ML Analysis — BANNER HEART HOSPITAL
CCN 030105 | 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.
51
/ 100 (C)
Financial Health18/25
RCM Upside5/25
Market Position9/20
Demand Defensibility11/15
Operational Efficiency7/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
Catalysts:
- Strong commercial payer base protects revenue
- Volume growth opportunity from low occupancy
Margin Prediction (Trained Ridge Model)
1.4%
R²=0.34 | n=4,907 | Grade B | Actual: 17.4%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-27.0%, 29.6%]. P66 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 1240470.315 | +0.0513 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.008 | +0.0279 | Higher State Peer Margin increases predicted margi | |
| Reimbursement Quality | 0.130 | +0.0206 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.211 | -0.0177 | Lower Net-to-Gross decreases predicted margin | |
| Revenue/Bed | 1502231.880 | -0.0108 | Lower Revenue/Bed decreases predicted margin |
Suburban Community Hospit
Archetype
47.9%
Distress Risk
$8.3M
RCM Opportunity
D
Opportunity Grade
22.5%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P6. 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: Elevated
National distress rate: 49.3%
AZ distress rate: 35.5%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Net To Gross Ratio | 0.211 | -0.070 | ▼ risk |
| Occupancy Rate | 0.493 | +0.030 | ▲ risk |
| Medicaid Day Pct | 0.075 | -0.014 | ▼ risk |
| Beds | 108.000 | -0.005 | ▼ risk |
| Revenue Per Bed | 1502231.880 | +0.005 | ▲ risk |
| Medicare Day Pct | 0.309 | -0.003 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.3M
Current margin: 17.4%
Projected margin: 22.5%
Grade: D
Comps: 51
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 | 0.211 | 0.416 | 20.5% | $3.9M | 65% | 18mo |
| Payer Mix Optimization | 0.616 | 0.789 | 17.3% | $2.6M | 50% | 24mo |
| Occupancy Improvement | 0.493 | 0.764 | 27.1% | $1.8M | 55% | 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 | 25.4 | [25.0, 75.0] | P29 | 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. |