Investability Score
Hold / Selective — investigate specific opportunities but be prepared for execution risk.
53
/ 100 (C)
Financial Health4/25
RCM Upside19/25
Market Position15/20
Demand Defensibility8/15
Operational Efficiency6/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Expenses exceed revenue
Catalysts:
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
-6.5%
R²=0.34 | n=4,907 | Grade B | Actual: -7.7%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-34.8%, 21.8%]. P46 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2686517.800 | +0.1546 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 2893577.350 | -0.1523 | Higher Expense/Bed decreases predicted margin | |
| Log(Beds) | 2.996 | -0.0320 | Lower Log(Beds) decreases predicted margin | |
| Bed Count | 20.000 | +0.0201 | Higher Bed Count increases predicted margin | |
| Reimbursement Quality | 0.154 | +0.0137 | Higher Reimbursement Quality increases predicted m |
Turnaround: 39%Turnaround possible (39%) but uncertain. Margin improvement depends on Revenue/Bed.
Suburban Community Hospit
Archetype
47.0%
Distress Risk
$3.6M
RCM Opportunity
C
Opportunity Grade
-1.0%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P30. 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%
PA distress rate: 48.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.403 | +0.113 | ▲ risk |
| Medicaid Day Pct | 0.009 | -0.080 | ▼ risk |
| Revenue Per Bed | 2686517.800 | -0.065 | ▼ risk |
| Net To Gross Ratio | 0.253 | -0.051 | ▼ risk |
| Beds | 20.000 | -0.017 | ▼ risk |
| Medicare Day Pct | 0.384 | +0.010 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.6M
Current margin: -7.7%
Projected margin: -1.0%
Grade: C
Comps: 46
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 | 0.607 | 0.748 | 14.1% | $2.1M | 50% | 24mo |
| Occupancy Improvement | 0.403 | 0.530 | 12.7% | $838K | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.253 | 0.356 | 10.3% | $647K | 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 | 32.4 | [25.0, 75.0] | P72 | 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. |