ML Analysis — AVERA HOLY FAMILY HEALTH
CCN 161351 | 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.
38
/ 100 (D)
Financial Health3/25
RCM Upside19/25
Market Position8/20
Demand Defensibility2/15
Operational Efficiency6/15
Entry Multiple: 6.0x – 8.5x
Est. MOIC: 1.5x
Risk Factors:
- Negative operating margin
- Heavy Medicare dependence (>55%)
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
- Expenses exceed revenue
Catalysts:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-12.2%
R²=0.34 | n=4,907 | Grade B | Actual: -10.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-40.5%, 16.1%]. P33 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 1114472.182 | -0.0649 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 1228852.682 | +0.0528 | Higher Expense/Bed increases predicted margin | |
| Log(Beds) | 3.091 | -0.0298 | Lower Log(Beds) decreases predicted margin | |
| State Peer Margin | -0.082 | -0.0269 | Lower State Peer Margin decreases predicted margin | |
| Bed Utilization Value | 230944.173 | -0.0213 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 30%Low turnaround probability (30%). Structural disadvantages in Revenue/Bed and Expense/Bed.
nan%
Distress Risk
$4.3M
RCM Opportunity
A
Opportunity Grade
7.1%
Projected Margin
Distress Analysis
Risk: Unknown
National distress rate: 49.3%
IA distress rate: 67.2%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.207 | +0.295 | ▲ risk |
| Medicare Day Pct | 0.729 | +0.069 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Net To Gross Ratio | 0.480 | +0.049 | ▲ risk |
| Revenue Per Bed | 1114472.182 | +0.027 | ▲ risk |
| Beds | 22.000 | -0.017 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.3M
Current margin: -10.3%
Projected margin: 7.1%
Grade: A
Comps: 89
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 | 0.271 | 0.478 | 20.7% | $3.1M | 50% | 24mo |
| Occupancy Improvement | 0.207 | 0.323 | 11.6% | $766K | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.480 | 0.617 | 13.8% | $396K | 65% | 18mo |
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. |