ML Analysis — LINCOLNHEALTH
CCN 201302 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Buy — solid fundamentals with identifiable value creation levers. Proceed to detailed diligence.
64
/ 100 (B)
Financial Health13/25
RCM Upside18/25
Market Position15/20
Demand Defensibility8/15
Operational Efficiency10/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
8.6%
R²=0.34 | n=4,907 | Grade B | Actual: -0.9%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-19.7%, 36.9%]. P80 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 4672771.720 | +0.4318 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 4716791.640 | -0.3769 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 4143276.272 | +0.1085 | Higher Bed Utilization Value increases predicted m | |
| Reimbursement Quality | 0.369 | -0.0481 | Higher Reimbursement Quality decreases predicted m | |
| Net-to-Gross | 0.622 | +0.0285 | Higher Net-to-Gross increases predicted margin |
Turnaround: 65%Model predicts 65% probability of positive margin. Key drivers: Revenue/Bed and Expense/Bed.
Suburban Community Hospit
Archetype
40.2%
Distress Risk
$0
RCM Opportunity
D
Opportunity Grade
-0.9%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P93. Community hospitals — the largest PE deal category. Focus on RCM improvement and cost optimization at 9-11x.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| CLARA MAASS MEDICAL CENTER | NJ | 259 |
| PRESENCE SAINTS MARY & ELIZABETH MED | IL | 266 |
| ADVENTIST HEALTH BAKERSFIELD | CA | 254 |
| BRISTOL REGIONAL MEDICAL CENTER | TN | 244 |
| HOLSTON VALLEY HOSP & MED CTR | TN | 286 |
| SPRINGFIELD REGIONAL MEDICAL CENTER | OH | 230 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
ME distress rate: 61.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.887 | -0.336 | ▼ risk |
| Revenue Per Bed | 4672771.720 | -0.183 | ▼ risk |
| Net To Gross Ratio | 0.622 | +0.113 | ▲ risk |
| Medicaid Day Pct | 0.154 | +0.065 | ▲ risk |
| Beds | 25.000 | -0.017 | ▼ risk |
| Medicare Day Pct | 0.254 | -0.013 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $0
Current margin: -0.9%
Projected margin: -0.9%
Grade: D
Comps: 21
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|
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 | 25.2 | [25.0, 75.0] | P28 | 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. |