ML Analysis — CASCADE MEDICAL CENTER
CCN 131308 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Speculative — only pursue if turnaround thesis is strong and entry multiple reflects risk.
44
/ 100 (D)
Financial Health1/25
RCM Upside18/25
Market Position15/20
Demand Defensibility5/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-19.6%
R²=0.34 | n=4,907 | Grade B | Actual: -22.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-47.9%, 8.7%]. P21 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 747345.625 | -0.1161 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 913854.125 | +0.0916 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.473 | -0.0781 | Higher Reimbursement Quality decreases predicted m | |
| Log(Beds) | 2.079 | -0.0533 | Lower Log(Beds) decreases predicted margin | |
| Net-to-Gross | 0.807 | +0.0492 | Higher Net-to-Gross increases predicted margin |
Turnaround: 20%Low turnaround probability (20%). Structural disadvantages in Revenue/Bed and Expense/Bed.
Under-Performing / Distre
Archetype
64.2%
Distress Risk
$2.5M
RCM Opportunity
A
Opportunity Grade
20.2%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P70. Deeply negative margins signal severe distress. Evaluate asset-level acquisition at 4-6x normalized EBITDA.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| HOLY FAMILY MEMORIAL INC | WI | 58 |
| MIDDLESBORO ARH | KY | 46 |
| ATRIUM HEALTH NAVICENT BALDWIN | GA | 86 |
| BON SECOURS COMMUNITY HOSPITAL | NY | 98 |
| ADVANCED SPECIALTY HOSP. OF TOLEDO | OH | 40 |
| COMMUNITY HEALTH CENTER BRANCH | MI | 75 |
Distress Analysis
Risk: High
National distress rate: 49.3%
ID distress rate: 46.0%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.054 | +0.438 | ▲ risk |
| Net To Gross Ratio | 0.807 | +0.195 | ▲ risk |
| Medicaid Day Pct | 0.025 | -0.063 | ▼ risk |
| Revenue Per Bed | 747345.625 | +0.049 | ▲ risk |
| Beds | 8.000 | -0.019 | ▼ risk |
| Medicare Day Pct | 0.389 | +0.011 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.5M
Current margin: -22.3%
Projected margin: 20.2%
Grade: A
Comps: 383
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.054 | 0.423 | 37.0% | $2.4M | 55% | 24mo |
| Payer Mix Optimization | 0.586 | 0.593 | 0.7% | $103K | 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 | 32.2 | [25.0, 75.0] | P71 | 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. |