ML Analysis — MCLAREN OAKLAND
CCN 230207 | 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.
53
/ 100 (C)
Financial Health11/25
RCM Upside14/25
Market Position9/20
Demand Defensibility9/15
Operational Efficiency9/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
- Volume growth opportunity from low occupancy
Margin Prediction (Trained Ridge Model)
-3.9%
R²=0.34 | n=4,907 | Grade B | Actual: 1.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-32.2%, 24.4%]. P52 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2003784.103 | +0.0593 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 1970944.075 | -0.0387 | Higher Expense/Bed decreases predicted margin | |
| Reimbursement Quality | 0.263 | -0.0177 | Higher Reimbursement Quality decreases predicted m | |
| Log(Beds) | 4.673 | +0.0069 | Higher Log(Beds) increases predicted margin | |
| Bed Count | 107.000 | +0.0065 | Higher Bed Count increases predicted margin |
Suburban Community Hospit
Archetype
48.6%
Distress Risk
$4.2M
RCM Opportunity
D
Opportunity Grade
3.6%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P1. 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%
MI distress rate: 50.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.481 | +0.041 | ▲ risk |
| Medicaid Day Pct | 0.052 | -0.036 | ▼ risk |
| Revenue Per Bed | 2003784.103 | -0.025 | ▼ risk |
| Medicare Day Pct | 0.268 | -0.010 | ▼ risk |
| Net To Gross Ratio | 0.387 | +0.008 | ▲ risk |
| Beds | 107.000 | -0.006 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.2M
Current margin: 1.6%
Projected margin: 3.6%
Grade: D
Comps: 48
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.481 | 0.796 | 31.5% | $2.1M | 55% | 24mo |
| Payer Mix Optimization | 0.679 | 0.809 | 13.0% | $2.0M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.387 | 0.393 | 0.5% | $136K | 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 | 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. |