ML Analysis — FRANKLIN MEMORIAL HOSPITAL
CCN 200037 | 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.
57
/ 100 (C)
Financial Health8/25
RCM Upside20/25
Market Position15/20
Demand Defensibility7/15
Operational Efficiency8/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
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)
-12.0%
R²=0.34 | n=4,907 | Grade B | Actual: -17.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-40.4%, 16.2%]. P33 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 2636393.761 | -0.1206 | Higher Expense/Bed decreases predicted margin | |
| Revenue/Bed | 2247179.044 | +0.0932 | Higher Revenue/Bed increases predicted margin | |
| State Peer Margin | -0.083 | -0.0278 | Lower State Peer Margin decreases predicted margin | |
| Reimbursement Quality | 0.275 | -0.0212 | Higher Reimbursement Quality decreases predicted m | |
| Bed Count | 46.000 | +0.0160 | Higher Bed Count increases predicted margin |
Turnaround: 30%Low turnaround probability (30%). Structural disadvantages in Expense/Bed and Revenue/Bed.
Under-Performing / Distre
Archetype
49.1%
Distress Risk
$2.9M
RCM Opportunity
D
Opportunity Grade
-14.6%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P24. 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%
ME distress rate: 61.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Revenue Per Bed | 2247179.043 | -0.039 | ▼ risk |
| Net To Gross Ratio | 0.417 | +0.021 | ▲ risk |
| Medicaid Day Pct | 0.110 | +0.021 | ▲ risk |
| Occupancy Rate | 0.503 | +0.020 | ▲ risk |
| Medicare Day Pct | 0.229 | -0.017 | ▼ risk |
| Beds | 46.000 | -0.014 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.9M
Current margin: -17.3%
Projected margin: -14.6%
Grade: D
Comps: 28
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 | 0.417 | 0.571 | 15.4% | $1.9M | 65% | 18mo |
| Occupancy Improvement | 0.503 | 0.654 | 15.0% | $992K | 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 | 28.4 | [25.0, 75.0] | P46 | 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. |