ML Analysis — SPECIALTY HOSPITAL OF LORAIN
CCN 362025 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Speculative — only pursue if turnaround thesis is strong and entry multiple reflects risk.
40
/ 100 (D)
Financial Health5/25
RCM Upside17/25
Market Position7/20
Demand Defensibility8/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
Catalysts:
Margin Prediction (Trained Ridge Model)
-9.4%
R²=0.34 | n=4,907 | Grade B | Actual: -1.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-37.7%, 18.9%]. P39 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 261181.375 | -0.1840 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 265404.792 | +0.1715 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.004 | +0.0313 | Higher State Peer Margin increases predicted margi | |
| Reimbursement Quality | 0.095 | +0.0306 | Higher Reimbursement Quality increases predicted m | |
| Medicaid % | 0.327 | -0.0287 | Higher Medicaid % decreases predicted margin |
Turnaround: 34%Turnaround possible (34%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Safety-Net/Medicaid Heavy
Archetype
61.7%
Distress Risk
$8.5M
RCM Opportunity
A
Opportunity Grade
134.5%
Projected Margin
Cluster: Safety-Net/Medicaid Heavy
Percentile within cluster: P68. High Medicaid dependence creates reimbursement risk. Assess DSH payments and state expansion status.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| WESTERN PEAKS SPECIALTY HOSPITAL | UT | 59 |
| HOSPITAL MENONITA AIBONITO | PR | 129 |
| TOPPENISH COMMUNITY HOSPITAL | WA | 47 |
| MINERAL COMMUNITY HOSPITAL | MT | 25 |
| BANNER UNIVERSITY MED CENTER SOUTH | AZ | 132 |
| NORTH COLORADO MEDICAL CENTER | CO | 202 |
Distress Analysis
Risk: High
National distress rate: 49.3%
OH distress rate: 37.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Medicaid Day Pct | 0.326 | +0.237 | ▲ risk |
| Occupancy Rate | 0.361 | +0.153 | ▲ risk |
| Revenue Per Bed | 261181.375 | +0.078 | ▲ risk |
| Net To Gross Ratio | 0.439 | +0.031 | ▲ risk |
| Medicare Day Pct | 0.457 | +0.022 | ▲ risk |
| Beds | 24.000 | -0.017 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.5M
Current margin: -1.6%
Projected margin: 134.5%
Grade: A
Comps: 77
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 | 0.217 | 0.685 | 46.8% | $7.0M | 50% | 24mo |
| Occupancy Improvement | 0.361 | 0.585 | 22.5% | $1.5M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.439 | 0.474 | 3.5% | $25K | 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 | 31.7 | [25.0, 75.0] | P69 | 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. |