ML Analysis — KINDRED HOSPITAL HOUSTON NORTHWEST
CCN 452039 | 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.
35
/ 100 (D)
Financial Health4/25
RCM Upside19/25
Market Position2/20
Demand Defensibility11/15
Operational Efficiency0/15
Entry Multiple: 6.0x – 8.5x
Est. MOIC: 1.5x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
Margin Prediction (Trained Ridge Model)
-4.0%
R²=0.34 | n=4,907 | Grade B | Actual: -5.8%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-32.3%, 24.3%]. P52 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 439560.167 | -0.1591 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 465119.667 | +0.1469 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.091 | +0.0318 | Higher Reimbursement Quality increases predicted m | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Net-to-Gross | 0.136 | -0.0261 | Lower Net-to-Gross decreases predicted margin |
Turnaround: 43%Turnaround possible (43%) but uncertain. Margin improvement depends on improving Revenue/Bed.
nan%
Distress Risk
$4.8M
RCM Opportunity
B
Opportunity Grade
7.3%
Projected Margin
Distress Analysis
Risk: Unknown
National distress rate: 49.3%
TX distress rate: 42.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Net To Gross Ratio | 0.136 | -0.104 | ▼ risk |
| Occupancy Rate | 0.557 | -0.029 | ▼ risk |
| Medicare Day Pct | 0.330 | +0.001 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Revenue Per Bed | 439560.167 | +0.067 | ▲ risk |
| Beds | 84.000 | -0.009 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.8M
Current margin: -5.8%
Projected margin: 7.3%
Grade: B
Comps: 204
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 | 0.670 | 0.827 | 15.7% | $2.3M | 50% | 24mo |
| Occupancy Improvement | 0.557 | 0.753 | 19.6% | $1.3M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.136 | 0.411 | 27.5% | $1.2M | 65% | 18mo |
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. |