34th Annual J.P. Morgan Healthcare Conference Jim Skogsbergh President and Chief Executive Officer Lee B. Sacks, M.D. Executive Vice President and Chief Medical Officer Dominic J. Nakis Chief Financial Officer and Treasurer San Francisco, California January 11, 2016 The following material and presentation contains information which is forward looking within the meaning of federal securities law. These forward-looking statements are based on the current plans and expectations of Advocate Health Care Network (Advocate) that, although believed to be reasonable, are subject to a number of known and unknown uncertainties and risks inherent in the operation of health care facilities, many of which are beyond Advocates control, that could significantly affect current plans and expectations and Advocates future financial position and results of operations. These forward-looking statements speak only as of the date made. Investors are cautioned not to unduly rely on such forward-looking statements. This presentation should be reviewed in conjunction with Advocates December 31, 2014 and September 30, 2015 continuing disclosure reports. Introduction and Advocate Overview Jim Skogsbergh President and Chief Executive Officer Advocate Health Care 5 Hospitals (12) 4 teaching 1 children's 1 critical access 5 level 1 trauma centers Physicians 1,350 employed 5,175 Advocate Physician Partners 6,400 medical staff Post-acute Home health, hospice, long-term acute care hospital and palliative care 33,700 associates $5.7 billion total revenue 17.8% market share Delayed NorthShore Merger FTC obtained federal court injunction to block merger December 22, 2015 Judge denied an FTC motion to seal documents Hearing date set for April 6, Merger Objective: Increase competition by dramatically changing the way that managed care products are constructed and sold in the Chicago area. $783 million community benefit Recognitions Key Market Dynamics Provider & health plan consolidation Dominant health plan Narrow networks emerging Revenue pressures utilization, mix and price Cost pressures labor and drugs 8 Advocate Well Positioned 9 Top decile safety and health outcomes Strong brand Population health leader Narrow network exchange product Pluralistic approach to physicians Robust ambulatory network & retail clinics Financial strength 10 Report Card 11 Market Share Leader 12 Medical Staff ~ 6,400 Pluralistic Physician Platform Advocate Physician Partners ~ 5,175 Aligned ~ 3,825 Employed ~1,350 13 AdvocateCare Achieving the Triple Aim Lee B. Sacks, M.D. Executive Vice President and Chief Medical Officer Triple Aim Requires New Business Model Five+ years ago, Advocate recognized three ways providers could earn revenue: 1.Maximize unit reimbursement 2.For given unit reimbursement, maximize quantity 3.Take financial risk for managing the health of a population, lowering total costs and serve a greater number of unique patients 15 Fee for Service to Value Shifting Incentives 16 Current Value-Based Agreements ContractLivesTotal Spend Commercial415,000$1.5 B Medicare ACO145,000$1.7 B Medicaid ACE100,000$0.2 B Medicare Advantage37,000$0.4 B Advocate Associates28,000$0.1 B Total725,000$3.9 B 17 High Performance Network (HPN) Competes on Value 2016 BlueCare Direct in collaboration with Advocate Public exchange and small group market Lowest priced Blue Cross plan Projected enrollment: 58,000 lives, $138 million revenue 2017 Market for the product expands: SHOP (small business health option program) exchange Large employer group market 18 Co-Marketed HPN 19 Medicare Advantage (MA) Chicago area Medicare population is over 1 million and growing 3% per annum 9.5% Advocate MA enrollment growth in 2015 Turning 65 population represents a market opportunity 20 Medicaid is Critical for OB and Childrens Hospital Illinois Medicaid expansion grows managed Medicaid Lives Selective fee for service contracts with Medicaid managed care payers Transition to global risk with an insurance partner anticipated mid Shared Savings is a transition model Medicare Advantage is growth opportunity Positioned for managed Medicaid High Performance Network Products for Public/Private Exchanges Going Forward 22 Financial Profile Dominic J. Nakis Chief Financial Officer and Treasurer Revenue Revenue Cycle Standardization/Consolidation Clinical Documentation Improvement Coding Training and Education Cost Labor Cost and Productivity Clinical Effectiveness Supply Chain and Purchased Services 24 Intense Focus on Revenue and Cost Management Driving Margin Performance Operating Performance Consistently Strong 24 // 25 Operating Cash Flow is Solid 25 // 26 Diversified Investment Portfolio 27 Expected return of 7.1% Risk/return ratio at 0.72 // 27 Debt Profile is Low, Level and Long* Tax-exempt debt is $1.6 billion, average annual debt service is generally level through 2038 at $95 million and average life is 19 years. * Debt profile as of October 31, Debt Portfolio Characteristics* 30 Product Mix Underlying Debt Mix Liquidity Mix * Debt profile as of October 31, Strong Coverage and Capitalization 31 // 30 Robust Cash to Debt Ratio 32 // 31 Pension Plans Well Funded 33 // 32 Substantial Liquidity Position 34 // 33 Significant Capital Expenditures Past Three Years 35 // 34 Summary National leader in safety, health outcomes and Population Health Management Market share leader and brand strength Growth through new risk based products Balance sheet strength and solid operating performance AA bond ratings with stable (M/F) and positive (S&P) outlooks 42 35