LANDMARK HOSPITAL OF SOUTHWEST FLORI
1. Target Overview & Investment Thesis
LANDMARK HOSPITAL OF SOUTHWEST FLORI is a 32-bed community hospital in LEE, FL with $12.7M in net patient revenue and a 6.1% operating margin. The hospital serves a payer mix of 59.7% Medicare, 0.0% Medicaid, and 40.3% commercial.
Thesis: Turnaround. Our ML models identify $938K in annual EBITDA improvement potential from RCM optimization across 5 levers, lifting margin from 6.1% to 13.4% (+738bps).
| Net Revenue HCRIS | $12.7M |
| Current EBITDA COMPUTED | $769K |
| Operating Margin COMPUTED | 6.1% |
| Occupancy HCRIS | 63.1% |
| Revenue / Bed COMPUTED | $397K |
| Net-to-Gross HCRIS | 20.6% |
| Distress Probability ML | nan% |
2. Market Context & Competitive Position
FL has 261 Medicare-certified hospitals with a median operating margin of 3.2%. The target's margin of 6.1% places it above the state median. Among 57 size-comparable peers (16-64 beds), the median margin is -1.8%. The target performs in line with or above peers.
3. RCM Performance Analysis — Comparable Hospitals
Comps selected by bed count (16-64), prioritizing same-state peers. 57 hospitals in the comp set.
| Hospital | State | Beds | Revenue | Margin |
|---|---|---|---|---|
| LANDMARK HOSPITAL OF SOUTHWEST (Target) | FL | 32 | $12.7M | 6.1% |
| OVIEDO MEDICAL CENTER | FL | 64 | $110.9M | 7.4% |
| BAPTIST MEDICAL CTR-NASSAU | FL | 54 | $85.1M | 2.1% |
| UCF LAKE NONA HOSPITAL | FL | 64 | $80.3M | 1.8% |
| MARINERS HOSPITAL | FL | 16 | $74.3M | 17.0% |
| MEDICAL CENTER OF DELTONA | FL | 43 | $45.4M | -30.2% |
| LEHIGH REGIONAL | FL | 53 | $41.3M | 6.6% |
| HENDRY REGIONAL MEDICAL CENTER | FL | 25 | $41.1M | -20.8% |
| ED FRASER MEMORIAL HOSPITAL | FL | 21 | $40.7M | 17.8% |
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: $938K (738bps margin improvement).
| Lever | Current | Target | EBITDA Impact | Margin | Ramp |
|---|---|---|---|---|---|
| Net Collection Rate | 93.5% | 97.0% | $267K | +210bp | 18mo |
| Cost to Collect | 4.5% | 2.5% | $254K | +200bp | 12mo |
| Denial Rate Reduction | 12.0% | 6.5% | $253K | +199bp | 12mo |
| A/R Days Reduction | 5200.0% | 3800.0% | $155K | +122bp | 9mo |
| Clean Claim Rate | 88.0% | 96.0% | $10K | +8bp | 6mo |
5. EBITDA Bridge
| Current EBITDA | $769K |
| + RCM Uplift | +$938K |
| Pro Forma EBITDA | $1.7M |
| Current Margin | 6.1% |
| Pro Forma Margin | 13.4% |
| WC Released (1x) | $487K |
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 | $1.2M | $14.4M | 12.22x | 65.0% |
| Base (11x exit) | 10.0x | 11.0x | $1.2M | $16.3M | 13.77x | 69.0% |
| Bull Case | 9.0x | 11.0x | $1.1M | $19.8M | 18.56x | 79.4% |
| Bull (12x exit) | 9.0x | 12.0x | $1.1M | $21.9M | 20.55x | 83.0% |
| Bear Case | 11.0x | 10.0x | $1.3M | $9.4M | 7.21x | 48.4% |
| Bear (11x exit) | 11.0x | 11.0x | $1.3M | $10.7M | 8.25x | 52.5% |
7. Key Risks & Mitigants
| Severity | Risk Factor | Mitigant |
|---|---|---|
| Medium | Heavy Medicare dependence | Medicare comprises 59.7% of days; rate updates may lag inflation. Mitigant: CDI/CMI lever directly increases Medicare reimbursement |
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
- 57 hospitals with 16-64 beds
- Same-state prioritization (n=58)
- Comp margins: P25=-25.1% / P50=-1.8% / P75=8.1%
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.