ML Analysis — NORTHEAST MONTANA HEALTH SERVICES
CCN 271341 | 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.
40
/ 100 (D)
Financial Health1/25
RCM Upside19/25
Market Position11/20
Demand Defensibility4/15
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:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-18.7%
R²=0.34 | n=4,907 | Grade B | Actual: -10.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-47.0%, 9.6%]. P22 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Medicaid % | 0.596 | -0.0613 | Higher Medicaid % decreases predicted margin | |
| Net-to-Gross | 0.742 | +0.0418 | Higher Net-to-Gross increases predicted margin | |
| State Peer Margin | -0.096 | -0.0373 | Lower State Peer Margin decreases predicted margin | |
| Log(Beds) | 3.091 | -0.0298 | Lower Log(Beds) decreases predicted margin | |
| Occupancy | 0.148 | -0.0215 | Lower Occupancy decreases predicted margin |
Turnaround: 21%Low turnaround probability (21%). Structural disadvantages in Medicaid % and Net-to-Gross.
Safety-Net/Medicaid Heavy
Archetype
72.3%
Distress Risk
$8.4M
RCM Opportunity
A
Opportunity Grade
13.6%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P76. 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%
MT distress rate: 69.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.596 | +0.506 | ▲ risk |
| Occupancy Rate | 0.148 | +0.351 | ▲ risk |
| Net To Gross Ratio | 0.742 | +0.166 | ▲ risk |
| Medicare Day Pct | 0.218 | -0.019 | ▼ risk |
| Beds | 22.000 | -0.017 | ▼ risk |
| Revenue Per Bed | 1607542.273 | -0.002 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.4M
Current margin: -10.2%
Projected margin: 13.6%
Grade: A
Comps: 47
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 | 0.186 | 0.452 | 26.6% | $4.0M | 50% | 24mo |
| Occupancy Improvement | 0.148 | 0.732 | 58.5% | $3.9M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.742 | 0.878 | 13.7% | $566K | 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 | 32.0 | [25.0, 75.0] | P70 | 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. |