ML Analysis — CENTURA MERCY HOSPITAL
CCN 060013 | 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 Health18/25
RCM Upside10/25
Market Position15/20
Demand Defensibility10/15
Operational Efficiency11/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
10.1%
R²=0.34 | n=4,907 | Grade B | Actual: 10.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-18.2%, 38.4%]. P82 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 3703455.479 | +0.2965 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 3333584.904 | -0.2065 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 2573585.350 | +0.0564 | Higher Bed Utilization Value increases predicted m | |
| Reimbursement Quality | 0.131 | +0.0203 | Higher Reimbursement Quality increases predicted m | |
| Medicaid % | 0.198 | -0.0132 | Higher Medicaid % decreases predicted margin |
Suburban Community Hospit
Archetype
43.4%
Distress Risk
$6.3M
RCM Opportunity
D
Opportunity Grade
12.3%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P79. 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%
CO distress rate: 46.7%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.695 | -0.158 | ▼ risk |
| Revenue Per Bed | 3703455.479 | -0.125 | ▼ risk |
| Medicaid Day Pct | 0.198 | +0.109 | ▲ risk |
| Net To Gross Ratio | 0.257 | -0.050 | ▼ risk |
| Beds | 73.000 | -0.010 | ▼ risk |
| Medicare Day Pct | 0.292 | -0.006 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.3M
Current margin: 10.0%
Projected margin: 12.3%
Grade: D
Comps: 39
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 | 0.257 | 0.388 | 13.1% | $4.1M | 65% | 18mo |
| Payer Mix Optimization | 0.510 | 0.622 | 11.2% | $1.7M | 50% | 24mo |
| Occupancy Improvement | 0.695 | 0.762 | 6.7% | $445K | 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 | 25.9 | [25.0, 75.0] | P33 | 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. |