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Lafayette General HealthLeading with purpose Serving with passion
Our MissionTo restore, maintain, and improve health
Our VisionBe a regional healthcare system that ALWAYS delivers excellence.
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This presentation that you are about to view is provided as of March 31, 2016 in connection with the LafayetteGeneral Health presentation at the HFMA Capital Conference. It has been prepared for informational purposesonly.
Certain statements in this presentation are forward‐looking statements, including those that discuss strategies,goals, outlook or other non‐historical matters; or revenues, income, returns or other financial measures. Theseforward‐looking statements speak only as of the date on which they are made, and Lafayette General Healthundertakes no obligation to update or revise any forward‐looking statements. These forward‐looking statementsare subject to risks and uncertainties that may cause actual results to differ materially from this presentation.
By viewing this investor presentation you acknowledge that you understand and agree to the provisions of thispage.
Disclaimer
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Primary FacilitiesOverview of Lafayette General Health System
Lafayette General Medical Center
Lafayette, LA
427 licensed beds
Founded 1911
University Hospital and Clinics
Lafayette, LA
116 licensed beds
Operated by LGHS since 2013
Lafayette General Surgical Hospital
Lafayette, LA
10 licensed beds
50% with Lafayette Surgical, LLC
St. Martin Hospital
Breaux Bridge, LA
25 licensed beds
Operated by LGHS since 2009
Acadia General Hospital
Crowley, LA
140 licensed beds
Operated by LGHS since June 2014
Abrom Kaplan Memorial Hospital
Kaplan, LA
35 licensed beds
Operated by LGHS since June 2015
Lafayette General Southwest
Lafayette, LA
128 licensed bedsOperated by LGHS since Nov. 2015 3
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Strong Regional PresenceOverview of Lafayette General Health System
Owned/Managed Facilities
Lafayette General Medical Center – Lafayette
Lafayette General Southwest ‐ Lafayette
University Hospital & Clinics – Lafayette
Lafayette General Surgical Hospital – Lafayette
Acadia General Hospital – Crowley
St. Martin Hospital – Breaux Bridge
Abrom Kaplan Memorial Hospital – Kaplan
Clinical Affiliates
Abbeville General Hospital – Abbeville
Bunkie General Hospital – Bunkie
Franklin Foundation Hospital – Franklin
Opelousas General Health System – Opelousas (Collaboration Agreement)
Savoy Medical Center – Mamou
Iberia Medical Center – New Iberia
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LGH Corporate Organization LGHS was incorporated in 2011 as part of a corporate reorganization to facilitate greater efficiencies
in the administration of the System and provides administrative and operational support services forthe System’s health care facilities and providers.
Lafayette Health Ventures, dba Lafayette General MD
Lafayette General Medical Center
University Hospital & Clinics
Acadia General Hospital
Kaplan General Hospital, dba Abrom Kaplan Memorial Hospital
St. Martin Hospital
Acadiana Radiation Therapy
Lafayette General Southwest
Lafayette General Endoscopy
Lafayette Investment Group
Lafayette General Surgical Hospital
Oil Center Surgical Plaza
Lafayette General Health System
Lafayette General Foundation Healthcare Innovation Fund
Greater Lafayette PHO/Acadian Healthcare Alliance
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PAST RECENT RENOVATION
PRESENT
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Awards and Honors
Lafayette General Health System
– Partnership with Ochsner Health System (2015)
– Best Places to Work in Information Technology (2015)
– #4 in Best Large Hospital IT Departments by Healthcare IT News (2015)
– Awarded 2014 MAP Award for performance improvement in revenue cycle by HFMA
Lafayette General Medical Center
– The Louisiana Performance Excellence Award by Louisiana Quality Foundation (2015)
– America’s Best Hospitals for Patient Safety, Obstetrics, Orthopedics, andCancer Care by Women’s Choice Awards (2015)
– Excellence in Patient Care award from Studer Group (2014)
– Consumer Choice Award by National Research Corporation (2005‐2015)
– A 5 star rated HCAHPS hospital on hospitalcompare.gov
St. Martin Hospital
– Best Place to Work In Healthcare by Modern Healthcare (2014 & 2015)
Abrom‐Kaplan Memorial Hospital
– Top 20 Critical Access Hospital in Financial Stability by the National RuralHealth Association (2015)
University Hospital & Clinics
– Quality Respiratory Care Recognition (2015)
– A 4 star rated HCAHPS hospital on hospitalcompare.gov
Overview of Lafayette General Health System
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Awards and Honors
Guardian of Excellence Awards from Press Ganey:
(Winners achieve this distinction by reaching the 95th percentile for each reporting period for the award year.)
– LGMC – patient experience for inpatient care & HCAHPS
– LGMC – patient experience for medical practice
– SMH – patient experience for the emergency room & patient experience for outpatient services
Pinnacle of Excellence Awards from Press Ganey:
(Winners achieve this distinction by maintaining consistently high levels of excellence as a top‐performing organization on the basis of extraordinary achievement.)
– LGMC – patient experience for inpatient care
– LGSH – patient experience for the ambulatory services
Three LGH Facilities: Lafayette General Medical Center, Lafayette General Surgical Hospital, and Opelousas General Health System recognized among the nation’s “Most Wired” (LGMC has been recognized since 2012)
Employee engagement scores for all entities at or above 89th percentile
LGMC & AGH physician engagement scores are greater than 90th percentile
Overview of Lafayette General Health System
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LGH/LSU/State Partnership – Effective June 24, 2013
On June 23, 2013, Lafayette General Health (LGH) assumed responsibilities through a lease arrangement with LSU for the management and operation of LSU University Medical Center.
LGH’s primary goal in this partnership is to keep UHC open and over time, strengthen andexpand all services offered at the UHC campus.
This partnership preserved and expanded GME in Acadiana from 65 to 85 residents.
Financing for the transaction including Disproportionate Share (DSH) reimbursement, Medicaid reimbursement, and supplemental payments through Upper Payment Limitfunding.
LGMC achieved major teaching hospital status July 1, 2013.
Overview of Lafayette General Health System
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Expansion of ServicesOverview of Lafayette General Health System
Operating Room Suites and Emergency Room Addition (August 2014)
$53 million, 131,000 square foot addition to LGMC
Expansion added 18,000 square feet to the emergency department, a new 12‐room surgery platform, anew central sterile processing department, and a new six story parking garage
CIS at Lafayette General Medical Center (April 2011)
Partnership developed with Cardiovascular Institute of the South
CIS manages four state‐of‐the‐art cath labs at LGMC
Cancer Center of Acadiana (March 2010)
Developed by LGMC through the purchase of the practices of five area medical oncologists
LGMC Patient Tower Expansion (January 2010)
$70 million renovation on the main and west patient towers at LGMC
Pavilion for Women and Children (May 2008)
$20 million, 32,000 square feet addition to LGMC and includes creation of a separate entrance, larger patient rooms and expansion of the neonatal intensive care unit
Houses 12 labor and deliver rooms; 24 mother/baby beds, and 25 NICU beds
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“Fastest growing workforce in state,” despite temporary downturn in oil industry
- Diversified economy, only 45% oil vs. 75% 5 years ago
‐ Oil jobs lost replaced by retail, service and high‐tech
(Costco, Stuller, Bell Helicopter, CGI, Enquero,
Perficient, and CSE ICON)
Approximately $6.4 billion in retail sales in 2014
“Hub City Health Care Center of the 10‐parish Acadiana region”
Overview of Lafayette Louisiana
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Service Area
LGHS’s service area consists of a 10‐parish area in the south‐central region of Louisiana known as Acadiana, midway between New Orleans and Houston, along the Interstate 10 corridor.
LGMCs primary service area is composed of Lafayette Parish, whichconsists of 270 square miles.
The population of Lafayette Parishwas 235,644 in 2014.
The primary service area accountedfor 55.3% of the inpatient discharges of LGMC for FY 2014.
The secondary service area of LGMC includes the five neighboring parishes ofAcadia, Iberia, St. Landry, St. Martin and Vermilion, which accounted for approximately 38% of LGMC’s inpatient discharges for the fiscal year ended September 30, 2014.
Overview of Lafayette General Health System
LGHS Service Area:Acadiana Region
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Physicians/Medical Staff
As of September 30, 2015, 705 physicians, dentists, podiatrists, and psychologists were on the ObligatedGroup’s Medical Staff. Of these, 462 were on the Active Staff
In addition, the Medical Staff had 204 individuals designated as Advanced Dependent Practitioners
As September 30, 2015, the average age of the Active Medical Staff was 50 years, and 80% of Active MedicalStaff members were board certified
Overview of Lafayette General Health System
Source: Medical Center Records
Top 10 Admitting Physicians as of 9/30/2015
SPECIALTY AGEBOARDCERTIFIED
NUMBER OFDISCHARGES*
Internal Medicine 32 No 1,082Psychiatry 38 Yes 686Internal Medicine 28 No 560Internal Medicine 51 No 466Psychiatry 61 Yes 442Pediatrics 35 Yes 409Internal Medicine 34 Yes 401Internal Medicine 42 No 387Internal Medicine 43 Yes 387Internal Medicine 54 No 373All Other 16,002
TOTAL 21,195
*Excludes Nursery Bassinets
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75,000
125,000
175,000
225,000
275,000
325,000
375,000
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
LGMC NET PATIENT REVENUEFYE 1997‐2014
LHVI Clinics
CCA
CV Surgery
Intensivists
LGMD Ortho Surgery
Neurology
Surgicalists
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Market Position
There are currently 23 additional acute‐care hospitals located in the Obligated Group’s service area. The System’s primary competitors are Our Lady of Lourdes Regional Medical Center, the Heart Hospital of Lafayette, Park Place Surgical Hospital, Women’s and Children’s Hospital, and Lafayette Surgicare
(1) Source: Louisiana Health Information Network (via Truven Health) and LHIN State Inpatient Data(2) Timeline: Calendar Years 2012‐2014, and the first quarter (January‐March) of 2015.
Overview of Lafayette General Health System
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Aligned Goals
Aligned Behaviors
Aligned Processes
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Start of J2E(2009)
Progress(most recent)
People EMPLOYEE Satisfaction
38th percentile
87th percentile
Service INPT 38th percentileED 15th percentile
OUTPT n/aAmb Surg n/a
Physician Sat n/a
INPT 99th percentile ED 96th percentile
Outpatient 78thpercentileAmb Surg 96th percentile
Physician 24th -> 68th
Quality 14 of 25 Indicators at National Average
28/35 Indicators≥ Nat’l Benchmark
Finance -0.4% LGMC=14.8%LGH= 4.5% (end of FY14)
Growth 2 Hospitals 6 Hospitals, 1 Collaboration60 Employed Physician
Practices &6 Clinical Affiliates
Pillar Progress
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Lafayette General Medical CenterEmployee Satisfaction
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LGMC Inpatient Satisfaction Results Since Beginning J2E
PercentileRan
k
Source: Press Ganey Inpatient Satisfaction Report –Large PG Database
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Recommit to Internal Customer Rounding
Revised Support Card
Large Press Ganey Data Base
Reported by FYTD
Percentile Ran
k
LGMC HCAHPS Overall Rating of Care
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Strategic Business ObjectivesOverview of Lafayette General Health System
• Achieve greater physician alignment
• Become the leading provider in population health management
• Achieve national top decile ranking in patient experience, employee and physician engagement
• Achieve 100% score in quality outcomes
• Develop a real estate capacity strategy
• Grow/evolve medical education program
• Develop an information technology system strategy
• Develop a consolidated system financial strategy
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People 20%
Service 20%
Funding Our Future
30%
Quality 20%
Growth10%
• Outpatient Satisfaction
• ED PatientSatisfaction
• Ambulatory Surgery Satisfaction
• Physician Engagement
• Quality Measures
• CAHPS Domains
• Operating Margin
• Days Cash on Hand
• Net Revenue over FY15
• 1st Year Turnover
• Employee Engagement
FY 2016 LGH System Goals
2222
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VBPerformancefor Leaders & Staff
Our Work + My Work + My Values = SEM Score
(30%) + (50%) + (20%) = 100%
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Strategic Clinical ObjectivesOverview of Lafayette General Health System
• LGMC Level II Trauma Center
• Hospitalists Programs at AGH and AKMH
• RN Residency Program
• Increased Clinic Hours at UHC for Internal Medicine and Orthopedics staffed by Nurse Practitioners
• OB Beds and NICU expansion
• 11 new physicians at LGMD in existing and new practices, including Plastics
• Ochsner Partnership
• Developed post‐acute home care affiliated network
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System Financial ProfileFinancial Overview
Total operating revenues increased from $495.5 million during FY2014 to $585.0 million during FY2015
Balance sheet continues to strengthen with unrestricted net assets having increased from $247.7 million inFY2014 to $297.7 million in FY2015 (20.2% increase)
Total cash available increased from $135.1 million to 154.9 million in FY2015 (14.7%)
During the past three years, the System has seen substantial growth in the number of hospitals that make up the System
University Hospitals and Clinics was acquired in 2013, Acadia General Hospital was acquired in 2014 and, most recently in November 2015, LGMC acquired the assets of RMCA and converted it to its newest campus, Lafayette General Southwest
Key Statistics ($000s) FY 2015
Total Operating Revenues $585,119
Operating Cash Flow Margin 8.5%
Operating Margin 3.4%
Unrestricted Net Assets 297,625
Days Cash on Hand 104
Source: 2014 FY Audit Financials & 2015 FY Audited Financials25
Historical Utilization (System)
16,66919,318
25,242
0
5,000
10,000
15,000
20,000
25,000
30,000
2013 2014 2015
80,287
126,027145,821
0
50,000
100,000
150,000
200,000
2013 2014 2015
Inpatient Discharges Emergency Room Visits
1,820
4,879
7,134
0
2,000
4,000
6,000
8,000
2013 2014 2015
Outpatient Surgeries
241
300335
0
100
200
300
400
2013 2014 2015
Average Daily Census
Overview of Lafayette General Health System
Source: Medical Center Records26
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System Financial StatisticsFinancial Overview
$364,062
$495,503 $585,119
$0
$200,000
$400,000
$600,000
$800,000
2013 2014 2015
Total Operating Revenue
12.1%
9.0% 8.5%
0.0%
5.0%
10.0%
15.0%
2013 2014 2015
Operating Cash Flow Margin
5.2%
3.9%3.2%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
2013 2014 2015
Operating Margin
Source: 2014 FY Audit Financials & 2015 FY Audited Financials27
System Financial Statistics (Continued)Financial Overview
220,480247,761
297,625
0
100,000
200,000
300,000
400,000
2013 2014 2015
Unrestricted Net Assets
157
108 104
0
50
100
150
200
2013 2014 2015
Days Cash On Hand
3.53.3
3.1
0.0
1.0
2.0
3.0
4.0
2013 2014 2015 Pro Forma
Maximum Annual Debt Service Coverage (x)
Source: 2014 FY Audit Financials & 2015 FY Audited Financials
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Lafayette General Health
Net Patient Revenue Growth ‐ FY 2010 ‐ FY 2015
Net = 175% increaseG
row
th in
Mill
ion
s
*NPR before provision for bad debts
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SummaryLafayette General Health
Integrated healthcare system with six hospitals, nine professional centers and several physician clinics
Leading and growing market share in demographically favorable service area
Strategic relationships with physicians has led to improved alignment across the organization
Increased capacity, leading to strong growth in revenue and utilization
History of stable earnings and cash flow metrics
Diversified and active governance at the Board level
LGH is well positioned to continue to be the market leader in the region.
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