ML Analysis — ADVENTHEALTH CENTRAL TEXAS
CCN 450152 | 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.
48
/ 100 (C)
Financial Health7/25
RCM Upside18/25
Market Position13/20
Demand Defensibility11/15
Operational Efficiency0/15
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
- Volume growth opportunity from low occupancy
Margin Prediction (Trained Ridge Model)
-6.8%
R²=0.34 | n=4,907 | Grade B | Actual: -6.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.0%, 21.6%]. P45 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 669691.207 | -0.1270 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 713050.986 | +0.1163 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Log(Beds) | 5.338 | +0.0224 | Higher Log(Beds) increases predicted margin | |
| Bed Utilization Value | 249167.117 | -0.0207 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 38%Turnaround possible (38%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Under-Performing / Distre
Archetype
52.5%
Distress Risk
$5.6M
RCM Opportunity
D
Opportunity Grade
-2.5%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P49. 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%
TX distress rate: 42.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.372 | +0.142 | ▲ risk |
| Net To Gross Ratio | 0.209 | -0.071 | ▼ risk |
| Revenue Per Bed | 669691.207 | +0.054 | ▲ risk |
| Medicare Day Pct | 0.202 | -0.021 | ▼ risk |
| Medicaid Day Pct | 0.104 | +0.015 | ▲ risk |
| Beds | 208.000 | +0.008 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.6M
Current margin: -6.5%
Projected margin: -2.5%
Grade: D
Comps: 148
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.372 | 0.754 | 38.1% | $2.5M | 55% | 24mo |
| Payer Mix Optimization | 0.694 | 0.819 | 12.5% | $1.9M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.209 | 0.281 | 7.2% | $1.2M | 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 | 25.8 | [25.0, 75.0] | P33 | 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. |