FIELD MEMORIAL COMMUNITY HOSPITAL
1. Target Overview & Investment Thesis
FIELD MEMORIAL COMMUNITY HOSPITAL is a 16-bed rural/critical access in WILKINSON, MS with $21.3M in net patient revenue and a -19.6% operating margin. The hospital serves a payer mix of 82.3% Medicare, 2.2% Medicaid, and 15.4% commercial.
Thesis: Turnaround. Our ML models identify $1.6M in annual EBITDA improvement potential from RCM optimization across 5 levers, lifting margin from -19.6% to -12.2% (+736bps).
| Net Revenue HCRIS | $21.3M |
| Current EBITDA COMPUTED | $-4.2M |
| Operating Margin COMPUTED | -19.6% |
| Occupancy HCRIS | 59.3% |
| Revenue / Bed COMPUTED | $1.3M |
| Net-to-Gross HCRIS | 54.3% |
| Distress Probability ML | 50.1% |
2. Market Context & Competitive Position
MS has 110 Medicare-certified hospitals with a median operating margin of -12.5%. The target's margin of -19.6% places it below the state median. Among 46 size-comparable peers (8-32 beds), the median margin is -14.4%. The target's below-peer margin suggests operational improvement opportunity.
3. RCM Performance Analysis — Comparable Hospitals
Comps selected by bed count (8-32), prioritizing same-state peers. 46 hospitals in the comp set.
| Hospital | State | Beds | Revenue | Margin |
|---|---|---|---|---|
| FIELD MEMORIAL COMMUNITY HOSPI (Target) | MS | 16 | $21.3M | -19.6% |
| KINGS DAUGHTERS MEDICAL CENTER | MS | 22 | $91.5M | -8.4% |
| NORTH SUNFLOWER COUNTY HOSPITA | MS | 25 | $70.1M | -7.2% |
| MISSISSIPPI METHODIST REHAB CE | MS | 31 | $68.1M | -0.5% |
| MONROE REGIONAL HOSPITAL | MS | 25 | $45.6M | 0.9% |
| S.E. LACKEY MEMORIAL HOSPITAL | MS | 25 | $34.1M | -2.1% |
| COVINGTON COUNTY HOSPITAL | MS | 25 | $33.7M | -26.3% |
| PANOLA MEDICAL CENTER | MS | 21 | $33.4M | -21.8% |
| LAIRD HOSPITAL | MS | 25 | $31.4M | -9.0% |
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: $1.6M (736bps margin improvement).
| Lever | Current | Target | EBITDA Impact | Margin | Ramp |
|---|---|---|---|---|---|
| Net Collection Rate | 93.5% | 97.0% | $447K | +210bp | 18mo |
| Cost to Collect | 4.5% | 2.5% | $426K | +200bp | 12mo |
| Denial Rate Reduction | 12.0% | 6.5% | $422K | +198bp | 12mo |
| A/R Days Reduction | 5200.0% | 3800.0% | $259K | +122bp | 9mo |
| Clean Claim Rate | 88.0% | 96.0% | $14K | +6bp | 6mo |
5. EBITDA Bridge
| Current EBITDA | $-4.2M |
| + RCM Uplift | +$1.6M |
| Pro Forma EBITDA | $-2.6M |
| Current Margin | -19.6% |
| Pro Forma Margin | -12.2% |
| WC Released (1x) | $817K |
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 | $-6.4M | $-11.8M | 0.00x | -100.0% |
| Base (11x exit) | 10.0x | 11.0x | $-6.4M | $-15.1M | 0.00x | -100.0% |
| Bull Case | 9.0x | 11.0x | $-5.8M | $-12.0M | 0.00x | -100.0% |
| Bull (12x exit) | 9.0x | 12.0x | $-5.8M | $-14.8M | 0.00x | -100.0% |
| Bear Case | 11.0x | 10.0x | $-7.1M | $-17.6M | 0.00x | -100.0% |
| Bear (11x exit) | 11.0x | 11.0x | $-7.1M | $-21.6M | 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 | Heavy Medicare dependence | Medicare comprises 82.3% of days; rate updates may lag inflation. Mitigant: CDI/CMI lever directly increases Medicare reimbursement |
| High | Elevated distress probability | Model estimates 50.1% 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
- 46 hospitals with 8-32 beds
- Same-state prioritization (n=47)
- Comp margins: P25=-25.6% / P50=-14.4% / P75=-7.1%
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.