ML Analysis — ST. JOSEPHS MEDICAL CENTER
CCN 240075 | 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 Upside17/25
Market Position15/20
Demand Defensibility11/15
Operational Efficiency8/15
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
- Volume growth opportunity from low occupancy
Margin Prediction (Trained Ridge Model)
-2.8%
R²=0.34 | n=4,907 | Grade B | Actual: -0.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-31.1%, 25.5%]. P55 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2231020.496 | +0.0910 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 2231309.992 | -0.0707 | Higher Expense/Bed decreases predicted margin | |
| Reimbursement Quality | 0.275 | -0.0210 | Higher Reimbursement Quality decreases predicted m | |
| Log(Beds) | 4.844 | +0.0109 | Higher Log(Beds) increases predicted margin | |
| State Peer Margin | -0.036 | +0.0074 | Higher State Peer Margin increases predicted margi |
Turnaround: 45%Turnaround possible (45%) but uncertain. Margin improvement depends on Revenue/Bed.
Suburban Community Hospit
Archetype
49.4%
Distress Risk
$3.5M
RCM Opportunity
D
Opportunity Grade
1.2%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P5. 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%
MN distress rate: 45.4%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.435 | +0.084 | ▲ risk |
| Medicaid Day Pct | 0.031 | -0.057 | ▼ risk |
| Revenue Per Bed | 2231020.496 | -0.038 | ▼ risk |
| Net To Gross Ratio | 0.415 | +0.021 | ▲ risk |
| Medicare Day Pct | 0.306 | -0.004 | ▼ risk |
| Beds | 127.000 | -0.003 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.5M
Current margin: -0.0%
Projected margin: 1.2%
Grade: D
Comps: 18
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.435 | 0.806 | 37.1% | $2.5M | 55% | 24mo |
| Payer Mix Optimization | 0.662 | 0.718 | 5.6% | $842K | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.415 | 0.421 | 0.6% | $192K | 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. |