ML Analysis — CHILDRENS HOSPITAL LOS ANGELES
CCN 053302 | 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.
56
/ 100 (C)
Financial Health11/25
RCM Upside20/25
Market Position8/20
Demand Defensibility11/15
Operational Efficiency6/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- RCM optimization could add 3-5pp margin
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-11.6%
R²=0.34 | n=4,907 | Grade B | Actual: -36.8%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-39.9%, 16.7%]. P34 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 4001935.208 | -0.2888 | Higher Expense/Bed decreases predicted margin | |
| Revenue/Bed | 2925779.605 | +0.1880 | Higher Revenue/Bed increases predicted margin | |
| Bed Utilization Value | 2203112.334 | +0.0441 | Higher Bed Utilization Value increases predicted m | |
| Bed Count | 413.000 | -0.0412 | Higher Bed Count decreases predicted margin | |
| Log(Beds) | 6.023 | +0.0383 | Higher Log(Beds) increases predicted margin |
Turnaround: 30%Turnaround possible (30%) but uncertain. Margin improvement depends on improving Expense/Bed.
nan%
Distress Risk
$43K
RCM Opportunity
D
Opportunity Grade
-36.8%
Projected Margin
Distress Analysis
Risk: Unknown
National distress rate: 49.3%
CA distress rate: 49.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.753 | -0.211 | ▼ risk |
| Medicare Day Pct | 0.003 | -0.056 | ▼ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Revenue Per Bed | 2925779.605 | -0.079 | ▼ risk |
| Beds | 413.000 | +0.035 | ▲ risk |
| Net To Gross Ratio | 0.311 | -0.025 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $43K
Current margin: -36.8%
Projected margin: -36.8%
Grade: D
Comps: 139
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.753 | 0.759 | 0.6% | $43K | 55% | 24mo |
Predicted RCM Performance (Public Data Only)
B
RCM Grade
Average RCM profile — some improvement opportunities. Standard diligence scope recommended.
| Metric | Predicted | 90% CI | Percentile | Assessment |
|---|---|---|---|---|
| Denial Rate | 25.0% | [2.0%, 25.0%] | P83 | Below average — denial rate suggests RCM improvement opportu |
| Days in AR | 75.0 | [25.0, 75.0] | P83 | Below average — days in ar suggests RCM improvement opportun |
| 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. |