ML Analysis — MUHLENBERG COMMUNITY HOSPITAL
CCN 180004 | 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.
48
/ 100 (C)
Financial Health3/25
RCM Upside19/25
Market Position15/20
Demand Defensibility7/15
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)
-7.5%
R²=0.34 | n=4,907 | Grade B | Actual: -8.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.8%, 20.8%]. P43 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 1051933.425 | -0.0736 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 1141973.532 | +0.0635 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.006 | +0.0295 | Higher State Peer Margin increases predicted margi | |
| Bed Utilization Value | 284215.181 | -0.0195 | Lower Bed Utilization Value decreases predicted ma | |
| Bed Count | 47.000 | +0.0159 | Higher Bed Count increases predicted margin |
Turnaround: 37%Turnaround possible (37%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Suburban Community Hospit
Archetype
53.2%
Distress Risk
$3.7M
RCM Opportunity
C
Opportunity Grade
-1.1%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P55. 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%
KY distress rate: 45.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.270 | +0.237 | ▲ risk |
| Medicaid Day Pct | 0.011 | -0.078 | ▼ risk |
| Revenue Per Bed | 1051933.426 | +0.031 | ▲ risk |
| Net To Gross Ratio | 0.316 | -0.023 | ▼ risk |
| Beds | 47.000 | -0.014 | ▼ risk |
| Medicare Day Pct | 0.334 | +0.001 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.7M
Current margin: -8.6%
Projected margin: -1.1%
Grade: C
Comps: 67
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.270 | 0.610 | 34.0% | $2.2M | 55% | 24mo |
| Payer Mix Optimization | 0.655 | 0.714 | 5.9% | $884K | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.316 | 0.413 | 9.6% | $557K | 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 | 29.8 | [25.0, 75.0] | P57 | 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. |