ML Analysis — FROEDTERT MEM. LUTHERAN HOSPT.
CCN 520177 | 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.
66
/ 100 (B)
Financial Health20/25
RCM Upside14/25
Market Position9/20
Demand Defensibility13/15
Operational Efficiency9/15
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
Margin Prediction (Trained Ridge Model)
6.0%
R²=0.34 | n=4,907 | Grade B | Actual: 2.2%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-22.3%, 34.3%]. P76 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Revenue/Bed | 3261191.769 | +0.2348 | Higher Revenue/Bed increases predicted margin | |
| Expense/Bed | 3188826.365 | -0.1887 | Higher Expense/Bed decreases predicted margin | |
| Bed Count | 731.000 | -0.0909 | Higher Bed Count decreases predicted margin | |
| Bed Utilization Value | 2734369.117 | +0.0617 | Higher Bed Utilization Value increases predicted m | |
| Log(Beds) | 6.594 | +0.0516 | Higher Log(Beds) increases predicted margin |
Large Academic Medical Ce
Archetype
40.6%
Distress Risk
$2.8M
RCM Opportunity
D
Opportunity Grade
2.3%
Projected Margin
Cluster: Large Academic Medical Center
Percentile within cluster: P2. 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 |
| VCU HEALTH SYSTEM MCV HOSPITAL | VA | 842 |
| UH CLEVELAND MEDICAL CENTER | OH | 660 |
| UNIVERSITY OF IOWA HOSP & CLINICS | IA | 727 |
Distress Analysis
Risk: Elevated
National distress rate: 49.3%
WI distress rate: 34.5%
Model AUC: 0.629
| Factor | Value | Contribution | Direction |
|---|---|---|---|
| Occupancy Rate | 0.838 | -0.291 | ▼ risk |
| Revenue Per Bed | 3261191.769 | -0.099 | ▼ risk |
| Beds | 731.000 | +0.078 | ▲ risk |
| Net To Gross Ratio | 0.314 | -0.024 | ▼ risk |
| Medicare Day Pct | 0.217 | -0.019 | ▼ risk |
| Medicaid Day Pct | 0.089 | +0.001 | ▲ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $2.8M
Current margin: 2.2%
Projected margin: 2.3%
Grade: D
Comps: 489
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 | 0.314 | 0.320 | 0.7% | $1.8M | 65% | 18mo |
| Payer Mix Optimization | 0.693 | 0.758 | 6.5% | $970K | 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 | 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. |