ML Analysis — MANCHESTER MEMORIAL HOSPITAL
CCN 070027 | 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 Health7/25
RCM Upside19/25
Market Position11/20
Demand Defensibility10/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-8.7%
R²=0.34 | n=4,907 | Grade B | Actual: -6.8%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-37.0%, 19.6%]. P40 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| State Peer Margin | -0.068 | -0.0169 | Lower State Peer Margin decreases predicted margin | |
| Medicaid % | 0.208 | -0.0144 | Higher Medicaid % decreases predicted margin | |
| Log(Beds) | 4.934 | +0.0130 | Higher Log(Beds) increases predicted margin | |
| Revenue/Bed | 1499124.388 | -0.0112 | Lower Revenue/Bed decreases predicted margin | |
| Reimbursement Quality | 0.163 | +0.0110 | Higher Reimbursement Quality increases predicted m |
Turnaround: 35%Turnaround possible (35%) but uncertain. Margin improvement depends on improving State Peer Margin.
Suburban Community Hospit
Archetype
50.5%
Distress Risk
$3.3M
RCM Opportunity
D
Opportunity Grade
-5.2%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P63. Community hospitals — the largest PE deal category. Focus on RCM improvement and cost optimization at 9-11x.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| CLARA MAASS MEDICAL CENTER | NJ | 259 |
| PRESENCE SAINTS MARY & ELIZABETH MED | IL | 266 |
| ADVENTIST HEALTH BAKERSFIELD | CA | 254 |
| BRISTOL REGIONAL MEDICAL CENTER | TN | 244 |
| HOLSTON VALLEY HOSP & MED CTR | TN | 286 |
| SPRINGFIELD REGIONAL MEDICAL CENTER | OH | 230 |
Distress Analysis
Risk: High
National distress rate: 49.3%
CT distress rate: 74.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.208 | +0.119 | ▲ risk |
| Net To Gross Ratio | 0.280 | -0.040 | ▼ risk |
| Medicare Day Pct | 0.209 | -0.020 | ▼ risk |
| Occupancy Rate | 0.542 | -0.015 | ▼ risk |
| Revenue Per Bed | 1499124.388 | +0.005 | ▲ risk |
| Beds | 139.000 | -0.001 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.3M
Current margin: -6.8%
Projected margin: -5.2%
Grade: D
Comps: 19
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.542 | 0.820 | 27.8% | $1.8M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.280 | 0.341 | 6.2% | $1.5M | 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 | 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. |