ML Analysis — MCGEHEE HOSPITAL
CCN 041308 | 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.
45
/ 100 (D)
Financial Health2/25
RCM Upside18/25
Market Position15/20
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
- Low occupancy (<30%) — demand risk
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-16.5%
R²=0.34 | n=4,907 | Grade B | Actual: -17.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-44.8%, 11.8%]. P25 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 498291.520 | -0.1509 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 584000.640 | +0.1322 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.341 | -0.0401 | Higher Reimbursement Quality decreases predicted m | |
| Net-to-Gross | 0.718 | +0.0392 | Higher Net-to-Gross increases predicted margin | |
| Bed Utilization Value | 57610.691 | -0.0271 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 24%Low turnaround probability (24%). Structural disadvantages in Revenue/Bed and Expense/Bed.
Rural/Critical Access
Archetype
62.8%
Distress Risk
$4.1M
RCM Opportunity
A
Opportunity Grade
15.5%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P42. Rural/small hospitals face structural headwinds. Evaluate CAH conversion, telehealth, and rural health funding.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| BRECKINRIDGE HEALTH INC | KY | 25 |
| SHERIDAN MEMORIAL HOSPITAL | MT | 19 |
| DAYTON GENERAL HOSPITAL | WA | 25 |
| BLUE MOUNTAIN HOSPITAL DISTRICT | OR | 16 |
| COMMUNITY HOSPITAL | WY | 25 |
| CARLE EUREKA HOSPITAL | IL | 25 |
Distress Analysis
Risk: High
National distress rate: 49.3%
AR distress rate: 53.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.116 | +0.380 | ▲ risk |
| Net To Gross Ratio | 0.718 | +0.156 | ▲ risk |
| Revenue Per Bed | 498291.520 | +0.064 | ▲ risk |
| Medicaid Day Pct | 0.027 | -0.061 | ▼ risk |
| Medicare Day Pct | 0.498 | +0.029 | ▲ risk |
| Beds | 25.000 | -0.017 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.1M
Current margin: -17.2%
Projected margin: 15.5%
Grade: A
Comps: 52
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.116 | 0.564 | 44.9% | $3.0M | 55% | 24mo |
| Payer Mix Optimization | 0.475 | 0.549 | 7.4% | $1.1M | 50% | 24mo |
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 | 30.0 | [25.0, 75.0] | P58 | 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. |