ML Analysis — REUNION REHABILITATION HOSPITAL PHOE
CCN 033043 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Speculative — only pursue if turnaround thesis is strong and entry multiple reflects risk.
44
/ 100 (D)
Financial Health5/25
RCM Upside19/25
Market Position9/20
Demand Defensibility6/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-8.8%
R²=0.34 | n=4,907 | Grade B | Actual: -13.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-37.0%, 19.6%]. P40 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 255738.896 | -0.1848 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 289373.521 | +0.1685 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.307 | -0.0304 | Higher Reimbursement Quality decreases predicted m | |
| State Peer Margin | -0.008 | +0.0279 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 111593.827 | -0.0253 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 35%Turnaround possible (35%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Under-Performing / Distre
Archetype
53.4%
Distress Risk
$2.5M
RCM Opportunity
A
Opportunity Grade
7.1%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P16. Deeply negative margins signal severe distress. Evaluate asset-level acquisition at 4-6x normalized EBITDA.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| HOLY FAMILY MEMORIAL INC | WI | 58 |
| MIDDLESBORO ARH | KY | 46 |
| ATRIUM HEALTH NAVICENT BALDWIN | GA | 86 |
| BON SECOURS COMMUNITY HOSPITAL | NY | 98 |
| ADVANCED SPECIALTY HOSP. OF TOLEDO | OH | 40 |
| COMMUNITY HEALTH CENTER BRANCH | MI | 75 |
Distress Analysis
Risk: High
National distress rate: 49.3%
AZ distress rate: 35.5%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.436 | +0.082 | ▲ risk |
| Revenue Per Bed | 255738.896 | +0.078 | ▲ risk |
| Net To Gross Ratio | 0.477 | +0.048 | ▲ risk |
| Medicaid Day Pct | 0.062 | -0.027 | ▼ risk |
| Beds | 48.000 | -0.013 | ▼ risk |
| Medicare Day Pct | 0.294 | -0.006 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.5M
Current margin: -13.2%
Projected margin: 7.1%
Grade: A
Comps: 57
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.436 | 0.684 | 24.8% | $1.6M | 55% | 24mo |
| Payer Mix Optimization | 0.644 | 0.697 | 5.3% | $795K | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.477 | 0.517 | 4.0% | $57K | 65% | 18mo |
Predicted RCM Performance (Public Data Only)
A
RCM Grade
Strong RCM profile — likely low-risk from an operations perspective. Focus diligence on growth thesis.
| Metric | Predicted | 90% CI | Percentile | Assessment |
|---|---|---|---|---|
| Denial Rate | 2.0% | [2.0%, 25.0%] | P0 | Strong — predicted denial rate is in the top third nationall |
| Days in AR | 27.8 | [25.0, 75.0] | P43 | Strong — predicted days in ar is in the top third nationally |
| Clean Claim Rate | 98.0% | [80.0%, 98.0%] | P0 | Strong — predicted clean claim rate is in the top third. |
| Net Collection Rate | 99.5% | [90.0%, 99.5%] | P8 | Strong — predicted net collection rate is in the top third. |