Investability Score
Speculative — only pursue if turnaround thesis is strong and entry multiple reflects risk.
43
/ 100 (D)
Financial Health3/25
RCM Upside18/25
Market Position15/20
Demand Defensibility6/15
Operational Efficiency0/15
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:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-13.8%
R²=0.34 | n=4,907 | Grade B | Actual: -50.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-42.1%, 14.5%]. P29 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 306014.349 | -0.1777 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 688438.535 | +0.1193 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.051 | +0.0433 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.090 | -0.0312 | Lower Net-to-Gross decreases predicted margin | |
| Bed Utilization Value | 58882.659 | -0.0270 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 27%Low turnaround probability (27%). Structural disadvantages in Revenue/Bed and Expense/Bed.
Under-Performing / Distre
Archetype
54.3%
Distress Risk
$6.0M
RCM Opportunity
A
Opportunity Grade
-4.8%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P69. 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: High
National distress rate: 49.3%
NC distress rate: 36.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.192 | +0.309 | ▲ risk |
| Net To Gross Ratio | 0.090 | -0.124 | ▼ risk |
| Revenue Per Bed | 306014.349 | +0.075 | ▲ risk |
| Medicaid Day Pct | 0.027 | -0.062 | ▼ risk |
| Beds | 43.000 | -0.014 | ▼ risk |
| Medicare Day Pct | 0.407 | +0.014 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.0M
Current margin: -50.0%
Projected margin: -4.8%
Grade: A
Comps: 51
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.192 | 0.698 | 50.6% | $3.3M | 55% | 24mo |
| Payer Mix Optimization | 0.566 | 0.708 | 14.2% | $2.1M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.090 | 0.405 | 31.4% | $484K | 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 | 40.2 | [25.0, 75.0] | P82 | Average — predicted days in ar is near the median. |
| Clean Claim Rate | 98.0% | [80.0%, 98.0%] | P0 | Strong — predicted clean claim rate is in the top third. |
| Net Collection Rate | 97.8% | [90.0%, 99.5%] | P0 | Average — predicted net collection rate is near the median. |