ML Analysis — ADVENTIST HEALTH VALLEJO
CCN 054074 | 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.
50
/ 100 (C)
Financial Health5/25
RCM Upside20/25
Market Position13/20
Demand Defensibility10/15
Operational Efficiency2/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-8.8%
R²=0.34 | n=4,907 | Grade B | Actual: -18.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-37.1%, 19.5%]. P40 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 445024.787 | -0.1583 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 527951.508 | +0.1391 | Higher Expense/Bed increases predicted margin | |
| Medicaid % | 0.251 | -0.0197 | Higher Medicaid % decreases predicted margin | |
| Occupancy | 0.848 | +0.0184 | Higher Occupancy increases predicted margin | |
| Reimbursement Quality | 0.143 | +0.0168 | Higher Reimbursement Quality increases predicted m |
Turnaround: 35%Turnaround possible (35%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Safety-Net/Medicaid Heavy
Archetype
45.9%
Distress Risk
$3.5M
RCM Opportunity
B
Opportunity Grade
-5.7%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P50. 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: Elevated
National distress rate: 49.3%
CA distress rate: 49.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.848 | -0.300 | ▼ risk |
| Medicaid Day Pct | 0.251 | +0.162 | ▲ risk |
| Revenue Per Bed | 445024.787 | +0.067 | ▲ risk |
| Net To Gross Ratio | 0.279 | -0.040 | ▼ risk |
| Medicare Day Pct | 0.237 | -0.016 | ▼ risk |
| Beds | 61.000 | -0.012 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.5M
Current margin: -18.6%
Projected margin: -5.7%
Grade: B
Comps: 125
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 | 0.512 | 0.721 | 20.9% | $3.1M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.279 | 0.400 | 12.1% | $385K | 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 | 28.7 | [25.0, 75.0] | P49 | 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. |