ML Analysis — LIFECARE SPEC HOSP OF NORTH TEXAS
CCN 452044 | 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.
41
/ 100 (D)
Financial Health7/25
RCM Upside19/25
Market Position2/20
Demand Defensibility13/15
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
- Volume growth opportunity from low occupancy
Margin Prediction (Trained Ridge Model)
-5.2%
R²=0.34 | n=4,907 | Grade B | Actual: -11.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-33.5%, 23.1%]. P49 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 340018.044 | -0.1730 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 377957.267 | +0.1576 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 161041.662 | -0.0236 | Lower Bed Utilization Value decreases predicted ma | |
| Log(Beds) | 5.328 | +0.0222 | Higher Log(Beds) increases predicted margin |
Turnaround: 41%Turnaround possible (41%) but uncertain. Margin improvement depends on improving Revenue/Bed.
nan%
Distress Risk
$5.9M
RCM Opportunity
C
Opportunity Grade
-2.8%
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 | 0.474 | +0.048 | ▲ risk |
| Medicare Day Pct | 0.415 | +0.015 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Revenue Per Bed | 340018.044 | +0.073 | ▲ risk |
| Net To Gross Ratio | 0.221 | -0.066 | ▼ risk |
| Beds | 206.000 | +0.008 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.9M
Current margin: -11.2%
Projected margin: -2.8%
Grade: C
Comps: 148
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 | 0.585 | 0.819 | 23.5% | $3.5M | 50% | 24mo |
| Occupancy Improvement | 0.474 | 0.754 | 28.0% | $1.8M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.221 | 0.281 | 6.0% | $495K | 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. |