ML Analysis — MAGNOLIA HOSPITAL
CCN 250009 | 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.
50
/ 100 (C)
Financial Health7/25
RCM Upside18/25
Market Position13/20
Demand Defensibility9/15
Operational Efficiency2/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
Catalysts:
- RCM optimization could add 3-5pp margin
- Limited competition supports pricing power
- Volume growth opportunity from low occupancy
Margin Prediction (Trained Ridge Model)
-12.7%
R²=0.34 | n=4,907 | Grade B | Actual: -4.7%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-41.0%, 15.6%]. P32 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 1022851.956 | -0.0777 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 1070637.367 | +0.0723 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.125 | -0.0591 | Lower State Peer Margin decreases predicted margin | |
| Reimbursement Quality | 0.079 | +0.0354 | Higher Reimbursement Quality increases predicted m | |
| Log(Beds) | 5.063 | +0.0160 | Higher Log(Beds) increases predicted margin |
Turnaround: 29%Low turnaround probability (29%). Structural disadvantages in Revenue/Bed and Expense/Bed.
Rural/Critical Access
Archetype
51.7%
Distress Risk
$5.0M
RCM Opportunity
D
Opportunity Grade
-1.6%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P57. 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: High
National distress rate: 49.3%
MS distress rate: 68.2%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.456 | +0.064 | ▲ risk |
| Net To Gross Ratio | 0.231 | -0.061 | ▼ risk |
| Medicare Day Pct | 0.549 | +0.038 | ▲ risk |
| Revenue Per Bed | 1022851.956 | +0.033 | ▲ risk |
| Medicaid Day Pct | 0.110 | +0.022 | ▲ risk |
| Beds | 158.000 | +0.001 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.0M
Current margin: -4.7%
Projected margin: -1.6%
Grade: D
Comps: 29
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 | 0.340 | 0.538 | 19.7% | $3.0M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.231 | 0.305 | 7.4% | $1.4M | 65% | 18mo |
| Occupancy Improvement | 0.456 | 0.551 | 9.4% | $624K | 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 | 27.5 | [25.0, 75.0] | P41 | 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. |