ML Analysis — OLYMPIC MEDICAL CENTER
CCN 500072 | 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.
64
/ 100 (B)
Financial Health9/25
RCM Upside20/25
Market Position15/20
Demand Defensibility10/15
Operational Efficiency10/15
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)
-8.5%
R²=0.34 | n=4,907 | Grade B | Actual: -12.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-36.8%, 19.8%]. P41 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 3420579.615 | -0.2172 | Higher Expense/Bed decreases predicted margin | |
| Revenue/Bed | 3049385.308 | +0.2052 | Higher Revenue/Bed increases predicted margin | |
| State Peer Margin | -0.103 | -0.0426 | Lower State Peer Margin decreases predicted margin | |
| Bed Utilization Value | 1401303.406 | +0.0175 | Higher Bed Utilization Value increases predicted m | |
| Net-to-Gross | 0.473 | +0.0117 | Higher Net-to-Gross increases predicted margin |
Turnaround: 35%Turnaround possible (35%) but uncertain. Margin improvement depends on improving Expense/Bed.
Suburban Community Hospit
Archetype
49.0%
Distress Risk
$6.3M
RCM Opportunity
D
Opportunity Grade
-9.5%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P53. 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: Elevated
National distress rate: 49.3%
WA distress rate: 67.3%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Revenue Per Bed | 3049385.308 | -0.087 | ▼ risk |
| Occupancy Rate | 0.460 | +0.061 | ▲ risk |
| Medicaid Day Pct | 0.040 | -0.049 | ▼ risk |
| Net To Gross Ratio | 0.473 | +0.046 | ▲ risk |
| Medicare Day Pct | 0.459 | +0.023 | ▲ risk |
| Beds | 78.000 | -0.009 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $6.3M
Current margin: -12.2%
Projected margin: -9.5%
Grade: D
Comps: 28
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Payer Mix Optimization | 0.501 | 0.762 | 26.1% | $3.9M | 50% | 24mo |
| Occupancy Improvement | 0.460 | 0.822 | 36.3% | $2.4M | 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 | 26.9 | [25.0, 75.0] | P38 | 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. |