ML Analysis — MERCY REHAB HOSPITAL IOWA
CCN 163025 | 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.
41
/ 100 (D)
Financial Health15/25
RCM Upside5/25
Market Position6/20
Demand Defensibility6/15
Operational Efficiency9/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Heavy Medicare dependence (>55%)
Catalysts:
Margin Prediction (Trained Ridge Model)
-5.9%
R²=0.34 | n=4,907 | Grade B | Actual: 16.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-34.2%, 22.4%]. P47 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 442514.040 | -0.1587 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 370454.580 | +0.1585 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.082 | -0.0269 | Lower State Peer Margin decreases predicted margin | |
| Bed Utilization Value | 312669.509 | -0.0186 | Lower Bed Utilization Value decreases predicted ma | |
| Bed Count | 50.000 | +0.0154 | Higher Bed Count increases predicted margin |
nan%
Distress Risk
$2.3M
RCM Opportunity
B
Opportunity Grade
26.9%
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 | 0.707 | -0.168 | ▼ risk |
| Medicare Day Pct | 0.640 | +0.054 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Revenue Per Bed | 442514.040 | +0.067 | ▲ risk |
| Net To Gross Ratio | 0.433 | +0.028 | ▲ risk |
| Beds | 50.000 | -0.013 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.3M
Current margin: 16.3%
Projected margin: 26.9%
Grade: B
Comps: 76
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 | 0.360 | 0.489 | 12.9% | $1.9M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.433 | 0.591 | 15.8% | $410K | 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. |