ML Analysis — NORTHWEST SPECIALTY HOSPITAL
CCN 130066 | 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.
53
/ 100 (C)
Financial Health12/25
RCM Upside13/25
Market Position13/20
Demand Defensibility6/15
Operational Efficiency9/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-2.3%
R²=0.34 | n=4,907 | Grade B | Actual: 3.7%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-30.6%, 26.0%]. P56 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 3758336.062 | +0.3042 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 3617992.125 | -0.2416 | Higher Expense/Bed decreases predicted margin | |
| Log(Beds) | 3.466 | -0.0211 | Lower Log(Beds) decreases predicted margin | |
| Occupancy | 0.197 | -0.0187 | Lower Occupancy decreases predicted margin | |
| Bed Count | 32.000 | +0.0182 | Higher Bed Count increases predicted margin |
Suburban Community Hospit
Archetype
51.8%
Distress Risk
$6.8M
RCM Opportunity
D
Opportunity Grade
9.4%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P70. 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%
ID distress rate: 46.0%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.197 | +0.305 | ▲ risk |
| Revenue Per Bed | 3758336.062 | -0.129 | ▼ risk |
| Medicaid Day Pct | 0.053 | -0.036 | ▼ risk |
| Net To Gross Ratio | 0.301 | -0.030 | ▼ risk |
| Beds | 32.000 | -0.016 | ▼ risk |
| Medicare Day Pct | 0.351 | +0.004 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.8M
Current margin: 3.7%
Projected margin: 9.4%
Grade: D
Comps: 27
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 | 0.301 | 0.634 | 33.3% | $4.7M | 65% | 18mo |
| Occupancy Improvement | 0.197 | 0.519 | 32.2% | $2.1M | 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 | 30.3 | [25.0, 75.0] | P60 | 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. |