ML Analysis — HOAG ORTHOPEDIC INSTITUTE
CCN 050769 | 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.
58
/ 100 (C)
Financial Health19/25
RCM Upside5/25
Market Position15/20
Demand Defensibility8/15
Operational Efficiency11/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
1.5%
R²=0.34 | n=4,907 | Grade B | Actual: 31.1%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-26.8%, 29.8%]. P66 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2154624.429 | +0.0803 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 1484175.800 | +0.0213 | Higher Expense/Bed increases predicted margin | |
| Occupancy | 0.177 | -0.0198 | Lower Occupancy decreases predicted margin | |
| Bed Utilization Value | 381423.338 | -0.0163 | Lower Bed Utilization Value decreases predicted ma | |
| Reimbursement Quality | 0.147 | +0.0156 | Higher Reimbursement Quality increases predicted m |
Suburban Community Hospit
Archetype
53.6%
Distress Risk
$8.7M
RCM Opportunity
D
Opportunity Grade
36.9%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P87. 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%
CA distress rate: 49.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.177 | +0.323 | ▲ risk |
| Medicaid Day Pct | 0.000 | -0.088 | ▼ risk |
| Net To Gross Ratio | 0.273 | -0.043 | ▼ risk |
| Revenue Per Bed | 2154624.429 | -0.034 | ▼ risk |
| Medicare Day Pct | 0.459 | +0.023 | ▲ risk |
| Beds | 70.000 | -0.011 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.7M
Current margin: 31.1%
Projected margin: 36.9%
Grade: D
Comps: 139
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.177 | 0.726 | 54.9% | $3.6M | 55% | 24mo |
| Payer Mix Optimization | 0.540 | 0.722 | 18.1% | $2.7M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.273 | 0.406 | 13.4% | $2.4M | 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 | 27.4 | [25.0, 75.0] | P40 | 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. |