ML Analysis — LAREDO SPECIALTY HOSPITAL
CCN 452096 | 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.
40
/ 100 (D)
Financial Health5/25
RCM Upside19/25
Market Position6/20
Demand Defensibility6/15
Operational Efficiency4/15
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:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-6.8%
R²=0.34 | n=4,907 | Grade B | Actual: -16.7%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.1%, 21.5%]. P45 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 264266.500 | -0.1836 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 308309.000 | +0.1662 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 113308.787 | -0.0252 | Lower Bed Utilization Value decreases predicted ma | |
| Bed Count | 40.000 | +0.0170 | Higher Bed Count increases predicted margin |
Turnaround: 38%Turnaround possible (38%) but uncertain. Margin improvement depends on improving Revenue/Bed.
nan%
Distress Risk
$5.6M
RCM Opportunity
A
Opportunity Grade
36.1%
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 | 0.429 | +0.089 | ▲ risk |
| Medicare Day Pct | 0.506 | +0.031 | ▲ risk |
| Medicaid Day Pct | nan | +nan | ▼ risk |
| Revenue Per Bed | 264266.500 | +0.078 | ▲ risk |
| Beds | 40.000 | -0.015 | ▼ risk |
| Net To Gross Ratio | 0.372 | +0.002 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.6M
Current margin: -16.7%
Projected margin: 36.1%
Grade: A
Comps: 286
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 | 0.494 | 0.738 | 24.3% | $3.7M | 50% | 24mo |
| Occupancy Improvement | 0.429 | 0.695 | 26.6% | $1.8M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.372 | 0.510 | 13.8% | $171K | 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. |