ML Analysis — KPC PROMISE HOSPITAL OF PHOENIX
CCN 032006 | 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.
44
/ 100 (D)
Financial Health9/25
RCM Upside13/25
Market Position9/20
Demand Defensibility8/15
Operational Efficiency5/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Small facility (<50 beds) — limited scale
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-7.3%
R²=0.34 | n=4,907 | Grade B | Actual: 4.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.6%, 21.0%]. P44 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 363357.333 | -0.1697 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 346847.000 | +0.1614 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.008 | +0.0279 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 173610.973 | -0.0232 | Lower Bed Utilization Value decreases predicted ma | |
| Bed Count | 48.000 | +0.0157 | Higher Bed Count increases predicted margin |
Suburban Community Hospit
Archetype
54.3%
Distress Risk
$5.3M
RCM Opportunity
A
Opportunity Grade
35.0%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P57. 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%
AZ distress rate: 35.5%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.185 | +0.096 | ▲ risk |
| Revenue Per Bed | 363357.333 | +0.072 | ▲ risk |
| Occupancy Rate | 0.478 | +0.044 | ▲ risk |
| Beds | 48.000 | -0.013 | ▼ risk |
| Medicare Day Pct | 0.360 | +0.006 | ▲ risk |
| Net To Gross Ratio | 0.358 | -0.005 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.3M
Current margin: 4.5%
Projected margin: 35.0%
Grade: A
Comps: 57
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 | 0.456 | 0.697 | 24.1% | $3.6M | 50% | 24mo |
| Occupancy Improvement | 0.478 | 0.684 | 20.6% | $1.4M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.358 | 0.517 | 15.9% | $324K | 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 | 28.1 | [25.0, 75.0] | P45 | 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. |