ML Analysis — PALOMAR HEALTH REHABILITATION INSTIT
CCN 053043 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Hold / Selective — investigate specific opportunities but be prepared for execution risk.
45
/ 100 (C)
Financial Health12/25
RCM Upside10/25
Market Position8/20
Demand Defensibility8/15
Operational Efficiency7/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Heavy Medicare dependence (>55%)
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-7.3%
R²=0.34 | n=4,907 | Grade B | Actual: 8.4%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.6%, 21.0%]. P44 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 395350.269 | -0.1653 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 362140.308 | +0.1595 | Higher Expense/Bed increases predicted margin | |
| Bed Utilization Value | 173762.484 | -0.0232 | Lower Bed Utilization Value decreases predicted ma | |
| Bed Count | 52.000 | +0.0151 | Higher Bed Count increases predicted margin | |
| Reimbursement Quality | 0.161 | +0.0116 | Higher Reimbursement Quality increases predicted m |
Rural/Critical Access
Archetype
52.7%
Distress Risk
$7.1M
RCM Opportunity
A
Opportunity Grade
42.9%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P56. 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%
CA distress rate: 49.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.440 | +0.080 | ▲ risk |
| Medicaid Day Pct | 0.017 | -0.072 | ▼ risk |
| Revenue Per Bed | 395350.269 | +0.070 | ▲ risk |
| Medicare Day Pct | 0.598 | +0.046 | ▲ risk |
| Net To Gross Ratio | 0.419 | +0.022 | ▲ risk |
| Beds | 52.000 | -0.013 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $7.1M
Current margin: 8.4%
Projected margin: 42.9%
Grade: A
Comps: 97
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 | 0.385 | 0.734 | 34.9% | $5.2M | 50% | 24mo |
| Occupancy Improvement | 0.440 | 0.715 | 27.6% | $1.8M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.419 | 0.428 | 1.0% | $23K | 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 | 28.1 | [25.0, 75.0] | P45 | 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. |