ML Analysis — HOSPITAL FOR SPECIAL SURGERY
CCN 330270 | 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.
60
/ 100 (B)
Financial Health11/25
RCM Upside20/25
Market Position9/20
Demand Defensibility11/15
Operational Efficiency10/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
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)
-24.0%
R²=0.34 | n=4,907 | Grade B | Actual: -29.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-52.3%, 4.3%]. P17 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 7249460.265 | -0.6889 | Higher Expense/Bed decreases predicted margin | |
| Revenue/Bed | 5606404.150 | +0.5621 | Higher Revenue/Bed increases predicted margin | |
| State Peer Margin | -0.175 | -0.0960 | Lower State Peer Margin decreases predicted margin | |
| Bed Utilization Value | 2088584.906 | +0.0403 | Higher Bed Utilization Value increases predicted m | |
| Log(Beds) | 5.298 | +0.0215 | Higher Log(Beds) increases predicted margin |
Turnaround: 16%Low turnaround probability (16%). Structural disadvantages in Expense/Bed and Revenue/Bed.
Under-Performing / Distre
Archetype
45.6%
Distress Risk
$6.1M
RCM Opportunity
D
Opportunity Grade
-28.8%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P100. Deeply negative margins signal severe distress. Evaluate asset-level acquisition at 4-6x normalized EBITDA.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| HOLY FAMILY MEMORIAL INC | WI | 58 |
| MIDDLESBORO ARH | KY | 46 |
| ATRIUM HEALTH NAVICENT BALDWIN | GA | 86 |
| BON SECOURS COMMUNITY HOSPITAL | NY | 98 |
| ADVANCED SPECIALTY HOSP. OF TOLEDO | OH | 40 |
| COMMUNITY HEALTH CENTER BRANCH | MI | 75 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
NY distress rate: 84.9%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Revenue Per Bed | 5606404.150 | -0.238 | ▼ risk |
| Occupancy Rate | 0.373 | +0.142 | ▲ risk |
| Medicaid Day Pct | 0.003 | -0.086 | ▼ risk |
| Net To Gross Ratio | 0.409 | +0.018 | ▲ risk |
| Medicare Day Pct | 0.382 | +0.009 | ▲ risk |
| Beds | 200.000 | +0.007 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.1M
Current margin: -29.3%
Projected margin: -28.8%
Grade: D
Comps: 99
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.373 | 0.823 | 45.1% | $3.0M | 55% | 24mo |
| Payer Mix Optimization | 0.616 | 0.745 | 13.0% | $1.9M | 50% | 24mo |
| Net-to-Gross Ratio Improvement | 0.409 | 0.418 | 0.9% | $1.2M | 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 | 26.7 | [25.0, 75.0] | P38 | 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. |