ML Analysis — VCU HEALTH SYSTEM MCV HOSPITAL
CCN 490032 | Clustering + Distress + RCM Opportunity
🛡️ Public data only — no PHI permitted on this instance.
Investability Score
Buy — solid fundamentals with identifiable value creation levers. Proceed to detailed diligence.
70
/ 100 (B)
Financial Health20/25
RCM Upside15/25
Market Position17/20
Demand Defensibility11/15
Operational Efficiency7/15
Entry Multiple: 9.5x – 11.5x
Est. MOIC: 2.3x
Risk Factors:
Catalysts:
- RCM optimization could add 3-5pp margin
- Strong commercial payer base protects revenue
- Limited competition supports pricing power
Margin Prediction (Trained Ridge Model)
3.7%
R²=0.34 | n=4,907 | Grade B | Actual: 0.3%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-24.6%, 32.0%]. P71 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 2685536.216 | +0.1544 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 2678284.701 | -0.1258 | Higher Expense/Bed decreases predicted margin | |
| Bed Count | 842.000 | -0.1082 | Higher Bed Count decreases predicted margin | |
| State Peer Margin | 0.044 | +0.0666 | Higher State Peer Margin increases predicted margi | |
| Log(Beds) | 6.736 | +0.0549 | Higher Log(Beds) increases predicted margin |
Large Academic Medical Ce
Archetype
41.5%
Distress Risk
$11.2M
RCM Opportunity
D
Opportunity Grade
0.8%
Projected Margin
Cluster: Large Academic Medical Center
Percentile within cluster: P1. Large medical centers trade at premium multiples (12-14x). Limited PE value creation but strong cash flow.
Nearest Peers
| Hospital | State | Beds |
|---|---|---|
| NORTH CAROLINA BAPTIST HOSPITAL | NC | 800 |
| HACKENSACK UNIVERSITY MEDICAL CENTER | NJ | 779 |
| TEMPLE UNIVERSITY HOSPITAL | PA | 761 |
| UH CLEVELAND MEDICAL CENTER | OH | 660 |
| FROEDTERT MEM. LUTHERAN HOSPT. | WI | 731 |
| UNIVERSITY OF IOWA HOSP & CLINICS | IA | 727 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
VA distress rate: 29.6%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.783 | -0.240 | ▼ risk |
| Beds | 842.000 | +0.093 | ▲ risk |
| Revenue Per Bed | 2685536.216 | -0.065 | ▼ risk |
| Net To Gross Ratio | 0.278 | -0.041 | ▼ risk |
| Medicaid Day Pct | 0.049 | -0.040 | ▼ risk |
| Medicare Day Pct | 0.183 | -0.025 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $11.2M
Current margin: 0.3%
Projected margin: 0.8%
Grade: D
Comps: 369
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 | 0.278 | 0.318 | 4.1% | $10.8M | 65% | 18mo |
| Occupancy Improvement | 0.783 | 0.839 | 5.5% | $364K | 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. |