ML Analysis — CHILDRENS HOSPITAL
CCN 193300 | 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.
58
/ 100 (C)
Financial Health17/25
RCM Upside11/25
Market Position12/20
Demand Defensibility9/15
Operational Efficiency9/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
Catalysts:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-0.8%
R²=0.34 | n=4,907 | Grade B | Actual: 6.7%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-29.0%, 27.6%]. P61 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2769063.550 | +0.1661 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 2584011.027 | -0.1142 | Higher Expense/Bed decreases predicted margin | |
| Medicaid % | 0.734 | -0.0781 | Higher Medicaid % decreases predicted margin | |
| Reimbursement Quality | 0.081 | +0.0346 | Higher Reimbursement Quality increases predicted m | |
| Bed Utilization Value | 1895374.528 | +0.0339 | Higher Bed Utilization Value increases predicted m |
Safety-Net/Medicaid Heavy
Archetype
58.1%
Distress Risk
$9.7M
RCM Opportunity
D
Opportunity Grade
8.5%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P90. High Medicaid dependence creates reimbursement risk. Assess DSH payments and state expansion status.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| WESTERN PEAKS SPECIALTY HOSPITAL | UT | 59 |
| HOSPITAL MENONITA AIBONITO | PR | 129 |
| TOPPENISH COMMUNITY HOSPITAL | WA | 47 |
| MINERAL COMMUNITY HOSPITAL | MT | 25 |
| BANNER UNIVERSITY MED CENTER SOUTH | AZ | 132 |
| NORTH COLORADO MEDICAL CENTER | CO | 202 |
Distress Analysis
Risk: High
National distress rate: 49.3%
LA distress rate: 46.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.734 | +0.645 | ▲ risk |
| Occupancy Rate | 0.684 | -0.148 | ▼ risk |
| Revenue Per Bed | 2769063.550 | -0.070 | ▼ risk |
| Medicare Day Pct | 0.008 | -0.055 | ▼ risk |
| Net To Gross Ratio | 0.314 | -0.024 | ▼ risk |
| Beds | 189.000 | +0.005 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $9.7M
Current margin: 6.7%
Projected margin: 8.5%
Grade: D
Comps: 41
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 | 0.258 | 0.834 | 57.6% | $8.6M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.314 | 0.329 | 1.4% | $870K | 65% | 18mo |
| Occupancy Improvement | 0.684 | 0.714 | 3.0% | $198K | 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 | 27.1 | [25.0, 75.0] | P39 | Strong — predicted days in ar is in the top third nationally |
| 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. |