ML Analysis — KINDRED HOSPITAL SAN DIEGO
CCN 052036 | 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 Health4/25
RCM Upside20/25
Market Position9/20
Demand Defensibility12/15
Operational Efficiency0/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-7.7%
R²=0.34 | n=4,907 | Grade B | Actual: -26.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-36.0%, 20.6%]. P43 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 501028.457 | -0.1505 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 634239.271 | +0.1260 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.136 | +0.0188 | Higher Reimbursement Quality increases predicted m | |
| Bed Utilization Value | 348445.192 | -0.0174 | Lower Bed Utilization Value decreases predicted ma | |
| Net-to-Gross | 0.228 | -0.0158 | Lower Net-to-Gross decreases predicted margin |
Turnaround: 37%Turnaround possible (37%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Under-Performing / Distre
Archetype
43.7%
Distress Risk
$2.8M
RCM Opportunity
C
Opportunity Grade
-18.6%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P61. 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: Elevated
National distress rate: 49.3%
CA distress rate: 49.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.695 | -0.158 | ▼ risk |
| Medicaid Day Pct | 0.021 | -0.068 | ▼ risk |
| Revenue Per Bed | 501028.457 | +0.064 | ▲ risk |
| Net To Gross Ratio | 0.228 | -0.063 | ▼ risk |
| Beds | 70.000 | -0.011 | ▼ risk |
| Medicare Day Pct | 0.382 | +0.009 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.8M
Current margin: -26.6%
Projected margin: -18.6%
Grade: C
Comps: 139
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Payer Mix Optimization | 0.597 | 0.722 | 12.5% | $1.9M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.228 | 0.406 | 17.8% | $731K | 65% | 18mo |
| Occupancy Improvement | 0.695 | 0.726 | 3.0% | $199K | 55% | 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 | 29.6 | [25.0, 75.0] | P56 | 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. |