ML Analysis — ADVENTHEALTH SOUTH OVERLAND PARK
CCN 170208 | 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.
40
/ 100 (D)
Financial Health3/25
RCM Upside19/25
Market Position15/20
Demand Defensibility3/15
Operational Efficiency0/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-23.9%
R²=0.34 | n=4,907 | Grade B | Actual: -50.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-52.2%, 4.3%]. P17 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 796263.512 | -0.1093 | Lower Revenue/Bed decreases predicted margin | |
| State Peer Margin | -0.177 | -0.0972 | Lower State Peer Margin decreases predicted margin | |
| Expense/Bed | 1197991.390 | +0.0566 | Higher Expense/Bed increases predicted margin | |
| Bed Utilization Value | 264862.161 | -0.0202 | Lower Bed Utilization Value decreases predicted ma | |
| Net-to-Gross | 0.208 | -0.0180 | Lower Net-to-Gross decreases predicted margin |
Turnaround: 16%Low turnaround probability (16%). Structural disadvantages in Revenue/Bed and State Peer Margin.
Under-Performing / Distre
Archetype
49.7%
Distress Risk
$3.5M
RCM Opportunity
B
Opportunity Grade
-39.2%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P64. 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%
KS distress rate: 76.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.333 | +0.179 | ▲ risk |
| Medicaid Day Pct | 0.001 | -0.088 | ▼ risk |
| Net To Gross Ratio | 0.208 | -0.072 | ▼ risk |
| Revenue Per Bed | 796263.512 | +0.046 | ▲ risk |
| Medicare Day Pct | 0.109 | -0.037 | ▼ risk |
| Beds | 41.000 | -0.014 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.5M
Current margin: -50.0%
Projected margin: -39.2%
Grade: B
Comps: 86
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Net-to-Gross Ratio Improvement | 0.208 | 0.763 | 55.5% | $2.1M | 65% | 18mo |
| Occupancy Improvement | 0.333 | 0.548 | 21.5% | $1.4M | 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 | 33.9 | [25.0, 75.0] | P77 | Average — predicted days in ar is near the median. |
| Clean Claim Rate | 98.0% | [80.0%, 98.0%] | P0 | Strong — predicted clean claim rate is in the top third. |
| Net Collection Rate | 99.1% | [90.0%, 99.5%] | P4 | Strong — predicted net collection rate is in the top third. |