University Hospitals in Cleveland makes aggressive refinancing move

Cleveland-based University Hospitals has refinanced more than a third of its debt in an attempt to exit the troubled market for so-called auction-rate securities. The system is leading other healthcare institutions in this exit, said representatives for Moody's Investors Service. According to Bradley Bond, vice president of treasury for University Hospitals, the interest rate the system paid climbed from 3.7 percent in January 2008 to 11 percent by mid-February 2008. To help, the system has refinanced all of its auction-rate bonds--$263 million worth--with borrowings from bank lines of credit, Bond said.