ML Analysis — FOUR WINDS INC.
CCN 334002 | 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.
44
/ 100 (D)
Financial Health3/25
RCM Upside20/25
Market Position8/20
Demand Defensibility9/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-19.3%
R²=0.34 | n=4,907 | Grade B | Actual: -17.8%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-47.6%, 9.0%]. P22 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 295158.154 | -0.1793 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 347618.731 | +0.1613 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.175 | -0.0960 | Lower State Peer Margin decreases predicted margin | |
| Medicaid % | 0.586 | -0.0601 | Higher Medicaid % decreases predicted margin | |
| Net-to-Gross | 0.726 | +0.0400 | Higher Net-to-Gross increases predicted margin |
Turnaround: 20%Low turnaround probability (20%). Structural disadvantages in Revenue/Bed and Expense/Bed.
Safety-Net/Medicaid Heavy
Archetype
59.4%
Distress Risk
$5.1M
RCM Opportunity
C
Opportunity Grade
-7.9%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P55. 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%
NY distress rate: 84.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.586 | +0.497 | ▲ risk |
| Occupancy Rate | 0.817 | -0.271 | ▼ risk |
| Net To Gross Ratio | 0.726 | +0.159 | ▲ risk |
| Revenue Per Bed | 295158.154 | +0.076 | ▲ risk |
| Medicare Day Pct | 0.003 | -0.056 | ▼ risk |
| Beds | 175.000 | +0.004 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.1M
Current margin: -17.8%
Projected margin: -7.9%
Grade: C
Comps: 96
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 | 0.411 | 0.745 | 33.5% | $5.0M | 50% | 24mo |
| Occupancy Improvement | 0.817 | 0.829 | 1.2% | $81K | 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 | 25.0 | [25.0, 75.0] | P0 | 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. |