NEW YORK PRESBYTERIAN HOSPITAL
1. Target Overview & Investment Thesis
NEW YORK PRESBYTERIAN HOSPITAL is a 2850-bed large academic medical center in NEW YORK, NY with $7.69B in net patient revenue and a -1.4% operating margin. The hospital serves a payer mix of 22.7% Medicare, 5.8% Medicaid, and 71.5% commercial.
Thesis: Undervalued. Our ML models identify $566.2M in annual EBITDA improvement potential from RCM optimization across 5 levers, lifting margin from -1.4% to 6.0% (+736bps).
| Net Revenue HCRIS | $7.69B |
| Current EBITDA COMPUTED | $-103.9M |
| Operating Margin COMPUTED | -1.4% |
| Occupancy HCRIS | 86.7% |
| Revenue / Bed COMPUTED | $2.7M |
| Net-to-Gross HCRIS | 27.4% |
| Distress Probability ML | 46.5% |
2. Market Context & Competitive Position
NY has 196 Medicare-certified hospitals with a median operating margin of -17.5%. The target's margin of -1.4% places it above the state median. Among 8 size-comparable peers (1425-5700 beds), the median margin is -2.9%. The target performs in line with or above peers.
3. RCM Performance Analysis — Comparable Hospitals
Comps selected by bed count (1425-5700), prioritizing same-state peers. 8 hospitals in the comp set.
| Hospital | State | Beds | Revenue | Margin |
|---|---|---|---|---|
| NEW YORK PRESBYTERIAN HOSPITAL (Target) | NY | 2850 | $7.69B | -1.4% |
| NYU LANGONE HOSPITALS | NY | 1618 | $7.24B | -7.8% |
| ADVENTHEALTH ORLANDO | FL | 2738 | $5.40B | 2.5% |
| NORTON HOSPITALS INC | KY | 1479 | $2.59B | 2.0% |
| METHODIST HOSPITAL | TX | 1729 | $2.42B | 22.9% |
| ORLANDO HEALTH | FL | 1507 | $2.38B | -20.2% |
| JACKSON MEMORIAL | FL | 1893 | $1.47B | -50.0% |
| BAPTIST HEALTH SYSTEM | TX | 1498 | $1.32B | 13.7% |
| KINGSBROOK JEWISH MEDICAL CENT | NY | 2342 | $189.4M | -50.0% |
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: $566.2M (736bps margin improvement).
| Lever | Current | Target | EBITDA Impact | Margin | Ramp |
|---|---|---|---|---|---|
| Net Collection Rate | 93.5% | 97.0% | $161.5M | +210bp | 18mo |
| Cost to Collect | 4.5% | 2.5% | $153.8M | +200bp | 12mo |
| Denial Rate Reduction | 12.0% | 6.5% | $152.3M | +198bp | 12mo |
| A/R Days Reduction | 5200.0% | 3800.0% | $93.6M | +122bp | 9mo |
| Clean Claim Rate | 88.0% | 96.0% | $4.9M | +6bp | 6mo |
5. EBITDA Bridge
| Current EBITDA | $-103.9M |
| + RCM Uplift | +$566.2M |
| Pro Forma EBITDA | $462.3M |
| Current Margin | -1.4% |
| Pro Forma Margin | 6.0% |
| WC Released (1x) | $295.0M |
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 | $-159.8M | $4.98B | 0.00x | -100.0% |
| Base (11x exit) | 10.0x | 11.0x | $-159.8M | $5.42B | 0.00x | -100.0% |
| Bull Case | 9.0x | 11.0x | $-143.8M | $7.24B | 0.00x | -100.0% |
| Bull (12x exit) | 9.0x | 12.0x | $-143.8M | $7.85B | 0.00x | -100.0% |
| Bear Case | 11.0x | 10.0x | $-175.8M | $2.20B | 0.00x | -100.0% |
| Bear (11x exit) | 11.0x | 11.0x | $-175.8M | $2.36B | 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 |
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
- 8 hospitals with 1425-5700 beds
- Same-state prioritization (n=3)
- Comp margins: P25=-27.7% / P50=-2.9% / P75=5.3%
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.