ML Analysis — LENOIR MEMORIAL HOSPITAL
CCN 340027 | 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 Upside18/25
Market Position15/20
Demand Defensibility10/15
Operational Efficiency4/15
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)
-7.8%
R²=0.34 | n=4,907 | Grade B | Actual: -4.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-36.1%, 20.5%]. P42 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 688305.786 | -0.1244 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 719652.137 | +0.1155 | Higher Expense/Bed increases predicted margin | |
| Bed Utilization Value | 236166.698 | -0.0211 | Lower Bed Utilization Value decreases predicted ma | |
| Log(Beds) | 5.204 | +0.0193 | Higher Log(Beds) increases predicted margin | |
| State Peer Margin | -0.020 | +0.0188 | Higher State Peer Margin increases predicted margi |
Turnaround: 37%Turnaround possible (37%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Suburban Community Hospit
Archetype
55.2%
Distress Risk
$5.4M
RCM Opportunity
D
Opportunity Grade
-0.2%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P47. 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%
NC distress rate: 36.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.343 | +0.169 | ▲ risk |
| Revenue Per Bed | 688305.786 | +0.053 | ▲ risk |
| Net To Gross Ratio | 0.381 | +0.006 | ▲ risk |
| Beds | 182.000 | +0.004 | ▲ risk |
| Medicaid Day Pct | 0.091 | +0.002 | ▲ risk |
| Medicare Day Pct | 0.336 | +0.001 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $5.4M
Current margin: -4.5%
Projected margin: -0.2%
Grade: D
Comps: 50
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 | 0.573 | 0.759 | 18.5% | $2.8M | 50% | 24mo |
| Occupancy Improvement | 0.343 | 0.738 | 39.5% | $2.6M | 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. |