Investability Score
Hold / Selective — investigate specific opportunities but be prepared for execution risk.
45
/ 100 (C)
Financial Health3/25
RCM Upside19/25
Market Position15/20
Demand Defensibility8/15
Operational Efficiency0/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-12.3%
R²=0.34 | n=4,907 | Grade B | Actual: -50.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-40.6%, 16.0%]. P32 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 745705.792 | -0.1164 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 1307796.583 | +0.0430 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 326501.662 | -0.0181 | Lower Bed Utilization Value decreases predicted ma | |
| Bed Count | 48.000 | +0.0157 | Higher Bed Count increases predicted margin |
Turnaround: 30%Low turnaround probability (30%). Structural disadvantages in Revenue/Bed and Expense/Bed.
Under-Performing / Distre
Archetype
49.2%
Distress Risk
$4.3M
RCM Opportunity
B
Opportunity Grade
-38.0%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P33. 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: Elevated
National distress rate: 49.3%
TX distress rate: 42.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.438 | +0.081 | ▲ risk |
| Medicaid Day Pct | 0.028 | -0.061 | ▼ risk |
| Net To Gross Ratio | 0.241 | -0.057 | ▼ risk |
| Revenue Per Bed | 745705.792 | +0.049 | ▲ risk |
| Beds | 48.000 | -0.013 | ▼ risk |
| Medicare Day Pct | 0.311 | -0.003 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.3M
Current margin: -50.0%
Projected margin: -38.0%
Grade: B
Comps: 280
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.438 | 0.722 | 28.4% | $1.9M | 55% | 24mo |
| Payer Mix Optimization | 0.661 | 0.746 | 8.5% | $1.3M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.241 | 0.511 | 27.0% | $1.1M | 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 | 35.0 | [25.0, 75.0] | P79 | 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 | 98.8% | [90.0%, 99.5%] | P3 | Strong — predicted net collection rate is in the top third. |