ML Analysis — BANNER GATEWAY MEDICAL CENTER
CCN 030122 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Buy — solid fundamentals with identifiable value creation levers. Proceed to detailed diligence.
63
/ 100 (B)
Financial Health22/25
RCM Upside12/25
Market Position9/20
Demand Defensibility9/15
Operational Efficiency11/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
8.6%
R²=0.34 | n=4,907 | Grade B | Actual: 5.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-19.7%, 36.9%]. P80 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 3101843.124 | +0.2125 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 2941480.378 | -0.1582 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 2482347.288 | +0.0534 | Higher Bed Utilization Value increases predicted m | |
| State Peer Margin | -0.008 | +0.0279 | Higher State Peer Margin increases predicted margi | |
| Medicaid % | 0.254 | -0.0200 | Higher Medicaid % decreases predicted margin |
Suburban Community Hospit
Archetype
43.2%
Distress Risk
$9.8M
RCM Opportunity
D
Opportunity Grade
6.9%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P80. Community hospitals — the largest PE deal category. Focus on RCM improvement and cost optimization at 9-11x.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| CLARA MAASS MEDICAL CENTER | NJ | 259 |
| PRESENCE SAINTS MARY & ELIZABETH MED | IL | 266 |
| ADVENTIST HEALTH BAKERSFIELD | CA | 254 |
| BRISTOL REGIONAL MEDICAL CENTER | TN | 244 |
| HOLSTON VALLEY HOSP & MED CTR | TN | 286 |
| SPRINGFIELD REGIONAL MEDICAL CENTER | OH | 230 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
AZ distress rate: 35.5%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.800 | -0.255 | ▼ risk |
| Medicaid Day Pct | 0.254 | +0.165 | ▲ risk |
| Revenue Per Bed | 3101843.124 | -0.090 | ▼ risk |
| Net To Gross Ratio | 0.263 | -0.047 | ▼ risk |
| Medicare Day Pct | 0.187 | -0.024 | ▼ risk |
| Beds | 185.000 | +0.005 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $9.8M
Current margin: 5.2%
Projected margin: 6.9%
Grade: D
Comps: 42
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 | 0.263 | 0.362 | 9.9% | $6.7M | 65% | 18mo |
| Payer Mix Optimization | 0.559 | 0.767 | 20.8% | $3.1M | 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 | 25.0 | [25.0, 75.0] | P0 | 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. |