ML Analysis — TEXAS ORTHOPEDIC HOSPITA
CCN 450804 | 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 Health19/25
RCM Upside5/25
Market Position2/20
Demand Defensibility8/15
Operational Efficiency11/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Small facility (<50 beds) — limited scale
Catalysts:
Margin Prediction (Trained Ridge Model)
41.1%
R²=0.34 | n=4,907 | Grade B | Actual: 46.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [12.8%, 69.5%]. P99 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 5663022.048 | +0.5700 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 3041522.691 | -0.1705 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 2128796.582 | +0.0417 | Higher Bed Utilization Value increases predicted m | |
| Reimbursement Quality | 0.095 | +0.0306 | Higher Reimbursement Quality increases predicted m | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi |
nan%
Distress Risk
$13.6M
RCM Opportunity
D
Opportunity Grade
52.0%
Projected Margin
Distress Analysis
Risk: Unknown
National distress rate: 49.3%
TX distress rate: 42.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.376 | +0.139 | ▲ risk |
| Medicare Day Pct | 0.360 | +0.006 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Revenue Per Bed | 5663022.048 | -0.241 | ▼ risk |
| Net To Gross Ratio | 0.149 | -0.098 | ▼ risk |
| Beds | 42.000 | -0.014 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $13.6M
Current margin: 46.3%
Projected margin: 52.0%
Grade: D
Comps: 283
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Net-to-Gross Ratio Improvement | 0.149 | 0.508 | 35.9% | $10.0M | 65% | 18mo |
| Occupancy Improvement | 0.376 | 0.705 | 32.9% | $2.2M | 55% | 24mo |
| Payer Mix Optimization | 0.640 | 0.736 | 9.6% | $1.4M | 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. |