ML Analysis — BEMC BURLESON
CCN 670107 | 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.
35
/ 100 (D)
Financial Health5/25
RCM Upside16/25
Market Position9/20
Demand Defensibility4/15
Operational Efficiency2/15
Entry Multiple: 6.0x – 8.5x
Est. MOIC: 1.5x
Risk Factors:
- Negative operating margin
- Small facility (<50 beds) — limited scale
- Low occupancy (<30%) — demand risk
Catalysts:
- Strong commercial payer base protects revenue
Margin Prediction (Trained Ridge Model)
-9.1%
R²=0.34 | n=4,907 | Grade B | Actual: -1.0%
Ridge regression trained on 4,907 HCRIS hospitals. 90% CI: [-37.4%, 19.2%]. P39 nationally.
| Driver | Value | Effect | Explanation | |
|---|---|---|---|---|
| Expense/Bed | 1299784.250 | +0.0440 | Higher Expense/Bed increases predicted margin | |
| Revenue/Bed | 1287449.125 | -0.0407 | Lower Revenue/Bed decreases predicted margin | |
| State Peer Margin | -0.006 | +0.0290 | Higher State Peer Margin increases predicted margi | |
| Log(Beds) | 3.178 | -0.0278 | Lower Log(Beds) decreases predicted margin | |
| Bed Utilization Value | 113313.159 | -0.0252 | Lower Bed Utilization Value decreases predicted ma |
Turnaround: 34%Turnaround possible (34%) but uncertain. Margin improvement depends on Expense/Bed.
Suburban Community Hospit
Archetype
55.5%
Distress Risk
$4.2M
RCM Opportunity
B
Opportunity Grade
12.5%
Projected Margin
Cluster: Suburban Community Hospital
Percentile within cluster: P83. 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 | 0.088 | +0.406 | ▲ risk |
| Medicaid Day Pct | 0.005 | -0.084 | ▼ risk |
| Net To Gross Ratio | 0.235 | -0.060 | ▼ risk |
| Revenue Per Bed | 1287449.125 | +0.017 | ▲ risk |
| Beds | 24.000 | -0.017 | ▼ risk |
| Medicare Day Pct | 0.246 | -0.014 | ▼ risk |
RCM Improvement Opportunity
Total (risk-adjusted): $4.2M
Current margin: -1.0%
Projected margin: 12.5%
Grade: B
Comps: 246
Gap analysis vs P75 peers with 60% closure assumption. Confidence-weighted by lever implementation difficulty.
| Lever | Current | Benchmark | Gap | Impact | Confidence | Timeline |
|---|---|---|---|---|---|---|
| Occupancy Improvement | 0.088 | 0.551 | 46.2% | $3.1M | 55% | 24mo |
| Net-to-Gross Ratio Improvement | 0.235 | 0.539 | 30.4% | $1.1M | 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 | 32.8 | [25.0, 75.0] | P73 | 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. |