ML Analysis — STILLWATER MEDICAL CENTER
CCN 370049 | 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.
63
/ 100 (B)
Financial Health9/25
RCM Upside21/25
Market Position13/20
Demand Defensibility12/15
Operational Efficiency8/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
4.4%
R²=0.34 | n=4,907 | Grade B | Actual: -9.9%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-23.9%, 32.7%]. P72 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 5196377.865 | +0.5049 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 5709506.904 | -0.4992 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 4270447.942 | +0.1127 | Higher Bed Utilization Value increases predicted m | |
| State Peer Margin | -0.088 | -0.0313 | Lower State Peer Margin decreases predicted margin | |
| Reimbursement Quality | 0.094 | +0.0309 | Higher Reimbursement Quality increases predicted m |
Turnaround: 58%Turnaround possible (58%) but uncertain. Margin improvement depends on Revenue/Bed.
Suburban Community Hospit
Archetype
39.8%
Distress Risk
$4.6M
RCM Opportunity
D
Opportunity Grade
-8.2%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P98. 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%
OK distress rate: 58.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.822 | -0.275 | ▼ risk |
| Revenue Per Bed | 5196377.865 | -0.214 | ▼ risk |
| Medicaid Day Pct | 0.228 | +0.139 | ▲ risk |
| Net To Gross Ratio | 0.274 | -0.042 | ▼ risk |
| Medicare Day Pct | 0.429 | +0.017 | ▲ risk |
| Beds | 52.000 | -0.013 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.6M
Current margin: -9.9%
Projected margin: -8.2%
Grade: D
Comps: 61
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Net-to-Gross Ratio Improvement | 0.274 | 0.359 | 8.4% | $2.7M | 65% | 18mo |
| Payer Mix Optimization | 0.343 | 0.472 | 12.9% | $1.9M | 50% | 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 | 28.8 | [25.0, 75.0] | P49 | 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. |