ML Analysis — ST. MARYS HOSPITAL
CCN 210028 | 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.
61
/ 100 (B)
Financial Health10/25
RCM Upside18/25
Market Position15/20
Demand Defensibility13/15
Operational Efficiency6/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-1.4%
R²=0.34 | n=4,907 | Grade B | Actual: -1.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-29.7%, 26.9%]. P59 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Net-to-Gross | 0.781 | +0.0463 | Higher Net-to-Gross increases predicted margin | |
| Revenue/Bed | 1890568.105 | +0.0435 | Higher Revenue/Bed increases predicted margin | |
| Reimbursement Quality | 0.342 | -0.0403 | Higher Reimbursement Quality decreases predicted m | |
| Expense/Bed | 1919518.619 | -0.0323 | Higher Expense/Bed decreases predicted margin | |
| State Peer Margin | -0.084 | -0.0281 | Lower State Peer Margin decreases predicted margin |
Turnaround: 48%Turnaround possible (48%) but uncertain. Margin improvement depends on Net-to-Gross.
Suburban Community Hospit
Archetype
50.0%
Distress Risk
$4.6M
RCM Opportunity
D
Opportunity Grade
0.8%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P41. 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: Elevated
National distress rate: 49.3%
MD distress rate: 60.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Net To Gross Ratio | 0.781 | +0.184 | ▲ risk |
| Occupancy Rate | 0.681 | -0.145 | ▼ risk |
| Medicare Day Pct | 0.491 | +0.028 | ▲ risk |
| Revenue Per Bed | 1890568.105 | -0.018 | ▼ risk |
| Medicaid Day Pct | 0.071 | -0.018 | ▼ risk |
| Beds | 105.000 | -0.006 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.6M
Current margin: -1.5%
Projected margin: 0.8%
Grade: D
Comps: 31
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 | 0.437 | 0.589 | 15.2% | $2.3M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.781 | 0.856 | 7.5% | $1.7M | 65% | 18mo |
| Occupancy Improvement | 0.681 | 0.776 | 9.5% | $629K | 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. |