ML Analysis — MACKINAC STRAITS HEALTH SYSTEM INC
CCN 231306 | 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.
56
/ 100 (C)
Financial Health9/25
RCM Upside14/25
Market Position15/20
Demand Defensibility6/15
Operational Efficiency11/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-5.4%
R²=0.34 | n=4,907 | Grade B | Actual: 1.1%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-33.7%, 22.9%]. P48 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 4149764.333 | +0.3588 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 4103454.200 | -0.3014 | Higher Expense/Bed decreases predicted margin | |
| Log(Beds) | 2.708 | -0.0387 | Lower Log(Beds) decreases predicted margin | |
| Reimbursement Quality | 0.331 | -0.0374 | Higher Reimbursement Quality decreases predicted m | |
| Net-to-Gross | 0.601 | +0.0261 | Higher Net-to-Gross increases predicted margin |
Suburban Community Hospit
Archetype
53.7%
Distress Risk
$3.6M
RCM Opportunity
D
Opportunity Grade
6.8%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P82. 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%
MI distress rate: 50.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.197 | +0.305 | ▲ risk |
| Revenue Per Bed | 4149764.333 | -0.152 | ▼ risk |
| Net To Gross Ratio | 0.601 | +0.104 | ▲ risk |
| Medicaid Day Pct | 0.005 | -0.084 | ▼ risk |
| Medicare Day Pct | 0.444 | +0.020 | ▲ risk |
| Beds | 15.000 | -0.018 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.6M
Current margin: 1.1%
Projected margin: 6.8%
Grade: D
Comps: 44
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 | 0.551 | 0.691 | 14.0% | $2.1M | 50% | 24mo |
| Occupancy Improvement | 0.197 | 0.418 | 22.2% | $1.5M | 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 | 30.4 | [25.0, 75.0] | P61 | 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. |