LOGAN HEALTH WHITEFISH
1. Target Overview & Investment Thesis
LOGAN HEALTH WHITEFISH is a 25-bed suburban community hospital in FLATHEAD, MT with $101.8M in net patient revenue and a 13.8% operating margin. The hospital serves a payer mix of 19.7% Medicare, 17.4% Medicaid, and 62.9% commercial.
Thesis: Turnaround. Our ML models identify $7.5M in annual EBITDA improvement potential from RCM optimization across 5 levers, lifting margin from 13.8% to 21.1% (+736bps).
| Net Revenue HCRIS | $101.8M |
| Current EBITDA COMPUTED | $14.0M |
| Operating Margin COMPUTED | 13.8% |
| Occupancy HCRIS | 60.8% |
| Revenue / Bed COMPUTED | $4.1M |
| Net-to-Gross HCRIS | 69.1% |
| Distress Probability ML | 48.5% |
2. Market Context & Competitive Position
MT has 66 Medicare-certified hospitals with a median operating margin of -9.6%. The target's margin of 13.8% places it above the state median. Among 48 size-comparable peers (12-50 beds), the median margin is -9.3%. The target performs in line with or above peers.
3. RCM Performance Analysis — Comparable Hospitals
Comps selected by bed count (12-50), prioritizing same-state peers. 48 hospitals in the comp set.
| Hospital | State | Beds | Revenue | Margin |
|---|---|---|---|---|
| LOGAN HEALTH WHITEFISH (Target) | MT | 25 | $101.8M | 13.8% |
| GREAT FALLS CLINIC MEDICAL CEN | MT | 20 | $132.1M | 21.0% |
| MARCUS DALY MEMORIAL HOSPITAL | MT | 25 | $107.6M | -1.3% |
| SIDNEY HEALTH CENTER | MT | 25 | $95.2M | -6.3% |
| NORTHERN MONTANA HOSPITAL | MT | 49 | $93.3M | -4.7% |
| COMMUNITY HOSPITAL OF ANACONDA | MT | 25 | $89.0M | 1.3% |
| LIVINGSTON HEALTHCARE | MT | 25 | $72.6M | -7.1% |
| HOLY ROSARY HEALTHCARE | MT | 25 | $67.3M | 1.3% |
| HEALTHCENTER NORTHWEST | MT | 17 | $67.2M | 24.0% |
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: $7.5M (736bps margin improvement).
| Lever | Current | Target | EBITDA Impact | Margin | Ramp |
|---|---|---|---|---|---|
| Net Collection Rate | 93.5% | 97.0% | $2.1M | +210bp | 18mo |
| Cost to Collect | 4.5% | 2.5% | $2.0M | +200bp | 12mo |
| Denial Rate Reduction | 12.0% | 6.5% | $2.0M | +198bp | 12mo |
| A/R Days Reduction | 5200.0% | 3800.0% | $1.2M | +122bp | 9mo |
| Clean Claim Rate | 88.0% | 96.0% | $65K | +6bp | 6mo |
5. EBITDA Bridge
| Current EBITDA | $14.0M |
| + RCM Uplift | +$7.5M |
| Pro Forma EBITDA | $21.5M |
| Current Margin | 13.8% |
| Pro Forma Margin | 21.1% |
| WC Released (1x) | $3.9M |
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 | $21.6M | $167.4M | 7.76x | 50.7% |
| Base (11x exit) | 10.0x | 11.0x | $21.6M | $191.1M | 8.86x | 54.7% |
| Bull Case | 9.0x | 11.0x | $19.4M | $222.8M | 11.48x | 62.9% |
| Bull (12x exit) | 9.0x | 12.0x | $19.4M | $248.8M | 12.82x | 66.6% |
| Bear Case | 11.0x | 10.0x | $23.7M | $122.9M | 5.18x | 39.0% |
| Bear (11x exit) | 11.0x | 11.0x | $23.7M | $142.9M | 6.02x | 43.2% |
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
- 48 hospitals with 12-50 beds
- Same-state prioritization (n=49)
- Comp margins: P25=-20.8% / P50=-9.3% / P75=-2.1%
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.