ML Analysis — CORNERSTONE REGIONAL HOSPITAL
CCN 450825 | 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.
37
/ 100 (D)
Financial Health9/25
RCM Upside13/25
Market Position11/20
Demand Defensibility1/15
Operational Efficiency3/15
Entry Multiple: 6.0x – 8.5x
Est. MOIC: 1.5x
Risk Factors:
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-8.4%
R²=0.34 | n=4,907 | Grade B | Actual: 3.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-36.7%, 19.9%]. P41 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 1881139.786 | +0.0421 | Higher Revenue/Bed increases predicted margin | |
| Log(Beds) | 2.639 | -0.0403 | Lower Log(Beds) decreases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Occupancy | 0.025 | -0.0284 | Lower Occupancy decreases predicted margin | |
| Bed Utilization Value | 46016.140 | -0.0274 | Lower Bed Utilization Value decreases predicted ma |
Suburban Community Hospit
Archetype
54.8%
Distress Risk
$3.7M
RCM Opportunity
A
Opportunity Grade
17.4%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P94. 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: High
National distress rate: 49.3%
TX distress rate: 42.8%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.024 | +0.465 | ▲ risk |
| Net To Gross Ratio | 0.157 | -0.095 | ▼ risk |
| Medicaid Day Pct | 0.008 | -0.081 | ▼ risk |
| Medicare Day Pct | 0.128 | -0.034 | ▼ risk |
| Beds | 14.000 | -0.018 | ▼ risk |
| Revenue Per Bed | 1881139.786 | -0.018 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $3.7M
Current margin: 3.3%
Projected margin: 17.4%
Grade: A
Comps: 155
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.024 | 0.404 | 37.9% | $2.5M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.157 | 0.556 | 39.9% | $1.2M | 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 | 35.2 | [25.0, 75.0] | P79 | Average — predicted days in ar is near the median. |
| Clean Claim Rate | 98.0% | [80.0%, 98.0%] | P0 | Strong — predicted clean claim rate is in the top third. |
| Net Collection Rate | 98.9% | [90.0%, 99.5%] | P4 | Strong — predicted net collection rate is in the top third. |