ML Analysis — METHODIST SUGAR LAND HOSPITAL
CCN 450820 | 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.
60
/ 100 (C)
Financial Health20/25
RCM Upside7/25
Market Position11/20
Demand Defensibility13/15
Operational Efficiency9/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
5.4%
R²=0.34 | n=4,907 | Grade B | Actual: 12.6%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-22.9%, 33.7%]. P75 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2016626.172 | +0.0610 | Higher Revenue/Bed increases predicted margin | |
| Log(Beds) | 5.820 | +0.0336 | Higher Log(Beds) increases predicted margin | |
| Bed Count | 337.000 | -0.0294 | Higher Bed Count decreases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Reimbursement Quality | 0.111 | +0.0260 | Higher Reimbursement Quality increases predicted m |
Suburban Community Hospit
Archetype
42.0%
Distress Risk
$8.8M
RCM Opportunity
D
Opportunity Grade
13.9%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P26. 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%
TX distress rate: 42.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.730 | -0.190 | ▼ risk |
| Net To Gross Ratio | 0.175 | -0.086 | ▼ risk |
| Revenue Per Bed | 2016626.172 | -0.026 | ▼ risk |
| Beds | 337.000 | +0.025 | ▲ risk |
| Medicaid Day Pct | 0.076 | -0.013 | ▼ risk |
| Medicare Day Pct | 0.288 | -0.007 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $8.8M
Current margin: 12.6%
Projected margin: 13.9%
Grade: D
Comps: 112
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 | 0.175 | 0.250 | 7.5% | $6.0M | 65% | 18mo |
| Payer Mix Optimization | 0.637 | 0.805 | 16.9% | $2.5M | 50% | 24mo |
| Occupancy Improvement | 0.730 | 0.776 | 4.7% | $309K | 55% | 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 | 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. |