ML Analysis — UPMC HORIZON HOSPITAL
CCN 390178 | 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.
52
/ 100 (C)
Financial Health8/25
RCM Upside19/25
Market Position15/20
Demand Defensibility7/15
Operational Efficiency2/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-9.3%
R²=0.34 | n=4,907 | Grade B | Actual: -16.5%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-37.6%, 19.0%]. P39 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Reimbursement Quality | 0.116 | +0.0247 | Higher Reimbursement Quality increases predicted m | |
| Net-to-Gross | 0.164 | -0.0230 | Lower Net-to-Gross decreases predicted margin | |
| Expense/Bed | 1839586.313 | -0.0225 | Higher Expense/Bed decreases predicted margin | |
| Bed Utilization Value | 563677.632 | -0.0103 | Lower Bed Utilization Value decreases predicted ma | |
| Occupancy × Net-to-Gross | 0.058 | -0.0096 | Lower Occupancy × Net-to-Gross decreases predicted |
Turnaround: 34%Turnaround possible (34%) but uncertain. Margin improvement depends on Reimbursement Quality.
Under-Performing / Distre
Archetype
50.2%
Distress Risk
$7.9M
RCM Opportunity
D
Opportunity Grade
-11.4%
Projected Margin
Cluster: Under-Performing / Distressed
Percentile within cluster: P6. 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: High
National distress rate: 49.3%
PA distress rate: 48.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.357 | +0.156 | ▲ risk |
| Net To Gross Ratio | 0.164 | -0.091 | ▼ risk |
| Medicare Day Pct | 0.206 | -0.021 | ▼ risk |
| Beds | 99.000 | -0.007 | ▼ risk |
| Medicaid Day Pct | 0.086 | -0.002 | ▼ risk |
| Revenue Per Bed | 1579497.434 | -0.000 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $7.9M
Current margin: -16.5%
Projected margin: -11.4%
Grade: D
Comps: 103
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 | 0.164 | 0.353 | 18.9% | $3.5M | 65% | 18mo |
| Occupancy Improvement | 0.357 | 0.779 | 42.2% | $2.8M | 55% | 24mo |
| Payer Mix Optimization | 0.707 | 0.816 | 10.9% | $1.6M | 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 | 29.3 | [25.0, 75.0] | P53 | 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. |