Moody's may lower seven diagnostic imaging companies

Moody's Investors Service said it placed the speculative-grade ratings of seven diagnostic imaging companies under review for possible downgrade in response to recent legislation that will negatively impact these companies' financial results upon implementation.

The legislation calls for significant changes in Medicare reimbursement rates with respect to the technical component of diagnostic imaging services provided by this sector commencing in January 2007, the agency said.

The review for possible downgrade for each company in the rated sector will focus on quantification of the revenue and EBIT impact of reimbursement rate changes by Medicare and the resulting effects on other payor rates, Moody's noted.

Affect ratings include Alliance Imaging, Inc.'s corporate family rating at B1, $70 million guaranteed senior secured revolving credit facility due 2010 at B1, $410 million guaranteed senior secured term loan B due 2011 at B1 and $150 million of 7.25% guaranteed senior subordinated global notes due 2012 at B3,

Center for Diagnostic Imaging, Inc.'s corporate family rating at B2, $20.0 million senior secured revolving credit facility due 2009 at B2 and $75.0 million senior secured term loan due 2010 at B2,

Diagnostic Imaging Group, LLC's corporate family rating at B2, $25 million guaranteed senior secured revolving credit facility due 2010 at B2 and $110 million guaranteed senior secured term loan B due 2012 at B2,

InSight Health Services Corp.'s corporate family rating at B2, $300 million guaranteed senior secured floating rate notes due 2011 at B2 and $250 million 9.875% guaranteed senior subordinated global notes due 2011 at Caa1,

MQ Associates, Inc.'s corporate family rating at B2 and $136 million aggregate principal amount, at maturity, 12.25% senior discount notes due 2012 at Caa3,

MedQuest, Inc.'s $80 million guaranteed senior secured revolving credit facility due 2007 at B2, $60 million guaranteed senior secured term loan due 2009 at B2 and $180 million 11.875% guaranteed senior subordinated notes, due 2012 at Caa1 and

Radiologix, Inc.'s corporate family rating at B1 and $160 million 10.50% guaranteed subordinated notes due 2008 at B2.

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