Selected risk factors

The obligors are concentrated in one industry

All obligors are hospitals and health systems. Their ability to pay depends on reimbursement from government programs and commercial payers, labor costs and patient volumes, any of which may change. Rural and critical-access hospitals, which make up about a third of each pool, have been under particular financial pressure.

Utilization Pricing collections vary

Payments under Utilization Pricing agreements above the minimum commitment depend on occupancy, which is seasonal and may fall. Only the minimum commitment is included in the pool balance.

Continuity Assurance may not work as expected

Many contracts in each pool cover equipment enrolled in Continuity Assurance, under which equipment may be placed in service hold if an account remains unpaid. Remote compliance depends on a third-party maintenance network, which the servicer does not control. If that network were unavailable, restricted or changed, the servicer might be unable to place equipment in service hold or to release it, and the incentive for obligors to pay may be reduced.

Service hold may attract regulatory and public scrutiny

Service hold of equipment used in patient care may attract the attention of regulators, attorneys general, hospitals and the press. In 2025 the office of a state attorney general made inquiries of the servicer following a service hold at an obligor hospital; the servicer answered those inquiries in full. Future laws, regulations or registration requirements could restrict or prohibit service hold, or require that it be registered or licensed, which could reduce collections.

The servicer is a single company

The trusts depend on Wardmore Health Capital, LLC as servicer. A backup servicer has been appointed, but a transfer of servicing could disrupt collections, particularly for Utilization Pricing agreements, which depend on the servicer’s metering systems.

Equipment may be hard to recover or remarket

Recovering equipment from a hospital, particularly equipment in clinical use, may be slow, costly or impractical, and its resale value may be low.

Cybersecurity

The servicer’s metering, billing and monitoring systems, and the networks through which equipment connects, could be disrupted by a cyber attack.

This page is a summary for information only and is not an offer to sell or a solicitation of an offer to buy any security.