ML Analysis — HARFORD MEMORIAL HOSPITAL
CCN 210006 | 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.
60
/ 100 (B)
Financial Health10/25
RCM Upside18/25
Market Position15/20
Demand Defensibility12/15
Operational Efficiency6/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-5.2%
R²=0.34 | n=4,907 | Grade B | Actual: -2.1%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-33.5%, 23.1%]. P49 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Reimbursement Quality | 0.463 | -0.0753 | Higher Reimbursement Quality decreases predicted m | |
| Revenue/Bed | 1163962.750 | -0.0580 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 1188558.671 | +0.0577 | Higher Expense/Bed increases predicted margin | |
| Net-to-Gross | 0.865 | +0.0557 | Higher Net-to-Gross increases predicted margin | |
| Occupancy × Net-to-Gross | 0.601 | +0.0309 | Higher Occupancy × Net-to-Gross increases predicte |
Turnaround: 41%Turnaround possible (41%) but uncertain. Margin improvement depends on improving Reimbursement Quality.
Suburban Community Hospit
Archetype
50.1%
Distress Risk
$3.4M
RCM Opportunity
D
Opportunity Grade
1.2%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P37. 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%
MD distress rate: 60.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Net To Gross Ratio | 0.865 | +0.221 | ▲ risk |
| Occupancy Rate | 0.695 | -0.158 | ▼ risk |
| Medicaid Day Pct | 0.021 | -0.068 | ▼ risk |
| Revenue Per Bed | 1163962.750 | +0.025 | ▲ risk |
| Medicare Day Pct | 0.444 | +0.020 | ▲ risk |
| Beds | 88.000 | -0.008 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.4M
Current margin: -2.1%
Projected margin: 1.2%
Grade: D
Comps: 22
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 | 0.535 | 0.733 | 19.8% | $3.0M | 50% | 24mo |
| Occupancy Improvement | 0.695 | 0.767 | 7.2% | $477K | 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 | 25.0 | [25.0, 75.0] | P0 | 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. |