ML Analysis — LALLIE KEMP REGIONAL MEDICAL CENTER
CCN 191321 | 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.
42
/ 100 (D)
Financial Health3/25
RCM Upside18/25
Market Position13/20
Demand Defensibility2/15
Operational Efficiency6/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-25.5%
R²=0.34 | n=4,907 | Grade B | Actual: -50.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-53.8%, 2.8%]. P15 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Reimbursement Quality | 0.416 | -0.0617 | Higher Reimbursement Quality decreases predicted m | |
| Expense/Bed | 2100301.042 | -0.0546 | Higher Expense/Bed decreases predicted margin | |
| Revenue/Bed | 1197615.458 | -0.0533 | Lower Revenue/Bed decreases predicted margin | |
| Log(Beds) | 3.178 | -0.0278 | Lower Log(Beds) decreases predicted margin | |
| Bed Utilization Value | 132749.385 | -0.0246 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 14%Low turnaround probability (14%). Structural disadvantages in Reimbursement Quality and Expense/Bed.
Under-Performing / Distre
Archetype
57.4%
Distress Risk
$4.3M
RCM Opportunity
A
Opportunity Grade
-35.2%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P82. 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: High
National distress rate: 49.3%
LA distress rate: 46.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.111 | +0.385 | ▲ risk |
| Medicaid Day Pct | 0.005 | -0.084 | ▼ risk |
| Net To Gross Ratio | 0.485 | +0.052 | ▲ risk |
| Medicare Day Pct | 0.137 | -0.033 | ▼ risk |
| Revenue Per Bed | 1197615.458 | +0.023 | ▲ risk |
| Beds | 24.000 | -0.017 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.3M
Current margin: -50.0%
Projected margin: -35.2%
Grade: A
Comps: 129
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.111 | 0.698 | 58.7% | $3.9M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.485 | 0.599 | 11.4% | $385K | 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 | 36.4 | [25.0, 75.0] | P80 | 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 | 98.6% | [90.0%, 99.5%] | P2 | Strong — predicted net collection rate is in the top third. |