ML Analysis — SUTTER DAVIS HOSPITAL
CCN 050537 | 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 Health20/25
RCM Upside7/25
Market Position15/20
Demand Defensibility8/15
Operational Efficiency13/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Small facility (<50 beds) — limited scale
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
11.1%
R²=0.34 | n=4,907 | Grade B | Actual: 12.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-17.2%, 39.4%]. P84 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 3685928.292 | +0.2941 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 3223844.792 | -0.1930 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 2637163.878 | +0.0585 | Higher Bed Utilization Value increases predicted m | |
| Bed Count | 48.000 | +0.0157 | Higher Bed Count increases predicted margin | |
| Log(Beds) | 3.871 | -0.0117 | Lower Log(Beds) decreases predicted margin |
Suburban Community Hospit
Archetype
39.9%
Distress Risk
$3.5M
RCM Opportunity
D
Opportunity Grade
14.5%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P58. 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%
CA distress rate: 49.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.715 | -0.177 | ▼ risk |
| Revenue Per Bed | 3685928.292 | -0.124 | ▼ risk |
| Medicaid Day Pct | 0.060 | -0.029 | ▼ risk |
| Net To Gross Ratio | 0.305 | -0.028 | ▼ risk |
| Beds | 48.000 | -0.013 | ▼ risk |
| Medicare Day Pct | 0.258 | -0.012 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.5M
Current margin: 12.5%
Projected margin: 14.5%
Grade: D
Comps: 104
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 | 0.305 | 0.468 | 16.3% | $3.4M | 65% | 18mo |
| Payer Mix Optimization | 0.682 | 0.687 | 0.6% | $85K | 50% | 24mo |
| Occupancy Improvement | 0.715 | 0.716 | 0.0% | $3K | 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 | 26.6 | [25.0, 75.0] | P37 | 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. |