ML Analysis — CAPE REGIONAL MEDICAL CENTER
CCN 310011 | 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.
54
/ 100 (C)
Financial Health9/25
RCM Upside19/25
Market Position15/20
Demand Defensibility11/15
Operational Efficiency0/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
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)
-6.9%
R²=0.34 | n=4,907 | Grade B | Actual: -10.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.2%, 21.4%]. P44 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 856400.544 | -0.1009 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 946522.852 | +0.0875 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.072 | +0.0371 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.145 | -0.0250 | Lower Net-to-Gross decreases predicted margin | |
| Bed Utilization Value | 388415.479 | -0.0161 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 38%Turnaround possible (38%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Rural/Critical Access
Archetype
48.8%
Distress Risk
$6.7M
RCM Opportunity
D
Opportunity Grade
-5.3%
Projected Margin
Cluster: Rural/Critical Access
Percentile within cluster: P59. Rural/small hospitals face structural headwinds. Evaluate CAH conversion, telehealth, and rural health funding.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| BRECKINRIDGE HEALTH INC | KY | 25 |
| SHERIDAN MEMORIAL HOSPITAL | MT | 19 |
| DAYTON GENERAL HOSPITAL | WA | 25 |
| BLUE MOUNTAIN HOSPITAL DISTRICT | OR | 16 |
| COMMUNITY HOSPITAL | WY | 25 |
| CARLE EUREKA HOSPITAL | IL | 25 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
NJ distress rate: 47.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Net To Gross Ratio | 0.145 | -0.099 | ▼ risk |
| Occupancy Rate | 0.454 | +0.066 | ▲ risk |
| Medicaid Day Pct | 0.033 | -0.056 | ▼ risk |
| Revenue Per Bed | 856400.544 | +0.043 | ▲ risk |
| Medicare Day Pct | 0.468 | +0.024 | ▲ risk |
| Beds | 149.000 | +0.000 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.7M
Current margin: -10.5%
Projected margin: -5.3%
Grade: D
Comps: 53
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 | 0.499 | 0.715 | 21.6% | $3.2M | 50% | 24mo |
| Occupancy Improvement | 0.454 | 0.735 | 28.2% | $1.9M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.145 | 0.251 | 10.5% | $1.6M | 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 | 28.6 | [25.0, 75.0] | P48 | 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. |