ML Analysis — KETCHIKAN MEDICAL CENTER
CCN 021311 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Hold / Selective — investigate specific opportunities but be prepared for execution risk.
56
/ 100 (C)
Financial Health6/25
RCM Upside20/25
Market Position13/20
Demand Defensibility8/15
Operational Efficiency10/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
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)
-4.8%
R²=0.34 | n=4,907 | Grade B | Actual: -13.1%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-33.1%, 23.5%]. P50 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 4180766.680 | -0.3109 | Higher Expense/Bed decreases predicted margin | |
| Revenue/Bed | 3697291.520 | +0.2957 | Higher Revenue/Bed increases predicted margin | |
| Log(Beds) | 3.219 | -0.0268 | Lower Log(Beds) decreases predicted margin | |
| Net-to-Gross | 0.549 | +0.0202 | Higher Net-to-Gross increases predicted margin | |
| Bed Utilization Value | 1475675.147 | +0.0200 | Higher Bed Utilization Value increases predicted m |
Turnaround: 42%Turnaround possible (42%) but uncertain. Margin improvement depends on improving Expense/Bed.
Suburban Community Hospit
Archetype
54.5%
Distress Risk
$1.9M
RCM Opportunity
D
Opportunity Grade
-11.0%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P89. Community hospitals — the largest PE deal category. Focus on RCM improvement and cost optimization at 9-11x.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| PROMEDICA HICKMAN HOSPITAL | MI | 58 |
| WATAUGA MEDICAL CENTER | NC | 95 |
| ST LUKES HOSPITAL - EASTON CAMPUS | PA | 29 |
| CULPEPER MEMORIAL HOSPITAL | VA | 70 |
| SOUTHSIDE COMMUNITY HOSPITAL | VA | 80 |
| SPECTRUM HEALTH LUDINGTON | MI | 45 |
Distress Analysis
Risk: High
National distress rate: 49.3%
AK distress rate: 38.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.216 | +0.127 | ▲ risk |
| Revenue Per Bed | 3697291.520 | -0.125 | ▼ risk |
| Occupancy Rate | 0.399 | +0.117 | ▲ risk |
| Net To Gross Ratio | 0.549 | +0.080 | ▲ risk |
| Medicare Day Pct | 0.478 | +0.026 | ▲ risk |
| Beds | 25.000 | -0.017 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $1.9M
Current margin: -13.1%
Projected margin: -11.0%
Grade: D
Comps: 11
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 | 0.549 | 0.648 | 9.9% | $1.1M | 65% | 18mo |
| Occupancy Improvement | 0.399 | 0.519 | 11.9% | $788K | 55% | 24mo |
| Payer Mix Optimization | 0.305 | 0.311 | 0.5% | $79K | 50% | 24mo |
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 | 31.4 | [25.0, 75.0] | P66 | 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. |