ML Analysis — ARKANSAS SURGICAL HOSPITAL
CCN 040147 | 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.
45
/ 100 (C)
Financial Health16/25
RCM Upside7/25
Market Position9/20
Demand Defensibility5/15
Operational Efficiency9/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Heavy Medicare dependence (>55%)
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-6.5%
R²=0.34 | n=4,907 | Grade B | Actual: 11.7%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-34.8%, 21.8%]. P46 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 1412109.617 | +0.0302 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.075 | -0.0222 | Lower State Peer Margin decreases predicted margin | |
| Reimbursement Quality | 0.129 | +0.0209 | Higher Reimbursement Quality increases predicted m | |
| Bed Count | 47.000 | +0.0159 | Higher Bed Count increases predicted margin | |
| Bed Utilization Value | 446839.606 | -0.0141 | Lower Bed Utilization Value decreases predicted ma |
Rural/Critical Access
Archetype
52.6%
Distress Risk
$6.3M
RCM Opportunity
C
Opportunity Grade
20.0%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P58. Rural/small hospitals face structural headwinds. Evaluate CAH conversion, telehealth, and rural health funding.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| BRECKINRIDGE HEALTH INC | KY | 25 |
| SHERIDAN MEMORIAL HOSPITAL | MT | 19 |
| DAYTON GENERAL HOSPITAL | WA | 25 |
| BLUE MOUNTAIN HOSPITAL DISTRICT | OR | 16 |
| COMMUNITY HOSPITAL | WY | 25 |
| CARLE EUREKA HOSPITAL | IL | 25 |
Distress Analysis
Risk: High
National distress rate: 49.3%
AR distress rate: 53.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.280 | +0.228 | ▲ risk |
| Medicaid Day Pct | 0.001 | -0.087 | ▼ risk |
| Medicare Day Pct | 0.553 | +0.039 | ▲ risk |
| Net To Gross Ratio | 0.289 | -0.035 | ▼ risk |
| Beds | 47.000 | -0.014 | ▼ risk |
| Revenue Per Bed | 1598318.064 | -0.001 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.3M
Current margin: 11.7%
Projected margin: 20.0%
Grade: C
Comps: 62
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.280 | 0.662 | 38.2% | $2.5M | 55% | 24mo |
| Payer Mix Optimization | 0.446 | 0.580 | 13.5% | $2.0M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.289 | 0.489 | 19.9% | $1.8M | 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 | 29.5 | [25.0, 75.0] | P55 | 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. |