ML Analysis — SOUTHERN OCEAN MEDICAL CENTER
CCN 310113 | 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 Health18/25
RCM Upside8/25
Market Position11/20
Demand Defensibility13/15
Operational Efficiency7/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
1.5%
R²=0.34 | n=4,907 | Grade B | Actual: 10.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-26.8%, 29.8%]. P66 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 1418162.347 | +0.0294 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.117 | +0.0245 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.218 | -0.0169 | Lower Net-to-Gross decreases predicted margin | |
| Log(Beds) | 4.990 | +0.0143 | Higher Log(Beds) increases predicted margin | |
| Occupancy | 0.677 | +0.0086 | Higher Occupancy increases predicted margin |
Suburban Community Hospit
Archetype
42.9%
Distress Risk
$4.0M
RCM Opportunity
D
Opportunity Grade
12.3%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P34. 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%
NJ distress rate: 47.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.677 | -0.141 | ▼ risk |
| Medicaid Day Pct | 0.019 | -0.070 | ▼ risk |
| Net To Gross Ratio | 0.218 | -0.067 | ▼ risk |
| Medicare Day Pct | 0.448 | +0.021 | ▲ risk |
| Revenue Per Bed | 1585277.259 | -0.000 | ▼ risk |
| Beds | 147.000 | -0.000 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.0M
Current margin: 10.5%
Projected margin: 12.3%
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 | 0.534 | 0.715 | 18.1% | $2.7M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.218 | 0.251 | 3.2% | $886K | 65% | 18mo |
| Occupancy Improvement | 0.677 | 0.735 | 5.9% | $386K | 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. |