ML Analysis — REHAB HOSPITAL OF CAPE & ISLANDS
CCN 223032 | 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.
47
/ 100 (C)
Financial Health5/25
RCM Upside20/25
Market Position11/20
Demand Defensibility8/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Heavy Medicare dependence (>55%)
- Expenses exceed revenue
Catalysts:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-10.4%
R²=0.34 | n=4,907 | Grade B | Actual: -17.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-38.7%, 17.9%]. P36 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 738383.333 | -0.1174 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 863545.033 | +0.0978 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.122 | -0.0566 | Lower State Peer Margin decreases predicted margin | |
| Reimbursement Quality | 0.139 | +0.0179 | Higher Reimbursement Quality increases predicted m | |
| Bed Count | 60.000 | +0.0138 | Higher Bed Count increases predicted margin |
Turnaround: 32%Turnaround possible (32%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Rural/Critical Access
Archetype
47.9%
Distress Risk
$8.3M
RCM Opportunity
A
Opportunity Grade
1.8%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P79. Rural/small hospitals face structural headwinds. Evaluate CAH conversion, telehealth, and rural health funding.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| BRECKINRIDGE HEALTH INC | KY | 25 |
| SHERIDAN MEMORIAL HOSPITAL | MT | 19 |
| DAYTON GENERAL HOSPITAL | WA | 25 |
| BLUE MOUNTAIN HOSPITAL DISTRICT | OR | 16 |
| COMMUNITY HOSPITAL | WY | 25 |
| CARLE EUREKA HOSPITAL | IL | 25 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
MA distress rate: 61.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.663 | -0.128 | ▼ risk |
| Medicare Day Pct | 0.646 | +0.055 | ▲ risk |
| Medicaid Day Pct | 0.036 | -0.053 | ▼ risk |
| Revenue Per Bed | 738383.333 | +0.050 | ▲ risk |
| Net To Gross Ratio | 0.437 | +0.031 | ▲ risk |
| Beds | 60.000 | -0.012 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.3M
Current margin: -17.0%
Projected margin: 1.8%
Grade: A
Comps: 37
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 | 0.318 | 0.724 | 40.5% | $6.1M | 50% | 24mo |
| Occupancy Improvement | 0.663 | 0.854 | 19.0% | $1.3M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.437 | 0.625 | 18.7% | $971K | 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 | 28.9 | [25.0, 75.0] | P50 | 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. |