ML Analysis — FRIENDS BEHAVIORAL HEALTH SYSTEM
CCN 394008 | 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.
44
/ 100 (D)
Financial Health5/25
RCM Upside18/25
Market Position9/20
Demand Defensibility9/15
Operational Efficiency4/15
Entry Multiple: 8.0x – 10.0x
Est. MOIC: 1.9x
Risk Factors:
- Negative operating margin
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-6.8%
R²=0.34 | n=4,907 | Grade B | Actual: -0.8%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-35.1%, 21.5%]. P45 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 250017.714 | -0.1856 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 251942.141 | +0.1731 | Higher Expense/Bed increases predicted margin | |
| Reimbursement Quality | 0.341 | -0.0403 | Higher Reimbursement Quality decreases predicted m | |
| Bed Utilization Value | 222051.263 | -0.0216 | Lower Bed Utilization Value decreases predicted ma | |
| Occupancy | 0.888 | +0.0206 | Higher Occupancy increases predicted margin |
Turnaround: 38%Turnaround possible (38%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Suburban Community Hospit
Archetype
40.9%
Distress Risk
$0
RCM Opportunity
D
Opportunity Grade
-0.8%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P56. Community hospitals — the largest PE deal category. Focus on RCM improvement and cost optimization at 9-11x.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| CLARA MAASS MEDICAL CENTER | NJ | 259 |
| PRESENCE SAINTS MARY & ELIZABETH MED | IL | 266 |
| ADVENTIST HEALTH BAKERSFIELD | CA | 254 |
| BRISTOL REGIONAL MEDICAL CENTER | TN | 244 |
| HOLSTON VALLEY HOSP & MED CTR | TN | 286 |
| SPRINGFIELD REGIONAL MEDICAL CENTER | OH | 230 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
PA distress rate: 48.1%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.888 | -0.337 | ▼ risk |
| Revenue Per Bed | 250017.714 | +0.078 | ▲ risk |
| Medicaid Day Pct | 0.033 | -0.056 | ▼ risk |
| Medicare Day Pct | 0.084 | -0.042 | ▼ risk |
| Net To Gross Ratio | 0.387 | +0.008 | ▲ risk |
| Beds | 192.000 | +0.006 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $0
Current margin: -0.8%
Projected margin: -0.8%
Grade: D
Comps: 98
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|
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. |