ML Analysis — BANNER BEHAVIORAL HEALTH HOSPITAL
CCN 034004 | 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 Health5/25
RCM Upside20/25
Market Position9/20
Demand Defensibility8/15
Operational Efficiency2/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-10.0%
R²=0.34 | n=4,907 | Grade B | Actual: -15.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-38.3%, 18.3%]. P37 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 281743.974 | -0.1811 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 325387.731 | +0.1641 | Higher Expense/Bed increases predicted margin | |
| Medicaid % | 0.501 | -0.0499 | Higher Medicaid % decreases predicted margin | |
| State Peer Margin | -0.008 | +0.0279 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 176171.627 | -0.0231 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 33%Turnaround possible (33%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Safety-Net/Medicaid Heavy
Archetype
57.5%
Distress Risk
$6.8M
RCM Opportunity
A
Opportunity Grade
-0.1%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P10. 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%
AZ distress rate: 35.5%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.501 | +0.412 | ▲ risk |
| Occupancy Rate | 0.625 | -0.093 | ▼ risk |
| Revenue Per Bed | 281743.974 | +0.077 | ▲ risk |
| Medicare Day Pct | 0.028 | -0.051 | ▼ risk |
| Net To Gross Ratio | 0.334 | -0.015 | ▼ risk |
| Beds | 156.000 | +0.001 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.8M
Current margin: -15.5%
Projected margin: -0.1%
Grade: A
Comps: 42
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 | 0.471 | 0.845 | 37.4% | $5.6M | 50% | 24mo |
| Occupancy Improvement | 0.625 | 0.778 | 15.3% | $1.0M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.334 | 0.362 | 2.8% | $144K | 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 | 27.0 | [25.0, 75.0] | P38 | 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. |