ML Analysis — ADVENTHEALTH GORDON
CCN 110023 | 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.
60
/ 100 (B)
Financial Health12/25
RCM Upside19/25
Market Position15/20
Demand Defensibility10/15
Operational Efficiency4/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
5.1%
R²=0.34 | n=4,907 | Grade B | Actual: -3.4%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-23.2%, 33.4%]. P74 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2731401.507 | +0.1608 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 2825066.290 | -0.1439 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 2305613.049 | +0.0475 | Higher Bed Utilization Value increases predicted m | |
| Reimbursement Quality | 0.128 | +0.0211 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.186 | -0.0204 | Lower Net-to-Gross decreases predicted margin |
Turnaround: 59%Turnaround possible (59%) but uncertain. Margin improvement depends on Revenue/Bed.
Suburban Community Hospit
Archetype
37.0%
Distress Risk
$4.7M
RCM Opportunity
D
Opportunity Grade
-1.0%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P45. 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: Elevated
National distress rate: 49.3%
GA distress rate: 44.4%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.844 | -0.296 | ▼ risk |
| Net To Gross Ratio | 0.186 | -0.081 | ▼ risk |
| Revenue Per Bed | 2731401.507 | -0.068 | ▼ risk |
| Medicaid Day Pct | 0.048 | -0.041 | ▼ risk |
| Medicare Day Pct | 0.264 | -0.011 | ▼ risk |
| Beds | 69.000 | -0.011 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.7M
Current margin: -3.4%
Projected margin: -1.0%
Grade: D
Comps: 69
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 | 0.186 | 0.381 | 19.5% | $4.3M | 65% | 18mo |
| Payer Mix Optimization | 0.688 | 0.712 | 2.4% | $367K | 50% | 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 | 26.8 | [25.0, 75.0] | P38 | 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. |