ML Analysis — CUMBERLAND MEDICAL CENTER
CCN 440009 | 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.
58
/ 100 (C)
Financial Health7/25
RCM Upside20/25
Market Position15/20
Demand Defensibility12/15
Operational Efficiency4/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
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)
-0.3%
R²=0.34 | n=4,907 | Grade B | Actual: -12.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-28.6%, 28.0%]. P62 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 1170392.833 | -0.0571 | Lower Revenue/Bed decreases predicted margin | |
| Expense/Bed | 1311146.486 | +0.0426 | Higher Expense/Bed increases predicted margin | |
| State Peer Margin | -0.006 | +0.0291 | Higher State Peer Margin increases predicted margi | |
| Occupancy | 0.867 | +0.0194 | Higher Occupancy increases predicted margin | |
| Bed Count | 72.000 | +0.0120 | Higher Bed Count increases predicted margin |
Turnaround: 50%Turnaround possible (50%) but uncertain. Margin improvement depends on improving Revenue/Bed.
Suburban Community Hospit
Archetype
39.7%
Distress Risk
$2.7M
RCM Opportunity
D
Opportunity Grade
-8.8%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P60. 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%
TN distress rate: 43.2%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.867 | -0.317 | ▼ risk |
| Medicaid Day Pct | 0.034 | -0.055 | ▼ risk |
| Net To Gross Ratio | 0.289 | -0.035 | ▼ risk |
| Revenue Per Bed | 1170392.833 | +0.024 | ▲ risk |
| Beds | 72.000 | -0.010 | ▼ risk |
| Medicare Day Pct | 0.338 | +0.002 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.7M
Current margin: -12.0%
Projected margin: -8.8%
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 | 0.289 | 0.429 | 14.0% | $1.4M | 65% | 18mo |
| Payer Mix Optimization | 0.628 | 0.718 | 9.0% | $1.3M | 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 | 26.2 | [25.0, 75.0] | P36 | 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. |