ML Analysis — CHEROKEE MEDICAL CENTER
CCN 010022 | 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.
43
/ 100 (D)
Financial Health12/25
RCM Upside10/25
Market Position15/20
Demand Defensibility3/15
Operational Efficiency3/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-17.7%
R²=0.34 | n=4,907 | Grade B | Actual: 6.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-46.0%, 10.6%]. P24 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 412540.244 | -0.1629 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 387925.756 | +0.1564 | Higher Expense/Bed increases predicted margin | |
| Medicaid % | 0.407 | -0.0385 | Higher Medicaid % decreases predicted margin | |
| Reimbursement Quality | 0.087 | +0.0329 | Higher Reimbursement Quality increases predicted m | |
| State Peer Margin | -0.085 | -0.0292 | Lower State Peer Margin decreases predicted margin |
Safety-Net/Medicaid Heavy
Archetype
61.7%
Distress Risk
$4.2M
RCM Opportunity
A
Opportunity Grade
28.4%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P33. High Medicaid dependence creates reimbursement risk. Assess DSH payments and state expansion status.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| WESTERN PEAKS SPECIALTY HOSPITAL | UT | 59 |
| HOSPITAL MENONITA AIBONITO | PR | 129 |
| TOPPENISH COMMUNITY HOSPITAL | WA | 47 |
| MINERAL COMMUNITY HOSPITAL | MT | 25 |
| BANNER UNIVERSITY MED CENTER SOUTH | AZ | 132 |
| NORTH COLORADO MEDICAL CENTER | CO | 202 |
Distress Analysis
Risk: High
National distress rate: 49.3%
AL distress rate: 58.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.407 | +0.318 | ▲ risk |
| Occupancy Rate | 0.274 | +0.234 | ▲ risk |
| Net To Gross Ratio | 0.200 | -0.075 | ▼ risk |
| Revenue Per Bed | 412540.244 | +0.069 | ▲ risk |
| Medicare Day Pct | 0.158 | -0.029 | ▼ risk |
| Beds | 45.000 | -0.014 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.2M
Current margin: 6.0%
Projected margin: 28.4%
Grade: A
Comps: 58
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 | 0.435 | 0.586 | 15.1% | $2.3M | 50% | 24mo |
| Occupancy Improvement | 0.274 | 0.473 | 20.0% | $1.3M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.200 | 0.471 | 27.2% | $590K | 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 | 31.8 | [25.0, 75.0] | P69 | Strong — predicted days in ar is in the top third nationally |
| 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. |