UNION GENERAL HOSPITAL
1. Target Overview & Investment Thesis
UNION GENERAL HOSPITAL is a 39-bed suburban community hospital in UNION, GA with $108.6M in net patient revenue and a 2.4% operating margin. The hospital serves a payer mix of 38.9% Medicare, 1.3% Medicaid, and 59.8% commercial.
Thesis: Turnaround. Our ML models identify $8.0M in annual EBITDA improvement potential from RCM optimization across 5 levers, lifting margin from 2.4% to 9.7% (+736bps).
| Net Revenue HCRIS | $108.6M |
| Current EBITDA COMPUTED | $2.6M |
| Operating Margin COMPUTED | 2.4% |
| Occupancy HCRIS | 63.9% |
| Revenue / Bed COMPUTED | $2.8M |
| Net-to-Gross HCRIS | 35.1% |
| Distress Probability ML | 42.8% |
2. Market Context & Competitive Position
GA has 165 Medicare-certified hospitals with a median operating margin of -2.8%. The target's margin of 2.4% places it above the state median. Among 82 size-comparable peers (20-78 beds), the median margin is -3.4%. The target performs in line with or above peers.
3. RCM Performance Analysis — Comparable Hospitals
Comps selected by bed count (20-78), prioritizing same-state peers. 82 hospitals in the comp set.
| Hospital | State | Beds | Revenue | Margin |
|---|---|---|---|---|
| UNION GENERAL HOSPITAL (Target) | GA | 39 | $108.6M | 2.4% |
| TANNER MEDICAL CENTER-VILLA RI | GA | 58 | $289.8M | 33.3% |
| ADVENTHEALTH GORDON | GA | 69 | $188.5M | -3.4% |
| KENNESTONE HOSPITAL AT WINDY H | GA | 55 | $160.5M | 0.7% |
| PIEDMONT COLUMBUS REGIONAL NOR | GA | 71 | $135.5M | 21.7% |
| PIEDMONT MOUNTAINSIDE HOSPITAL | GA | 52 | $131.2M | 10.5% |
| PIEDMONT WALTON HOSPITAL | GA | 76 | $128.6M | 29.1% |
| CRISP REGIONAL HOSPITAL INC. | GA | 65 | $115.2M | -8.7% |
| TATTNALL HOSPITAL COMPANY LLC | GA | 25 | $101.7M | 41.9% |
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: $8.0M (736bps margin improvement).
| Lever | Current | Target | EBITDA Impact | Margin | Ramp |
|---|---|---|---|---|---|
| Net Collection Rate | 93.5% | 97.0% | $2.3M | +210bp | 18mo |
| Cost to Collect | 4.5% | 2.5% | $2.2M | +200bp | 12mo |
| Denial Rate Reduction | 12.0% | 6.5% | $2.1M | +198bp | 12mo |
| A/R Days Reduction | 5200.0% | 3800.0% | $1.3M | +122bp | 9mo |
| Clean Claim Rate | 88.0% | 96.0% | $69K | +6bp | 6mo |
5. EBITDA Bridge
| Current EBITDA | $2.6M |
| + RCM Uplift | +$8.0M |
| Pro Forma EBITDA | $10.6M |
| Current Margin | 2.4% |
| Pro Forma Margin | 9.7% |
| WC Released (1x) | $4.2M |
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 | $4.0M | $97.0M | 24.38x | 89.4% |
| Base (11x exit) | 10.0x | 11.0x | $4.0M | $107.9M | 27.14x | 93.5% |
| Bull Case | 9.0x | 11.0x | $3.6M | $135.6M | 37.89x | 106.9% |
| Bull (12x exit) | 9.0x | 12.0x | $3.6M | $149.0M | 41.63x | 110.8% |
| Bear Case | 11.0x | 10.0x | $4.4M | $55.7M | 12.74x | 66.3% |
| Bear (11x exit) | 11.0x | 11.0x | $4.4M | $62.7M | 14.33x | 70.3% |
7. Key Risks & Mitigants
| Severity | Risk Factor | Mitigant |
|---|---|---|
| Medium | Standard execution risk | RCM improvement requires management buy-in and 12-18 month implementation timeline |
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
- 82 hospitals with 20-78 beds
- Same-state prioritization (n=83)
- Comp margins: P25=-18.0% / P50=-3.4% / P75=7.9%
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.