ST VINCENT GENERAL HOSPITAL
1. Target Overview & Investment Thesis
ST VINCENT GENERAL HOSPITAL is a 8-bed under-performing / distressed in nan, CO with $13.1M in net patient revenue and a -94.9% operating margin. The hospital serves a payer mix of 47.8% Medicare, 15.7% Medicaid, and 36.5% commercial.
Thesis: Turnaround. Our ML models identify $970K in annual EBITDA improvement potential from RCM optimization across 5 levers, lifting margin from -94.9% to -87.5% (+738bps).
| Net Revenue HCRIS | $13.1M |
| Current EBITDA COMPUTED | $-12.5M |
| Operating Margin COMPUTED | -94.9% |
| Occupancy HCRIS | 20.7% |
| Revenue / Bed COMPUTED | $1.6M |
| Net-to-Gross HCRIS | 47.8% |
| Distress Probability ML | 59.6% |
2. Market Context & Competitive Position
CO has 108 Medicare-certified hospitals with a median operating margin of -3.6%. The target's margin of -94.9% places it below the state median. Among 11 size-comparable peers (4-16 beds), the median margin is -14.0%. The target's below-peer margin suggests operational improvement opportunity.
3. RCM Performance Analysis — Comparable Hospitals
Comps selected by bed count (4-16), prioritizing same-state peers. 11 hospitals in the comp set.
| Hospital | State | Beds | Revenue | Margin |
|---|---|---|---|---|
| ST VINCENT GENERAL HOSPITAL (Target) | CO | 8 | $13.1M | -94.9% |
| NATIONAL JEWISH HEALTH | CO | 13 | $150.4M | -50.0% |
| ANIMAS SURGICAL HOSPITAL | CO | 12 | $47.4M | 13.7% |
| PIONEERS MEDICAL CENTER | CO | 16 | $43.9M | -5.9% |
| WRAY COMMUNITY DISTRICT HOSPIT | CO | 16 | $34.0M | 4.0% |
| PAGOSA SPRINGS MEDICAL CENTER | CO | 11 | $33.8M | -32.9% |
| PIKES PEAK REGIONAL HOSPITAL | CO | 13 | $26.3M | -9.3% |
| MELISSA MEMORIAL HOSPITAL | CO | 15 | $23.9M | -2.4% |
| YUMA DISTRICT HOSPITAL | CO | 15 | $22.6M | -14.0% |
4. Predicted Improvement Opportunities
Improvement targets set at P75 of comparable peers with 60% gap closure assumption. Coefficients calibrated to published research bands. Total EBITDA uplift: $970K (738bps margin improvement).
| Lever | Current | Target | EBITDA Impact | Margin | Ramp |
|---|---|---|---|---|---|
| Net Collection Rate | 93.5% | 97.0% | $276K | +210bp | 18mo |
| Cost to Collect | 4.5% | 2.5% | $263K | +200bp | 12mo |
| Denial Rate Reduction | 12.0% | 6.5% | $261K | +199bp | 12mo |
| A/R Days Reduction | 5200.0% | 3800.0% | $160K | +122bp | 9mo |
| Clean Claim Rate | 88.0% | 96.0% | $10K | +7bp | 6mo |
5. EBITDA Bridge
| Current EBITDA | $-12.5M |
| + RCM Uplift | +$970K |
| Pro Forma EBITDA | $-11.5M |
| Current Margin | -94.9% |
| Pro Forma Margin | -87.5% |
| WC Released (1x) | $504K |
6. Returns Analysis — Scenario Matrix
5-year hold, 5.5x leverage, 3% organic growth, 10%/yr debt paydown. Base case uses 100% of predicted RCM uplift. Bull case: 130% uplift at lower entry. Bear case: 50% uplift at higher entry.
| Scenario | Entry | Exit | Equity In | Equity Out | MOIC | IRR |
|---|---|---|---|---|---|---|
| Base Case | 10.0x | 10.0x | $-19.2M | $-72.6M | 0.00x | -100.0% |
| Base (11x exit) | 10.0x | 11.0x | $-19.2M | $-86.1M | 0.00x | -100.0% |
| Bull Case | 9.0x | 11.0x | $-17.3M | $-89.1M | 0.00x | -100.0% |
| Bull (12x exit) | 9.0x | 12.0x | $-17.3M | $-102.4M | 0.00x | -100.0% |
| Bear Case | 11.0x | 10.0x | $-21.1M | $-71.2M | 0.00x | -100.0% |
| Bear (11x exit) | 11.0x | 11.0x | $-21.1M | $-85.2M | 0.00x | -100.0% |
7. Key Risks & Mitigants
| Severity | Risk Factor | Mitigant |
|---|---|---|
| High | Negative operating margin | RCM uplift bridge shows clear path to profitability; working capital release provides near-term cash cushion |
| Medium | Low occupancy | At 20.7%, fixed costs are spread over fewer patient days. Mitigant: volume growth is an additional upside lever not modeled in base case |
| High | Elevated distress probability | Model estimates 59.6% probability of financial distress. Mitigant: distressed entry pricing (7-9x) compensates for risk |
8. Data Sources & Methodology Appendix
Data Sources
- CMS HCRIS Cost Reports (Medicare-certified hospitals)
- CMS Medicare Utilization (DRG-level volumes)
- CMS Chronic Conditions (county-level disease prevalence)
- HCRIS multi-year trend data (financial time series)
Comparable Selection
- 11 hospitals with 4-16 beds
- Same-state prioritization (n=13)
- Comp margins: P25=-29.0% / P50=-14.0% / P75=-4.2%
Bridge Methodology
- Targets: P75 of comparable peers (60% gap closure)
- Denial: avoidable share = 35% of delta × NPR
- AR: bad debt coefficient = $0.65 per day per $1K NPR
- NCR: 60% coefficient on collection rate improvement
- CDI: 0.75% of Medicare revenue per 0.01 CMI point
Returns Assumptions
- Leverage: 5.5x entry (84.6% debt / 15.4% equity)
- Organic growth: 3% annual EBITDA growth
- Debt paydown: 10% of principal per year
- Hold period: 5 years
Generated by SeekingChartis on April 26, 2026. All predictions use public data only. Confidence intervals calibrated via split conformal prediction (90% coverage target). This memo is for informational purposes and does not constitute investment advice.