ML Analysis — FHN MEMORIAL HOSPITAL
CCN 140160 | 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.
51
/ 100 (C)
Financial Health12/25
RCM Upside13/25
Market Position15/20
Demand Defensibility8/15
Operational Efficiency3/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-7.0%
R²=0.34 | n=4,907 | Grade B | Actual: 3.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.3%, 21.3%]. P44 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 1440148.470 | +0.0267 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.126 | +0.0216 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.237 | -0.0148 | Lower Net-to-Gross decreases predicted margin | |
| Revenue/Bed | 1493412.470 | -0.0120 | Lower Revenue/Bed decreases predicted margin | |
| Medicaid % | 0.174 | -0.0103 | Higher Medicaid % decreases predicted margin |
Suburban Community Hospit
Archetype
52.9%
Distress Risk
$7.6M
RCM Opportunity
D
Opportunity Grade
8.7%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P42. 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%
IL distress rate: 51.0%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.389 | +0.126 | ▲ risk |
| Medicaid Day Pct | 0.174 | +0.085 | ▲ risk |
| Net To Gross Ratio | 0.237 | -0.059 | ▼ risk |
| Beds | 100.000 | -0.007 | ▼ risk |
| Medicare Day Pct | 0.293 | -0.006 | ▼ risk |
| Revenue Per Bed | 1493412.470 | +0.005 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $7.6M
Current margin: 3.6%
Projected margin: 8.7%
Grade: D
Comps: 79
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Payer Mix Optimization | 0.533 | 0.737 | 20.4% | $3.1M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.237 | 0.380 | 14.3% | $2.5M | 65% | 18mo |
| Occupancy Improvement | 0.389 | 0.702 | 31.3% | $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 | 27.6 | [25.0, 75.0] | P41 | 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. |