ML Analysis — ENCOMPASS HEALTH REHABILITATION HOSP
CCN 423028 | 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.
45
/ 100 (D)
Financial Health16/25
RCM Upside5/25
Market Position9/20
Demand Defensibility6/15
Operational Efficiency9/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Heavy Medicare dependence (>55%)
Catalysts:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
11.4%
R²=0.34 | n=4,907 | Grade B | Actual: 37.1%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-16.9%, 39.7%]. P84 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 373181.220 | +0.1582 | Higher Expense/Bed increases predicted margin | |
| Revenue/Bed | 593060.640 | -0.1377 | Lower Revenue/Bed decreases predicted margin | |
| Net-to-Gross | 0.819 | +0.0505 | Higher Net-to-Gross increases predicted margin | |
| State Peer Margin | 0.013 | +0.0432 | Higher State Peer Margin increases predicted margi | |
| Occupancy × Net-to-Gross | 0.748 | +0.0419 | Higher Occupancy × Net-to-Gross increases predicte |
nan%
Distress Risk
$7.0M
RCM Opportunity
A
Opportunity Grade
60.6%
Projected Margin
Distress Analysis
Risk: Unknown
National distress rate: 49.3%
SC distress rate: 34.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.914 | -0.361 | ▼ risk |
| Medicare Day Pct | 0.766 | +0.075 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Net To Gross Ratio | 0.819 | +0.201 | ▲ risk |
| Revenue Per Bed | 593060.640 | +0.058 | ▲ risk |
| Beds | 50.000 | -0.013 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $7.0M
Current margin: 37.1%
Projected margin: 60.6%
Grade: A
Comps: 45
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 | 0.234 | 0.699 | 46.6% | $7.0M | 50% | 24mo |
Predicted RCM Performance (Public Data Only)
B
RCM Grade
Average RCM profile — some improvement opportunities. Standard diligence scope recommended.
| Metric | Predicted | 90% CI | Percentile | Assessment |
|---|---|---|---|---|
| Denial Rate | 25.0% | [2.0%, 25.0%] | P83 | Below average — denial rate suggests RCM improvement opportu |
| Days in AR | 75.0 | [25.0, 75.0] | P83 | Below average — days in ar suggests RCM improvement opportun |
| 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. |