ML Analysis — STERLINGTON CRITICAL ACCESS HOSPITAL
CCN 193069 | 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.
45
/ 100 (C)
Financial Health5/25
RCM Upside20/25
Market Position10/20
Demand Defensibility6/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Heavy Medicare dependence (>55%)
- Small facility (<50 beds) — limited scale
- Expenses exceed revenue
Catalysts:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-4.4%
R²=0.34 | n=4,907 | Grade B | Actual: -20.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-32.7%, 23.9%]. P51 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 767109.100 | -0.1134 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 924046.900 | +0.0903 | Higher Expense/Bed increases predicted margin | |
| Log(Beds) | 2.303 | -0.0481 | Lower Log(Beds) decreases predicted margin | |
| Reimbursement Quality | 0.072 | +0.0374 | Higher Reimbursement Quality increases predicted m | |
| Bed Count | 10.000 | +0.0216 | Higher Bed Count increases predicted margin |
Turnaround: 42%Turnaround possible (42%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Rural/Critical Access
Archetype
46.6%
Distress Risk
$8.9M
RCM Opportunity
A
Opportunity Grade
95.9%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P94. Rural/small hospitals face structural headwinds. Evaluate CAH conversion, telehealth, and rural health funding.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| BRECKINRIDGE HEALTH INC | KY | 25 |
| SHERIDAN MEMORIAL HOSPITAL | MT | 19 |
| DAYTON GENERAL HOSPITAL | WA | 25 |
| BLUE MOUNTAIN HOSPITAL DISTRICT | OR | 16 |
| COMMUNITY HOSPITAL | WY | 25 |
| CARLE EUREKA HOSPITAL | IL | 25 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
LA distress rate: 46.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.739 | -0.198 | ▼ risk |
| Medicare Day Pct | 0.832 | +0.087 | ▲ risk |
| Medicaid Day Pct | 0.016 | -0.073 | ▼ risk |
| Revenue Per Bed | 767109.100 | +0.048 | ▲ risk |
| Net To Gross Ratio | 0.469 | +0.045 | ▲ risk |
| Beds | 10.000 | -0.019 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.9M
Current margin: -20.5%
Projected margin: 95.9%
Grade: A
Comps: 36
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 | 0.153 | 0.711 | 55.9% | $8.4M | 50% | 24mo |
| Occupancy Improvement | 0.739 | 0.795 | 5.6% | $369K | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.469 | 0.668 | 19.9% | $179K | 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 | 35.1 | [25.0, 75.0] | P79 | Average — predicted days in ar is near the median. |
| Clean Claim Rate | 98.0% | [80.0%, 98.0%] | P0 | Strong — predicted clean claim rate is in the top third. |
| Net Collection Rate | 99.0% | [90.0%, 99.5%] | P4 | Strong — predicted net collection rate is in the top third. |