitchcock Medical Center in Lebanon and associated clinics in southern New Hampshire; Alice Peck Day Memorial Hospital in Lebanon; Cheshire Medical Center in Keene, N.H.; Mt. Ascutney Hospital and Health Center in Windsor; and New London Hospital.

Fitch, in its Dec. 23 release, pointed to the D-H health system’s “strong market position” and “high acuity patient mix” as reasons for affirming the ‘A’ rating, demonstrating that the agency has confidence in D-H’s ability to recover from the pandemic and see through its capital spending plans.

The downgrade from “positive” to “stable” is due to the challenges Fitch said it foresees for D-H in accomplishing goals it set for itself in a performance improvement plan, including achieving and maintaining operating cash flow margins of between 9 and 10%, following operating losses in fiscal year 2016.

While Fitch said those goals are still achievable in the long term, they are less so in the near term due to the ongoing pandemic and recent surge in cases and hospitalizations nationwide.

Fitch also pointed to uncertainty surrounding D-H’s proposed combination with GraniteOne, which includes Manchester’s Catholic Medical Center.

“Completion of the merger is dependent on CMC’s progress towards achieving required financial metrics, which were updated in the wake of the financial pressure brought about by the coronavirus pandemic,” the Dec. 23 news release said.

The ratings agency views the proposed combination with GraniteOne as of strategic benefit to D-H in supporting a more sustainable rural health network across a larger geographic region and in giving the organization an inpatient presence in southern New Hampshire to “solidify its competitive position in this demographically favorable area of the state by curtailing patient outmigration to competitor facilities.”

The combination agreement is pending before of state and federal regulators, but Fitch said D-H expects it will be completed this fiscal year.