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BOARD OF DIRECTORS
FINANCE Committee of the Whole
MEETING
November 19, 2009, 1:00pm Lee Memorial Hospital Boardroom
2776 Cleveland Ave, Ft. Myers, FL 33901
ELECTRONIC BOARD PACKET
ALL MEETINGS ARE OPEN TO THE PUBLIC AND THE PUBLIC IS INVITED TO ATTEND Any Public Input pertaining to an agenda item is limited to three minutes and a
“Request to Address the Board of Directors” card must be completed and submitted to the Board Assistant prior to the meeting.
P.O. BOX 2218 FORT MYERS, FLORIDA
33902
239-332-1111
CAPE CORAL HOSPITAL GULF COAST MEDICAL CENTER
HEALTHPARK MEDICAL CENTER
LEE MEMORIAL HOSPITAL
THE CHILDREN’S HOSPITAL THE REHABILITATION HOSPITAL
LEE PHYSICIAN GROUP
LEE CONVENIENT CARE
BOARD OF DIRECTORS
DISTRICT ONE
Stephen R. Brown, M.D.
Marilyn Stout
DISTRICT TWO
Richard B. Akin
Nancy M. McGovern, RN, MSM
DISTRICT THREE
Lois C. Barrett, MBA
Linda L. Brown, MSN, ARNP
DISTRICT FOUR
Frank T. La Rosa
Dawson C. McDaniel
DISTRICT FIVE
James Green
Jason Moon
LEE MEMORIAL HEALTH SYSTEM BOARD OF DIRECTORS
FINANCE COMMITTEE OF THE WHOLE MEETING Thursday, November 19, 2009 1:00 p.m.
Lee Memorial Hospital Boardroom
AGENDA
1. CALL TO ORDER (Marilyn Stout, Finance Chairman/Board Treasurer) The meeting of the Finance Committee of the Whole of the Lee Memorial Health System Board of Directors will be called to order. Matters concerning the business of Lee Memorial Health System consisting of Gulf Coast Medical Center & Lee Memorial Hospital/HealthPark Medical Center and its subsidiaries (HealthPark Care Center, Inc., Lee Memorial Home Health, Inc., Cape Memorial Hospital, Inc. doing business as Cape Coral Hospital, and Lee Memorial Medical Management, Inc.) may be reported, discussed and recommended by the Committee of the Whole, then referred to the full Board of Directors for final action.
2. PUBLIC INPUT: Any public input pertaining to items on the Agenda is limited to three minutes
and a “Request to Address the Board of Directors” card must be completed and submitted to the Board Assistant prior to meeting.
3. Consent Agenda (Approval)
A. Sept 10, 2009 Finance Committee of the Whole Meeting Minutes
B. Outpatient Lab Draw Station in Bonita Community Health Center (BCHC)
and Master Lease Agreement between LMHS and BCHC
4. SEI Quarterly Investment Performance Report (Acceptance) (Peter Glennon, Director/Relationship Management/SEI Investments – 40 min)
5. Stryker Surgical Equipment Operating Lease (Approval) (Mike German, Vice President/Financial Services and Denise Adema, System Director/Surgery Business Operations - 25 min)
6. Financial Reporting (Acceptance) (Mike German, Vice President/Financial Services – 25 min)
A. Fiscal Year Ending 9/30/09 Financial & Statistical Reports B. Quarterly Capital Report Ending 9/30/09 (FY 2009) C. October 31, 2009 (FY 2010) Financial & Statistical Reports
7. Comparison of Acquisition - Projected vs Actual (Update) (John Wiest, Chief Financial & Institutional Officer - 10 min) 8. Potential Refinancing of Bonds (Verbal Update) (John Wiest, Chief Financial & Institutional Officer - 15 min) 9. Other Items
10. Date of the next REGULAR FINANCE Committee of the Whole:
Thursday, January 21, 2010, 1:00 p.m. Lee Memorial Hospital Boardroom, 2776 Cleveland Ave, Fort Myers 33901
11. ADJOURNMENT of FINANCE COMMITTEE
V:\Presentations\2009\Finance\111909
___________________ L E E M E M O R I A L HEALTH SYSTEM
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PUBLIC INPUT – AGENDA ITEMS:
Any public input
pertaining to items on the Agenda is limited to three
minutes and a “Request to Address the Board of Directors”
card must be completed and submitted to the Board Assistant
prior to meeting.
Refer to Board Policy: 10:15E: Public Addressing the Board Non-Agenda Item: Individuals wishing to address the Board on an item NOT on the Agenda, the Board office must be notified of subject matter at least seven (7) days prior to the meeting to allow staff time to prepare and to insure the matter is within the jurisdiction of the Board.
Finance Committee of the Whole
November 19, 2009
3. Consent Agenda: (Approval)
A. September 10, 2009 Finance Committee Meeting Minutes
B. Outpatient Lab Draw Station in
Bonita Community Health Center (BCHC) and Master Lease Agreement between LMHS and BCHC
LEE MEMORIAL HEALTH SYSTEM BOARD OF DIRECTORS FINANCE COMMITTEE OF THE WHOLE MEETING MINUTES
Thursday, September 10, 2009
LOCATION: Lee Memorial Hospital Boardroom, 2776 Cleveland Avenue, Fort Myers, FL 33901 MEMBERS PRESENT: Marilyn Stout, Finance Chairman/Board Treasurer; Richard Akin, Board Chairman; Nancy McGovern, RN, MSM, Board Vice Chairman; Linda Brown, MSN, ARNP, Board Secretary; Lois Barrett, MBA, Director; Steve Brown, M.D., Director (via teleconference); Frank La Rosa, Director; Dawson McDaniel, Director MEMBERS ABSENT: James Green, Director; Joe Catti, Community Representative/Finance Committee; Ken Marcum, Community Representative/Finance Committee; Gene Principi, Community Representative/Finance Committee OTHERS PRESENT: James Nathan, President/CEO; Cathy Stephens, Board of Directors’ Liaison; Jim Humphrey, Board Counsel; Teri Isacson, System Counsel; John Wiest, Chief Financial and Institutional Services Officer; Larry Antonucci, M.D., Chief Operating Officer; CB Rebsamen, M.D., Chief Medical Officer/Ambulatory and Strategic Services; Jon Cecil, Chief Human Resources Officer; Gaile Anthony, Chief Administrative Officer/LMH; Sharon MacDonald, Chief Foundation Officer/Vice President/Oncology Services; Mike German, Vice President/Financial Services; Alison Thurau, System Director/Human Resources/Compensation and Benefits; Kevin Newingham, System Director/Planning and Strategy; Suzanne Bradach, System Director/Special Projects; Dave Cato, System Director/Outpatient Services; Karen Krieger, System Director/Public Affairs; Denise Adema, System Director/Surgery Business Operations; Marliese Mooney, Physician Leadership Council Consultant/Planning Committee; Bob Simpson, President/LeeSar; Gayle Reynolds, Chief Financial Officer/LeeSar; Bob Frieburger, Guest; Bob Johns, Guest; Beth Kilgore, Executive Secretary/Board of Directors
NOTE: Documents referred to in these minutes are on file by reference to this meeting date in the Office of the Board of Directors and on the Board of Directors website at www.leememorial.org/boardofdirectors, for public inspection.
SUBJECT DISCUSSION ACTION FOLLOW-UP MEETING
CALLED TO ORDER Marilyn Stout announced Steve Brown is attending the meeting today via telephone conference.
The FINANCE COMMITTEE OF THE WHOLE meeting was CALLED TO ORDER at 1:02pm
by Marilyn Stout, Finance Chairman/Board Treasurer.
The Board sits as the Lee Memorial Health System Board of Directors of Gulf Coast Medical Center, Lee Memorial Hospital, HealthPark
Medical Center and the Board of Directors of its subsidiary corporations: Cape Memorial Hospital, Inc. doing business as Cape
Coral Hospital; Lee Memorial Medical Management, Inc.; Lee Memorial Home Health, Inc.; and HealthPark Care Center, Inc.
PUBLIC INPUT There was no ‘Public Input’.
CONSENT AGENDA
Marilyn Stout asked if anyone wished to pull any of the items listed on the Consent Agenda for discussion:
A. August 20, 2009 Finance Committee of the Whole Meeting Minutes B. FYTD 2009 July Strategic Scorecard (Exhibit 1)
A motion was made by Dawson McDaniel to approve the Consent Agenda:
A. August 20, 2009 Finance Committee Meeting Minutes B. FYTD 2009 July Strategic Scorecard (Exhibit 1)
The motion was seconded by Lois Barrett and it carried with no opposition.
LEESAR
HEALTHTRUST PARTNERS LLC
MERGE TO LEESAR, INC
John Wiest said during the August Finance Committee meeting he provided a brief update on LeeSar, Inc. receiving the 501C3 designation from the Internal Revenue Service (IRS). John reviewed information included in the request to merge LeeSar Healthtrust Partners LLC into LeeSar, Inc. and said the result of this merger will be an operational and tax savings.
A motion was made by Nancy McGovern to approve merging LeeSar Healthtrust Partners LLC into LeeSar, Inc. (LeeSar Inc. has received a 501(C)(3) (tax free) designation from the Internal Revenue Service.) The motion was seconded by Dawson McDaniel and it carried with no opposition.
BONITA COMMUNITY
HEALTH CENTER OPERATIONS
REPORT
Suzanne Bradach introduced herself and said she is currently serving as the interim CEO for the Bonita Community Health Center (BCHC). She said there are many new initiatives underway in effort to develop BCHC into a long term viable entity. She reviewed the Bonita Community Health Center (BCHC) Operations Report (Exhibit 3) and said this report provides a short term view of where they hope BCHC will be in the next six to twelve months. Linda Brown asked if a birthing center is feasible for the Bonita area in attempt to attract patients from Collier county. Suzanne said there is no space available in the BCHC for this type of service. CB Rebsamen said with regard to the birthing center, they have researched several options for a birthing center in Lee County and have
(Richard Akin left the meeting at 2:00pm)
LEE MEMORIAL HEALTH SYSTEM BOARD OF DIRECTORS FINANCE COMMITTEE OF THE WHOLE MEETING MINUTES Thursday, September 10, 2009 Page 2 of 3
SUBJECT DISCUSSION ACTION FOLLOW-UP determined this type of service is not possible, due to licensing and patient safety issues. CB said although we are currently working toward providing enhanced women’s services at this facility. Jim Nathan said we are continuously exploring the possibilities of providing services that will fit market and community needs.
A motion was made by Linda Brown to accept the Bonita Community Health Center Operations Report (Exhibit 3). The motion was seconded by Nancy McGovern and it carried with no opposition.
SANCTUARY
AMBULATORY SURGERY CENTER
DESIGN-BUILD CONTRACT
Dave Cato provided a historical update on the development of the Ambulatory Surgery Center at The Sanctuary, which included the merger with HCA, partnering with the Regional Cancer Center, and efforts to increase market share. He said the Ambulatory Surgery Center will provide better coordinated care between services for patients. Dave reviewed highlights of information included in The Sanctuary Ambulatory Surgery Center Design-Build Contract request (Exhibit 4). He said they are also currently working toward obtaining additional funding to furnish the surgery center with furniture and IT equipment. He said the request to approve this contract is time sensitive as they hope to start construction by October 2009 in order to maintain AHCA approval. Sharon MacDonald said the surgery center is such an intricate part of providing a collaborative continuum of care for patients. She said treating the whole patient in one facility will also be a critical factor in the future growth and success of other programs in the System. Discussion ensued with regard to the following
• Possibility of hiring employed, specialty physicians for the specialized services at The Sanctuary
• Establishing The Sanctuary as a destination for women’s services, treating the whole patient in one location
• Additional funding for IT equipment and furniture in budget • Consolidating services and gaining new business
Jim Humphrey said the contract being presented today is still in draft form until final counsel review and Board approval. Jim suggested the Board to approve the contract today based on final review from Board Counsel prior to final approval of the Board later this month.
A motion was made by Linda Brown to approve entering into a contract with ERDMAN Company d/b/a Erdman Healthcare Facilities Company in the State of Florida in the amount of $3,790,253 to complete the construction of the Ambulatory Surgery Center Suite located at the Sanctuary Outpatient Center (Exhibit 4). This Design-Build Contract is contingent upon final LMHS counsel and outside construction review. The motion was seconded by Frank La Rosa and it carried with no opposition.
ORTHOPEDIC &
NEUROSURGICAL IMPLANTS
Denise Adema introduced herself and said System leaders and administration have made great strides in developing a solid relationship with our orthopedic surgeons and both groups are actively engaged in all matters of orthopedic care for our patients. Denise Adema reviewed the Orthopedic & Neurosurgical Implant presentation (Exhibit 5).
EMPLOYEE
APPRECIATION AND RECOGNITION
PAYMENT
Jon Cecil provided a historical background on employee pay increases based on annual job performance for non-management employees for FY2009. He said the Board also approved an additional 1.5% increase for non-management employees to be provided in January 2009 (based on job performance) if financially possible. He said based on the current economic conditions, the 1.5% increase is not possible at this time. Jon Cecil reviewed the request for Board approval of the Employee Appreciation and Recognition Payment (Exhibit 6). Discussion ensued with regard to employee options to place tax free money in a flexible spending account.
A motion was made by Linda Brown to approve a one-time FY 2009 Employee Appreciation & Recognition Program (as presented) (Exhibit 6) awarding $500 for full time employees and $250 for part time & PRN/Temporary employees (working at least 768 hrs during this period) to non-management employees hired on or before April 1, 2009. In addition, employees will be offered an option to deposit their payment into a new pre-tax Flexible Spending Account for healthcare and dependent care (child & senior). Note: Payment will be effective pay period 9/13 to 9/26/09 and received in 10/1/09 paycheck. The motion was seconded by Nancy McGovern and it carried with no opposition.
INVESTMENTS
REVIEW John Wiest provided a verbal update on the current investment reviews taking place. He said he has informed an investment committee comprised of community members and System staff to discuss with SEI various investments options for
LEE MEMORIAL HEALTH SYSTEM BOARD OF DIRECTORS FINANCE COMMITTEE OF THE WHOLE MEETING MINUTES Thursday, September 10, 2009 Page 3 of 3
SUBJECT DISCUSSION ACTION FOLLOW-UP planning and future recommendations. Discussion ensued with regard to the following:
• Continuing on the current asset allocation • Options for higher return in the short term and long term plans • Availability of liquid cash funds
FINANCIAL & STATISTICAL
REPORTS FOR
AUGUST 31, 2009
Mike German reviewed the Financial and Statistical Reports for August 31, 2009 (Exhibits 7-8). Marilyn Stout asked how the System has financially prepared for the upcoming flu season. John Wiest said it is next to impossible to accurately project volumes especially with variables such as outmigration of residents and the Swine Flu. He said they have projected to ensure appropriate staffing to avoid supply shortage. Discussion ensued with regard to preparing the System for the upcoming flu season.
A motion was made by Linda Brown to accept the Financial and Statistical Reports for August 31, 2009 (Exhibit 7). The motion was seconded by Nancy McGovern and it carried with no opposition.
OTHER ITEMS
Thank you from Frank
Jeannette Bevilacqua Cancer Patient
Frank La Rosa expressed his overwhelming appreciation for the kindness shown to him and his wife Bonnie after the passing of his mother in law. He said he is so thankful for all the kind words and support during this difficult time.
Linda Brown provided an update on Jeannette Bevilacqua, the breast cancer patient who shared her story with the Board regarding her experiences at the September 3rd Planning Committee Meeting. Linda said Jeannette will continue through various cancer surgeries and treatment. Nancy McGovern requested get well flowers be sent on behalf of the Board in appreciation of her sharing her story.
NEXT REGULAR
MEETING The date of the next *REGULAR Finance Committee of the Whole meeting is Thursday, November 19, 2009, 1:00 p.m. in the Lee Memorial Hospital Boardroom. *REMINDER – No Finance Committee meeting in October.
ADJOURNMENT The Finance Committee of the Whole meeting was
ADJOURNED at 2:51pm by Marilyn Stout, Finance Chairman/Board Treasurer.
Minutes were recorded by Beth Kilgore, Executive Secretary/Board of Directors Office
_________________________________________________
Linda Brown, MSN, ARNP Board Secretary
______________
L E E M E M O R I A L HEALTH SYSTEM BBBOOOAAARRRDDD OOOFFF DDDIIIRRREEECCCTTTOOORRRSSS
RECOMMENDED ACTION FOR BOARD APPROVAL (Action includes Acceptance, Approval, Adoption, etc)
Keep form to one page, SUBMIT (thru SLC Member) ELECTRONICALLY to L Drive – Miscellaneous - BOD Presentations by Noon the Friday before you’re scheduled on agenda.
DATE: November 19, 2009 LEGAL SERVICE REVIEW? YES_x NO__
SUBJECT: 1) Lease Approval for LMHS Outpatient Lab Draw Station in Bonita Community Health Center (BCHC) and 2) Approval of overall Master Lease agreement between LMHS and BCHC
REQUESTOR & TITLE: David Cato, System Director of Outpatient Services and Suzanne Bradach, CEO Bonita Community Health Center
PREVIOUS BOARD ACTION ON THIS ITEM (IF ANY) (justification and/or background for recommendations – internal groups which support the recommendation i.e. SLC, Operating Councils, PMTs, etc.)
On June 11th, 2009 the Board of Directors approved the tactic to put a LMHS OP lab draw station in Bonita Community Health Center. On August 20th, 2009 the OP Lab Draw station tactic was approved as a part of the FY 2010 LMHS Capital Budget.
SPECIFIC PROPOSED MOTION: Board approval to enter into a Master Lease agreement with Bonita Community Health Center to include a LMHS OP Lab Draw Station. The Master Lease also will include the existing Bonita Primary Care, Bonita GYN, and Dr. Goldsmith practices as outlined in the Schedule A of the attached Master Lease. The terms of this lease are contingent upon final LMHS council and board council review.
PROS TO RECOMMENDATION
Aligns with our strategy to expand OP services in the Bonita/Estero market and to strengthen the clinical services and financial performance of Bonita Community Health Center.
CONS TO RECOMMENDATION
None.
LIST AND EXPLAIN ALTERNATIVES CONSIDERED N/A
FINANCIAL IMPLICATIONS Budgeted _X__ Non-Budgeted ____ (including cash flow statement, projected cash flow, balance sheet and income statement)
The OP lab is an approved FY 2010 tactic and the Capital/Operating dollars are approved in the FY 2010 LMHS budget. The other Lee entities have budgeted operational dollars for their perspective leases.
OPERATIONAL IMPLICATIONS (including FTEs, facility needs, etc.)
We will be hiring 2 FTE’s to operate the lab draw station. Minimal facility, equipment, and IT needs are all budgeted in the approved tactic
SUMMARY LMHS has been operating under a Master Lease arrangement at BCHC for the past several years. The Master Lease covers the 3 existing LMHS entities (Bonita Primary Care, Bonita GYN, and Dr. Goldsmith). The lease terms for these existing entities were approved by the Board of Directors but the concept of using a Master Lease to allow LMHS to handle these various lease arrangements in one agreement does not appear to have been brought before the Board. As a consequence we are asking the Board to approve the Master Lease arrangement. We are also asking the Board to approve adding the Lee OP Lab agreement to the Master Lease. The move of the Lee OP Lab services to BCHC was an approved tactic and the Board is being asked to approve the terms of the lease arrangement.
BOD/Forms/Board (Action) Reporting Form - revised 6/16/08 cs
BONITA COMMUNITY HEALTH CENTER, INC.
MASTER LEASE AGREEMENT
This Master Lease is made this 1st day of December 2009 by and between
Bonita Community Health Center, Inc. a non-profit corporation under the laws of
the State of Florida, as Landlord, and Lee Memorial Health Systems(LMHS), as
Tenant.
WITNESSETH:
In consideration of the mutual covenants contained herein, Landlord hereby
leases to Tenant and Tenant hereby leases from Landlord certain property in Lee
County, Florida, more particularly described in paragraph 1 below, upon the
following terms and conditions:
1. PREMISES. Landlord has constructed a medical office complex
known as Bonita Community Health Center (the “Building”) located at
3501 Health Center Blvd., Bonita Springs, Florida (the “Property”). The
property leased by Landlord to Tenant (the “Premises”) is stated on
Schedule A of this lease agreement and subject to change by mutual
agreement of the parties.
2. INTERIOR IMPROVEMENTS. Any additional interior improvements
of the Premises desired by Tenant shall be provided at Tenant’s
1
expense. All leasehold improvements must be approved in writing by
Landlord, and such approval will not be unreasonably withheld.
3. TERM. Schedule A states the lease terms. Tenant may elect to
renew this Master Lease as agreed upon by both Landlord and Tenant.
4. RENT. Tenant shall pay to Landlord, without demand, setoff, or
deduction, an annual rent including common area maintenance
charges (“CAM”) as described below in Section 5. for each Lease
Year. The Annual Rent is stated on Schedule A. Beginning the
second lease year and each year thereafter, the Rent shall be adjusted
on the basis of any increase in the Consumer Price Index between the
most recently available monthly index figure (Adjustment Level) and
the monthly index figure for the same month in the Base Year (Base
Level). For the second lease year and each year thereafter, the rent
shall be computed by multiplying Base Year Rent by a fraction, the
numerator of which shall be the Adjustment Level, and the
denominator of which shall be the Base Level. As used herein, the
“Consumer Price Index” shall mean the Consumer Price Index for All
Urban Consumers, U.S. City Average: All Items (1982-84 = 100)
published by the Bureau of Labor Statistics of the Department of
Labor.
2
5. ADDITIONAL RENT. Tenant shall pay to Landlord for each year, in
addition to the rent set forth in paragraph 4, Tenant’s share for CAM.
The annual additional rent for CAM shall be stated on Schedule A per
square foot for the first lease year. Additional rent shall be paid at the
same time the rent is paid to the Landlord per Paragraph 4. During the
second year and each year thereafter, the Tenant shall pay its
calculated proportionate share of the CAM. Tenant’s proportionate
share shall be based on the gross leasable area of Tenant’s premises
compared to the gross leasable area of the Building. The CAM
charges as stated above are an estimate of the actual charges that will
be incurred by Landlord. Landlord shall provide an accounting on an
annual basis that shows the actual CAM charges. Should the actual
CAM charges be more than what Tenant has actually paid, then
Tenant will pay Landlord the difference between what Tenant actually
owed and what Tenant actually paid within thirty days of the date that
Tenant receives the accounting. Should the actual CAM charges be
less that what the Tenant actually paid, then Landlord shall reimburse
Tenant the difference between what Tenant paid and what Tenant
actually owed. Such reimbursement shall occur within thirty days of
the date that the accounting is provided to Tenant.
The Common Area Maintenance expenses shall include a) the total
costs and expenses incurred by Landlord in operating, maintaining,
and repairing the common areas, the Building, and such interior
3
portions of the Building as are uniformly maintained by Landlord
pursuant to tenant leases or otherwise, including without limitation, the
cost and expense of cleaning, painting, decorating, repaving, lighting,
landscaping, gardening, and planting, mowing and trimming, parking
services, pest control, janitorial and housekeeping services, fire
protection, security devices and personnel, and maintaining, repairing
or replacing any portion of the Building or any equipment or systems
serving any portion of the Building; b) the costs of removal of trash,
garbage, and other wastes; c) the costs of all property, casualty,
liability and other insurance carried by Landlord covering the Building
and common areas, all in limits selected by Landlord; d) the cost of all
taxes and special assessments assessed against the Property and
improvements thereon, including but not limited to real estate taxes
and non ad valorem taxes; e) the cost of operation of loudspeakers
and any other equipment supplying music to the common areas; f) the
cost of operation of public toilets and installing and renting of signs, g)
costs and expenses in connection with maintaining the Building and
common areas in good condition and in compliance with governmental
regulations, including the costs of materials, supplies, and services
therefore; h) the costs of maintenance, repair, and replacement of
utility and sewerage lines, equipment, and systems serving the
Building or common areas as well as the costs of providing electric,
water, sewer, and other utilities to the Tenants, their Premises, and to
4
the common areas, i) management, administrative, legal and
personnel costs incurred in connection with the foregoing, j) the cost of
all applicable payroll taxes, workers’ and unemployment
compensation, employee benefits, and insurance incurred in
connection with the foregoing.
6. USE. Tenant shall use the Premises exclusively as an office for the
providing of health care services. Such services shall be provided
exclusively by Qualified Individuals (as hereinafter defined) or by
employees or other health care professionals working under the direct
supervision of a Qualified Individual. As used herein, a “Qualified
Individual” shall mean an individual who has clinical privileges at Lee
Memorial Hospital or Naples Community Hospital or their affiliates (the
“Hospital”) or who is a member of the medical staff of either Hospital or
their affiliates. A Tenant who is not on the staff of either system and
who wishes to lease space may qualify to lease if Tenant makes
arrangements through a written transfer agreement with a physician for
admitting patients to a hospital should it become necessary. In no
event may employees or health care professionals working under the
direct supervision of a Qualified Individual provide or assist in the
providing of health care services on the Premises unless the Qualified
Individual uses the Premises for the providing of personal professional
medical services in direct patient care. Nothing contained herein shall
5
be construed to prohibit Tenant from owning or operating additional
medical offices in other locations. Tenant shall comply with all
applicable laws, ordinances, rules and regulations, including
reasonable rules and regulations of Landlord and any insurance
company insuring the Premises or the Building, and shall not use the
Premises or the Building for any unlawful purpose.
7. COMMON AREAS. As used herein, “Common Areas” shall mean all
parking areas, sidewalks, drives, walkways, malls, loading platforms,
ramps, drainage facilities, landscaped areas, restrooms, corridors,
elevators, lighting, lobbies, and other areas or facilities available for the
common use of benefit of tenants of the Building. Tenant shall have
the use of the Common Areas, but the Common Areas shall be subject
to the control and management of Landlord, including the
establishment of reasonable rules with respect to their use. Adequate
parking facilities will be provided for Tenant and those employees,
agents, invitees, and licensees of Tenant performing, receiving, or
transacting health care services or business on the Premises. Tenant
shall promptly furnish to the Landlord, upon request, license numbers
assigned to the vehicles of all its employees and further agrees to
comply with any tag, sticker, or decal parking system which may be
implemented by the Landlord.
6
8. MAINTENANCE/SECURITY REQUEST. Tenant shall maintain all of
Tenant’s furnishings and equipment on the Premises in a clean and
sightly condition and in good and substantial repair. Landlord shall
maintain the Building, Common Areas, Premises, and all
improvements installed by Landlord on the Premises in a clean and
sightly condition and in good and substantial repair; provided, however,
that Tenant shall be liable for all repairs which arise out of the
negligence or fault of Tenant, its employees, agents, invitees, or
licensees, and further provided that the cost of replacing any upgraded
or additional interior improvements provided by the Landlord at
Tenant’s request and expense pursuant to Paragraph 2 above shall be
paid by Tenant. Upon execution of this Lease, Tenant shall deposit
with Landlord the sum of One Thousand Dollars ($1000). If Tenant
defaults with respect to any provision of this Lease, Landlord may
retain all or a portion of this security deposit for repairing damage or
any other sum in default or to compensate Landlord for loss or damage
by reason of Tenant’s default.
9. SURRENDER OF PREMISES. Upon expiration of the Lease term,
Tenant shall surrender the Premises, together with all alterations and
improvements, to Landlord in a good and clean condition. If not then in
default, Tenant may remove any non-attached personal property or
trade fixtures installed by Tenant, provided Tenant repairs any damage
7
caused by such removal. All installments, improvements, alterations,
and remaining fixtures or equipment shall remain a part of the
Premises as the property of the Landlord.
10. QUIET ENJOYMENT. Landlord covenants that so long as Tenant
performs its obligations hereunder, Tenant shall have the right to
quietly enjoy and use the Premises for the term of the Lease, subject
only to the provisions thereof; governmental regulations, and
restrictions, reservations, and easements of record.
11. SIGNAGE. Landlord shall provide signage at the Tenant’s office.
Tenant shall not place or allow lettering, advertising, or signage on any
exterior or Common Area door, wall, window, or other portion of the
Premises or Building without first obtaining Landlord’s prior written
consent. If such consent is given, Tenant shall maintain such signage
or related matter in good condition and repair and remove the same at
the end of the term of this Lease if requested by Landlord. Upon
removal thereof, Tenant agrees to repair any damage caused by such
removal.
12. SUBORDINATION. Tenant’s rights under this Lease shall be
subordinate to all mortgages or security instruments now or hereafter
encumbering the property or any part thereof, including any renewals,
8
modifications, consolidations, replacements, and extensions thereof.
Tenant shall execute any subordination agreement or other
instruments deemed necessary by Landlord to further effect the
subordination of the Lease. Notwithstanding such subordination, as
long as tenant is not in default, Tenant’s right to peaceful occupation
and possession of the Premises will not be disturbed during the Lease
term.
13. TAXES. Landlord shall pay all ad valorem taxes or assessments
levied or assessed against the Property before they become
delinquent. Tenant shall pay any sales tax on the rental installments
(including Base Rent, Common Area Maintenance and Laboratory
Equipment) due hereunder, which sales tax shall be paid to Landlord
along with each such installment. Tenant shall also pay all taxes and
assessments levied against Tenant’s personal property or equipment
on the Premises.
14. RIGHT TO CONVEY. Should Landlord sell or convey the title to the
Property or any portion thereof, this Lease shall remain in full force and
effect. In the event of a proposed sale, Tenant shall execute an
estoppel certificate or such other documentation as may be reasonably
required by Landlord. In the event of assignment of this Lease by
9
Landlord in conjunction with Landlord’s sale or conveyance of the
Property, Landlord shall thereafter be relieved of all obligations or
liability arising under this Lease.
15. ADDITIONAL CONSTRUCTION. Landlord reserves the right to make
alterations or additions to the Building and to construct other
improvements adjacent to the Building. In the event of such
construction, Landlord shall maintain reasonable access to the
Premises for Tenant and Tenant’s employees, agents, invitees, and
licensees.
16. RADON. Florida law requires that the following notice be given:
“RADON GAS: Radon is a naturally occurring radioactive gas that,
when it has accumulated in a building insufficient quantities, may
present health risks to persons who are exposed to it over time.
Levels of radon that exceed federal and state guidelines have been
found in buildings in Florida. Additional information regarding radon
and radon testing may be obtained from your county public health
unit.”
17. NOTICES. All notices and payments to be made to Landlord under
the terms of this Lease shall be delivered to Landlord at 3501 Health
Center Blvd., Bonita Springs, FL 34135, or to such other address as
10
Landlord may direct. All notices to Tenant shall be delivered to the
Premises or to such other address as Tenant my direct. All notices
shall be in writing, shall be either hand delivered or mailed by U.S.
certified or registered mail, return receipt requested with postage
prepaid, and shall be effective upon hand delivery or mailing.
18. HEALTH CARE PROVISIONS.
A. Avoidance of Violations. Notwithstanding any provision of the
Lease, the parties shall not violate any applicable laws, rules, or
regulations, including those relating to Medicare, Medicaid, similar
Florida programs, or the provision of health care or medical services.
The parties shall modify this Lease to the Extent necessary to comply
with such laws, rules and regulations.
B. Fair Market Value Remuneration: Anti-kickback. Any
remuneration exchanged between the parties shall at all times be
commercially reasonable and represent fair market value for rendered
services or purchased items. Notwithstanding any provision of this
Agreement, no remuneration exchanged between the parties shall be
determined in a manner that takes into account (directly or indirectly)
the volume or value of any referrals or any other business generated
between the parties.
11
C. Lease Safe Harbor. It is the intent of the parties that this
Lease comply with the safe harbor requirements contained in 42 CFR
sections 1001.952 and 411.357. Consequently, (I) this Lease is in
writing, specifies the premises covered, and represents the entire
agreement between the parties, (ii) if this Lease allows access/use for
only periodic intervals rather than on a full-time basis, it specifies the
schedule with the precise length and rent for such intervals, (iii) the
amount leased does not exceed what is necessary for Tenant’s
legitimate business purposes and is used exclusively by Tenant during
the specified time periods, (iv) the term of this Lease is for at least 1
year, and (v) the rent hereunder is set in advance, is commercially
reasonable and consistent with the fair market value, and is not based
on the volume of value or referrals or business generated between the
parties.
D. Referrals. Nothing contained herein requires the referral of any
patient between the parties. Each party retains the right, in its sole
discretion, to refer patients to any person or entity deemed appropriate
for their care and treatment.
12
IN WITNESS WHEREOF, the parties have executed this Lease as of the day and year first above written. Signed sealed and delivered BONITA COMMUNITY HEALTH CENTER, INC. In the presence of: _______________________ By: _________________________________
LANDLORD _______________________ As to Landlord
The foregoing instrument was acknowledged before me by Michael Riley as Chief Executive Officer of Bonita Community Health Center, Inc., a Florida corporation, on behalf of the corporation and is personally known to me or has produced __________________as identification. SWORN AND SUBSCRIBED TO BEFORE ME, THIS _____ DAY OF _________________, 2009. __________________________ NOTARY PUBLIC My Commission Expires: __________________________ Printed Name Signed sealed and delivered __________________________ In the presence of: ________________________ ____________________________________
TENANT ________________________ As To Tenant The foregoing instrument was acknowledged before me by, ________________ and is personally known to me or has produced ________________as identification. SWORN AND SUBSCRIBED TO BEFORE ME, THIS _____ DAY OF _________________, 2009. __________________________ NOTARY PUBLIC My Commission Expires: __________________________ Printed Name
13
Total Commence End Annual $Suite # Leassee Sq. ft. Monthly $ Date Date Months Base CAM Sq. Ft.
2145 Dr.Goldsmith 1840 450.00 3/1/2008 Monthly 1 2.932140 Lee Lab Services 2164 4,328.00 12/1/2009 11/30/2012 36 16.00 8.00 24.002220 Bonita GYN 2895 7,213.38 2/1/2007 1/31/2010 36 21.90 8.00 29.902310 Bonita Primary 4540 9,401.58 9/1/2009 8/31/2012 36 16.85 8.00 24.85
Totals 16,370 33,144.99$ 24.30
14
3rd Calendar Quarter Investment Portfolio Review
Peter Glennon, Terry Gerlich, Chris LaMarca, Keith Pivik
November 19, 2009
2
Agenda
• Executive Summary
• Capital Market Review
• LMHS Investment Portfolio Review–
Debt Covenant Requirement Pool
• Strategy Review–
SEI Opportunity Fund–
International Equity
3
3rd
Quarter SummarySummary:
Overall the LMHS Portfolio earned 6.0% for Q3 and -5.7% for Fiscal Year ending 9/30/09The blended benchmark returned 6.0% for Q3 and -6.5% for Fiscal Year ending 9/30/09The return oriented allocation (equity/fixed income/alternatives) returned 6.9% vs. a benchmark of 6.5%Ending Market Value was $413,943,081 : reflecting a $22,867,282 investment gainThe “Debt Covenant Requirement Pool” reached $201,688,7136 of 9 SEI strategies beat their respective benchmarkThe portfolio’s recovery continues from depressed price levels, high risk / low quality delivered the best performance, diversification was key to success in capturing multiple sources of return
Equities:Global stock markets are up ~65% from trough (March 9th) and S&P 500 Index is up 19.3% YTD through 9/30/09Economically sensitive areas experienced greatest rebound (finance / technology / materials / consumer discretionary)
Fixed Income:Credit markets continue to improve as liquidity returnsDistressed Debt, Emerging Markets Debt and High Yield best performersUS Treasury’s PPIP (Public Private Investment Program) commences and should positively impact the fixed income market
4
•
GDP growth returns in 3Q on the back of massive monetary and fiscal stimulus
•
Markets and valuations have significantly improved one year after Lehman’s collapse
•
Huge risk rally since early March
•
Bond markets retrace one year losses
•
Equity markets still down on a one year basis
•
Low quality and high beta powers the rally•
Markets entering more uncertain times
Source: FactSet
Global Market Review: Rebound Continues
*Large Cap = Russell 1000, Small Cap = Russell 2000, Real Estate
= DJ Wilshire RESI Index, Developed International Equity Markets = MSCI EAFE, Emerging Markets Equity = MSCI EME, US Investment Grade Bonds = Barclay’s Capital US Aggregate, High Yield = Merrill Lynch Master II HY Constrained, Emerging Markets Debt = JP Morgan EMBIGD, Treasury = Treasury
component of the Barclay’s US Aggregate
Source: Ned Davis Research, LehmanLive.
5
Market Rebound Dominated by Low Quality and High Beta
Credit Markets
•
Recent active management success was determined by risk exposures; future success will be determined by security selection
•
High risk exposures delivered larger than expected excess performance•
Many managers underweight to high beta diversified financials industry
Performance by security beta* (R3000)
Equity MarketsPerformance by credit quality*
•Beta based on 3 Year Historical Beta •CCC-BB returns compiled from the Merrill Lynch Master II HY Constrained Index. BBB-Treasuries returns compiled from the Barclay’s Capital US Aggregate Index.
6
Asset Allocation & Performance Summary as of 9/30/09
*Inception date 9/30/07
Asset Allocation Target Allocation Actual Allocation ValueCash & Equivalents 7% 21% $ 86,255,601Fixed Income 46% 39% $ 157,806,483US Equity 16% 15% $ 60,640,813International Equity 6% 6% $ 23,645,259Hedge Funds 22% 18% $ 73,496,370Real Estate 3% 3% $ 12,098,554
TOTAL 100% 100% $ 413,943,081
Cash21%
Real Return13%
Enhanced Libor10%
Core Fixed Income13%
Ultra Short2%
REIT Fund3%
Hedge18%
ACWI6%
Ridgeworth4%
Small-Mid Cap2%
Disciplined Equity8%
1 Month 3 Month FYTD 1 Year ITD*Total Portfolio Returns 1.70% 6.0% -5.7% --5.7% -7.8%
7
Performance Summary By Fund
Strategy Q3 SEI Q3 Benchmark
Cash
Treasury II Fund* 0.05 0.07
Compass Bank* 0.07 0.07
Fixed Income
Core Fixed Income* 6.6 3.7
Ultra Short Bond* 4.8 0.3
Real Return* 2.2 2.3
Enhanced Income 5.9 0.2
Domestic Equity
Ridgeworth
LC Growth 13.5 14.0
Large Cap Disciplined Equity 15.6 15.6
Small/Mid Cap Equity 21.0 20.1
International Equity
World Equity ex US 18.7 19.7
Alternatives
SEI Opportunity Fund 2.4 0.1
REIT 31.4 35.9
*reflects strategies included in “Debt Covenant Requirement Pool”
8
SEI’s representative investment strategies•
US Large Cap Disciplined Equity StrategyMFS Investment Management –
Blended ResearchAnalytic Investors –
Dynamic PositioningINTECH –
Volatility CaptureQuantitative Mgt Associates –
Bias ExploitationDeclaration Management & Research –
Enhanced CashHyperion Brookfield Asset Management -
Enhanced Cash
•
US Small/Mid Cap Equity StrategyBlackRock
Advisors, Inc. –
Business Momentum Integrity Asset Management -
Opportunistic Value
Janus Capital Management –
Quality Growth LA Capital Mgmt -
Factor Rotation
Lee Munder
Capital Group –
Earnings GrowthLee Munder
Capital Group –
Relative ValueLSV Asset Management* –
Contrarian Value Martingale Asset Management, LP –
Disciplined CorePanAgora
Asset Mgt Company –
Factor CustomizationSecurity Capital –
REITWellington Management Company LLP –
GARPWells Capital, LLC –Growth
•
World Equity ex US StrategyAcadian Asset Management –
QuantitativeArtisan Partners -
EmergingAXA Rosenberg –
Systematic Intrinsic ValueDeclaration Mgt & Research–
Int’l Enhanced Cash Alpha TransportINTECH –
Volatility CaptureMcKinley Capital Management –
GrowthPrincipal Global –
Momentum GrowthQuantitative Mgt Associates –
Quantitative CoreRexiter
Capital Management –
ContrarianWellington Management Company LLP –
Value
•
Real Return StrategyDeutsche Asset Mgt
•
US Core Fixed Income StrategyING Investment ManagementWestern Asset Management –
Sector RotatorMetropolitan West Asset Management –
ValueWells Capital Management –
Strategic Value
•
High Yield Fixed Income Strategy Ares Management LLC-
Opportunistic
Brigade Capital Management, LLC –
Opportunistic
Delaware Investments –
Fundamental
Guggenheim Investment Management, LLC –
Relative Value
JP Morgan Asset Management –
Relative Value
•
Enhanced LIBOR Opportunities StrategyHighland Capital ManagementWellington Management Company –
Enhanced Cash
•
Real Estate StrategySecurity Capital Management –
REITWellington Management Company –
REIT
•
SEI Opportunity FundPlease refer to slide17 for manager listing
9
160 000
180,000
200,000
220,000
240,000
Debt Covenant Requirement Pool
September 30 November 5
Target Bands
Debt Covenenant Summary November 5, 2009
Treasury II Income 41% 90,467,147 Compass Bank 5% 12,019,592 Include Ultra Short 3% 7,211,657 Include Core Fixed Income 25% 55,168,040 Include Real Return 25% 54,368,211
- Total 100% 219,234,648
Target (Required Covenant) 200,000,000
Surplus/(Deficit) 19,234,648
Current Target Ratio 109.6%
Range Levels Maximum Target 110.0% 220,000,000 Deficit -0.4% (765,352)
Minimum Target 90.0% 180,000,000 Surplus 19.6% 39,234,648
Debt Covenenant Summary
Treasury II and Compass 43% 86,255,601 -
Include Ultra Short 4% 7,109,419 Include Core Fixed Income 27% 54,838,351 Include Real Return 27% 53,485,442
- Total 100% 201,688,813
Target (Required Covenant) 200,000,000
Surplus/(Deficit) 1,688,813
Current Target Ratio 100.8%
Range Levels Maximum Target 110.0% 220,000,000 Deficit -9.2% (18,311,187)
Minimum Target 90.0% 180,000,000 Surplus 10.8% 21,688,813
September 30, 2009
10
Debt Covenant Requirement Pool Credit Statistics as of 9/30/2009
Asset Value Pct Credit Quality Duration Current Yield Yield to Maturity Q3 2009 2009 Fiscal 2010 Fiscal
YTDCash 86,255,601 42.8% AAA 0.14 0.15 0.15 0.05 0.25 0.02Core Fixed 54,838,351 27.2% AA 4.2 4.7 8.8 6.6 13.36 1.53Real Return 53,485,442 26.5% AAA 2.8 2.2 2.2 2.17 2.9 1.49Ultra Short 7,109,419 3.5% AA 0.8 2.8 4.1 4.5 2.29 1.68
Total 201,688,813 AA+ 2.0 2.0 3.2 2.5 4.6 0.9
ScaleAAA 5.0AA 4.0A 3.0BBB 2.0BIG 1.0
Cash 2.1 AAACore Fixed 1.1 AA Real Return 1.3 AAAUltra Short 0.1 AA
Weighted Rating 4.7 AA+
AAA 69.3%AA 30.7%Total 100.0%
ReturnsBond Characteristics as of 9/30/2009Assets
Ultra Short, 3.5%
Real Return, 26.5%
Cash, 42.8%
Core Fixed, 27.2%
AA , 30.7%
AAA, 69.3%
11
Economy Turning Up But Headwinds Remain
•
GDP growth resumed in 3Q at estimated 3.1% rate
•
However, there is still a lot of leverage in the system
•
Fed’s stimulus is slowing and will begin to unwind•
Near term strength but sustainability of rebound will be issue in 2010
Household debt to income ratio
70% of GDP is consumer spending
12
Government Policy Interventions Beginning to Unwind
Program What it does When it Ends
Treasury purchases
●Federal Reserve purchases up to $300B in Treasury securities
●Injects money directly into economy and bypasses “impaired”
banking system
Oct 2009
MBS purchases ●Federal Reserve purchases up to $1.25 trillion dollars of Agency MBS
●Holds down mortgage rates and injects money into the economy
1Q 2010
Agency debt purchases
●Federal Reserve purchases up to $200B in Agency debt
●Injects money directly into economy and bypasses “impaired”
banking system
1Q 2010
First time home buyers credit
●$8,000 first time home buyer credit●Stimulate economic activity and help clear
inventory glutNov 2009
Cash for Clunkers
●$4000 rebate for trade in of old, inefficient vehicles●Stimulate economic activity Expired 3Q
13
Outlook
Forecast strong recent economic growth will be replaced by sluggish growth in 2010Deleveraging of the credit bubble may restrain economic growthUS Consumer debt still too high – Asian countries savings rate is still too high – need to find a balanceUnemployment rate is forecast to be 9.8%, 8.6% and 7.7% in 2010, 2011, and 2012, respectively.
Low quality, high risk rally to subsideEquity and credit markets still fundamentally attractiveMomentum strategies should be begin to workHigh quality attractively valuedAnticipate continued market volatility - alternative investment strategies advantaged
Uncertainty around future US Government deficits and policy initiatives Healthcare, taxes, fiscal spending, and legislation specifically regulating banks and derivatives
Fed needs to be particularly nimble to reverse monetary stimulus in a timely mannerMonetary policy initiatives coming to an end but high excess reserves and very low rates remainToo quick = possible double dip; too slow = inflationConfidence in the dollar necessary to preserve financial flexibility
14
** The performance presented is an asset weighted composite of the SEI Offshore Opportunity Fund, Ltd. and SEI Offshore Opportunity Fund II, Ltd. Performance prior to 1/1/08 is from SEI Offshore Opportunity Fund, Ltd. These vehicles are run pari-passu
and have slightly different performance due to the timing of cashflows
and rebalancing. Actual performance for investors will be presented in the monthly statements produced by the administrator. Returns are also actual periodic returns as opposed to “lagged one month”
returns as are shown in client performance reports.
Performance data quoted is past performance. Past performance is no guarantee of future results. The principal value and investment return of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original value. Current performance may be higher or lower. For performance data current to the most recent month end, please call 1-800-DIAL-SEI.
SEI Opportunity Fund:
Oct 2003 -
Sept 2009 Q3 2009 2008 2007 2006 2005 2004 STD
SEI Offshore Opportunity Fund Composite(Net)** 2.4 4.2 -20.4 8.1 9.3 4.0 6.8 5.3
S & P 500 15.6 19.2 -37.0 5.5 15.8 4.9 10.9 15.0
Barclays Aggregate 3.7 5.7 5.2 7.0 4.3 2.4 4.3 3.7
ML 3 Month T Bills 0.1 0.2 2.1 5.0 4.9 3.1 1.3 0.5
50% S&P 500 / 50% Barclays 9.6 12.4 -17.9 6.4 10.0 3.8 7.6 9.4
15
* Holdings are subject to change
Directional Non Directional Event Driven
SEI Opportunity Fund: Sub strategy allocations as of 9/30/09
** Calculations include estimated September numbers. Weights are for SEI Offshore Opportunity Fund II Ltd and do not include cash allocation
Event Driven, 19%Long/ Short Equit y, 26%
Convert ible Bond Hedging, 1%
Fixed Income Arbit rage, 9%Global Macro, 16%
Credit Hedging, 14%
Mult i-St rat egy, 14%
16
Manager allocations
17
During the 3rd Quarter, credit, equity and commodity markets rallied strongly. The Russell 1000 large cap index was up 15.5%, while the Russell 2000 small cap index was up 19.3%; value stocks generally outperformed growth stocks. The largest gains were in technology, retail, as well as basic materials and industrials, as investors once again see the potential for economic growth. International markets also surged, with the MSCI EAFE returning 19.55% and MSCI Emerging Markets Index moved 21.00% higher. On the fixed income side, both investment grade and high yield gained sharply: the investment grade index returned 8.3%, while the high yield index returned 14.8%. Interestingly, even US Treasury’s rallied, with the 10 year returning 2.6% and the 30 year up 5.6% during the quarter. In the commodity space, metals led the way, with Gold, Silver, Copper, Platinum, Zinc and Aluminum all moving higher.
Broadly in the Hedge Fund Universe, all major strategies were positive for the quarter, led by higher beta strategies such as Emerging Markets, Convertible Bond Arbitrage and Distressed Debt. All three strategies sold off dramatically last year, and have subsequently rebounded sharply this year. The worst performers were Equity Market Neutral and Global Macro, which posted marginal losses.
The SEI Opportunity Fund returned 2.4% during the quarter, with all three Strategy segments (Directional, Non-Directional and Event/Distressed) posting positive absolute performance. The two largest contributing sub-strategies were Global Macro and Distressed Debt, as each added approximately 80-100bps to the Fund. Meanwhile, the Multi-Strategy sub-strategy was the largest detractor, subtracting about 70 bps during the quarter, entirely due to exposure to Volatility managers. While the SEI Opportunity Fund posted strong positive absolute performance, it trailed its peer universe, the HFRI Fund of Funds Index, which returned 4.3% during the quarter. Similar to the 2nd quarter, the primary reasons for the underperformance relative to peers was considerably less market beta, especially in the Equity Long/Short allocation, as well as the Fund’s limited exposure to Convertible Bond Arbitrage and Emerging Markets strategies, which generally represent in excess of 10% of the average Fund of Funds but we have largely avoided due to their higher volatility profile. Finally, the performance of the HFRI FoF index has benefitted significantly from survivorship bias as close to 1/3 of universe has stopped reporting over the past 12 months.
The Strategy of the Opportunity Fund remains focused on identifying strategies that provide compelling return opportunities, while maintaining an overall low exposure/beta the broader markets. Recent portfolio changes in the Opportunity Fund have focused on fully restructuring and increasing the Global Macro allocation as well as increasing exposure to Distressed/Event-related managers. Additionally, in the Equity Long/Short allocation the focus remains towards strategies that generate alpha via security selection and not taking material net exposure to the equity markets. Finally, the Fund has begun the process of fully redeeming from the Fund’s exposure to Volatility managers due to both better implementation opportunity and expectations for lower volatility going forward.
SEI Opportunity Fund: Third Quarter 2009 Market Environment & Fund Performance
18Data Source: Ibbotson
Market Overview 2009 Global Equity Market Performance
Developed Markets: •
MSCI EAFE Index returned 19.5% in Q3 and 29% YTD •
Global markets continued to rally in Q3 as the world economy showed signs of stabilization.
Emerging Markets: •
MSCI EM Index returned 20.9% in Q3 and 65% YTD •
Emerging Markets outperformed their developed peers again in Q3,
with the strongest contribution coming from the Asian emerging region.
MSCI EAFE +29%
MSCI EM +65%
S&P 500 +19%
0.60
0.80
1.00
1.20
1.40
1.60
1.80
Dec‐08 Jan‐09 Feb‐09 Mar‐09 Apr‐09 May‐09 Jun‐09 Jul‐09 Aug‐09 Sep‐09
19
Sector performance dispersion narrowed from the previous quarterMore risk-seeking sectors such as Financials and Materials, which struggled the most during late 2008, continued their outperformance in Q3 2009 More stable sectors, such as Health Care, continued to underperform during the quarter
Unprecedented Sector Rotation
‐50
‐40
‐30
‐20
‐10
0
10
20
30
40
50
Sep‐07 Dec‐07 Mar‐08 Jun‐08 Sep‐08 Dec‐08 Mar‐09 Jun‐09 Sep‐09
Materials Financials
MSCI ACWI ex US Health Care
MSCI ACWI Ex-US Index; Data Source: Factset
20
World Equity (MSCI ACWI ex-US) Sector Contribution to Alpha (%)
-0.8 -0.3 0.2
Financials(-2.08)Health Care(+0.58)
Industrials(+0.54)Materials(-0.46)
Telecom.(+0.91)Info. Tech.(+1.19)
Consumer Staples(-0.51)Energy(-0.42)Utilities(-0.79)
Consumer Disc.(+0.99)
YTD Q3 2009
Source: Factset
(#) indicates the benchmark percent allocations to the sectors
SEI World Equity Ex-US
Equity:SEI World Equity ex. US
Manager Contribution to Alpha (%)
-5 -4 -3 -2 -1 0 1 2
Declaration(2)Rexiter(6)Artisan(4)
AXA EME(9)McKinley(7)
Wellington(10)Principal(13)
Intech(9)QMA(17)
AXA Developed(13)Acadian(10)
SIIT ACWI ex US
YTD Q3 2009
Region/country attribution
– the Fund has held its overweight positioning to Asia/Pacific Ex
Japan and Latin America,and its underweight to Europe and North America in the past few
months. This positioning detracted from the Fund performance slightly in the quarter but contributed positively year‐to‐date. At the country level, the Fund’s strong stock selection in Canada and Turkey helped the performance; however its small underweight to Australia and weak stock selection within that market detracted the performance most. A small overweight to China was also a negative contributor during the quarter.
Sector/industry attribution
– the Fund’s 2% underweight to financials was the single most significant detractor. •The weak stock selection within the sector was the key negative driver while the strong stock selection in• consumer discretionary and utilities was able to offset some of
the underperformance.
21Source: Factset
SEI World Equity Ex-US Equity Fund Managers:
• The fund maintains a strategic allocation across a diverse set
of alpha sources
Acadian10%
Axa Developed13%
QMA17%
INTECH10%
Principal12%
McKinley7%
Artisan4%
Rexiter6%
Axa EM9%
Declaration2%
Wellington10%
Source of Return
Alpha SourcesSelectionQuant ‐ Val/MomVolatility captureMomentumAlpha transport
22
Healthcare sector portfolio allocation statistics
10.5%, 7.8%
6.60%, 6.46%
5.0%
5.5%
6.0%
6.5%
7.0%
7.5%
8.0%
8.5%
9.0%
9.5%
10.0%
4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0%
Standard Deviation
Expe
cted
Ret
urn
AveragePortfolio
Lee MemorialHealth System
Low Risk High
Equity48%
Alts9%
Fixed Inc43%
23
SEI’s
proprietary modeling technology
Median comparison. Allows to select one of 10 medians and compare them to 3 rating levels. Check “System Medians”
to compare to just that, otherwise compares to stand alone hospitals.
Changes the cash allocation of the portfolio and allows to see the “cash drag”
on the portfolio
Changes the economic environment, both return and interest rates, based on the respective period,
24
SEI’s
proprietary modeling technology
Shows Net Interest Margin (difference between investment returns and debt cost). Dark Red Line is the margin. Red and Green markers illustrate if positive or negative. (Red negative). Green box is number of positive years in projection, red is negative years
Allows to change the variable rate debt as a percentage of total debt
Total Debt service and interest expense. Interest Expense and thus total debt service changes with changes to “% VRDB of Mix”
25
SEI’s
proprietary modeling technology
Slider for changing “Ratio Projections”. Sliding changes year from 2008 (Beginning) to 2018 (end)
S&P rating medians. Highlighted medians are the closest comparable median in the year selected in slider
26
SEI’s
proprietary modeling technology
Set historical financial data and decide between the most appropriate base year (Current YTD annualized, latest audited, ect.).
Financial statement assumptions for balance sheet, income statement. Different assumptions include common sizing, growth at CPI, Healthcare CPI index, or user defined.
Toggle between Stochastic and Deterministic simulations
27
Historical Market Data
BBBOOOAAARRRDDD OOOFFF DDDIIIRRREEECCCTTTOOORRRSSS RECOMMENDED ACTION FOR BOARD APPROVAL
(Action includes Acceptance, Approval, Adoption, etc)
Keep form to one page, SUBMIT (thru SLC Member) ELECTRONICALLY to L Drive – Miscellaneous - BOD Presentations by Noon the Friday before you’re scheduled on agenda.
DATE: November 19, 2009 LEGAL SERVICE REVIEW? YES_x_ NO__
SUBJECT: Stryker Surgical Equipment Operating Lease
REQUESTOR & TITLE: Mike German, Vice President/Financial Services
PREVIOUS BOARD ACTION ON THIS ITEM (IF ANY) (justification and/or background for recommendations – internal groups which support the recommendation i.e. SLC, Operating Councils, PMTs, etc.)
None
SPECIFIC PROPOSED MOTION:
Approval of an operating lease with Stryker Finance and Stryker Surgical to acquire surgical equipment.
PROS TO RECOMMENDATION
Allows uninterrupted surgical procedures, resulting in greater patient safety and quality outcomes. Maintains surgical revenue.
CONS TO RECOMMENDATION
Increases operating expenses
LIST AND EXPLAIN ALTERNATIVES CONSIDERED
Use current equipment until irreparable and apply for contingency funds for replacement, as needed. Postpone major equipment replacement until next fiscal year, when possible. FINANCIAL IMPLICATIONS Budgeted ____ Non-Budgeted __X__ (including cash flow statement, projected cash flow, balance sheet and income statement) $2,804,321 in equipment to be acquired through an operating lease with monthly payments of $70,574.43 for 36 months. Two buyout points at FMV at 6 months and 12 months. Additional cost of lease versus outright purchase: 6 month buyout $82,285.78 12 month buyout $153,894.58 Full 36 month lease with FMV buyout $380,721.06 OPERATIONAL IMPLICATIONS (including FTEs, facility needs, etc.) SUMMARY This surgical equipment is necessary to continue to support critical surgical service line business, resulting in stability of operating margins and maintenance of surgical volumes.
BOD/Forms/Board (Action) Reporting Form – updated 9/2/09 cs
Stryker Surgical Capital Proposal
Fiscal Year 2010
Key Surgical Services Contribution Margins and Volumes FY ’09 (Data for GCMC available through 8-09)
HOSPITAL SERVICE LINE CASESCONTR MARGIN
W/ACT PMTCM PER
CASE
HOSPSVC GO GYNECOLOGIC ONCOLOGY 717 $1,888,232 $2,634
HOSPSVC GYN GYNECOLOGY 2,790 $5,375,608 $1,927
HOSPSVC NES NEUROSURGERY 3,558 $18,658,917 $5,244
HOSPSVC ORS ORAL SURGERY 159 $253,876 $1,597
HOSPSVC ORT ORTHOPEDIC SURGERY 7,197 $23,288,813 $3,236
HOSPSVC OTO OTOLARYNGOLOGY 1,678 $2,291,849 $1,366
HOSPSVC POS PEDS ORTHOPEDIC SURGERY 461 $660,794 $1,433
HOSPSVC SUR GENERAL SURGERY 6,884 $16,930,668 $2,459
HOSPSVC THS THORACIC SURGERY 613 $7,562,281 $12,337
HOSPSVC TRS TRAUMA SURGERY 400 $4,066,655 $10,167
HOSPSVC URO UROLOGY 2,048 $3,154,689 $1,540
HOSPSVC VAS VASCULAR SURGERY 2,140 $5,200,652 $2,430
REPORT TOTAL 28,645 $89,333,034 $3,119
*Cases through 9-30-09. Payments are only those actually received. Expected payments resulted in CM in excess of $99 million.
LMHS Surgery Capital by Campus by Fiscal Year
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
2006 2007 2007revised
2008 2009
Total Capital Budget by YearAverage Capital by Campus
*GCMC has had limited requests due to Metro Project. Excluded from above average calculations
Stryker CapitalStryker Neuro• Neuro Drills
Stryker Orthopedic/Surgical• Drills• Saws• Neptune System
Stryker Endoscospy (Laparoscopic/Arthroscopic equipment)• Cameras• Lenses• Scopes• Monitors
Stryker Navigation• ENT• Neuro
Stryker Medical• Stretchers
Stryker Capital RequestsInitial Stryker requests for all campuses $1.8 millionFinal approved Stryker capital $688,000Items removed or not included:• Video upgrades at HP, Lee, CCH to current
technology standard of 1188 definition• HP Navigation for pediatric ortho/spine and
neurosurgery• Orthopedic and neurosurgical drills and saws for
replacement• Neptune fluid collection system for all facilities
Stryker Proposal OverviewTotal proposal $3,515,615Purchase HP Navigation and Neptune System for $690k with budgeted capital funds, plus ~$22,000 in service agreements.Total remaining $2,804,321.42.Total monthly payment for 36 months is $70,574.43 plus any applicable taxes. Early Buyout Options for the three schedules combined are as follows:After 6th payment—EBO $2,463,160.85 plus any applicable taxes.After 12th payment—EBO $2,111,323.33 plus any applicable taxes.
Stryker Capital by Facility
STRYKER DIVISIONLMHS FACILITY
NET AMT Value-Add
LMH CCH GC HP
Navigation $ - $ - $ - $ 318,110 $ 318,110 $ 20,000
Endoscopy - full upgrade $ 575,200 $ 472,840 $ - $ 573,128 $ 1,621,168 $ 50,000
Surgical - full upgrade $ 198,453 $ 396,587 $ - $ 185,229 $ 780,269 $ 65,894
NSE - full upgrade $ 160,000 $ 68,482 $ 143,878 $ - $ 372,360 $ 197,000
Medical (stretchers) $ - $ 18,314 $ - $ 12,209 $ 30,523 $ -
Neptune $ 112,605 $ 94,621 $ 76,637 $ 109,322 $ 393,185 $ 30,000
TOTALS $ 1,046,258 $ 1,050,844 $ 220,515 $ 1,197,998 $ 3,515,615 $ 362,894
Cost of Leasing
STRYKER DIVISIONTotal by category
Monthly payment
Total 36 months payments
FMV Buyout at 36 months
Initial Outright Purchase
Grand total under payments
Cost of Leasing for 36 months
Navigation $318,110 $318,110.00 $318,110.00
Endoscopy - full upgrade $1,621,168 $39,948.73 $1,438,154.28 $231,000 $1,669,154.28 ($47,986.28)
Surgical - full upgrade $1,152,629 $29,897.30 $1,076,302.80 $405,000 $1,481,302.80 ($328,673.80)
NSE - full upgrade
Medical (stretchers) $30,523 $728.40 $26,222.40 $9,000 $35,222.40 ($4,699.40)
Neptune $393,185 $393,185.00 $393,185.00
TOTALS $3,515,615 $70,574.43 $2,540,679.48 $645,000 $711,295.00 $3,896,974.48 ($381,359.48)
Future needsAlthough this proposal will substantially fulfill the needs of Surgical Services over the next three fiscal years, there are still some probable needs:• Replace cardiac assist system for GCMC (~$115,000) - old system is no
longer supported• Stealth navigation upgrade at CCH (and potentially at GCMC)• Sterile processing equipment (postponed in conjunction with off-site
project)• Anesthesia machines with possible EMR interface capability system-wide • Equipment for surgeons who partially migrate part of their volumes to other
facilities (requires transport of expensive capital equipment between facilities)
• Planned replacement of OR lights (~$45,000 per room)• Capital equipment for newly recruited surgeons. Oftentimes, their needs
and expectations are for technology that is not currently used within LMHS• Additional rovers for Neptune (~$15,000 each)
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008 t: 269 323 7700 f: 888-655-4344
www.stryker.com
Finance
RE: Reference # 21239355
October 27, 2009
Lee Memorial Health System
PO Box 151247
Cape Coral, FL 33915
Thank you for choosing Stryker Finance for your equipment financing needs. Enclosed please find the financing documents necessary to enter into
the financing arrangement. Once all of the documents are completed, properly executed and returned to us, we will issue an order for release of the
financed equipment.
PLEASE COMPLETE ALL ENCLOSED DOCUMENTS TO EXPEDITE THE SHIPMENT OF YOUR ORDER.
- Master Lease Agreement
- Schedule 001 to Master Lease Agreement
- Exhibit “A” to Schedule 001
- Early Buyout Addendum (Month 7 and Month 13) Sch.001
- Certificate of Acceptance Sch. 001
- Schedule 002 to Master Lease Agreement
- Exhibit “A” to Schedule 002
- Early Buyout Addendum (Month 7 and Month 13) Sch.002
- Certificate of Acceptance Sch. 002
- Schedule 003 to Master Lease Agreement
- Exhibit “A” to Schedule 003
- Early Buyout Addendum (Month 7 and Month 13) Sch.003
- Certificate of Acceptance Sch. 003
- Insurance Authorization and Verification
- Opinion of Counsel
- State and Local Government Customer Rider
- Addendum
**Conditions of Approval: Original Documentation, Hospital Purchase Order, Tax Exempt Certificate, Correctly Executed
Opinion of Counsel, Correctly Executed Insurance Authorization and Verification, Correctly Executed State and Local
Government Customer Rider
- PLEASE PROVIDE THE FOLLOWING WITH THE COMPLETED DOCUMENTS:
a) A COPY OF YOUR TAX EXEMPT CERTIFICATE, IF APPLICABLE
b) FEDERAL TAX ID NUMBER
c) PURCHASE ORDER NUMBER AS YOU WOULD LIKE TO APPEAR ON ANY BILLING
Your personal leasing representative is Sarah Leitz and can be reached at (269) 323-7700 ext: 4521 for any questions regarding these
documents.
PLEASE RETURN THE COMPLETED DOCUMENTS AS FOLLOWS TO YOUR LEASING REPRESENTATIVE’S ATTENTION:
- FAX COPIES OF ALL DOCUMENTS: (888) 655-4344
- FED-EX ORIGINAL INK DOCUMENTS: Fed-Ex Shipping ID# 388-313242
The financing proposal evidenced by these documents is valid through the last business day of October, 2009.
Sincerely,
Stryker Finance Notice: To help the government fight the funding of terrorism and money laundering activities, U.S. Federal law requires financial institutions to obtain, verify and record
information that identifies each person (individuals or businesses) who opens an account. What this means for you: When you open an account or add any additional service, we will
ask you for your name, address, federal employer identification number and other information that will allow us to identify you. We may also ask to see other identifying documents.
For your records, the federal employer identification number for Stryker Finance, a Division of Stryker Sales Corporation is 38-2902424.
MASTER LEASE AGREEMENT
No. 21239355
Lessor: STRYKER FINANCE, a division of Stryker Sales Corporation
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008
Lessee: Lee Memorial Health System
Address: PO Box 151247 Cape Coral, FL 33915
1. Master Lease. The undersigned Lessee ("Lessee") unconditionally and irrevocably agrees to lease from the above referenced Lessor (together with all of its successors and Assignees, collectively, "Lessor") the equipment and other personal property and services, if any (together with all additions and attachments to it and all substitutions for it,
collectively, the "Equipment") described in each Equipment Schedule referencing this Master Lease Agreement (each, together with any attachments thereto, a "Schedule") and
purchased from the Supplier(s) noted in the applicable Schedule (each a “Supplier”). Each Schedule shall incorporate by reference all of the terms of this Master Lease Agreement and shall constitute a separate lease agreement (each such Schedule, together with such incorporated terms of this Master Lease Agreement, collectively, a "Lease")
that is assignable separately from each other Lease. In the event of a conflict between this Master Lease Agreement and the terms of a Schedule, the terms of the Schedule shall
prevail. No provision of a Lease may be waived or modified except in a writing signed by Lessor‟s duly authorized representative.
2. Term. The term of each Lease ("Term") shall start on the Acceptance Date (as hereinafter defined) and shall continue for the number of months set forth in the Schedule beginning with the Rent Commencement Date (as defined in paragraph 3 below). Lessee shall be deemed to have accepted the Equipment for lease under a Lease on the date
that is ten (10) days after the date it is shipped to Lessee by the Supplier (“Acceptance Date”) and, at Lessor's request, Lessee shall confirm for Lessor such acceptance in
writing. No acceptance of any item of Equipment may be revoked by Lessee. At no time will Lessor bear any risk of loss with respect to the Equipment.
3. Rent. Periodic rental payments payable during the Term ("Periodic Rent") shall be paid commencing on (i) the first day of the month following the month in which the
Acceptance Date occurs, if the Acceptance Date is on or before the 15th of the month, or (ii) the first day of the second month following the month in which the Acceptance Date
occurs, if the Acceptance Date is after the 15th day of the month (“Rent Commencement Date”). Periodic Rent and other amounts due from Lessee to Lessor under a Lease are collectively referred to as “Rent”. Unless otherwise instructed by Lessor in writing, all payments of Rent shall be made to Lessor's address in the applicable Schedule. Any
payment by or on behalf of Lessee that purports to be payment in full for any obligation under any Lease may only be made after Lessor's prior written agreement to accept such
payment amount.
4. Rent Payments; Fees. Periodic Rent is due monthly beginning on the Rent Commencement Date and continuing on the same day of each consecutive month thereafter during the Term regardless of whether or not Lessee receives an invoice for it. If Lessee fails to pay any amount due under a Lease within five (5) days after its due date, Lessee
agrees to pay a late charge equal to (as reasonable liquidated damages and not as a penalty) five percent (5%) of the amount of each such late payment. If any check or funds transfer request for any Rent is returned to Lessor unpaid, Lessee shall pay Lessor a service charge of $55 for each such returned check or request.
5. Equipment. Lessee shall keep the Equipment free of liens, claims and encumbrances, and shall not modify, move, sell, transfer, lease, sublease or otherwise encumber any
Equipment or permit any Equipment to become attached to any realty, in each case without the prior written consent of Lessor. Any modification or addition to any Equipment
shall automatically become the sole property of Lessor. Lessor shall have the right to enter Lessee's premises during business hours to inspect any Equipment and observe its use upon at least one (1) day's prior written or verbal notice. Lessee shall comply with all applicable laws, rules and regulations concerning the operation, ownership, use and/or
possession of the Equipment.
6. Obligations Absolute. NOTWITHSTANDING ANY CLAIM OF DEFECT OR ANY OTHER REASON WHATSOEVER, ALL RENTALS AND OTHER PAYMENTS UNDER EACH LEASE SHALL BE PAID BY LESSEE TO LESSOR OR ITS ASSIGNEES ABSOLUTELY AND UNCONDITIONALLY, WITHOUT ANY DEFENSE,
SETOFF, ABATEMENT, CLAIM OR COUNTERCLAIM OF ANY NATURE. Lessee waives all rights to any indirect, punitive, special or consequential damages in
connection with the Equipment or any Lease.
7. Use/Assignment /Disclaimers. All Equipment shall be used solely for business purposes, and not for personal or household use. Lessee shall maintain the Equipment in good repair in accordance with the instructions of the Supplier so that it shall be able to operate in accordance with the manufacturer‟s specifications. Lessee shall bear the
entire risk of loss or damage to the Equipment. LESSEE SHALL NOT TRANSFER, SUBLEASE OR ASSIGN ANY OF ITS RIGHTS OR OBLIGATIONS UNDER
ANY LEASE OR EQUIPMENT without Lessor's prior written consent. Lessee shall promptly notify Lessor in writing of any loss or damage to any Equipment. Lessor shall
own the Equipment and may sell, assign, transfer or grant a security interest to any third party (each, an "Assignee") in any Equipment, Rent and/or Lease, or interest therein, in
whole or in part, without notice to or consent by Lessee. Lessee agrees that Lessor may assign its rights under and/or interest in each Lease and the related Equipment to an
Assignee immediately upon or any time after Lessor‟s acceptance of each Lease and upon such assignment, Lessee consents to such assignment and acknowledges that references herein to “Lessor” shall mean the Assignee. No Assignee shall assume or be liable for any of the Original Lessor‟s (as defined below) obligations to Lessee even
though an Assignee may continue to bill and collect all of Lessee‟s obligations under this Agreement in the name of “Stryker Finance”. Lessee acknowledges that such Assignee
is not the manufacturer or supplier of any Equipment and is not responsible for its delivery, installation, repair, maintenance or servicing and no Assignee shall have any obligations or liabilities of any kind whatsoever concerning or relating to the Equipment. Lessee has selected each Supplier and manufacturer and all of the Equipment. Neither
the Original Lessor, Supplier nor any manufacturer is an agent of any Assignee, and no representative of the Original Lessor, manufacturer or any Supplier is authorized to bind
any Assignee for any purpose or make any representation on Assignee‟s behalf. Lessee agrees to look only to Stryker Sales Corporation (the “Original Lessor”), the Supplier(s) or the manufacturer(s) for any defect or breach of warranty regarding the Equipment. AS TO ANY ASSIGNEE, LESSEE LEASES THE EQUIPMENT ON AN
“AS-IS”, “WHERE-IS” BASIS. ASSIGNEE MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED,
REGARDING ANY EQUIPMENT, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE. TO THE EXTENT, IF ANY, THAT LESSEE HAS ANY CLAIMS, RIGHTS OR DEFENSES AGAINST THE ORIGINAL LESSOR,
ANY MANUFACTURER AND/OR ANY SUPPLIER, LESSEE SHALL RAISE SUCH CLAIMS, RIGHTS OR DEFENSES ONLY AGAINST THE ORIGINAL
LESSOR, MANUFACTURER OR SUPPLIER AND NOT AGAINST ASSIGNEE AND SHALL NONE-THE-LESS PAY ALL RENT AND OTHER AMOUNTS
HEREUNDER TO THE ASSIGNEE ON THEIR RESPECTIVE DUE DATES WITHOUT ANY DEFENSE, SETOFF, ABATEMENT, CLAIM OR
COUNTERCLAIM OF ANY NATURE. THE ORIGINAL LESSOR (INCLUDING STRYKER FINANCE, ITS DIVISION) MAKES NO IMPLIED WARRANTIES
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE REGARDING ANY EQUIPMENT.
8. Insurance; Indemnification. Lessee shall at all times maintain and provide Lessor with certificates of insurance evidencing (i) third-party general liability insurance
(covering death and personal injury and damage to third party property) with a minimum limit of $1 million combined single limit per occurrence and (ii) property insurance covering the Equipment against fire, theft, and other loss, damage or casualty for the full replacement value of the Equipment in each case with insurers acceptable to Lessor.
Such policies shall list Lessor and each Assignee as an additional insured and sole loss payee, as applicable, for such insurance. Such insurance policies shall require the insurer
to provide Lessor with at least 30 days' prior written notice of any material change in or cancellation of the insurance. In the event that Lessor determines that the insurance is
not in effect, Lessor may (but shall not be required to) obtain such insurance and add an insurance fee (which may include a profit) to the amounts due from Lessee under the
applicable Lease. Upon any loss or damage to any Equipment, Lessee shall continue to pay all Rent due under the related Lease for the remainder of its Term and shall, at
Lessor's sole election, either repair such Equipment or replace it with comparable equipment satisfactory to Lessor. Proceeds of insurance shall be paid to Lessor with respect to any Equipment loss, damage, theft or other casualty and shall, at the election of Lessor, be applied either to the repair of the Equipment by payment by Lessor directly to the party
completing the repairs, or to the reimbursement of Lessee for the cost of such repairs; provided, however, that Lessor shall have no obligation to make such payment or any part
thereof until receipt of such evidence as Lessor shall deem satisfactory that such repairs have been completed and further provided that Lessor may apply such proceeds to the payment of any Rent or other sum due or to become due hereunder if at the time such proceeds are received by Lessor there shall have occurred any Event of Default or any event
which with lapse of time or notice, or both, would become an Event of Default. Lessee shall indemnify, reimburse and defend (with counsel acceptable to Lessor) Lessor,
including each Assignee, its and their affiliated companies and its and their officers, directors, employees and agents, on demand, from and against any and all damages, losses, liabilities, expenses, claims or legal proceedings relating to or arising out of the applicable Lease or the ownership, use, operation, possession, sale, lease or maintenance of the
Equipment (including any claim for environmental damage and, as to any Assignee only, for claims for patent, trademark or copyright infringement), regardless of whether its
Term shall have commenced or expired, including (without limitation) Lessor's attorneys' fees and expenses (collectively “Claims”); provided that Stryker Sales Corporation shall be responsible for, and Lessee will not be required to indemnify, reimburse and defend Stryker Sales Corporation (including Stryker Finance, its division) as to, any Claims
which arise solely from the act or neglect of Stryker Sales Corporation or are covered by an express warranty given by Stryker Sales Corporation to Lessee. All Taxes and
indemnity obligations shall survive the termination of the Lease.
9. UCC Filings. Lessee acknowledges that each Lease is intended to be a "finance lease" as defined in §2A-103(1)(g) of the Uniform Commercial Code, as in effect in Michigan ("UCC”). LESSEE WAIVES ANY AND ALL RIGHTS AND REMEDIES OTHERWISE GRANTED TO LESSEE BY UCC §§2A-508 THROUGH 2A-522. If and to the
extent that this Master Lease Agreement or a Schedule is deemed a security agreement, Lessee hereby grants to Lessor, its successors and assigns, a security interest in all of
Lessee's rights under and interest in the Equipment, all additions to the Equipment and all proceeds of the foregoing. Such security interest secures all Obligations owing by
Lessee to Lessor. Lessee authorizes Lessor and any Assignee to file UCC financing statements disclosing Lessor's or Assignee‟s interest in the Equipment and in any
"Additional Collateral" set forth in any Schedule. Lessee shall provide Lessor with at least 45 days‟ prior written notice of any change to Lessee‟s principal place of business, organization or incorporation.
10. Taxes.
(a) Reporting and Payment. If permitted by applicable law, Lessor shall pay when and as due all sales, use, property, excise and other taxes, and all license and registration fees
now or hereafter imposed by any governmental body or agency upon any Lease or the ownership, use, possession, sale or rental of the Equipment, together with all interest and penalties for their late payment or non-payment (“Taxes”). Lessee shall indemnify and hold Lessor harmless from any such Taxes. Lessor shall prepare and file all tax returns
relating to Taxes for which Lessor is responsible hereunder or which Lessor is permitted to file under the laws of the applicable taxing jurisdiction; provided, however, that
except with respect to Equipment located in Tennessee, Lessee will not list any of the Equipment for property tax purposes or report any property tax assessed against the Equipment. Upon receipt of any tax bill pertaining to the Equipment from the appropriate taxing authority, Lessor will pay such tax and will invoice Lessee for the expense.
Upon receipt of such invoice, Lessee will promptly reimburse Lessor for such expense. If any of the Equipment is located in Tennessee, Lessee shall report and pay all
applicable property taxes on such Equipment located in Tennessee. Nothing in this Subsection shall be deemed to prohibit Lessee from reporting, for informational purposes only and to the extent required under applicable law, that it leases the Equipment.
(b) Tax Ownership.
(i) If Lessee selects $1.00 Buyout for any Lease, the parties intend that Lessee shall be considered the owner of the Equipment for tax purposes; provided, however, that Lessor shall not be deemed to have violated this Agreement or any Schedule by taking a tax position inconsistent with the foregoing to the extent such a position is required by law or is
taken though inadvertence so long as such inadvertent tax position is reversed by Lessor promptly upon its discovery.
(ii) If Lessee selects the Fair Market Value Option or the Fixed Purchase Option for any Schedule, the parties intend that the Schedule will be a true lease and not a "conditional sale", and that Lessor shall at all times and for all purposes be considered the owner of the Equipment (including for income taxes purposes), and that such Lease will convey to
Lessee no right, title or interest in any of the Equipment except as a lessee. Lessee will not take any actions or positions inconsistent with treating Lessor as the owner of the
Equipment on or with respect to any income tax return; Should either the United States government (or agency thereof) or any state or local tax authority disallow, eliminate, reduce, recapture, or disqualify, in whole or in part, the
Equipment tax benefits claimed under a Lease by Lessor as a result of any act or omission of Lessee (collectively, “Tax Loss”), Lessee will indemnify Lessor (on a net after tax
basis) against all Tax Losses suffered, including the amount of any interest or penalties which might be assessed on Lessor by the governmental authority(ies) with respect to such Tax Loss. All references to Lessor in this Section include Lessor and the consolidated taxpayer group of which Lessor is a member. All of Lessor‟s (including any
Assignee‟s) rights, privileges and indemnities contained in this Section shall survive the expiration or other termination of this Agreement. The rights, privileges and
indemnities contained herein are expressly made for the benefit of, and shall be enforceable by Lessor (including any Assignee), or its respective successors and assigns.
11. Return of Equipment. Upon (x) any early termination of each Lease or (y) the expiration of the Term of each Lease and Lessee has not exercised any option to purchase
available to it under the terms of the applicable Lease, if any, the $1.00 Buyout has not been selected and Lessee has given Lessor at least 90 days but not more than 180 days written notice by certified mail prior to the end of the Term (the “Return Notice”) that Lessee will return the Equipment to Lessor, Lessee shall at its expense, pack and insure
the related Equipment and send it freight prepaid to a location designated by Lessor in the contiguous 48 states of the United States. If Lessee fails to give the Return Notice or
the Return Notice is not sent timely, the Term will be automatically extended (upon the same terms and payments) until the first Periodic Rent Payment date which is more than 90 days after Lessee has given Lessor written notice by certified mail that Lessee will return the Equipment to Lessor and at the end of such extended Term, Lessee shall return
the Equipment as described above. All Equipment upon its return to Lessor shall be in the same condition and appearance as when delivered to Lessee, excepting only
reasonable wear and tear from proper use and all such Equipment shall be eligible for manufacturer's maintenance. If Lessee fails to return the Equipment as and when required, Lessee shall continue to remit Periodic Rent ("Remedial Payments") to Lessor on the dates such payments would be payable under the applicable Lease as if the Lease had not
expired or terminated.
12. Facsimile Copies. Lessor may from time to time, in its sole discretion, accept a photocopy or facsimile of this Master Lease Agreement and/or any Schedule (bearing a photocopied or electronically transmitted copy of Lessee‟s signature) as the binding and effective record of such agreement(s) whether or not an ink signed counterpart thereof is
also received by Lessor from Lessee, provided, however, that no Schedule shall be binding on Lessor unless and until executed by Lessor. Any such photocopy or electronically
transmitted facsimile received by Lessor shall when executed by Lessor, constitute an original document for the purposes of establishing the provisions thereof and shall be legally admissible under the "best evidence rule" and binding on Lessee as if Lessee‟s manual ink signature was personally delivered.
13. Notices. All notices required or provided for in any Lease, shall be in writing and shall be addressed to Lessee or Lessor, as the case may be, at its address set forth above or
such other address as either such party may later designate in writing to the other party. Such notice shall be considered delivered and effective: (a) upon receipt, if delivered by
hand or overnight courier, or (b) three (3) days after deposit with the U.S. Postal Service, if sent certified mail, return receipt requested with postage prepaid. No other means of delivery of notices shall be permitted.
14. Default; Remedies. Lessee will be in "default" under a Lease, if any one or more of the following shall occur: (a) Lessee or any guarantor of any Lease (“Guarantor”) fails
to pay Lessor any Rent due under any Lease when it is due, or (b) Lessee or any such Guarantor breaches any other term of the Lease, or (c) Lessee or any such Guarantor makes any misrepresentation to Lessor, or (d) Lessee or any such Guarantor fails to pay any other obligation owed to Lessor, any of Lessor's affiliates, or any other party, or (e)
Lessee or any such Guarantor shall consent to the appointment of a receiver, trustee or liquidator of itself or a substantial part of its assets, or (f) there shall be filed by or against
Lessee or any such Guarantor a petition in bankruptcy, or (g) Lessee‟s articles of incorporation or other formation documents shall be amended to change Lessee‟s name or state
of incorporation or formation, or (h) Lessee‟s legal existence in its state of incorporation or formation shall have lapsed or terminated, or (i) Lessee shall dissolve, sell, transfer
or otherwise dispose of all or substantially all of its assets, or (j) without prior written consent of Lessor, Lessee merges or consolidates with any other entity and Lessee is not
the survivor of such merger or consolidation. Upon default, Lessor may do any one or more of the following: (1) recover from Lessee the sum of (A) any and all Rent, late charges and other amounts then due and owing under any or all Leases, (B) accelerate and collect the unpaid balance of the remaining Rent scheduled to be paid under any or all
Leases, together with Lessor's anticipated residual interest in any or all Equipment subject to them, both discounted to present value at a rate of 3% per annum, and (C) Lessor's
related attorneys' fees, collection costs and expenses; (2) enter upon Lessee's premises and take possession of any or all of such Equipment; (3) terminate any or all Leases; and/or (4) utilize any other right or remedy provided by applicable law. Lessee shall also pay to Lessor interest on all unpaid amounts due under a Lease from the due date of
such amounts until paid in full, at a rate per annum equal to the lower of 1-1/2% per month or the highest rate of interest permitted by applicable law (the “Default Interest
Rate”). Lessee waives any rights that Lessee may have to require Lessor to sell or otherwise dispose of any Equipment. If Lessee fails to perform or comply with any of its agreements or obligations, Lessor may perform or comply with such agreements or obligations in its own name or in Lessee‟s name as attorney-in-fact and the amount of any
payments and expenses of Lessor incurred in connection with such performance or compliance, together with interest thereon at the Default Interest Rate, shall be deemed Rent
payable by Lessee upon demand. No express or implied waiver by Lessor of any default or breach of Lessee's obligations hereunder shall constitute a waiver of any other default or breach of Lessee's obligations hereunder.
15. Miscellaneous. Lessor may, by written notice to Lessee, amend this Master Lease Agreement and, as amended, this Master Lease Agreement shall be effective with respect
to all Schedules. All Leases shall be binding on Lessee's successors and permitted assigns, and shall be for the benefit of Lessor and its successors and Assignees. This Master
Lease Agreement and each Lease shall be deemed entered into and performed in Kalamazoo County, Michigan. EACH LEASE SHALL BE GOVERNED BY THE LAWS
OF MICHIGAN, WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICT OF LAWS OR CHOICE OF LAW. IN ANY ACTION OR PROCEEDING
RELATING TO ANY LEASE OR EQUIPMENT THE PARTIES WAIVE THE RIGHT TO A JURY TRIAL IN ANY PROCEEDING RELATING TO ANY LEASE
OR EQUIPMENT. The parties do not intend to exceed any applicable usury laws. If for any reason a Lease is held to constitute a loan of money, any amounts
payable under such Lease in excess of the applicable highest lawful rate of interest shall be deemed a prepayment of any principal amount due under the Lease and, if
such principal is paid in full, such excess amounts shall be immediately refunded to Lessee. Lessee agrees that it shall upon request from Lessor, promptly provide to Lessor a copy of Lessee‟s most recent annual financial statements and any other financial information of Lessee (including interim financial statements) that Lessor may request.
Lessee authorizes Lessor to share such information with Lessor‟s affiliates, subsidiaries and assigns. Lessee expressly authorizes credit reporting agencies and other persons to
furnish credit information to Lessor and its Assignees (and prospective Assignees), separately or jointly with other creditors or lessors, for use in connection with this Master Lease Agreement or any Lease. Lessee agrees that Lessor may provide any information or knowledge Lessor may have about Lessee or about any matter relating to this Master
Lease Agreement or any Lease to any one or more Assignees (and prospective Assignees). Lessors and joint Lessees of such information are authorized to receive and exchange
credit information and to update such information as appropriate during the term of this Master Lease Agreement and each Lease. Information about the undersigned may be used for marketing and administrative purposes and shared with Lessor's affiliates. The undersigned may direct Lessor not to share that information (except transaction and
experience information and information needed for credit approval) with Lessor's affiliates by writing to the Lessor‟s address referenced above. This Master Lease Agreement
will not be valid until accepted by Lessor (as evidenced by Lessor‟s signature below). Lessee represents and warrants to Lessor, that effective on the date on which Lessee executes this Master Lease Agreement and each Schedule: (i) if Lessee is a partnership, corporation, limited liability company or other legal entity, the execution and delivery of this
Master Lease Agreement and each Schedule and the performance of Lessee‟s obligations hereunder and thereunder have been duly authorized by all necessary action on the part of
the Lessee; (ii) the person signing the Master Lease Agreement and each Schedule on behalf of Lessee is duly authorized; (iii) all information provided by Lessee to Lessor in connection with this Master Lease Agreement and each Schedule is true and correct; and (iv) this Master Lease Agreement and each Schedule constitute legal, valid and binding
obligations of Lessee, enforceable against Lessee in accordance with their terms. Only one counterpart of this Master Lease Agreement and of each Schedule shall bear Lessor‟s ink
signed signature and be marked “Original.” To the extent that any Schedule constitutes chattel paper (as that term is defined by the Uniform Commercial Code), a security interest may only be created in the Schedule that bears Lessor‟s ink signed signature and is marked “Original.” Any provision of a Lease which is unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such unenforceability without invalidating the remaining provisions of the Lease, and any such unenforceability in any
jurisdiction shall not render unenforceable such provision in any other jurisdiction. Paragraph headings are for convenience only, are not part of the Lease and shall not be deemed to affect the meaning or construction of any of the provisions hereof. Lessee has not received any tax or accounting advice from Lessor. This Master Lease Agreement,
any Schedules, any attachments to this Master Lease Agreement or any Schedules and any express warrantees made by Stryker Sales Corporation constitute the entire agreement
between the parties hereto regarding the Equipment and its use and possession and supersede all prior agreements and discussions regarding the Equipment and any prior course of conduct. There are no agreements, oral or written, between the parties which are contrary to the terms of this Master Lease Agreement and such other documents.
LESSEE HAS READ THIS MASTER LEASE AGREEMENT AND EACH SCHEDULE BEFORE SIGNING IT.
Lessee: Lee Memorial Health System
By: ___________________________________________
Its:___________________________________________
Date: _____________, 20____
Accepted:
STRYKER FINANCE, a division of Stryker Sales Corporation
By: _____________________________________________________
Its: _____________________________________________________
KZLIB:571520.1\087451-00161 v.4-08
EQUIPMENT SCHEDULE #001
TO
MASTER LEASE AGREEMENT NO. 21239355
FPU and NON-FPU
Lessor:
STRYKER FINANCE, a division of Stryker Sales
Corporation
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008
Lessee: Lee Memorial Health System
Address: PO Box 151247
Cape Coral, FL 33915
Supplier:
Stryker Sales Corporation 4100 E Milham Ave
Kalamazoo, MI 49001
Equipment Description: (and/or as described in equipment list attached hereto and made a part hereof collectively, the “Equipment”)
Equipment Location: 636 Del Prado Blvd, Cape Coral, FL 33990, 9981 Healthpark Circle, Fort Myers, FL 33908, 2776 Cleveland Ave, Fort Myers, FL 33901, 13681 Doctor's Way, Ft. Myers, FL 33912
Schedule of Periodic Rent Payments:
_36_ monthly payments of $ 29,897.30 (plus applicable taxes, unless otherwise indicated as follows:___________________________________)
Term in Months: 36 Minimum Monthly Uses: n/a Fee Per Use: n/a
Purchase Terms (if no blank is checked, the Fair Market Value Option will be deemed chosen): __X__ Fair Market Value Option ____ $1.00 Buyout ___ Fixed Purchase Option $_______________
TERMS AND CONDITIONS
1. Agreement. The undersigned Lessee ("Lessee") unconditionally and irrevocably agrees to lease from the Lessor whose name is listed above (“Lessor”) the Equipment described above, on the terms specified in this Schedule, including all attachments to this Schedule and in the Master Lease Agreement referred to above (as amended
from time to time, the "Agreement"). Except as modified herein, the terms of the Agreement are hereby ratified and incorporated into this Schedule as if set forth herein
in full, and shall remain fully enforceable throughout the Term of this Schedule. Capitalized terms used and not otherwise defined in this Schedule have the respective meanings given to those terms in the Agreement. The Minimum Monthly Uses and Fee Per Use described above shall not affect the amount of any monthly payment.
2. Purchase Option. If either the Fair Market Value Option or the Fixed Purchase Option is selected above, or otherwise applies, upon expiration of the Term and provided that the Lease has not been terminated early and Lessee is in compliance with the Lease in all respects, Lessee may upon at least 90 but not more than 180 days
prior written notice to Lessor exercise the applicable purchase option, and upon the giving of such notice Lessee shall be irrevocably and unconditionally obligated to purchase all (but not less than all) of the Equipment, for the purchase amount shown above (plus all applicable Taxes), which amount shall be due and payable upon the
expiration of the Term of this Schedule. If the $1.00 Buyout is selected above, upon expiration of the Term, Lessee shall pay the amount of all Rent owed by Lessee
hereunder but unpaid as of such date and $1.00 (plus all applicable Taxes). Any purchase of the Equipment by Lessee pursuant to a purchase option or $1.00 Buyout shall be “AS IS, WHERE IS”, without representation or warranty of any kind from Lessor. “Fair Market Value” shall be the amount determined by Lessor as the fair market
value of the Equipment on the basis of an arms-length sale between an informed and willing buyer who is currently in possession of the Equipment and a willing Seller
under no compulsion to sell.
3. Equipment Acceptance. By signing this Schedule LESSEE certifies that the Equipment described above shall be deemed accepted by LESSEE for all purposes under the Agreement on the date that is ten (10) days after the date it is shipped to LESSEE by the supplier of the Equipment.
4. Miscellaneous. The amount of each Periodic Rent payment set forth above is based on Supplier's best estimate of the cost of the Equipment described in this Schedule. If prior to the Rent Commencement Date, Equipment price changes have been accepted by both parties, Rent may be increased up to 15%, or decreased without limit, if
the actual cost of the Equipment differs from that assumed under this Schedule and such change in Rent will be effectuated by written notice from Lessor to Lessee. If Lessee fails to pay (within thirty days of invoice date) any freight, sales tax or other amounts related to the Equipment which are billed directly by Lessor to Lessee, such
amounts shall be added to the Periodic Rent payments set forth above (plus interest or additional charges thereon) and Lessee authorizes Lessor to adjust such Periodic
Rent payments accordingly. In the event the transaction evidenced by this Schedule is determined to be a secured transaction, then as security for all existing or hereafter arising obligations of Lessee under this Lease and all other obligations of Lessee to Lessor, Lessee hereby grants to Lessor a first priority security interest in all of
Lessee's rights, title (if any) and interests in the Equipment and any additional collateral described herein, and all proceeds and products thereof, including, without
limitation, all proceeds of insurance. This Schedule will not be valid until signed by Lessor. Lessee acknowledges that Lessee has not received any tax or accounting advice from Lessor. If Lessee is required to report the components of its payment obligations hereunder to certain state and/or federal agencies or public health coverage
programs such as Medicare, Medicaid, SCHIP or others, the various components are provided above or in an attachment hereto.
LESSEE HAS READ (AND UNDERSTANDS THE TERMS OF) THIS SCHEDULE BEFORE SIGNING IT.
Lessee: Lee Memorial Health System
Signature:
Its
Date: _____________, 20____
Accepted: STRYKER FINANCE, a division of Stryker Sales Corporation
By:
Its:
KZLIB:575151.1\087451-00161
04/23/08
Exhibit “A” to Schedule 001 to Master Lease Agreement # 21239355 Description of Equipment
Lessee Name: Lee Memorial Health System
Part I – Equipment / Service Coverage (if applicable)
Delivery Address: 636 Del Prado Blvd, Cape Coral, FL 33990
Model No. Description Qty 6208-000-000 SYSTEM 6 SAGITTAL SAW 9 6203-000-000 SINGLE TRIGGER ROTARY 9 6203-136-000 SGL TRIG PIN COLLET 2.0-3.2mm 9 6203-131-000 1/4" CHUCK W/KEY 18 6203-110-000 AO SMALL ATTACHMENT 9 6203-160-000 TRINKLE ATTACHMENT 9 6203-135-000 HUDSON/MODIFIED TRINKLE ATTACH 9 0277-094-099 Snap-Lock Hudson Adapter 9 2102-135-000 Modified Trinkle Adapter 9 4300-000-000 CORDLESS DRIVER 3 6 4100-062-000 Wire Collet 6 4100-110-000 Synthes Drill 6 4100-126-000 Adjustable Pin Collet 6 4100-132-000 5/32 inch Drill with Jacobs Chuck 6 4100-231-000 1/4 inch Reamer with Jacobs Chuck 6 4100-235-000 Hudson/Modified Trinkle Reamer 6 4100-400-000 SAGITTAL SAW ATTACHMENT 6 5100-009-000 Universal Handswitch 2 5100-004-000 TPS Handpiece Cord 2 5400-015-000 Core Micro Drill 1 5100-015-250 Micro Drill Medium Straight Attachment 1 5100-015-270 Micro Drill Long Straight Attachment 1 5400-034-000 Micro Sagittal Saw 1 5400-031-000 Micro Oscillating Saw 1 5400-037-000 Micro Reciprocating Saw 1 4100-062-000 Wire Collet 1 5400-099-000 Core Universal Driver 1 4100-110-000 Synthes Drill 1 4100-132-000 5/32 inch Drill with Jacobs Chuck 1 4100-131-000 1/4 inch Drill with Jacobs Chuck 1 5400-277-000 CORE STERILE CASE-MEDIUM 1 5400-050-000 CORE CONSOLE 1 5100-009-000 Universal Handswitch 2 5100-004-000 TPS Handpiece Cord 2 5400-300-000 Core Impaction Drill 1 2296-301-000 Impaction Bur Guard 1 2296-302-000 Impaction Drill Shield 1 5400-015-000 Core Micro Drill 1 5100-015-250 Micro Drill Medium Straight Attachment 1 5100-015-270 Micro Drill Long Straight Attachment 1 5400-034-000 Micro Sagittal Saw 1 5400-031-000 Micro Oscillating Saw 1 5400-037-000 Micro Reciprocating Saw 1 4100-062-000 Wire Collet 1 5400-099-000 Core Universal Driver 1 4100-110-000 Synthes Drill 1 4100-132-000 5/32 inch Drill with Jacobs Chuck 1 4100-131-000 1/4 inch Drill with Jacobs Chuck 1 5400-277-000 CORE STERILE CASE-MEDIUM 1 5400-050-000 CORE CONSOLE 1 5400-100-000 Universal Drill 4 5100-004-000 TPS Handpiece Cord 4 5100-010-070 U2 Straight Long Am Attachment 4 5100-010-072 U2 Angled Long Am Attachment 4 5100-010-050 U2 Straight Medium M Attachment 4 5400-110-000 Universal High Torque Drill 1 5100-010-050 U2 Straight Medium M Attachment 1 5100-010-048 Fixed Duraguard, 16mm" 1 5100-010-248 Steering Duraguard, 16mm" 1 5100-010-072 U2 Angled Long Am Attachment 1 5100-010-020 U2 Straight Short O Attachment 1
Delivery Address: 9981 Healthpark Circle, Fort Myers, FL 33908
Model No. Description Qty
4300-000-000 CORDLESS DRIVER 3 6 4100-062-000 Wire Collet 6 4100-110-000 Synthes Drill 6 4100-126-000 Adjustable Pin Collet 6 4100-132-000 5/32 inch Drill with Jacobs Chuck 6 4100-231-000 1/4 inch Reamer with Jacobs Chuck 6 4100-235-000 Hudson/Modified Trinkle Reamer 6 4100-400-000 SAGITTAL SAW ATTACHMENT 6 6212-000-000 SYSTEM 6 SMALL BATTERY 12 6110-120-000 SYSTEM 6 CHARGER 1 6207-000-000 SYS 6 STERNUM 6 4107-008-000 Sternum Blade Guard 6 6212-000-000 SYSTEM 6 SMALL BATTERY 12 6110-120-000 SYSTEM 6 CHARGER 1 5100-009-000 Universal Handswitch 2 5100-004-000 TPS Handpiece Cord 2 5400-015-000 Core Micro Drill 1 5100-015-250 Micro Drill Medium Straight Attachment 1 5100-015-270 Micro Drill Long Straight Attachment 1 5400-034-000 Micro Sagittal Saw 1 5400-031-000 Micro Oscillating Saw 1 5400-037-000 Micro Reciprocating Saw 1 4100-062-000 Wire Collet 1 5400-099-000 Core Universal Driver 1 4100-110-000 Synthes Drill 1 4100-132-000 5/32 inch Drill with Jacobs Chuck 1 4100-131-000 1/4 inch Drill with Jacobs Chuck 1 5400-277-000 CORE STERILE CASE-MEDIUM 1 5400-050-000 CORE CONSOLE 1
Delivery Address: 2776 Cleveland Ave, Fort Myers, FL 33901
Model No. Description Qty
6208-000-000 SYSTEM 6 SAGITTAL SAW 3 6203-000-000 SINGLE TRIGGER ROTARY 3 6203-136-000 SGL TRIG PIN COLLET 2.0-3.2mm 3 6203-131-000 1/4" CHUCK W/KEY 6 6203-110-000 AO SMALL ATTACHMENT 3 6203-160-000 TRINKLE ATTACHMENT 3 6203-135-000 HUDSON/MODIFIED TRINKLE ATTACH 3 0277-094-099 Snap-Lock Hudson Adapter 3 2102-135-000 Modified Trinkle Adapter 3 4300-000-000 CORDLESS DRIVER 3 6 4100-062-000 Wire Collet 6 4100-110-000 Synthes Drill 6 4100-126-000 Adjustable Pin Collet 6 4100-132-000 5/32 inch Drill with Jacobs Chuck 6 4100-231-000 1/4 inch Reamer with Jacobs Chuck 6 4100-235-000 Hudson/Modified Trinkle Reamer 6 4100-400-000 SAGITTAL SAW ATTACHMENT 6 5400-050-000 CORE CONSOLE WITH INTEGRAL IRRIGATION PUMP 8 5100-008-000 TPS Bi-Directional Footswitch 4 5400-130-000 CORE SUMEX DRILL 11 5100-120-000 Saber Drill 11 5100-120-450 Straight Medium Saber Attachment 11 5100-120-452 Angled Medium Saber Attachment 11 5100-120-470 Straight Long Saber Attachment 11 5100-120-472 Angled Long Saber Attachment 11 5400-210-052 MAESTRO MEDIUM ANGLED ATTCHMNT 11 5400-210-058 MAESTRO MEDIUM FIXED DURAGUARD 11 5400-210-258 MAESTRO MED STEERING DURAGUARD 11 5400-210-060 MAESTRO PERFORATOR CHUCK 11
Delivery Address: 13681 Doctor's Way, Ft. Myers, FL 33912
Model No. Description Qty 5400-130-000 CORE SUMEX DRILL 6 5400-131-000 CORE SUMEX HAND SWITCH 6 5400-210-052 MAESTRO MEDIUM ANGLED ATTCHMNT 6 5400-210-058 MAESTRO MEDIUM FIXED DURAGUARD 6 5400-210-060 MAESTRO PERFORATOR CHUCK 6 5400-210-072 MAESTRO LONG ANGLED ATTACHMENT 6 5100-120-450 Straight Medium Saber Attachment 6 5100-120-452 Angled Medium Saber Attachment 6 5100-120-470 Straight Long Saber Attachment 6 5100-120-472 Angled Long Saber Attachment 6 5400-007-000 NSE FOOTSWITCH 4 5400-050-000 CORE CONSOLE WITH INTEGRAL IRRIGATION PUMP 4 5400-277-000 CORE STERILE CASE-MEDIUM 6
Total Equipment: $ 1,152,630.70
Total Financed Amount: $ 1,152,630.70
Agreed and Accepted By:
Lee Memorial Health System STRYKER FINANCE, a division of
Lessee Name Stryker Sales Corporation
Signature Signature
Print Name Print Name
Title Title
Date Date
EARLY BUYOUT ADDENDUM
This Early Buyout Addendum (“Addendum”) is made part of and amends that certain Schedule 001 to Master Lease Agreement No. 21239355
dated as of ________________ (“Lease”) by and between Stryker Finance, a division of Stryker Sales Corporation (“Lessor”) and Lee Memorial
Health System (“Lessee”). Unless otherwise defined herein, capitalized terms shall have the definition set forth in the Agreement.
WHEREAS, Lessor and Lessee have determined that it is to their mutual benefit to make certain additions to the Lease.
NOW, THEREFORE, for good and valuable consideration, intending to be legally bound and pursuant to the Terms and Conditions of the Lease, it is
hereby agreed as follows:
1. Lessor agrees that Lessee shall have the option (“Termination Option”) to terminate the Lease early after timely receipt by Lessor
of the six (6) lease payments, but before the seventh (7th) lease payment (the effective date of such termination shall be referred to herein as the
“Termination Date”) provided (a) no Event of Default shall have occurred under the Lease; (b) Lessee provides Lessor with thirty (30) days prior
written notice of Lessee‟s intent to exercise the Termination Option on the Termination Date; and (c) Lessee pays to Lessor on the Termination Date
a termination amount equal to $1,006,998.00 plus all applicable taxes plus all other amounts then outstanding under the Lease (“Termination Buyout
Amount”) OR Lessor agrees that Lessee shall have the option (“Termination Option”) to terminate the Lease early after timely receipt by Lessor of
the twelve (12) lease payments, but before the thirteenth (13th) lease payment (the effective date of such termination shall be referred to herein as the
“Termination Date”) provided (a) no Event of Default shall have occurred under the Lease; (b) Lessee provides Lessor with thirty (30) days prior
written notice of Lessee‟s intent to exercise the Termination Option on the Termination Date; and (c) Lessee pays to Lessor on the Termination Date
a termination amount equal to $856,808.49 plus all applicable taxes plus all other amounts then outstanding under the Lease (“Termination Buyout
Amount”).
2. Lessee shall notify Lessor in writing at 13010 SW 68th Parkway, Ste 100 Portland, OR 97223 Attn: Equipment Management
Group Manager, as to its election to terminate the Lease early. If Lessee fails to notify Lessor or fails to pay the Termination Buyout Amount, then
the Lease shall continue in effect in accordance with the terms and conditions contained therein and this option to early terminate the Lease shall
expire.
3. Upon payment of the Termination Buyout Amount, title to the Equipment subject to the Lease shall pass to Lessee on an „AS-IS-
WHERE-IS” basis and without warranty by the Lessor.
4. It is expressly agreed by the parties that this Addendum is supplemental to the Lease which is by reference made a part hereof
and all the Terms and Conditions and provisions thereof unless specifically modified herein, are to apply to this Addendum and are made a part of
this Addendum as though they were expressly rewritten, incorporated and included herein.
5. In the event of any conflict, inconsistency or incongruity between the provisions of this Addendum and any of the provisions of
the Lease, the provisions of this Addendum shall in all respects govern and control.
IN WITNESS WHEREOF, the parties have caused this Addendum to be executed on the dates set forth below.
Dated: ___________________ Lessee: Lee Memorial Health System
By: ____________________________________
Print name: ______________________________
Title: ___________________________________
Dated: ___________________ Stryker Finance, a division of Stryker Sales Corporation
By: ____________________________________
Print name: ______________________________
Title: ___________________________________
Certificate of Acceptance
Stryker Finance, a division of Stryker Sales Corporation 4664 Campus Drive, Suite 130 Kalamazoo, MI 49008
Schedule Number 001 to Master Lease Agreement # 21239355 dated ______________, 20___ Between Stryker Finance, a division of Stryker Sales Corporation and Lessee
Name and Address of Lessee: Lee Memorial Health System PO Box 151247 Cape Coral, FL 33915
Equipment Description: ( See the attached Exhibit “A”) to Schedule 001 to Master Lease Agreement # 21239355 Equipment Location: 636 Del Prado Blvd, Cape Coral, FL 33990, 9981 Healthpark Circle, Fort Myers, FL 33908, 2776 Cleveland Ave, Fort Myers, FL 33901, 13681 Doctor's Way, Ft. Myers, FL 33912
Acceptance Certification: All of the equipment described above (the "Equipment") has been delivered to us pursuant to the financing agreement referred to above (the "Agreement”),we have inspected the Equipment and we hereby unqualifiedly accept the Equipment as of the date set forth below and agree that the Equipment is now subject to the Agreement . Dated: Lee Memorial Health System
[Lessee/User]
By
Title
EQUIPMENT SCHEDULE #002
TO
MASTER LEASE AGREEMENT NO. 21239355
FPU and NON-FPU Lessor:
STRYKER FINANCE, a division of Stryker Sales
Corporation
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008
Lessee: Lee Memorial Health System
Address: PO Box 151247
Cape Coral, FL 33915
Supplier:
Stryker Sales Corporation 5900 Optical Court
San Jose, CA 95138
Equipment Description:
(and/or as described in equipment list attached hereto and made a part hereof collectively, the “Equipment”)
Equipment Location: 636 Del Prado Blvd, Cape Coral, FL 33990, 9981 Healthpark Circle, Fort Myers, FL 33908, 2776 Cleveland Ave, Fort Myers, FL 33901
Schedule of Periodic Rent Payments:
_36_ monthly payments of $ 39,948.73 (plus applicable taxes, unless otherwise indicated as follows:___________________________________)
Term in Months: 36 Minimum Monthly Uses: n/a Fee Per Use: n/a
Purchase Terms (if no blank is checked, the Fair Market Value Option will be deemed chosen): __X__ Fair Market Value Option ____ $1.00 Buyout ___ Fixed Purchase Option $_______________
TERMS AND CONDITIONS
1. Agreement. The undersigned Lessee ("Lessee") unconditionally and irrevocably agrees to lease from the Lessor whose name is listed above (“Lessor”) the Equipment described above, on the terms specified in this Schedule, including all attachments to this Schedule and in the Master Lease Agreement referred to above (as amended
from time to time, the "Agreement"). Except as modified herein, the terms of the Agreement are hereby ratified and incorporated into this Schedule as if set forth herein in full, and shall remain fully enforceable throughout the Term of this Schedule. Capitalized terms used and not otherwise defined in this Schedule have the respective
meanings given to those terms in the Agreement. The Minimum Monthly Uses and Fee Per Use described above shall not affect the amount of any monthly payment.
2. Purchase Option. If either the Fair Market Value Option or the Fixed Purchase Option is selected above, or otherwise applies, upon expiration of the Term and
provided that the Lease has not been terminated early and Lessee is in compliance with the Lease in all respects, Lessee may upon at least 90 but not more than 180 days prior written notice to Lessor exercise the applicable purchase option, and upon the giving of such notice Lessee shall be irrevocably and unconditionally obligated to
purchase all (but not less than all) of the Equipment, for the purchase amount shown above (plus all applicable Taxes), which amount shall be due and payable upon the
expiration of the Term of this Schedule. If the $1.00 Buyout is selected above, upon expiration of the Term, Lessee shall pay the amount of all Rent owed by Lessee hereunder but unpaid as of such date and $1.00 (plus all applicable Taxes). Any purchase of the Equipment by Lessee pursuant to a purchase option or $1.00 Buyout shall
be “AS IS, WHERE IS”, without representation or warranty of any kind from Lessor. “Fair Market Value” shall be the amount determined by Lessor as the fair market
value of the Equipment on the basis of an arms-length sale between an informed and willing buyer who is currently in possession of the Equipment and a willing Seller under no compulsion to sell.
3. Equipment Acceptance. By signing this Schedule LESSEE certifies that the Equipment described above shall be deemed accepted by LESSEE for all purposes under the Agreement on the date that is ten (10) days after the date it is shipped to LESSEE by the supplier of the Equipment.
4. Miscellaneous. The amount of each Periodic Rent payment set forth above is based on Supplier's best estimate of the cost of the Equipment described in this Schedule.
If prior to the Rent Commencement Date, Equipment price changes have been accepted by both parties, Rent may be increased up to 15%, or decreased without limit, if the actual cost of the Equipment differs from that assumed under this Schedule and such change in Rent will be effectuated by written notice from Lessor to Lessee. If
Lessee fails to pay (within thirty days of invoice date) any freight, sales tax or other amounts related to the Equipment which are billed directly by Lessor to Lessee, such
amounts shall be added to the Periodic Rent payments set forth above (plus interest or additional charges thereon) and Lessee authorizes Lessor to adjust such Periodic Rent payments accordingly. In the event the transaction evidenced by this Schedule is determined to be a secured transaction, then as security for all existing or hereafter
arising obligations of Lessee under this Lease and all other obligations of Lessee to Lessor, Lessee hereby grants to Lessor a first priority security interest in all of
Lessee's rights, title (if any) and interests in the Equipment and any additional collateral described herein, and all proceeds and products thereof, including, without limitation, all proceeds of insurance. This Schedule will not be valid until signed by Lessor. Lessee acknowledges that Lessee has not received any tax or accounting
advice from Lessor. If Lessee is required to report the components of its payment obligations hereunder to certain state and/or federal agencies or public health coverage
programs such as Medicare, Medicaid, SCHIP or others, the various components are provided above or in an attachment hereto.
LESSEE HAS READ (AND UNDERSTANDS THE TERMS OF) THIS SCHEDULE BEFORE SIGNING IT.
Lessee: Lee Memorial Health System
Signature:
Its
Date: _____________, 20____
Accepted: STRYKER FINANCE, a division of Stryker Sales Corporation
By:
Its:
KZLIB:575151.1\087451-00161
04/23/08
Exhibit “A” to Schedule 002 to Master Lease Agreement # 21239355 Description of Equipment
Lessee Name: Lee Memorial Health System
Part I – Equipment / Service Coverage (if applicable)
Delivery Address: 636 Del Prado Blvd, Cape Coral, FL 33990
Model No. Description Qty
1188-010-000 1188HD CCU 7 1188-210-122 1188 CAMERA HEAD & COUPLER 21 0220-200-000 X8000 LIGHTSOURCE 2 0233-050-064 FIBEROPTIC LIGHT CABLE 6 0240-050-990 SDC ULTRA DIGITAL CAPTURE AND PRINTER 11 0240-030-960 26IN VISION ELECT HDTV SURGICAL MONITOR 10 0240-099-011K STANDARD VIDEO CART KIT 2 0233-032-105 SCOPE AND CAMERA STERILIZATION TRAY 4 0502-539-010 5MM 0° LAPAROSCOPE, AC 2 0502-859-010 10MM 0° LAPAROSCOPE, AC 2 0502-205-010 5MM 0° BARIATRIC LAPAROSCOPE, AC 2 0502-205-030 5MM 30° BARIATRIC LAPAROSCOPE, AC 2 0620-040-610 PNEUMO SURE XL HIGH FLOW INSUFFLATOR 2
Delivery Address: 9981 Healthpark Circle, Fort Myers, FL 33908
Model No. Description Qty 1188-010-000 1188HD CCU 7 1188-210-122 1188 CAMERA HEAD & COUPLER 20 0220-200-000 X8000 LIGHTSOURCE 2 0233-050-064 FIBEROPTIC LIGHT CABLE 6 0240-050-990 SDC ULTRA DIGITAL CAPTURE AND PRINTER 10 0240-030-970 WIRELAESS 26IN HDTV SURGICAL DISPLAY 4 0240-030-971 WIRELESS HDTV TRANSMITTER 4 0240-030-974 WIRELESS TOKEN KEY 2 0240-030-960 26IN VISION ELECT HDTV SURGICAL MONITOR 10 0233-032-105 SCOPE AND CAMERA STERILIZATION TRAY 4 0502-729-000 HYSTEROSCOPE, 2.9MM 0DEG 1 0502-539-010 5MM 0° LAPAROSCOPE, AC 4 0502-859-010 10MM 0° LAPAROSCOPE, AC 4 0620-040-610 PNEUMO SURE XL HIGH FLOW INSUFFLATOR 2
Delivery Address: 2776 Cleveland Ave, Fort Myers, FL 33901
Model No. Description Qty
1188-010-000 1188HD CCU 7 1188-210-122 1188 CAMERA HEAD & COUPLER 31 0220-200-000 X8000 LIGHTSOURCE 1 0240-050-990 SDC ULTRA DIGITAL CAPTURE AND PRINTER 8 0240-030-970 WIRELAESS 26IN HDTV SURGICAL DISPLAY 1 0240-030-971 WIRELESS HDTV TRANSMITTER 1 0240-030-974 WIRELESS TOKEN KEY 1 0240-030-960 26IN VISION ELECT HDTV SURGICAL MONITOR 8 0240-099-011K STANDARD VIDEO CART KIT 1 0502-524-030 1.9MM 30° ARTHROSCOPE C-MOUNT 2 0502-144-530 2.8MM AUTOCLAVABLE CANNULA, 1 ROTATING STOPCOCK W/ SPEEDLOCK 2 0502-144-560 2.8MM AUTOCLAVABLE CANNULA, 2 ROTATING STOPCOCKS W/SPEEDLOCK 2 0502-144-500 1.9MM AUTOCLAVABLE PENCIL TIP OBTURATOR WITH SPEED-LOCK 2 0620-040-610 PNEUMO SURE XL HIGH FLOW INSUFFLATOR 1 0105-073-001 ARTICULATING LAPAROSCOPE 1
Total Equipment: $ 1,621,167.82
Total Financed Amount: $ 1,621,167.82
Agreed and Accepted By:
Lee Memorial Health System STRYKER FINANCE, a division of
Lessee Name Stryker Sales Corporation
Signature Signature
Print Name Print Name
Title Title
Date Date
EARLY BUYOUT ADDENDUM
This Early Buyout Addendum (“Addendum”) is made part of and amends that certain Schedule 002 to Master Lease Agreement No. 21239355
dated as of ________________ (“Lease”) by and between Stryker Finance, a division of Stryker Sales Corporation (“Lessor”) and Lee Memorial
Health System (“Lessee”). Unless otherwise defined herein, capitalized terms shall have the definition set forth in the Agreement.
WHEREAS, Lessor and Lessee have determined that it is to their mutual benefit to make certain additions to the Lease.
NOW, THEREFORE, for good and valuable consideration, intending to be legally bound and pursuant to the Terms and Conditions of the Lease, it is
hereby agreed as follows:
1. Lessor agrees that Lessee shall have the option (“Termination Option”) to terminate the Lease early after timely receipt by Lessor
of the six (6) lease payments, but before the seventh (7th) lease payment (the effective date of such termination shall be referred to herein as the
“Termination Date”) provided (a) no Event of Default shall have occurred under the Lease; (b) Lessee provides Lessor with thirty (30) days prior
written notice of Lessee‟s intent to exercise the Termination Option on the Termination Date; and (c) Lessee pays to Lessor on the Termination Date
a termination amount equal to $1,429,111.62 plus all applicable taxes plus all other amounts then outstanding under the Lease (“Termination Buyout
Amount”) OR Lessor agrees that Lessee shall have the option (“Termination Option”) to terminate the Lease early after timely receipt by Lessor of
the twelve (12) lease payments, but before the thirteenth (13th) lease payment (the effective date of such termination shall be referred to herein as the
“Termination Date”) provided (a) no Event of Default shall have occurred under the Lease; (b) Lessee provides Lessor with thirty (30) days prior
written notice of Lessee‟s intent to exercise the Termination Option on the Termination Date; and (c) Lessee pays to Lessor on the Termination Date
a termination amount equal to $1,231,043.95 plus all applicable taxes plus all other amounts then outstanding under the Lease (“Termination Buyout
Amount”).
2. Lessee shall notify Lessor in writing at 13010 SW 68th Parkway, Ste 100 Portland, OR 97223 Attn: Equipment Management
Group Manager, as to its election to terminate the Lease early. If Lessee fails to notify Lessor or fails to pay the Termination Buyout Amount, then
the Lease shall continue in effect in accordance with the terms and conditions contained therein and this option to early terminate the Lease shall
expire.
3. Upon payment of the Termination Buyout Amount, title to the Equipment subject to the Lease shall pass to Lessee on an „AS-IS-
WHERE-IS” basis and without warranty by the Lessor.
4. It is expressly agreed by the parties that this Addendum is supplemental to the Lease which is by reference made a part hereof
and all the Terms and Conditions and provisions thereof unless specifically modified herein, are to apply to this Addendum and are made a part of
this Addendum as though they were expressly rewritten, incorporated and included herein.
5. In the event of any conflict, inconsistency or incongruity between the provisions of this Addendum and any of the provisions of
the Lease, the provisions of this Addendum shall in all respects govern and control.
IN WITNESS WHEREOF, the parties have caused this Addendum to be executed on the dates set forth below.
Dated: ___________________ Lessee: Lee Memorial Health System
By: ____________________________________
Print name: ______________________________
Title: ___________________________________
Dated: ___________________ Stryker Finance, a division of Stryker Sales Corporation
By: ____________________________________
Print name: ______________________________
Title: ___________________________________
Certificate of Acceptance
Stryker Finance, a division of Stryker Sales Corporation 4664 Campus Drive, Suite 130 Kalamazoo, MI 49008
Schedule Number 002 to Master Lease Agreement # 21239355 dated ______________, 20___ Between Stryker Finance, a division of Stryker Sales Corporation and Lessee
Name and Address of Lessee: Lee Memorial Health System PO Box 151247 Cape Coral, FL 33915
Equipment Description: ( See the attached Exhibit “A”) to Schedule 002 to Master Lease Agreement # 21239355 Equipment Location: 636 Del Prado Blvd, Cape Coral, FL 33990, 9981 Healthpark Circle, Fort Myers, FL 33908, 2776 Cleveland Ave, Fort Myers, FL 33901
Acceptance Certification: All of the equipment described above (the "Equipment") has been delivered to us pursuant to the financing agreement referred to above (the "Agreement”),we have inspected the Equipment and we hereby unqualifiedly accept the Equipment as of the date set forth below and agree that the Equipment is now subject to the Agreement . Dated: Lee Memorial Health System
[Lessee/User]
By
Title
EQUIPMENT SCHEDULE #003
TO
MASTER LEASE AGREEMENT NO. 21239355
FPU and NON-FPU Lessor:
STRYKER FINANCE, a division of Stryker Sales
Corporation
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008
Lessee: Lee Memorial Health System
Address: PO Box 151247
Cape Coral, FL 33915
Supplier:
Stryker Sales Corporation 3200 Centre Ave
Portage, MI 49002
Equipment Description:
(and/or as described in equipment list attached hereto and made a part hereof collectively, the “Equipment”)
Equipment Location: 636 Del Prado Blvd, Cape Coral, FL 33990, 9981 Healthpark Circle, Fort Myers, FL 33908
Schedule of Periodic Rent Payments:
_36_ monthly payments of $ 728.40 (plus applicable taxes, unless otherwise indicated as follows:___________________________________)
Term in Months: 36 Minimum Monthly Uses: n/a Fee Per Use: n/a
Purchase Terms (if no blank is checked, the Fair Market Value Option will be deemed chosen):
__X__ Fair Market Value Option ____ $1.00 Buyout ___ Fixed Purchase Option $_______________
TERMS AND CONDITIONS
1. Agreement. The undersigned Lessee ("Lessee") unconditionally and irrevocably agrees to lease from the Lessor whose name is listed above (“Lessor”) the Equipment described above, on the terms specified in this Schedule, including all attachments to this Schedule and in the Master Lease Agreement referred to above (as amended
from time to time, the "Agreement"). Except as modified herein, the terms of the Agreement are hereby ratified and incorporated into this Schedule as if set forth herein in full, and shall remain fully enforceable throughout the Term of this Schedule. Capitalized terms used and not otherwise defined in this Schedule have the respective
meanings given to those terms in the Agreement. The Minimum Monthly Uses and Fee Per Use described above shall not affect the amount of any monthly payment.
2. Purchase Option. If either the Fair Market Value Option or the Fixed Purchase Option is selected above, or otherwise applies, upon expiration of the Term and
provided that the Lease has not been terminated early and Lessee is in compliance with the Lease in all respects, Lessee may upon at least 90 but not more than 180 days prior written notice to Lessor exercise the applicable purchase option, and upon the giving of such notice Lessee shall be irrevocably and unconditionally obligated to
purchase all (but not less than all) of the Equipment, for the purchase amount shown above (plus all applicable Taxes), which amount shall be due and payable upon the
expiration of the Term of this Schedule. If the $1.00 Buyout is selected above, upon expiration of the Term, Lessee shall pay the amount of all Rent owed by Lessee hereunder but unpaid as of such date and $1.00 (plus all applicable Taxes). Any purchase of the Equipment by Lessee pursuant to a purchase option or $1.00 Buyout shall
be “AS IS, WHERE IS”, without representation or warranty of any kind from Lessor. “Fair Market Value” shall be the amount determined by Lessor as the fair market
value of the Equipment on the basis of an arms-length sale between an informed and willing buyer who is currently in possession of the Equipment and a willing Seller under no compulsion to sell.
3. Equipment Acceptance. By signing this Schedule LESSEE certifies that the Equipment described above shall be deemed accepted by LESSEE for all purposes under the Agreement on the date that is ten (10) days after the date it is shipped to LESSEE by the supplier of the Equipment.
4. Miscellaneous. The amount of each Periodic Rent payment set forth above is based on Supplier's best estimate of the cost of the Equipment described in this Schedule.
If prior to the Rent Commencement Date, Equipment price changes have been accepted by both parties, Rent may be increased up to 15%, or decreased without limit, if the actual cost of the Equipment differs from that assumed under this Schedule and such change in Rent will be effectuated by written notice from Lessor to Lessee. If
Lessee fails to pay (within thirty days of invoice date) any freight, sales tax or other amounts related to the Equipment which are billed directly by Lessor to Lessee, such
amounts shall be added to the Periodic Rent payments set forth above (plus interest or additional charges thereon) and Lessee authorizes Lessor to adjust such Periodic Rent payments accordingly. In the event the transaction evidenced by this Schedule is determined to be a secured transaction, then as security for all existing or hereafter
arising obligations of Lessee under this Lease and all other obligations of Lessee to Lessor, Lessee hereby grants to Lessor a first priority security interest in all of
Lessee's rights, title (if any) and interests in the Equipment and any additional collateral described herein, and all proceeds and products thereof, including, without limitation, all proceeds of insurance. This Schedule will not be valid until signed by Lessor. Lessee acknowledges that Lessee has not received any tax or accounting
advice from Lessor. If Lessee is required to report the components of its payment obligations hereunder to certain state and/or federal agencies or public health coverage
programs such as Medicare, Medicaid, SCHIP or others, the various components are provided above or in an attachment hereto.
LESSEE HAS READ (AND UNDERSTANDS THE TERMS OF) THIS SCHEDULE BEFORE SIGNING IT.
Lessee: Lee Memorial Health System
Signature:
Its
Date: _____________, 20____
Accepted: STRYKER FINANCE, a division of Stryker Sales Corporation
By:
Its:
Exhibit “A” to Schedule 003 to Master Lease Agreement # 21239355 Description of Equipment
Lessee Name: Lee Memorial Health System
Part I – Equipment / Service Coverage (if applicable)
Delivery Address: 636 Del Prado Blvd, Cape Coral, FL 33990
Model No. Description Qty 1015-000-000 M-Series with Big Wheel (SM204) 3
Delivery Address: 9981 Healthpark Circle, Fort Myers, FL 33908
Model No. Description Qty 1015-000-000 M-Series with Big Wheel (SM204) 2
Total Equipment: $ 30,522.90
Total Financed Amount: $ 30,522.90
Agreed and Accepted By:
Lee Memorial Health System STRYKER FINANCE, a division of
Lessee Name Stryker Sales Corporation
Signature Signature
Print Name Print Name
Title Title
Date Date
EARLY BUYOUT ADDENDUM
This Early Buyout Addendum (“Addendum”) is made part of and amends that certain Schedule 003 to Master Lease Agreement No. 21239355
dated as of ________________ (“Lease”) by and between Stryker Finance, a division of Stryker Sales Corporation (“Lessor”) and Lee Memorial
Health System (“Lessee”). Unless otherwise defined herein, capitalized terms shall have the definition set forth in the Agreement.
WHEREAS, Lessor and Lessee have determined that it is to their mutual benefit to make certain additions to the Lease.
NOW, THEREFORE, for good and valuable consideration, intending to be legally bound and pursuant to the Terms and Conditions of the Lease, it is
hereby agreed as follows:
1. Lessor agrees that Lessee shall have the option (“Termination Option”) to terminate the Lease early after timely receipt by Lessor
of the six (6) lease payments, but before the seventh (7th) lease payment (the effective date of such termination shall be referred to herein as the
“Termination Date”) provided (a) no Event of Default shall have occurred under the Lease; (b) Lessee provides Lessor with thirty (30) days prior
written notice of Lessee‟s intent to exercise the Termination Option on the Termination Date; and (c) Lessee pays to Lessor on the Termination Date
a termination amount equal to $27,051.23 plus all applicable taxes plus all other amounts then outstanding under the Lease (“Termination Buyout
Amount”) OR Lessor agrees that Lessee shall have the option (“Termination Option”) to terminate the Lease early after timely receipt by Lessor of
the twelve (12) lease payments, but before the thirteenth (13th) lease payment (the effective date of such termination shall be referred to herein as the
“Termination Date”) provided (a) no Event of Default shall have occurred under the Lease; (b) Lessee provides Lessor with thirty (30) days prior
written notice of Lessee‟s intent to exercise the Termination Option on the Termination Date; and (c) Lessee pays to Lessor on the Termination Date
a termination amount equal to $ 23,470.89 plus all applicable taxes plus all other amounts then outstanding under the Lease (“Termination Buyout
Amount”).
2. Lessee shall notify Lessor in writing at 13010 SW 68th Parkway, Ste 100 Portland, OR 97223 Attn: Equipment Management
Group Manager, as to its election to terminate the Lease early. If Lessee fails to notify Lessor or fails to pay the Termination Buyout Amount, then
the Lease shall continue in effect in accordance with the terms and conditions contained therein and this option to early terminate the Lease shall
expire.
3. Upon payment of the Termination Buyout Amount, title to the Equipment subject to the Lease shall pass to Lessee on an „AS-IS-
WHERE-IS” basis and without warranty by the Lessor.
4. It is expressly agreed by the parties that this Addendum is supplemental to the Lease which is by reference made a part hereof
and all the Terms and Conditions and provisions thereof unless specifically modified herein, are to apply to this Addendum and are made a part of
this Addendum as though they were expressly rewritten, incorporated and included herein.
5. In the event of any conflict, inconsistency or incongruity between the provisions of this Addendum and any of the provisions of
the Lease, the provisions of this Addendum shall in all respects govern and control.
IN WITNESS WHEREOF, the parties have caused this Addendum to be executed on the dates set forth below.
Dated: ___________________ Lessee: Lee Memorial Health System
By: ____________________________________
Print name: ______________________________
Title: ___________________________________
Dated: ___________________ Stryker Finance, a division of Stryker Sales Corporation
By: ____________________________________
Print name: ______________________________
Title: ___________________________________
Certificate of Acceptance
Stryker Finance, a division of Stryker Sales Corporation 4664 Campus Drive, Suite 130 Kalamazoo, MI 49008
Schedule Number 003 to Master Lease Agreement # 21239355 dated ______________, 20___ Between Stryker Finance, a division of Stryker Sales Corporation and Lessee
Name and Address of Lessee: Lee Memorial Health System PO Box 151247 Cape Coral, FL 33915
Equipment Description: ( See the attached Exhibit “A”) to Schedule 003 to Master Lease Agreement # 21239355 Equipment Location: 636 Del Prado Blvd, Cape Coral, FL 33990, 9981 Healthpark Circle, Fort Myers, FL 33908
Acceptance Certification: All of the equipment described above (the "Equipment") has been delivered to us pursuant to the financing agreement referred to above (the "Agreement”),we have inspected the Equipment and we hereby unqualifiedly accept the Equipment as of the date set forth below and agree that the Equipment is now subject to the Agreement . Dated: Lee Memorial Health System
[Lessee/User]
By
Title
INSURANCE AUTHORIZATION
AND VERIFICATION
Date: October 9, 2009 Schedule 001, 002, and 003 to Master Lease Agreement Number: 21239355
To: Lee Memorial Health System (“Customer”) 636 Del Prado Blvd, Cape Coral, FL 33990,
9981 Healthpark Circle, Fort Myers, FL 33908,
2776 Cleveland Ave, Fort Myers, FL 33901, and 13681 Doctor's Way, Ft. Myers, FL 33912
From: Stryker Finance, a Division of Stryker Sales Corporation
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008
TO THE CUSTOMER: In connection with one or more financing arrangements, Creditor requires proof in the form of this document, executed by
both Customer* and Customer‟s agent, that Customer's insurable interest in the financed property (the “Property”) meets Creditor‟s requirements as follows,
with coverage including, but not limited to, fire, extended coverage, vandalism, and theft:
Creditor, and its successors and assigns shall be covered as both ADDITIONAL INSURED and LENDER'S LOSS PAYEE with regard to all
equipment financed or leased by policy holder through or from Creditor.
Customer must carry GENERAL LIABILITY (and/or, for vehicles, Automobile Liability) in the amount of no less than $1,000,000.00 (one
million dollars).
Customer must carry PROPERTY Insurance (or, for vehicles, Physical Damage Insurance) in an amount no less than the 'Insurable
Value' $ 2,804,321.42, with deductibles no more than $10,000.00.
*Customer: Please execute this form and return with your document package. Creditor will fax this form to your insurance agency for endorsement. In lieu of
agent endorsement, Customer‟s agency may submit insurance certificates demonstrating compliance with all requirements. If fully executed form (or
Customer-executed form plus certificates) is not provided within 15 days, we have the right to purchase such insurance at your expense. Should you have
any questions, please contact Emily Southard at (269) 323-7700 ext: 4438.
By signing, Customer authorizes the Agent named below: 1) to complete and return this form as indicated; and 2) to endorse the policy and
subsequent renewals to reflect the required coverage as outlined above.
Agency/Agent:
Address:
Phone/Fax:
________________________________________
________________________________________
________________________________________
________________________________________
Lee Memorial Health System
By: _______________________________ (Customer Signature)
TO THE AGENT: In lieu of providing a certificate, please execute this form in the space below and promptly fax it to Stryker Finance at (888) 655-
4344. This fully endorsed form shall serve as proof that Customer's insurance meets the above requirements.
Agent hereby verifies that the above requirements have been met in regard to the Property listed below.
Print Name Of Agency:
X_____________________________________
By: X____________________________________
(Agent's Signature)
Print Name: X______________________________
Date: X__________________________________
Insurable Value: $ 2,804,321.42
ATTACHED: PROPERTY DESCRIPTION FOR Schedule 001, 002, and 003 to Master Lease Agreement Number: 21239355
See Exhibit “A” to Schedule 001, 002, and 003 to Master Lease Agreement Number: 21239355
TOGETHER WITH ALL REPLACEMENTS, PARTS, REPAIRS, ADDITIONS, ACCESSIONS AND ACCESSORIES INCORPORATED THEREIN OR
AFFIXED OR ATTACHED THERETO AND ANY AND ALL PROCEEDS OF THE FOREGOING, INCLUDING, WITHOUT LIMITATION, INSURANCE
RECOVERIES.9/10
OPINION OF COUNSEL LETTER
DATE: ___________________
Stryker Finance
a division of Stryker Sales Corporation (“we” or “us”)
4664 Campus Drive, Suite 130
Kalamazoo, MI 49008
Gentlemen/Ladies:
Reference is made to that Master Lease Agreement # 21239355 and Schedules 001, 002, and 003 thereunder dated
_________________ (collectively, the “Agreement”) between Stryker Finance a division of Stryker Sales Corporation (herein called
"Owner"), and Lee Memorial Health System, (herein called "Lessee") for the use (“Use”) of certain equipment, goods and/or services as
described in the Agreement. Unless otherwise defined herein, terms which are defined or defined by reference in the Agreement or any
exhibit or schedule thereto shall have the same meaning when used herein as such terms have therein.
The undersigned is Counsel for the Lessee in connection with the negotiation, execution and delivery of the Agreement, and as such I
am able to render a legal opinion as follows:
1. The Lessee is a public body corporate and politic of the State of ____________________ and is authorized by the Constitution and
laws of the State of ____________________ to enter into the transactions contemplated by the Agreement and to carry out its obligations
thereunder.
2. The Agreement set forth above has been duly authorized, executed and delivered by the Lessee and constitutes a valid, legal and
binding agreement, enforceable in accordance with its terms.
3. No further approval, consent or withholding of objections is required from any federal, state or local governmental
authority with respect to the entering into or performance by the Lessee of the Agreement and the transactions contemplated thereby.
4. The entering into and performance of the Agreement and the other related documents will not violate any judgment, order, law or
regulation applicable to the Lessee or result in any breach of, or constitute a default under, or result in the creation of any lien, charge,
security interest or other encumbrance upon any assets of the Lessee or the equipment pursuant to any indenture, mortgage, deed of trust,
bank loan, credit agreement or other instrument by which the Lessee is a party or by which it or its assets may be bound.
5. There are no actions, suits or proceedings pending or, to the knowledge of the Lessee, threatened against or affecting the Lessee in
any court or before any governmental commission, board or authority, which, if adversely determined, will have a material adverse effect on
the ability of the Lessee to perform its obligations under the Agreement..
6. All required public bidding procedures regarding the award of the Agreement have been followed by the Lessee.
7. Lessee has no authority (statutory or otherwise) to terminate the Agreement prior to the end of its term for any reason other than
pursuant to the Fiscal Funding Addendum (if there is such an Addendum attached to the Agreement) for the nonappropriation of funds to pay
the Agreement payments for any fiscal period during the term of the Agreement.
Very truly yours,
BY: _________________________________________________________
PRINT NAME: ________________________________________________
TITLE: ______________________________________________________
STATE AND LOCAL GOVERNMENT CUSTOMER RIDER
This State and Local Government Customer Rider (the “Rider”) is an addition to and hereby made a part of the Master Lease Agreement #
21239355 (the “Agreement”) between STRYKER FINANCE, a division of Stryker Sales Corporation ("Lessor") and Lee Memorial Health
System (“Lessee”) to be executed simultaneously herewith and to which this Rider is attached. Capitalized terms used but not defined in this
Rider shall have the respective meanings provided in the Agreement. Lessor and Lessee agree as follows:
1. Lessee represents and warrants to Lessor that as of the date of, and throughout the Term of, the Agreement: (a) Lessee is a political subdivision
of the state or commonwealth in which it is located and is organized and existing under the constitution and laws of such state or commonwealth;
(b) Lessee has complied, and will comply, fully with all applicable laws, rules, ordinances, and regulations governing open meetings, public
bidding and appropriations required in connection with the Agreement, the performance of its obligations under the Agreement and the acquisition
and use of the Equipment; (c) The person(s) signing the Agreement and any other documents required to be delivered in connection with the
Agreement (collectively, the “Documents”) have the authority to do so, are acting with the full authorization of Lessee's governing body, and hold
the offices indicated below their signatures, each of which are genuine; (d) The Documents are and will remain valid, legal and binding
agreements, and are and will remain enforceable against Lessee in accordance with their terms; and (e) The Equipment is essential to the
immediate performance of a governmental or proprietary function by Lessee within the scope of its authority and will be used during the Term of
the Agreement only by Lessee and only to perform such function. Lessee further represents and warrants to Lessor that, as of the date each item
of Equipment becomes subject to the Agreement and any applicable schedule, it has funds available to pay all lease payments payable
thereunder until the end of Lessee‟s then current fiscal year, and, in this regard and upon Lessor‟s request, Lessee shall deliver in a form
acceptable to Lessor a resolution enacted by Lessee's governing body, authorizing the appropriation of funds for the payment of Lessee‟s
obligations under the Agreement during Lessee's then current fiscal year.
2. To the extent permitted by applicable law, Lessee agrees to take all necessary and timely action during the Agreement and any applicable
schedule (referred to herein as a “Lease”) term to obtain and maintain funds appropriations sufficient to satisfy its payment obligations under
the Lease (the “Obligations”), including, without limitation, providing for the Obligations in each budget submitted to obtain applicable
appropriations, causing approval of such budget, and exhausting all available reviews and appeals if an appropriation sufficient to satisfy the
Obligations is not made.
3. Notwithstanding anything to the contrary provided in a Lease, if Lessee does not appropriate funds sufficient to make all payments due
during any fiscal year under the Lease and Lessee does not otherwise have funds available to lawfully pay the Lease payments (a "Non-
Appropriation Event"), and provided Lessee is not in default of any of Lessee‟s obligations under such Lease as of the effective date of such
termination, Lessee may terminate such Lease effective as of the end of Lessee‟s last funded fiscal year (“Termination Date”) without liability
for future monthly charges or the early termination charge under such Lease, if any, by giving at least 60 days‟ prior written notice of
termination (“Termination Notice”) to Lessor.
4. If Lessee terminates a Lease prior to the expiration of the end of the Lease‟s initial (primary) term, or any extension or renewal thereof, as
permitted under Section 3 above, Lessee shall (i) return the Equipment to Lessor on or before the Termination Date in accordance with the
applicable provisions of the Lease, (ii) provide in the Termination Notice a certification of a responsible official that a Non-Appropriation
Event has occurred, (iii) deliver to Lessor, upon request by Lessor, an opinion of Lessee's counsel (addressed to Lessor) verifying that the Non-
Appropriation Event as set forth in the Termination Notice has occurred, and (iv) pay Lessor all sums payable to Lessor under the Lease up to
and including the Termination Date.
5. Any provisions in this Rider that are in conflict with any applicable statute, law or rule shall be deemed omitted, modified or altered to the
extent required to conform thereto, but the remaining provisions hereof shall remain enforceable as written.
Lessor: STRYKER FINANCE, a division of Stryker
Sales Corporation Lessee: LEE MEMORIAL HEALTH SYSTEM
By: By:
Name: Name:
Title: Title:
Date: Date:
ADDENDUM TO MASTER LEASE AGREEMENT NO. 21239355 AND EQUIPMENT SCHEDULES NOS. 001, 002 AND 003
TO MASTER LEASE AGREEMENT NO. 21239355 BETWEEN STRYKER FINANCE, A DIVISION OF STRYKER SALES
CORPORATION AND LEE MEMORIAL HEALTH SYSTEM
This Addendum is hereby made a part of the Master Lease Agreement described above (the “Agreement”) and Equipment
Schedules 001, 002 and 003 to the Agreement (the “Schedules”). In the event of a conflict between the provisions of this Addendum and
the provisions of the Agreement or the provisions of this Addendum and the provisions of the Schedules, the provisions of this Addendum
shall control.
1. The second sentence of section 2 of the Agreement is hereby amended in its entirety to read as follows:
“Within ten (10) days after the date the Equipment is delivered to Lessee under a Schedule, Lessee shall either: (i) accept the Equipment
by executing and delivering to Lessor a Certificate of Acceptance in form acceptable to Lessor (and the date such written acceptance is
delivered to Lessor is hereinafter referred to as the “Acceptance Date”); or (ii) reject the Equipment and promptly return the Equipment
to Lessor at which time the Schedule shall terminate.”
2. The following language is hereby added to the end of section 8 of the Agreement:
“Notwithstanding anything to the contrary contained herein or in any “Insurance Authorization and Verification,” Lessee may maintain a
deductible of not to exceed $500,000 regarding the property insurance required above.”
3. Sub-section (g) of the first sentence of section 14 of the Agreement is hereby amended in its entirety to read as follows:
“(g) Lessee‟s articles of incorporation or other formation documents shall be amended to change Lessee‟s name or state of incorporation
or formation and Lessee fails to give Lessor written notice of such change (including a copy of any such amendment) not less than 15 days
prior to such amendment becoming effective, or”
4. The third to last sentence of section 14 of the Agreement is hereby deleted and replaced by the following:
“Any return or repossession of the Equipment pursuant to this paragraph will not constitute a termination of this Agreement unless Lessor
expressly notifies Lessee in writing. In the event the Equipment is returned or repossessed by Lessor, Lessor may sell, lease or rent the
Equipment to any persons with any terms Lessor determines, at one or more public or private sales, with notice as required by law, and
apply the net proceeds after deducting the costs and expenses of such sale, lease or rental, to Lessee‟s obligations with Lessee remaining
liable for any deficiency and with any excess being retained by Lessor or applied as required by law. The credit for any sums to be
received by Lessor from any such lease or rental shall be discounted to the date of the applicable lease/rental agreement at three percent
(3%) per year.”
5. The third sentence of section 15 of the Agreement is hereby deleted and what was the fourth sentence of section 15 of the
Agreement is hereby amended in its entirety to read as follows:
“EACH SCHEDULE SHALL BE GOVERNED BY THE LAWS OF FLORIDA, WITHOUT REGARD TO ITS PRINCIPLES
OF CONFLICT OF LAWS OR CHOICE OF LAW.”
6. The following sentence is hereby added to section 15 of the Agreement:
”Notwithstanding anything herein to the contrary, information about the undersigned may not be used by Lessor for marketing purposes.”
7. The last sentence of section 2 of Schedule 001 is hereby amended in its entirety to read as follows:
““Fair Market Value” shall be the amount determined by Lessor as the fair market value of the Equipment on the basis of an arms-length
sale between an informed and willing buyer who is currently in possession of the Equipment and a willing Seller under no compulsion to
sell not to exceed $230,528.80 plus applicable taxes.”
8. The last sentence of section 2 of Schedule 002 is hereby amended in its entirety to read as follows:
““Fair Market Value” shall be the amount determined by Lessor as the fair market value of the Equipment on the basis of an arms-length
sale between an informed and willing buyer who is currently in possession of the Equipment and a willing Seller under no compulsion to
sell not to exceed $405,292.05 plus applicable taxes.”
9. The last sentence of section 2 of Schedule 003 is hereby amended in its entirety to read as follows:
““Fair Market Value” shall be the amount determined by Lessor as the fair market value of the Equipment on the basis of an arms-length
sale between an informed and willing buyer who is currently in possession of the Equipment and a willing Seller under no compulsion to
sell not to exceed $8,546.44 plus applicable taxes.”
10. Section 3 of each of the Schedules is hereby amended in its entirety to read as follows;
“3. Equipment Acceptance. See section 2 of the Agreement.”
11. The first and second sentences of section 4 of each of the Schedules are hereby deleted.
Dated: _______________________, 2009
STRYKER FINANCE, A DIVISION OF STRYKER SALES
CORPORATION
By: _____________________________
Its: _____________________________
LEE MEMORIAL HEALTH SYSTEM
By: _____________________________
Its: _____________________________
17378320.1\087451-00161 DRAFT 10/27/09 9:06 AM
1
WARRANTY, INDEMNIFICATION AND COMPLIANCE STATEMENT
(Endoscopy)
ENDOSCOPY WARRANTY: Products manufactured and sold by Stryker Endoscopy, a division of Stryker Sales Corporation (“Stryker”) include the warranties, and are subject to Stryker’s Return Policy, set forth in Schedule I attached to this Statement and incorporated herein by reference. If you have purchased an extended warranty from Stryker on any products, then, as to such products, the “Warranty Period” described in Schedule I will mean the number of months or years of coverage purchased by you. EXCEPT AS OTHERWISE SET FORTH IN THIS STATEMENT, STRYKER (INCLUDING STRYKER FINANCE, A DIVISION OF STRYKER SALES CORPORATION) MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE.
INDEMNIFICATION:
This indemnification is in effect for the Equipment and Disposables provided the instructions outlined in the Manufacturers Operating Manual (separately provided to you) are followed. Stryker will hold you harmless and will indemnify you for any and all liability incurred from patient injury resulting directly from a defect in workmanship or design of the Equipment and Disposables that are used during any surgical procedure. This indemnification will not apply to any liability arising from (A) a patient injury due to the negligence of any person other than an employee or agent of Stryker during such procedure, (B) the failure of any person other than an employee or agent of Stryker to follow any instructions for use of the Equipment and Disposables or (C) the use of any equipment or disposables not purchased from Stryker or Equipment or Disposables that have been modified or altered. Except as specifically provided herein, Stryker is not responsible for any losses or injuries arising from the selection, manufacture, installation, operation, condition, possession, or use of the Equipment and Disposables. You agree to reimburse and to defend Stryker for and against any claims for losses or injuries arising from (A), (B), or (C) above. INSURANCE: Stryker shall maintain, at its own expense, insurance policies of the kind and limits listed below and with insurers with an A.M. Best rating of not less than A- VIII or its equivalent: (a) WORKERS’ COMPENSATION with statutory limits and EMPLOYER’S LIABILITY with minimum limits of $2,000,000 Each Accident, $2,000,000 Disease – Each Employee, and $2,000,000 Disease – Policy Limit. (b) COMMERCIAL GENERAL LIABILITY, including Premises/Operations Liability, Products/Completed Operations Liability, Contractual Liability, Independent Contractor’s Liability, Broad Form Property Damage Liability, and Personal/Advertising Injury Liability, with minimum limits of $3,000,000 per occurrence and $3,000,000 general aggregate. (c) AUTOMOBILE LIABILITY covering owned, non-owned and hired autos with a minimum combined single limit of $2,000,000 per accident if licensed vehicles are used in connection with the performance of this Agreement, and at all times when such vehicles are operated on the leased or owned premises of Hospital. At your request, Stryker shall provide you with a certificate of insurance evidencing the foregoing insurance. Stryker warrants that it will maintain the above insurance coverages during the term of your purchases of products from Stryker and you will be provided with at least thirty (30) days’ prior written notice of cancellation of any coverage, unless cancellation is due to the non-payment of premium, in which case Stryker shall provide ten (10) days’ prior written notice. With the exception of policy (c) above, Stryker shall be permitted to maintain any of the required insurance coverages through a program of self-insurance. COMPLIANCE: 1. FDA. To the extent required, Stryker represents and warrants that the U.S. Food and Drug Administration (“FDA”) has cleared the products provided to you for the uses specifically set forth in the instructions for use accompanying the products. Stryker represents and warrants that no product delivered to you by Stryker is adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, as amended, or within the meaning of any applicable state or municipal law in which the definition of adulteration and misbranding are substantially the same as those contained in the Federal Food, Drug and Cosmetic Act, as said Act and such laws are constituted and effective at the time of shipment or delivery, or is a product which may not, under the provisions of Section 404 or 505 of said Act, be introduced into interstate commerce. 2. Stryker Personnel. To the extent provided to you, Stryker represents and warrants that all services shall be completed in a professional, workmanlike manner, with the degree of skill and care that is required by current, good and sound professional procedures. Further Stryker represents and warrants that services shall be completed in accordance with applicable specifications and shall be correct and appropriate for the purposes for which they are provided. Stryker only agrees to acknowledge your policies and that Stryker is encouraged by you to report violations of your policies. You may only exclude Stryker’s employees, agents, or independent contractors from dealings
2
between the parties for violations of your policies, provided, however, that Stryker’s agents and independent contractors are not subject to your approval. 3. Non-Exclusion. Stryker represents and warrants that, neither it nor any of its employees, are or have been excluded terminated, suspended, or debarred from a federal or state health care program or from participation in any federal or state procurement or non-procurement programs. Stryker further represents to you that no final adverse action by the federal or state government has occurred or is pending or threatened against Stryker, its affiliates, or, to its knowledge, against any employee of Stryker, or agent engaged to provide goods or services to you. If during the term of your purchases of products from Stryker, it, or any of its employees becomes so excluded, terminated, suspended, or debarred from a federal or state health care program or from participation in any federal or state procurement or non-procurement programs, Stryker will promptly notify you.
4. HIPAA Compliance. Stryker and you understand, acknowledge and agree that although not necessary to Stryker’s providing goods and/or services to you, Stryker’s employees, contractors, agents or other representatives may encounter personal or confidential information or materials belonging to you, your patients, employees, contractors, agents or other representatives. All medical information and/or data concerning specific patients (including, but not limited to, the identity of the patients) shall be treated by both parties as confidential so as to comply with all applicable state and federal laws and regulations regarding confidentiality of patient records, and shall not be released, disclosed, or published to any party other than as required or permitted under applicable laws. The parties shall to the extent applicable, comply with the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), and the regulations thereunder as amended to ensure the protection of Protected Health Information ("PHI") as defined therein. 5. Applicable Laws. It is the intent of Stryker and you to comply in all respects with all federal, state and local laws and regulations governing the relationship between or among healthcare providers. In the event performance by either party should jeopardize your full accreditation or licensure by any regulatory agency, or be in violation of any statute or ordinance or for any reason be illegal or deemed unethical by any recognized agency or association in the medical or hospital fields, you may, at your option, terminate your purchases of products from Stryker. 6. Access to Records. To the extent required by law the following provision applies: Stryker agrees to comply with the Omnibus Reconciliation Act of 1980 (P.L. 96-499) and its implementing regulations (42 CFR, Part 420). To the extent applicable to its activities, Stryker further specifically agrees that until the expiration of four (4) years after furnishing services and/or products pursuant to this Agreement, Stryker shall make available, upon written request of the Secretary of the Department of Health and Human Services, or upon request of the Comptroller General, or any of their duly authorized representatives, this Statement and the books, documents and records of Stryker that are necessary to verify the nature and extent of the costs charged to you for purchases of products from Stryker. Stryker further agrees that if Stryker carries out any of the duties of this Agreement through a subcontract with a value or cost of ten thousand dollars ($10,000) or more over a twelve (12) month period, with a related organization, such subcontract shall contain a clause to the effect that until the expiration of four (4) years after the furnishing of such services pursuant to such subcontract, the related organization shall make available, upon written request to the Secretary, or upon request to the Comptroller General, or any of their duly authorized representatives the subcontract, and books and documents and records of such organization that are necessary to verify the nature and extent of such costs. CONFIDENTIALITY: You will not disclose to any third party the terms, including pricing information, or any other information provided by Stryker to you in connection with the sale of products to you by Stryker, without Stryker’s prior written approval. The confidentiality obligation will not apply to information that is: (a) already public or that becomes public other than as a result of disclosure by you; or (b) required by law or legal process to be disclosed. In the case of required disclosure, written notice of such requirement will be promptly communicated to Stryker and you will cooperate, at the expense of Stryker, with Stryker in its efforts to limit the scope of disclosure required. NO EFFECT ON STRYKER FINANCE AGREEMENTS: The warranty, indemnification, insurance, compliance and other terms of this Statement are the responsibility of Stryker, but: (i) this Statement shall not be part of any agreement(s) between you and Stryker Finance, a division of Stryker Sales Corporation (collectively “Stryker Finance Agreement”); and (ii) no assignee of any Stryker Finance Agreement shall have any responsibility to you under this Statement.
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STRYKER ENDOSCOPY
PRODUCT WARRANTY & RETURN POLICY PRODUCT WARRANTY Stryker Endoscopy warrants all products, subject to the exceptions provided herein, to be free from defects in design, materials and workmanship and to substantially conform to the product specifications contained in the documentation provided by Stryker Endoscopy with the products for a period of one year from the date of purchase (the “Warranty Period”). This warranty shall apply only to the original end-user purchaser of products directly from Stryker Endoscopy or a Stryker Endoscopy authorized distributor. This warranty may not be transferred or assigned without the express written consent of Stryker Endoscopy. If a valid warranty claim is received within the Warranty Period, Stryker will, in its sole discretion: (1) repair the product at no charge, (2) replace the product at no charge with a product that is at least functionally equivalent to the original product, or (3) refund the purchase price of the product. In any event, Stryker’s liability for breach of warranty shall be limited to the replacement value of the defective or non-conforming part or component. This warranty does not apply to: (1) products that have been misused, neglected, modified, altered, adjusted, tampered with, improperly installed or refurbished; (2) products that have been repaired by any person other than Stryker Endoscopy personnel without the prior written consent of Stryker Endoscopy; (3) products that have been subjected to unusual stress or have not been maintained in accordance with the instructions in the user manual or as demonstrated by a Stryker Endoscopy representative; (4) products on which any original serial numbers or other identification marks have been removed or destroyed; or (5) products that have been repaired with any unauthorized or non-Stryker components, including replacement lamps. If Stryker determines in its reasonable discretion that the claimed defect or non-conformance in the product is excluded from warranty coverage as described hereunder, it will notify the customer of such determination and will provide an estimate of the cost of repair of the product. In such an event, any repair would be performed at Stryker’s standard rates. Products and product components repaired or replaced under this warranty continue to be warranted as described herein during the initial Warranty Period or, if the initial Warranty Period has expired by the time the product is repaired or replaced, for thirty (30) days after delivery of the repaired or replaced product. When a product or component is replaced, the item provided in replacement will be the customer’s property and the replaced item will be Stryker’s property. If a refund is provided by Stryker, the product for which the refund is provided must be returned to Stryker and will become Stryker’s property. The inspection, testing, acceptance or use of the products and services furnished hereunder shall not affect Stryker’s obligation under this warranty, and such warranty shall survive inspection, test, acceptance and use. Notwithstanding the above, the following products are warranted for a period of ninety (90) days from the date of purchase:
Scopes, Associated Scope Hardware, Fiber Optic Cables, Laparoscopic Instruments, VCRs, Monitors, and Printers;
replacement light bulbs are warranted for a period of sixty (60) days from the date of purchase.
TO THE FULLEST EXTENT PERMITTED BY LAW, THE EXPRESS WARRANTY SET FORTH HEREIN IS THE
ONLY WARRANTY APPLICABLE TO THE PRODUCTS AND IS EXPRESSLY IN LIEU OF ANY OTHER WARRANTY
BY STRYKER, EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT AS SPECIFICALLY PROVIDED IN
THIS WARRANTY AND TO THE EXTENT PERMITTED BY LAW, STRYKER IS NOT RESPONSIBLE FOR
INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES RESULTING FROM ANY BREACH OF
WARRANTY OR UNDER ANY OTHER LEGAL THEORY.
RETURN POLICY Stryker Endoscopy values customer relationships and strives for satisfaction in purchases made by our customers. Therefore, we offer a return policy for most products. Under this policy, customers may return purchased products to Stryker Endoscopy, within 90 days of customer’s receipt of the product, for a credit or a refund of the purchase price paid, less shipping and handling and applicable restocking fees. Products that fail after the first 90 days may be covered by and are subject to the terms of applicable product warranty. Sterile products may not be returned for credit or refund unless they are in their original, unopened packaging or unless they are in breach of the applicable warranty.
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Restocking Fees: Unless the product is defective or the return is the direct result of a Stryker Endoscopy error, a restocking fee of 10% may be charged on all returned products. A Returned Merchandise Authorization (RMA) number must be obtained from Stryker Endoscopy before returning products. To obtain an RMA number, please contact Stryker Endoscopy Customer Service at 1.800.624.4422. Please send any returned products to:
Stryker Endoscopy
Attn: Returns
5900 Optical Court
San Jose, CA 95138
With the return, please include the following:
• RMA number
• Purchase order number
• Original invoice number
• Name, address, and account number (of the organization returning the product)
• Itemized list of the items being returned
• Reason for the return
• Product Experience Report/Complaint number, if applicable Please carefully package the product being returned. Credit will not be given for items that are damaged in return shipment due to inadequate packaging. Stryker Endoscopy does not accept any COD returns. Return shipping costs are borne by the customer unless Stryker Endoscopy specifically agrees otherwise. Please clean and sterilize all potentially contaminated products prior to returning them to Stryker Endoscopy. It is unlawful to transport bio-contaminated products through interstate commerce, unless they are properly packaged and labeled as such. If a return does not comply with these terms, Stryker Endoscopy reserves the right to destroy the product at the customer’s expense. Any replacement would be at the customer’s expense. KZLIB:595454.2\087451-00161
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WARRANTY, INDEMNIFICATION AND COMPLIANCE STATEMENT
(Instruments)
INSTRUMENTS WARRANTY: Products manufactured and sold by Stryker Instruments, a division of Stryker Sales Corporation (“Stryker”) include the warranties, and are subject to Stryker’s Return Policy, set forth in Schedule I attached to this Statement and incorporated herein by reference. If you have purchased an extended warranty from Stryker on any products, then, as to such products, the “Warranty Period” described in Schedule I will mean the number of months or years of coverage purchased by you. EXCEPT AS OTHERWISE SET FORTH IN THIS STATEMENT, STRYKER (INCLUDING STRYKER FINANCE, A DIVISION OF STRYKER SALES CORPORATION) MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE.
INDEMNIFICATION:
This indemnification is in effect for the Equipment and Disposables provided the instructions outlined in the Manufacturers Operating Manual (separately provided to you) are followed. Stryker will hold you harmless and will indemnify you for any and all liability incurred from patient injury resulting directly from a defect in workmanship or design of the Equipment and Disposables that are used during any surgical procedure. This indemnification will not apply to any liability arising from (A) a patient injury due to the negligence of any person other than an employee or agent of Stryker during such procedure, (B) the failure of any person other than an employee or agent of Stryker to follow any instructions for use of the Equipment and Disposables or (C) the use of any equipment or disposables not purchased from Stryker or Equipment or Disposables that have been modified or altered. Except as specifically provided herein, Stryker is not responsible for any losses or injuries arising from the selection, installation, if applicable, by a third party other than an employee or agent of Stryker, condition or possession. You will hold Stryker harmless and will indemnify Stryker for any and all liability incurred from patient injury resulting directly from the negligence of any of your employees, your failure to follow Stryker’s instructions for the Equipment and Disposables, and any modifications or alterations to the Equipment or Disposables by you. INSURANCE: Stryker shall maintain, at its own expense, insurance policies of the kind and limits listed below and with insurers with an A.M. Best rating of not less than A- VIII or its equivalent: (a) WORKERS’ COMPENSATION with statutory limits and EMPLOYER’S LIABILITY with minimum limits of $2,000,000 Each Accident, $2,000,000 Disease – Each Employee, and $2,000,000 Disease – Policy Limit. (b) COMMERCIAL GENERAL LIABILITY, including Premises/Operations Liability, Products/Completed Operations Liability, Contractual Liability, Independent Contractor’s Liability, Broad Form Property Damage Liability, and Personal/Advertising Injury Liability, with minimum limits of $3,000,000 per occurrence and $3,000,000 general aggregate. (c) AUTOMOBILE LIABILITY covering owned, non-owned and hired autos with a minimum combined single limit of $2,000,000 per accident if licensed vehicles are used in connection with the performance of this Agreement, and at all times when such vehicles are operated on the leased or owned premises of Hospital. At your request, Stryker shall provide you with a certificate of insurance evidencing the foregoing insurance. Stryker warrants that it will maintain the above insurance coverages during the term of your purchases of products from Stryker and you will be provided with at least thirty (30) days’ prior written notice of cancellation of any coverage, unless cancellation is due to the non-payment of premium, in which case Stryker shall provide ten (10) days’ prior written notice. With the exception of policy (c) above, Stryker shall be permitted to maintain any of the required insurance coverages through a program of self-insurance. COMPLIANCE: 1. FDA. To the extent required, Stryker represents and warrants that the U.S. Food and Drug Administration (“FDA”) has cleared the products provided to you for the uses specifically set forth in the instructions for use accompanying the products. Stryker represents and warrants that no product delivered to you by Stryker is adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, as amended, or within the meaning of any applicable state or municipal law in which the definition of adulteration and misbranding are substantially the same as those contained in the Federal Food, Drug and Cosmetic Act, as said Act and such laws are constituted and effective at the time of shipment or delivery, or is a product which may not, under the provisions of Section 404 or 505 of said Act, be introduced into interstate commerce. 2. Stryker Personnel. To the extent provided to you, Stryker represents and warrants that all services shall be completed in a professional, workmanlike manner, with the degree of skill and care that is required by current, good and sound professional procedures. Further Stryker represents and warrants that services shall be completed in accordance with applicable specifications and shall be correct and appropriate for the purposes for which they are provided. Stryker only agrees to acknowledge your policies and that Stryker is encouraged by you to report violations of your policies. You may only exclude Stryker’s employees, agents, or independent contractors from dealings
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between the parties for violations of your policies, provided, however, that Stryker’s agents and independent contractors are not subject to your approval. 3. Non-Exclusion. Stryker represents and warrants that, neither it nor any of its employees, are or have been excluded terminated, suspended, or debarred from a federal or state health care program or from participation in any federal or state procurement or non-procurement programs. Stryker further represents to you that no final adverse action by the federal or state government has occurred or is pending or threatened against Stryker, its affiliates, or, to its knowledge, against any employee of Stryker, or agent engaged to provide goods or services to you. If during the term of your purchases of products from Stryker, it, or any of its employees becomes so excluded, terminated, suspended, or debarred from a federal or state health care program or from participation in any federal or state procurement or non-procurement programs, Stryker will promptly notify you.
4. HIPAA Compliance. Stryker and you understand, acknowledge and agree that although not necessary to Stryker’s providing goods and/or services to you, Stryker’s employees, contractors, agents or other representatives may encounter personal or confidential information or materials belonging to you, your patients, employees, contractors, agents or other representatives. All medical information and/or data concerning specific patients (including, but not limited to, the identity of the patients) shall be treated by both parties as confidential so as to comply with all applicable state and federal laws and regulations regarding confidentiality of patient records, and shall not be released, disclosed, or published to any party other than as required or permitted under applicable laws. The parties shall to the extent applicable, comply with the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), and the regulations thereunder as amended to ensure the protection of Protected Health Information ("PHI") as defined therein. 5. Applicable Laws. It is the intent of Stryker and you to comply in all respects with all federal, state and local laws and regulations governing the relationship between or among healthcare providers. In the event performance by either party should jeopardize your full accreditation or licensure by any regulatory agency, or be in violation of any statute or ordinance or for any reason be illegal or deemed unethical by any recognized agency or association in the medical or hospital fields, you may, at your option, terminate your purchases of products from Stryker. 6. Access to Records. To the extent required by law the following provision applies: Stryker agrees to comply with the Omnibus Reconciliation Act of 1980 (P.L. 96-499) and its implementing regulations (42 CFR, Part 420). To the extent applicable to its activities, Stryker further specifically agrees that until the expiration of four (4) years after furnishing services and/or products pursuant to this Agreement, Stryker shall make available, upon written request of the Secretary of the Department of Health and Human Services, or upon request of the Comptroller General, or any of their duly authorized representatives, this Statement and the books, documents and records of Stryker that are necessary to verify the nature and extent of the costs charged to you for purchases of products from Stryker. Stryker further agrees that if Stryker carries out any of the duties of this Agreement through a subcontract with a value or cost of ten thousand dollars ($10,000) or more over a twelve (12) month period, with a related organization, such subcontract shall contain a clause to the effect that until the expiration of four (4) years after the furnishing of such services pursuant to such subcontract, the related organization shall make available, upon written request to the Secretary, or upon request to the Comptroller General, or any of their duly authorized representatives the subcontract, and books and documents and records of such organization that are necessary to verify the nature and extent of such costs. CONFIDENTIALITY: You will not disclose to any third party the terms, including pricing information, or any other information provided by Stryker to you in connection with the sale of products to you by Stryker, without Stryker’s prior written approval. The confidentiality obligation will not apply to information that is: (a) already public or that becomes public other than as a result of disclosure by you; or (b) required by law or legal process to be disclosed. In the case of required disclosure, written notice of such requirement will be promptly communicated to Stryker and you will cooperate, at the expense of Stryker, with Stryker in its efforts to limit the scope of disclosure required. NO EFFECT ON STRYKER FINANCE AGREEMENTS: The warranty, indemnification, insurance, compliance and other terms of this Statement are the responsibility of Stryker, but: (i) this Statement shall not be part of any agreement(s) between you and Stryker Finance, a division of Stryker Sales Corporation (collectively “Stryker Finance Agreement”); and (ii) no assignee of any Stryker Finance Agreement shall have any responsibility to you under this Statement.
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Schedule 1
Product Warranty and Return Policy Stryker warrants all products, subject to the exceptions provided herein, to be free from defects in design, materials and workmanship and to substantially conform to the product specifications contained in the documentation provided by Stryker with the products for a period of one year from the date of purchase (the “Warranty Period”). This warranty shall apply only to the original end-user purchaser of products directly from Stryker by or a Stryker authorized distributor. This warranty may not be transferred or assigned without the express written consent of Stryker. If a valid warranty claim is received within the Warranty Period, Stryker will, in its sole discretion: (1) repair the product at no charge, (2) replace the product at no charge with a product that is at least functionally equivalent to the original product, or (3) refund the purchase price of the product. Stryker Instruments provides no cost loaners for powered instruments while repairs are being made to its products. In any event, Stryker’s liability for breach of warranty shall be limited to the replacement value of the defective or non-conforming part or component. This warranty does not apply to: (1) products that have been misused, neglected, modified, altered, adjusted, tampered with, improperly installed or refurbished; (2) products that have been repaired by any person other than Stryker personnel without the prior written consent of Stryker; (3) products that have been subjected to unusual stress or have not been maintained in accordance with the instructions in the user manual or as demonstrated by a Stryker representative; (4) products on which any original serial numbers or other identification marks have been removed or destroyed; or (5) products that have been repaired with any unauthorized or non-Stryker components. In addition, in order to ensure safe operation of Stryker products, only Stryker accessories should be used. Stryker reserves the right to invalidate product warranties and complimentary loaner programs if Stryker products are used with accessories not manufactured by Stryker. Products and product components repaired or replaced under this warranty continue to be warranted as described herein during the initial Warranty Period or, if the initial Warranty Period has expired by the time the product is repaired or replaced, for thirty (30) days after delivery of the repaired or replaced product. When a product or component is replaced, the item provided in replacement will be the customer’s property and the replaced item will be Stryker’s property. If a refund is provided by Stryker, the product for which the refund is provided must be returned to Stryker and will become Stryker’s property. Notwithstanding the above, the following products are warranted for the periods indicated from the date of purchase:
Reusable Irrigation Tubing, Tips and Clips 30 days Contra Angle Heads and Reducers 90 days Micro Electric System Fiber Optic Cables 90 days Heavy Duty Powered Instrument Battery Packs 90 days/100 sterilization cycles (whichever comes first) Battery Adapters 6 months Repairs, except Cast Saws and Autopsy Saws 90 days ConstaVac™ Battery Packs 6 months Repairs of Cast Saws and Autopsy Saws 6 months Steri-Shield™ Battery Packs 6 months Handpiece Power Cords 6 months Bur Guards and Bur Shields 6 months Steri-Shield™ Fiber Optic Cables 6 months Burs, Blades and Cutting Accessories No Warranty
Software License and Warranty
Certain Stryker products contain software that is installed into the products by Stryker. Stryker owns this software; this software is never sold. Each sale of a software-containing product is not a sale of such software; it includes only a license to use the software in the product in which the software was initially installed. Any license granted by Stryker to use the software contained in its products does not give the licensee the right to copy, alter, disassemble, reverse engineer, create derivative works of such software or to use such software in either original or modified form in any product other than the Stryker product in which the software was initially installed by Stryker. Prior to delivering a product containing software, Stryker may require the customer to execute a license agreement to acknowledge the above and any additional terms under which Stryker may elect to license its software. If a customer elects not to sign a license agreement, Stryker reserves the right to cancel the order for the product containing the software. If a customer receives a Stryker product without agreeing to any additional licensee agreement, the customer is still bound by the license term set forth above. Software packages are warranted to not contain any computer virus, Trojan horse, or software lock, and are guaranteed to operate substantially in accordance with the performance specifications. This warranty is for a term of 1 year and will cover any software patches intended to eliminate any of these bugs. Software Warranty DOES NOT cover any future upgrades, updates or new releases. You must be covered under a Stryker Software Maintenance Agreement to receive software upgrades, updates, and releases. Credit Return Authorization
Please obtain authorization before returning merchandise for credit. Your local Stryker Sales Representative or Customer Service Department can provide you with a Return Merchandise Authorization (RMA) number. Use of this RMA number will expedite your credit. Return pre-paid to the attention of the Credit Return Department, and please include the following information: 1. Return Merchandise Authorization number 2. Original invoice number 3. Customer name, address and account number 4. A packing list itemizing each item being returned 5. Reason for product return
Credit cannot be issued for returns of discontinued, special, or modified items. A 20% restocking fee will be assessed on items returned beyond 30 days after original
invoice date. No credit will be issued for products being returned beyond 90 days after the original invoice date. Sterile packaged items cannot be returned for credit.
Please package items carefully, as credit cannot be issued for items damaged in return shipment due to packaging inadequacy. All merchandise returned for credit must be in resalable condition or may be subject to an additional restocking fee. Stryker does not accept any COD returns. Return shipping costs are borne by the customer unless Stryker specifically agrees otherwise. Please clean and sterilize all potentially contaminated products prior to returning them to Stryker. It is unlawful to transport bio-contaminated products through interstate commerce, unless they are properly packaged and labeled as such. Stryker reserves the right to destroy contaminated product at the customer’s expense and charge the customer for a replacement unit.
If a return does not comply with these terms, Stryker reserves the right to destroy the product at the customer’s expense. Any replacement would be at the customer’s expense.
KZLIB:594512.2\087451-00161
Lee Memorial Health System Operating Expense Highlights
For the year ended September 30, 2009
Total Salaries & Wages reflect a $15.3 million unfavorable variance to budget. The 6.3% increase in adjusted admits created a $2.3 million unfavorable volume variance primarily due to the increased reliance on contract/traveler labor. The other component of this salary & wage variance is the unfavorable rate variance of $0.84 cents per hour which amounted to $13.0 million. This unfavorable rate variance is due to the seasonal incentive bonus that was paid to the staff at year-end along with the accrual of the leadership incentive. Fringe Benefits reflect a $2.9 million unfavorable variance. This unfavorable variance is due to the increased utilization by the participants of LMHS self-funded health insurance plan along with increased costs of unemployment insurance. This was offset by a favorable variance in the worker’s compensation expenses due to the better management of claims which reduced our actuarial liability. Other Supplies reflect a $6.8 million unfavorable variance. The 6.3% increase in volumes resulted in an unfavorable volume variance of $13.5 million as more supplies were needed to properly care for the additional patient volume. Offsetting this unfavorable volume variance was a $6.6 million favorable rate variance. Favorable variances in implant costs, routine med/surg supplies and other supplies due to the efforts of management resulted in an overall reduction in the supply cost per case of $61. Purchased Services reflect a $8.7 million unfavorable variance due to additional medical fees paid to physicians which reimburses them for funds collected for their services and uncompensated care. The remaining expense increase is due to additional fees paid for equipment rental, transcription and lab fees as a result of the increased volumes. Depreciation/Amortization reflects a $6.9 million unfavorable variance. The early completion of GCMC increased depreciation by $2.5 million as both the old SWFRMC building was still being depreciated and the new GCMC began depreciating with a two month overlap. The capitalization of the Regional Cancer Center and the Sanctuary buildings in accordance with generally accepted accounting principals increased depreciation by $1.0 million and the change in the depreciable life for numerous assets as directed by our audit firm increased depreciation by $1.5 million.
LEE MEMORIAL HEALTH SYSTEM
LEE COUNTY, FLORIDA CONSOLIDATED FINANCIAL STATEMENTS AND STATISTICAL REPORTS SEPTEMBER 30, 2009
LEE MEMORIAL HEALTH SYSTEM CONSOLIDATED FINANCIAL STATEMENTS & STATISTICAL REPORTS TABLE OF CONTENTS SECTION A PAGE CONSOLIDATED SCHEDULES HIGHLIGHTS A.1 CONSOLIDATED STATISTICAL REPORT A.3 CONSOLIDATED INCOME STATEMENT A.4 SOURCES & APPLICATIONS OF FUNDS A.6 CONSOLIDATED BALANCE SHEET A.7 CONSOLIDATED FINANCIAL RATIOS A.8 CONSOLIDATED PAYOR MIX A.10 CAPITAL STATUS REPORT A.11 INVESTMENT PERFORMANCE SUMMARY A.12
Lee Memorial Health System Operating Highlights
For the year ended September 30, 2009
Actual adjusted admits (overall inpatient & outpatient volume indicator) for the year ended September 30, 2009 are 109,783 which is 6.3% greater than budget and 4.9% greater than FY2008. Year-to-Date (YTD) actual inpatient admits are 69,682 or 6.5% greater than budget and 4.2% greater than last year. Emergency room visits are 3.8% less than budget but 0.5% greater than last year. Outpatient surgeries are 2.3% less than budget and last year. The YTD length of stay is 5.3 days is equal to budget but 0.1 day greater than last year. YTD net patient revenue reflects a $56.4 million or a 5.9% favorable variance to budget. This 5.9% increase in net patient revenue is primarily from the 6.3% increase in adjusted admits. Net patient revenue per case mix adjusted admit is $6,712 for a 0.1% favorable variance against budget. The YTD total operating expenses before depreciation and interest expense are $31.1 million greater than budget. However, the actual total operating costs per case mix adjusted admit is 1.2% less than budget (6,475 act, 6,550 budget). YTD depreciation expense exceeded budget by $6.9 million due to the early completion of GCMC, changes in selected asset lives and the classification of the Regional Cancer Center(RCC)/Sanctuary as capital leases. Interest expense exceeds budget by $3.5 million due to the classification of the RCC/Sanctuary leases and the added financing costs incurred on the variable rate debt when the market collapsed in October 2008. Productivity as measured by FTEs/AOB improved by 6.8% (4.60 actual, 4.94 budget) throughout the year. For the year ended September 30, 2009, the gain from operations is $36.4 million versus a budgeted gain of $21.8 million. Excess revenue over expenses is a gain of $20.9 million versus a budgeted gain of $44.1 million. Investments were budgeted to return $22.3 million for the fiscal year but the market did not fully recover from its October 2008 correction so investment losses for the year are $15.5 million.
Page A.1
Lee Memorial Health System Operating Highlights
For the year ended September 30, 2009 For the year, Cash & Investments increased by $36.7 million to $449.7 million. Operations increased cash by $83.9 million due to the favorable gain from operations while working capital increased cash by $46.3 million. Cash was reduced by $65.3 million for the construction project at Metro/Daniels and $12.6 million for routine capital equipment. The Regional Cancer Center & Sanctuary were recorded as capital leases which increased both the net borrowings and capital expenditures by $46.6 million. Principal payments on debt reduced cash by $15.1 million. Days in Accounts Receivable are 52.9 days and resulted in a $0.5 million decrease in cash. Total Notes & Bonds payable on September 30, 2009 is $690.6 million resulting in a Cash to Debt ratio of 65.1%. Net Patient Revenue per adjusted admit CMI for the year ended September 30, 2009 is $6,712 while the Operating Expense per adjusted admit CMI is $6,475. The difference which represents the gain from operations per adjusted admit is $237.00 while the budgeted gain from operations is $150.00. Wages & Benefits as a percent of Net Operating Revenue is 50.5% for fiscal year 2009 versus a budget of 51.5% and 52.9% for FY2008. The actual hourly pay rate is $28.93 which is 71 cents or 2.5% greater than last year. Post Acute entities provided the following YTD contributions to Acute Care by allowing charity care patients into their respective programs: Lee Memorial Home Health $437,000; HealthPark Care Center $477,000; The Rehabilitation Hospital $608,000; Access Medical South (DME joint venture) $72,000. The Lee Physician Group YTD loss per physician is $38,325. This includes practice revenue and expenses along with ancillary revenue referred to LMHS. This YTD loss is greater than expected due to reduced visits during the fiscal year.
Page A.2
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATISTICAL SUMMARYFOR THE PERIOD ENDING SEPTEMBER 30, 2009
Current period Year-to-DateBudget Actual Prior Year Variance Var % Budget Actual Prior Year Variance Var %
ACT TO BUD ACT TO BUD ACT TO BUD ACT TO BUD
Admissions ADULTS 4,499 4,868 4,551 369 8.2% 58,764 62,786 59,928 4,022 6.8% PEDIATRICS 379 370 375 (9) -2.4% 4,470 4,482 4,703 12 0.3% NICU 53 48 49 (5) -9.4% 580 600 556 20 3.4% POST ACUTE 118 156 145 38 32.3% 1,594 1,814 1,651 220 13.8%Total Adult & Peds 5,049 5,442 5,120 393 7.8% 65,408 69,682 66,838 4,274 6.5% NEWBORNS 533 572 600 39 7.3% 6,490 6,450 7,209 (40) -0.6%Total Admissions 5,582 6,014 5,720 432 7.7% 71,898 76,132 74,047 4,234 5.9%
Patient Days ADULTS 20,242 21,982 19,840 1,740 8.6% 262,896 289,307 268,832 26,411 10.0% PEDIATRICS 1,385 1,332 1,236 (53) -3.8% 16,093 16,425 16,109 332 2.1% NICU 1,265 1,243 1,435 (22) -1.7% 14,208 15,481 15,216 1,273 9.0% POST ACUTE 4,021 3,871 4,045 (150) -3.7% 50,733 50,792 50,396 59 0.1%Total Adult & Peds 26,913 28,428 26,556 1,515 5.6% 343,930 372,005 350,553 28,075 8.2% NEWBORNS 1,223 1,334 1,321 111 9.1% 14,886 14,669 16,829 (217) -1.5%Total Patient Days 28,136 29,762 27,877 1,626 5.8% 358,816 386,674 367,382 27,858 7.8%
Average Length of Stay ADULTS 4.5 4.5 4.4 0.0 0.4% 4.5 4.6 4.5 0.1 3.0% PEDIATRICS 3.7 3.6 3.3 (0.1) -1.5% 3.6 3.7 3.4 0.1 1.8% NICU 23.9 25.9 29.3 2.0 8.5% 24.5 25.8 27.4 1.3 5.3% POST ACUTE 34.1 24.8 27.9 (9.3) -27.2% 31.8 28.0 30.5 (3.8) -12.0%Total Adult & Peds 5.3 5.2 5.2 (0.1) -2.0% 5.3 5.3 5.2 0.1 1.5% NEWBORNS 2.3 2.3 2.2 0.0 1.7% 2.3 2.3 2.3 (0.0) -0.8%Total Patient Days 5.0 4.9 4.9 (0.1) -1.8% 5.0 5.1 5.0 0.1 1.8%
OP Registrations EMERGENCY ROOM 12,600 14,125 11,075 1,525 12.1% 157,261 151,247 150,562 (6,014) -3.8% OP SURGERY CASES 1,531 1,506 1,576 (25) -1.6% 20,326 19,855 20,307 (471) -2.3%SUBTOTAL 14,131 15,631 12,651 1,500 10.6% 177,587 171,102 170,869 (6,485) -3.7%
Visits / Encounters HOME HEALTH ADMISSIONS 276 259 270 (17) -6.2% 3,700 3,859 3,723 159 4.3% HOSP BASED PHY ENCOUNTERS 12,133 14,401 11,670 2,268 18.7% 159,383 161,805 153,058 2,422 1.5% PHYSICIAN ENCOUNTERS 42,713 40,121 40,996 (2,592) -6.1% 542,318 495,069 505,343 (47,249) -8.7% TRAUMA SERVICES DISTRICT 549 760 806 211 38.5% 9,342 9,985 9,929 643 6.9%SUBTOTAL 55,671 55,541 53,742 (130) -0.2% 714,743 670,718 672,053 (44,025) -6.2%
TOTAL OP 69,802 71,172 66,393 1,370 2.0% 892,329 841,820 842,922 (50,509) -5.7%
Page A.3
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATEMENT OF OPERATIONSFOR THE PERIOD ENDING: SEPTEMBER 30, 2009( IN THOUSANDS )
BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR % BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR %ACT TO BUD ACT TO BUD PR YR ACT TO BUD ACT TO BUD PR YR
INPATIENT REVENUE 157,640 178,379 154,302 20,738 13.2% 15.6% 2,112,854 2,303,098 1,955,533 190,244 9.0% 17.8%OUTPATIENT REVENUE 97,494 112,818 94,683 15,325 15.7% 19.2% 1,222,480 1,325,393 1,106,054 102,913 8.4% 19.8%TOTAL PATIENT REVENUE 255,134 291,197 248,985 36,063 14.1% 17.0% 3,335,334 3,628,491 3,061,587 293,158 8.8% 18.5%
DED FROM REV-MEDICARE 83,652 92,110 78,575 (8,458) -10.1% -17.2% 1,138,529 1,282,078 1,033,041 (143,549) -12.6% -24.1%DED FROM REV-MEDICAID 21,664 32,601 21,824 (10,937) -50.5% -49.4% 269,597 331,558 258,189 (61,961) -23.0% -28.4%DED FROM REV-CHARITY 9,098 9,604 7,389 (506) -5.6% -30.0% 110,819 115,605 99,487 (4,786) -4.3% -16.2%DED FROM REV-HMO/PPO 35,256 32,878 28,035 2,378 6.7% -17.3% 443,031 414,609 363,490 28,421 6.4% -14.1%DED FROM REV-OTHER 20,244 27,714 25,370 (7,470) -36.9% -9.2% 292,355 334,541 257,854 (42,186) -14.4% -29.7%DED FROM REV-BAD DEBT 9,352 9,943 13,369 (591) -6.3% 25.6% 122,830 135,568 112,205 (12,738) -10.4% -20.8%TOTAL DED FROM REV 179,267 204,850 174,562 (25,583) -14.3% -17.4% 2,377,160 2,613,959 2,124,265 (236,799) -10.0% -23.1%
NET PATIENT REVENUE 75,867 86,347 74,423 10,480 13.8% 16.0% 958,174 1,014,532 937,323 56,358 5.9% 8.2%OTHER OPER REV 1,444 1,469 1,901 25 1.7% -22.7% 17,300 17,049 18,208 (251) -1.4% -6.4%
TOTAL OPERATING REV 77,311 87,816 76,325 10,505 13.6% 15.1% 975,473 1,031,581 955,531 56,108 5.8% 8.0%
OPERATING EXPENSES PROD SALARIES 29,653 46,922 28,602 (17,270) -58.2% -64.1% 366,720 382,452 357,346 (15,732) -4.3% -7.0% PROD OVERTIME 1,310 1,034 713 277 21.1% -45.0% 18,720 17,630 15,125 1,090 5.8% -16.6% CONTRACT LABOR 0 6 263 (6) 0.0% 97.5% 1,057 2,877 9,463 (1,820) -172.2% 69.6% NON-PROD SALARIES 3,956 3,618 4,627 338 8.6% 21.8% 45,340 44,140 49,768 1,200 2.6% 11.3%TOTAL SALARIES & WAGES 34,919 51,580 34,205 (16,661) -47.7% -50.8% 431,837 447,100 431,703 (15,263) -3.5% -3.6%
FRINGE BENEFITS 5,668 3,485 7,325 2,183 38.5% 52.4% 70,665 73,630 74,134 (2,965) -4.2% 0.7%HEALTH CARE ACCESS 862 (987) 611 1,849 214.4% 261.5% 11,452 11,415 11,482 37 0.3% 0.6%SUPPLIES 16,113 15,918 12,800 195 1.2% -24.4% 212,738 219,546 208,746 (6,807) -3.2% -5.2%OTHER SERVICES 5,038 4,885 4,466 153 3.0% -9.4% 60,280 57,700 59,704 2,581 4.3% 3.4%PURCHASED SERVICES 7,410 8,739 9,704 (1,329) -17.9% 9.9% 89,609 98,310 91,651 (8,702) -9.7% -7.3%
TOTAL OPER EXPENSES 70,010 83,620 69,111 (13,610) -19.4% -21.0% 876,582 907,701 877,419 (31,119) -3.6% -3.5%
EBITDA 7,301 4,196 7,214 (3,105) -42.5% -41.8% 98,891 123,880 78,112 24,988 25.3% 58.6%
DEPRECIATION/AMORT 4,533 6,721 7,698 (2,188) -48.3% 12.7% 57,885 64,827 56,783 (6,942) -12.0% -14.2%INTEREST EXPENSE 2,145 2,357 1,349 (213) -9.9% -74.7% 19,163 22,680 18,270 (3,516) -18.3% -24.1%GAIN(LOSS) FROM OPER 623 (4,882) (1,833) (5,506) -883.3% 166.3% 21,843 36,373 3,059 14,530 66.5% 1089.0%
CURRENT MONTH YEAR TO DATE
Page A.4
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED INCOME STATEMENT BY ENTITYFOR THE MONTH ENDED SEPTEMBER 30, 2009(IN THOUSANDS)
ENTITY BUDGET ACTUAL VARIANCE PRIOR YR BUDGET ACTUAL VARIANCE PRIOR YR
LEE MEMORIAL HOSPITAL 2,201 3,620 1,419 (15,794) 25,386 35,664 10,279 7,576HEALTHPARK MEDICAL CTR 6,377 5,789 (588) (20,629) 79,666 78,908 (758) 45,117CAPE CORAL HOSPITAL 2,220 1,293 (927) (13,454) 30,797 40,304 9,507 16,873GULF COAST MEDICAL CENTER 1,257 (1,593) (2,850) (31,319) 11,704 16,819 5,116 (21,231)TRAUMA SERVICES DIST (414) (167) 248 (1,622) (4,110) (3,632) 478 (5,818)OUTPATIENT CENTERS 124 268 145 (627) 4,372 2,606 (1,766) (565)HEALTHPARK CARE CTR 66 (322) (388) (1,147) 576 720 143 2,808HOME HEALTH AGENCIES (6) (210) (204) (798) 745 964 219 (113)FOUNDATION 39 40 2 (170) 484 161 (322) 224REHAB HOSPITAL 283 (67) (350) (492) 5,048 5,171 123 4,206PHYSICIANS (LPG-MSO-HBP) (2,920) (2,882) 37 (15,344) (29,030) (34,459) (5,429) (47,813)CORPORATE SERVICES (8,532) (10,516) (1,984) 99,678 (102,943) (106,217) (3,274) 2,559AUXILIARY (3) (2) 1 (3) (31) (23) 8 (32)CHILD DEVELOP/PPEC (68) (135) (66) (111) (802) (611) 191 (733)PHO (1) (0) 1 0 (18) (2) 16 0
TOTAL GAIN FROM OPS 623 (4,882) (5,506) (1,833) 21,843 36,373 14,530 3,059
INT EARN & REALIZED GAIN 1,788 64 (1,724) 1,291 21,148 (14,373) (35,521) 50,478UNREALIZED GAIN (LOSS) (18) 6,983 7,001 (24,090) (225) (3,490) (3,265) (87,574)UNREALIZED GAIN (LOSS) ON SWAP 0 (609) (609) (353) 0 (1,761) (1,761) (775)OTHER NON OPERATING 46 1,582 1,536 1,330 1,343 2,373 1,030 687RESTRICTED GIFTS 0 414 414 1,668 0 1,733 1,733 1,668
TOTAL NON OPERATING 1,815 8,433 6,618 (20,153) 22,266 (15,518) (37,784) (35,514)
EXCESS OF REV/EXPS 2,439 3,551 1,112 (21,987) 44,110 20,855 (23,254) (32,455)
CURRENT MONTH YEAR TO DATE
Page A.5
MONTH YTDSources of Funds:
Excess Revenue Over Expenses 3,551 20,855 Depreciation/Amortization Expense 6,721 64,827 Restricted Gifts (414) (1,733) Total Sources 9,858 83,949
Uses of Funds:
Dec(Inc) in Accts Receivable (16,320) (136,070) Provision for Bad Debts 9,943 135,568 Dec(Inc) in Net Accts Receivable (6,377) (502)
Net borrowings (581) 31,048 Dec(Inc) in Other Assets (3,966) 5,012 Inc(Dec) in Liabilities 21,259 41,306 Capital Expenditures, net (10,571) (124,073) Total Uses (236) (47,209)
Net Increase(Decrease) In Funds 9,622 36,740
Cash & Investments at beginning of period 440,106 412,988
Cash & Investments at end of period 449,727 449,727
Total Bonds & Notes Payable-end of period 690,602
Cash to Debt Ratio 65.1%
LEE MEMORIAL HEALTH SYSTEM
FOR THE PERIOD ENDING SEPTEMBER 30, 2009In Thousands (000's)
SOURCES & APPLICATIONS OF FUNDS
Page A.6
Lee Memorial Health SystemConsolidated Balance Sheet As of SEPTEMBER 30, 2009
in Thousands (000's)
ASSETS: Current Prior Month Prior Year LIABILITIES: Current Prior Month Prior Year
Current Assets: Current Liabilities:Cash And Cash Equivalents * 18,590 16,161 8,806 Accounts Payable 43,728 33,116 43,070Operating Fund Investments * 413,708 415,676 382,127 Wages and Benefits Payable 65,142 48,512 47,427Accrued Interest Receivable 280 299 464 Notes Payable - Short Term 1,936 2,961 2,118Accounts Receivable (net) 132,616 127,713 130,633 Current Portion Bonds Payable 12,170 12,170 11,045Accounts Receivable - Phys (Net) 12,381 10,906 13,861 Due to State of Florida 13,768 5,974 11,873Inventories 27,787 28,313 26,737 Malpractice Liability - Short Term 5,936 5,936 5,936Third Party Settlements 0 0 0 Accrued Bond Costs 11,271 9,622 11,724Other Current Assets 12,932 7,807 15,313 Due to LMHS 0 0 0
Other Current Liabilities 28,093 31,951 16,786
Total Current Assets: 618,293 606,875 577,941 Total Current Liabilities 182,045 150,243 149,979
Other Assets Other Liabilities and Fund BalanceLimited or Restricted Use Assets * 17,298 8,135 21,954 Benefits Payable - Long Term 0 0 0Bond Issuance Costs 5,680 5,707 7,730 Notes Payable - Long Term 55,232 54,600 10,552Trustee Held Funds * 31 34 1 Due to State of Florida - Long Term 3,193 14,983 5,751Directors/Officers Indemnity Fund * 100 100 100 Malpractice Liability - Long Term 7,268 8,338 7,220Long Term Operating Fund Investments * 0 0 0 Bonds Payable 621,264 621,452 635,839Other Assets 94,939 93,259 95,898 Other Long Term Liabilities 16,891 15,789 13,822
UnRestricted Fund Balance 527,918 524,781 508,796Restricted Fund Balance 24,150 22,004 20,683
Total Other Assets 118,049 107,235 125,683 Total Other Liabilities & Fund Balance 1,255,917 1,261,947 1,202,665
Property and Equipment:Plant In Use 1,156,168 1,144,141 899,107Construction in Process 47,910 49,991 206,546Accumulated Depreciation (524,224) (517,955) (476,741)
Total Property & Equipment (Net) 679,854 676,177 628,912
Restricted Assets 21,766 21,903 20,107
TOTAL ASSETS 1,437,962 1,412,190 1,352,644 TOTAL LIABILITIES AND EQUITY 1,437,962 1,412,190 1,352,644
* Cash and InvestmentsAbove Balance Sheet has been adjusted to eliminate intercompany receivables, payables and investments in subsidiaries
Page A.7
LEE MEMORIAL HEALTH SYSTEMFINANCIAL RATIOSFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
2008 AuditedMoody's 2009 FYE YTDMedian Goals 2008 9/30/2009
PROFITABILITY RATIOS:Operating Margin (%) - Total 2.2% 2.5% 0.3% 3.5% +Excess Margin (%) 4.6% 3.6% -3.4% 1.9% +Operating CashFlow Margin (%) 9.1% 9.6% 8.2% 12.0% +
LIQUIDITY RATIOS:Days Cash on Hand (net of VRDB) 157.2 106.8 95.1 86.9 +Cushion Ratio (x) 15.3 10.2 9.6 11.2 +Cash-to-Debt (%) 113.9% 67.3% 62.6% 65.1% +
CAPITALIZATION RATIOS:Debt to Capitalization(%) - (net of VRDB) 38.1% 43.9% 47.6% 46.6% (-)Annual Debt Service Coverage (x) 4.6 3.1 4.6 3.4 +Debt to Cashflow (net of VRDB) 3.5 6.8 4.3 5.1 (-)
NOTE: + = Ratios that should be above the Moody's median(-) = Ratios that should be lower than the Moody's median
Page A.8
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED OPERATING RATIOSFOR THE PERIOD ENDING SEPTEMBER 30, 2009
YEAR TO DATESAME MO SAME MO
BUDGET ACTUAL PRIOR YR ACT-BUD ACT-PRIOR BUDGET ACTUAL PRIOR YR ACT-BUD ACT-PRIOR
AS % NET OPER REV
WAGES & BENEFITS 52.5% 62.7% 54.4% -16.3% -15.2% 51.5% 50.5% 52.9% 2.1% 4.6%SUPPLIES 20.8% 18.1% 16.8% 15.0% -8.1% 21.8% 21.3% 21.8% 2.5% 2.6%ALL OTHER OPER EXPENSES 17.2% 14.4% 19.4% 19.6% 25.7% 16.5% 16.2% 17.0% 1.9% 4.8%CAPITAL COSTS 8.6% 10.3% 11.9% -16.4% 12.8% 7.9% 8.5% 7.9% -6.9% -8.0%EBITDA MARGIN 9.4% 4.8% 9.5% -49.4% -97.8% 10.1% 12.0% 8.2% 18.5% 31.9%OPERATING MARGIN 0.8% -5.6% -2.4% -789.6% 56.8% 2.2% 3.5% 0.3% 57.5% 90.9%EXCESS MARGIN 3.2% 3.3% -28.8% 3.3% 983.8% 4.5% 1.9% -3.4% -58.4% 280.5%
PER CMI ADJ ADMIT / VISIT
NET OPER REV 6,710 7,215 6,695 7.5% 7.2% 6,700 6,712 6,569 0.2% 2.1%TOTAL EXPENSES 6,656 7,616 6,855 -12.6% -11.1% 6,550 6,475 6,548 1.2% 1.1%WAGES & BENEFITS 3,523 4,524 3,643 -22.1% -24.2% 3,452 3,388 3,478 1.9% 2.6%SUPPLIES 1,398 1,308 1,123 6.9% -16.5% 1,461 1,428 1,435 2.3% 0.5%ALL OTHER OPER EXPENSES 1,155 1,038 1,296 11.3% 19.9% 1,108 1,089 1,120 1.7% 2.8%CAPITAL COSTS 580 746 794 -22.3% 6.0% 529 569 516 -7.0% -10.3%OPERATING MARGIN 54 (401) (161) -842.6% 59.9% 150 237 21 58.0% 91.1%EXCESS MARGIN 212 292 (1,928) 37.7% 760.3% 303 136 (223) -55.1% 264.0%
LABOR
PROD FTEs/ADJ DAILY ADMIT 24.1 22.9 23.1 5.1% 0.7% 23.9 22.4 23.5 6.6% 4.6%NON PROD AS % PAID 7.7% 9.4% 7.6% -17.9% -23.9% 8.2% 8.9% 8.3% -8.5% -7.2%AVG HOURLY RATE 28.7 40.2 29.0 -28.6% -38.4% 28.1 28.9 28.2 -2.9% -2.5%
OP REV % OF TOTAL REVENUE 38.2% 38.7% 38.0% 1.4% 1.9% 36.7% 36.5% 36.1% -0.3% 1.1%
Page A.9
CURRENT MONTH % VARIANCE% VARIANCE
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED - PAYOR MIXSeptember 30, 2009
Budget Actual Same Mo Budget Actual Same MoPrior Year Prior Year
MEDICARE 45.5% 45.6% 46.3% 47.9% 49.7% 48.4%MEDICAID 10.1% 11.9% 10.7% 9.5% 10.1% 10.2%MEDICAID HMO 2.4% 4.2% 3.1% 2.5% 3.3% 2.6%HMO/PPO 26.6% 23.7% 24.6% 25.3% 23.1% 24.7%COMMERCIAL 2.9% 2.8% 3.4% 3.2% 3.2% 3.1%OTHER 12.5% 11.8% 11.9% 11.7% 10.6% 11.1%
100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Budget Actual % Variance Budget Actual % VarianceMEDICARE CASE MIX INDEX 1.61 1.57 -2.5% 1.61 1.60 -0.6%SYSTEM CASE MIX INDEX 1.41 1.37 -2.8% 1.41 1.40 -0.7%
09/30/08 09/30/09 VarianceGross Accounts Receivable 290,325 317,132 26,807 Net Accounts Receivable 144,906 144,997 91 Net Days in Accounts Receivable 59.0 52.9 (6.1)
CURRENT MONTH YEAR-TO-DATE
Page A.10
LEE MEMORIAL HEALTH SYSTEMFY 2009
CAPITAL STATUS REPORTSeptember 30, 2009
CAPITAL BUDGET POOL
$ CERF $'s
APPROVEDCERF $'s SPENT
CERF's PENDING
APPROVALCAPITAL BALANCE
ROUTINE CAPITALROUTINE 5,902,821 5,249,942 4,839,618 0 652,879SURGICAL 2,160,654 1,952,185 958,705 0 208,469RADIOLOGY 1,116,473 1,054,679 524,812 0 61,794
INFORMATION SYSTEMS 4,021,443 4,018,265 599,960 0 3,178
MAJOR FACILITIES/PLANT OPS 5,227,400 1,756,431 367,052 0 3,470,969
TACTICAL PLANS 336,000 86,000 12,500 0 250,000
CONTINGENCY 600,000 597,282 382,008 0 2,718
TOTAL FY 2009 19,364,791 14,714,785 7,684,654 0 4,650,006
Unbudgeted- Board Approved 2,484,441 141,937 0 2,342,504
Metro Expansion Project 285,000,000 123,419,901 47,727,587 75,692,314
Outside Funding 3,198,105 1,070,925 0 2,127,181
PRIOR YEARS CERF'SOpen 38,867,645 14,173,991 24,693,654
TOTAL CASH OUTLAY FOR CAPITAL IN FY'09 70,799,093
109,505,659
Page A.11
INTEREST REALIZED BOOK UNREALIZED MARKET MONTHLY %INCOME GAINS/(LOSSES) VALUE GAINS/(LOSSES) VALUE RETURN
CASH MANAGERSGENERAL OPERATING ACCOUNTS 379 0 18,590,000 0 18,590,000LIMITED/RESTRICTED ASSET ACCTS 415 0 7,056,872 0 7,056,872 0.01%NORTHERN TRUST 11,725 0 3,404,720 (5,359) 3,399,360 0.19%COMPASS BANK MONEY MARKET 2,845 0 4,502,845 0 4,502,845 0.06%COMPASS BANK 7 MONTH CD 0 0 7,513,612 0 7,513,612 0.00% ML Treasury 91 Day 0.00%
SEI CASH & EQUIVALENTSSEI DAILY INCOME TREAS II FUND #37 2,640 0 74,003,571 0 74,003,571 0.00% ML Treasury 91 Day 0.00%
TOTAL CASH & CASH EQUIVALENT 18,004 0 115,071,620 (5,359) 115,066,261
FIXED INCOME COMPOSITEMFO SEI INSTL INVTS TR CORE FIXED INCOME 0.353 221,890 0 54,178,972 659,379 54,838,351 1.60% Lehman US Aggregate Index 1.00%
MFO SEI DAILY INCOME TR ULTRA SHORT BOND 0.093 13,808 0 7,077,962 31,458 7,109,419 0.70% Lehman 9-12 Month US Treasury 0.10%
SIIT REAL RETURN 0.353 0 0 52,862,311 623,131 53,485,442 1.20% Lehman 1-5 YR US Treasury 1.30%
MFO SEI INSTL INVTS TR ENHANCED INCOME 0.257 0 (200,792) 41,597,109 776,162 42,373,271 1.40% Merrill Lynch 3 mo Cons-Ma 0.00%
TOTAL FIXED INCOME COMPOSITE 235,698 (200,792) 155,716,353 2,090,130 157,806,483
EQUITY COMPOSITE DOMESTIC EQUITY
RIDGEWORTH SEL L/C GRW ST-I 0 0 18,446,665 620,183 19,066,848 3.40% Russell 1000 Growth 4.20%
MFO SEI INSTL INVTS TR LARGECAP 23.4% 0 0 30,569,162 1,115,663 31,684,825 3.70% S&P 500 3.70%
MFO SEI SIIT SMALL/MID CAP 6.5% 0 0 9,296,416 592,725 9,889,141 6.40% Russell 2500 5.80%
INTERNATIONAL EQUITYWORLD EQUITY EX-US 0 0 22,510,093 1,135,166 23,645,259 5.10% MSCI ACWI EX-US 5.10%
TOTAL EQUITY COMPOSITE 0 0 80,822,336 3,463,736 84,286,072
ALTERNATIVE INVESTMENTSSEI OFFSHORE OPPORTUNITY FUND LI, LTD 0 0 72,950,844 545,527 73,496,370 0.70% ML Treasury 91 Day 0.00%
REAL ESTATE INVESTMENT TRUSTREIT FUND 0 0 11,238,042 860,513 12,098,554 7.80% DJ WILSHIRE RESI 7.20%
TOTAL OTHER COMPOSITE 0 0 84,188,885 1,406,040 85,594,925
FOUNDATION 13,370 3,315 28,312 MISCELLANEOUS OTHER INCOME (272,016) VARIABLE RATE INTEREST EXPENSE OFFSET (137,428) INVESTMENT MANAGER FEES (206,094)
GRAND TOTAL (348,466) (197,476) 435,799,195 6,982,859 442,753,742 1.70%PORTFOLIO INDEX 1.90%
FOR THE MONTH ENDING SEPTEMBER 30, 2009DETAILED PERFORMANCE HISTORY
LEE MEMORIAL HEALTH SYSTEM INVESTMENT PORTFOLIO
Page A.12
INTEREST REALIZED BOOK UNREALIZED MARKET %INCOME GAINS/(LOSSES) VALUE GAINS/(LOSSES) VALUE RETURN*
CASH MANAGERSGENERAL OPERATING ACCOUNTS 42,903 0 18,590,000 0 18,590,000LIMITED/RESTRICTED ASSET ACCTS 26,153 0 7,056,872 0 7,056,872 0.37%NORTHERN TRUST 144,435 0 3,410,188 (10,828) 3,399,360 3.92%COMPASS BANK MONEY MARKET 16,458 # 0 4,502,845 0 4,502,845 0.37%COMPASS BANK 7 MONTH CD 0 0 7,513,612 0 7,513,612 0.00% ML Treasury 91 Day 0.40%
SEI CASH & EQUIVALENTSSEI DAILY INCOME PRIME OBLIGATION FUND 181,008 (2) 0 0 0 3.02% ML Treasury 91 Day 0.30%
SEI DAILY INCOME TREAS II FUND #37 522,386 0 74,003,571 0 74,003,571 0.71% ML Treasury 91 Day 0.40%
TOTAL CASH & CASH EQUIVALENT 933,342 (2) 115,077,089 (10,828) 115,066,261
FIXED INCOME COMPOSITEMFO SEI INSTL INVTS TR CORE FIXED INCOME 4,075,663 (10,701,948) 48,283,577 6,554,774 54,838,351 13.40% Lehman US Aggregate Index 10.60%
MFO SEI DAILY INCOME TR ULTRA SHORT BOND 215,452 (384,565) 7,162,052 (52,633) 7,109,419 2.30% Lehman 9-12 Month US Treasury 2.30%
SIIT REAL RETURN 2,201,454 (4,046,758) 53,144,427 341,015 53,485,442 3.10% Lehman 1-5 YR US Treasury 3.30%
MFO SEI INSTL INVTS TR ENHANCED INCOME 331,381 (2,247,591) 47,355,145 (4,981,874) 42,373,271 -10.00% Merrill Lynch 3 mo Cons-Ma 2.30%
NON-US DEBTSIIT EMERGING MARKETS DEBT FUND 508,694 (3,309,971) 0 1,279,374 0 -10.46% JPM EMBI Global Diversified NA
TOTAL FIXED INCOME COMPOSITE 7,332,644 (20,690,833) 155,945,201 3,140,656 157,806,483
EQUITY COMPOSITE DOMESTIC EQUITY
RIDGEWORTH SEL L/C GRW ST-I 44,049 0 15,044,049 4,022,799 19,066,848 NA Russell 1000 Growth NA
MFO SEI INSTL INVTS TR LARGECAP 167,727 4,524,538 34,734,469 (3,049,644) 31,684,825 -12.40% S&P 500 -6.90%
MFO SEI SIIT SMALL/MID CAP 129,368 (28,398) 10,556,324 (667,183) 9,889,141 -4.20% Russell 2500 -5.70%
INTERNATIONAL EQUITYWORLD EQUITY EX-US 1,049 (3,753,126) 18,632,547 5,012,712 23,645,259 -1.40% MSCI ACWI EX-US 5.90%
TOTAL EQUITY COMPOSITE 342,193 743,014 78,967,389 5,318,683 84,286,072
ALTERNATIVE INVESTMENTSSEI OFFSHORE OPPORTUNITY FUND LI, LTD 0 0 79,978,350 (6,481,979) 73,496,370 -13.00% ML Treasury 91 Day 0.40%
REAL ESTATE INVESTMENT TRUSTREIT FUND 241,485 (396,726) 17,524,955 (5,426,401) 12,098,554 -27.90% DJ WILSHIRE RESI -29.50%
TOTAL OTHER COMPOSITE 241,485 (396,726) 97,503,305 (11,908,380) 85,594,925
FOUNDATION 88,386 (24,081) (30,375) MISCELLANEOUS OTHER INCOME 582,771 VARIABLE RATE INTEREST EXPENSE OFFSET (2,479,045) INVESTMENT MANAGER FEES (2,807,182)
GRAND TOTAL 4,234,595 (20,368,628) 447,492,984 (3,490,243) 442,753,742 -5.70%PORTFOLIO INDEX -6.00%*Net of reallocations between funds
FOR THE TWELVE MONTHS ENDING SEPTEMBER 30, 2009DETAILED PERFORMANCE HISTORY
LEE MEMORIAL HEALTH SYSTEM INVESTMENT PORTFOLIO
Page A.13
LEE MEMORIAL HEALTH SYSTEM CONSOLIDATED FINANCIAL STATEMENTS & STATISTICAL REPORTS TABLE OF CONTENTS SECTION B PAGE CONSOLIDATING SCHEDULES CONSOLIDATING STATISTICAL REPORT B.1 CONSOLIDATING INCOME STATEMENT – MONTH B.7 YTD B.10 CONSOLIDATING FINANCIAL RATIOS B.13 STAFFING SUMMARY B.17 SUMMARY OF ACCOUNTS RECEIVABLE B.18
LEE MEMORIAL HEALTH SYSTEMSTATISTICAL SUMMARYCONSOLIDATING ACTUALFOR THE MONTH ENDING SEPTEMBER 30, 2009
HOME ALLSYSTEM LEE HPMC CCH GCMC HPCC HEALTH REHAB PHYSICIANS
Admissions ADULTS 4,868 959 1,218 1,138 1,553 0 0 0 0 PEDIATRICS 370 0 370 0 0 0 0 0 0 NICU 48 0 48 0 0 0 0 0 0 POST ACUTE 156 0 0 0 0 70 0 86 0Total Adult & Peds 5,442 959 1,636 1,138 1,553 70 0 86 0 NEWBORNS 572 0 260 145 167 0 0 0 0Total Admissions 6,014 959 1,896 1,283 1,720 70 0 86 0
Patient DaysADULTS 21,982 5,008 4,957 5,007 7,010 0 0 0 0 PEDIATRICS 1,332 0 1,332 0 0 0 0 0 0 NICU 1,243 0 1,243 0 0 0 0 0 0 POST ACUTE 3,871 0 0 0 0 3,083 0 788 0Total Adult & Peds 28,428 5,008 7,532 5,007 7,010 3,083 0 788 0 NEWBORNS 1,334 0 559 381 394 0 0 0 0Total Patient Days 29,762 5,008 8,091 5,388 7,404 3,083 0 788 0
Average Length of Stay ADULTS 18.2 5.2 4.1 4.4 4.5 0.0 0.0 0.0 0.0 PEDIATRICS 3.6 0.0 3.6 0.0 0.0 0.0 0.0 0.0 0.0 NICU 25.9 0.0 25.9 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE 53.2 0.0 0.0 0.0 0.0 44.0 0.0 9.2 0.0Total Adult & Peds 5.2 5.2 4.6 4.4 4.5 44.0 0.0 9.2 0.0 NEWBORNS 7.1 0.0 2.2 2.6 2.4 0.0 0.0 0.0 0.0Total Patient Days 4.9 5.2 4.3 4.2 4.3 44.0 0.0 9.2 0.0
OP Registrations EMERGENCY ROOM 14,125 3,507 3,679 4,044 2,895 0 0 0 0 OP SURGERY CASES 1,506 302 466 338 400 0 0 0 0SUBTOTAL 15,631 3,809 4,145 4,382 3,295 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS 259 0 0 0 0 0 259 0 0 HOSP BASED PHY ENCOUNTERS 14,401 0 0 0 0 0 0 0 14,401 PHYSICIAN ENCOUNTERS 40,121 0 0 0 0 0 0 0 40,121 TRAUMA 760 760 0 0 0 0 0 0 0SUBTOTAL 55,541 760 0 0 0 0 259 0 54,522
TOTAL OP 71,172 4,569 4,145 4,382 3,295 0 259 0 54,522
Page B.1
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING STATISTICALACTUAL TO BUDGET VARIANCEFOR THE MONTH ENDED SEPTEMBER 30, 2009
ALLSYSTEM LEE HP CCH GCMC HPCC HH REHAB PHYSICIANS
Admissions ADULTS 369 133 55 208 (27) 0 0 0 0 PEDIATRICS (9) 0 (9) 0 0 0 0 0 0 NICU (5) 0 (5) 0 0 0 0 0 0 POST ACUTE 38 0 0 0 0 17 0 21 0Total Adult & Peds 393 133 41 208 (27) 17 0 21 0 NEWBORNS 39 0 (12) 34 17 0 0 0 0Total Admissions 432 133 29 242 (10) 17 0 21 0
Patient Days ADULTS 1,740 855 208 681 (4) 0 0 0 0 PEDIATRICS (53) 0 (53) 0 0 0 0 0 0 NICU (22) 0 (22) 0 0 0 0 0 0 POST ACUTE (150) 0 0 0 0 (157) 0 7 0Total Adult & Peds 1,515 855 133 681 (4) (157) 0 7 0 NEWBORNS 111 0 (61) 128 44 0 0 0 0Total Patient Days 1,626 855 72 809 40 (157) 0 7 0
Average Length of Stay ADULTS 0.0 0.2 (0.0) (0.3) 0.1 0.0 0.0 0.0 0.0 PEDIATRICS (0.1) 0.0 (0.1) 0.0 0.0 0.0 0.0 0.0 0.0 NICU 2.0 0.0 2.0 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE (9.3) 0.0 0.0 0.0 0.0 (17.6) 0.0 (2.8) 0.0Total Adult & Peds (7.3) 0.2 2.0 (0.3) 0.1 (17.6) 0.0 (2.8) 0.0 NEWBORNS 0.2 0.0 (0.1) 0.4 0.0 0.0 0.0 0.0 0.0Total Patient Days (7.1) 0.2 1.8 0.1 0.1 (17.6) 0.0 (2.8) 0.0
OP Registrations EMERGENCY ROOM 1,525 343 733 3 446 0 0 0 0 OP SURGERY CASES (25) 23 (26) (15) (7) 0 0 0 0SUBTOTAL 1,500 366 706 (12) 439 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS (17) 0 0 0 0 0 (17) 0 0 HOSP BASED PHY ENCOU 2,268 0 0 0 0 0 0 0 2,268 PHYSICIAN ENCOUNTERS (2,592) 0 0 0 0 0 0 0 (2,592) TRAUMA 211 211 0 0 0 0 0 0 0SUBTOTAL (130) 211 0 0 0 0 (17) 0 (324)
TOTAL OP 1,370 578 706 (12) 439 0 (17) 0 (324)
Page B.2
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING STATISTICALACTUAL TO PRIOR MONTH VARIANCEFOR THE MONTH ENDED SEPTEMBER 30, 2009
ALLSYSTEM LEE HP CCH GCMC HPCC HH REHAB PHYSICIANS
Admissions ADULTS 317 179 13 56 69 0 0 0 0 PEDIATRICS (5) 0 (5) 0 0 0 0 0 0 NICU (1) 0 (1) 0 0 0 0 0 0 POST ACUTE 11 0 0 0 0 5 0 6 0Total Adult & Peds 322 179 7 56 69 5 0 6 0 NEWBORNS (28) 0 (20) 1 (9) 0 0 0 0Total Admissions 294 179 (13) 57 60 5 0 6 0
Patient Days ADULTS 2,142 944 (5) 546 657 0 0 0 0 PEDIATRICS 96 0 96 0 0 0 0 0 0 NICU (192) 0 (192) 0 0 0 0 0 0 POST ACUTE (174) 0 0 0 0 31 0 (205) 0Total Adult & Peds 1,872 944 (101) 546 657 31 0 (205) 0 NEWBORNS 13 0 (18) 18 13 0 0 0 0Total Patient Days 1,885 944 (119) 564 670 31 0 (205) 0
Average Length of Stay ADULTS 1.9 0.0 (0.0) 0.3 1.6 0.0 0.0 0.0 0.0 PEDIATRICS 0.3 0.0 0.3 0.0 0.0 0.0 0.0 0.0 0.0 NICU (3.4) 0.0 (3.4) 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE (6.2) 0.0 0.0 0.0 0.0 (2.9) 0.0 (3.2) 0.0Total Adult & Peds (7.4) 0.0 (3.1) 0.3 1.6 (2.9) 0.0 (3.2) 0.0 NEWBORNS 2.6 0.0 0.1 0.1 2.4 0.0 0.0 0.0 0.0Total Patient Days (4.8) 0.0 (3.0) 0.4 4.0 (2.9) 0.0 (3.2) 0.0
OP Registrations EMERGENCY ROOM 3,050 789 1,189 574 498 0 0 0 0 OP SURGERY CASES (70) (37) (25) (16) 8 0 0 0 0SUBTOTAL 2,980 752 1,164 558 506 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS (11) 0 0 0 0 0 (11) 0 0 HOSP BASED PHY ENCOUNTER 2,731 0 0 0 0 0 0 0 2,731 PHYSICIAN ENCOUNTERS (875) 0 0 0 0 0 0 0 (875) TRAUMA (46) (46) 0 0 0 0 0 0 0SUBTOTAL 1,799 (46) 0 0 0 0 (11) 0 1,856
TOTAL OP 4,779 706 1,164 558 506 0 (11) 0 1,856
Page B.3
LEE MEMORIAL HEALTH SYSTEMSTATISTICAL SUMMARYCONSOLIDATING ACTUALFOR THE 12 MONTHS ENDING SEPTEMBER 30, 2009
HOME ALLSYSTEM LEE HPMC CCH GCMC HPCC HEALTH REHAB PHYSICIANS
Admissions ADULTS 62,786 12,102 16,472 14,326 19,886 0 0 0 0 PEDIATRICS 4,482 0 4,482 0 0 0 0 0 0 NICU 600 0 600 0 0 0 0 0 0 POST ACUTE 1,814 0 0 0 0 778 0 1,036 0Total Adult & Peds 69,682 12,102 21,554 14,326 19,886 778 0 1,036 0 NEWBORNS 6,450 0 3,059 1,412 1,979 0 0 0 0Total Admissions 76,132 12,102 24,613 15,738 21,865 778 0 1,036 0
Patient Days ADULTS 289,307 64,829 71,766 63,048 89,664 0 0 0 0 PEDIATRICS 16,425 0 16,425 0 0 0 0 0 0 NICU 15,481 0 15,481 0 0 0 0 0 0 POST ACUTE 50,792 0 0 0 0 38,241 0 12,551 0Total Adult & Peds 372,005 64,829 103,672 63,048 89,664 38,241 0 12,551 0 NEWBORNS 14,669 0 6,554 3,515 4,600 0 0 0 0Total Patient Days 386,674 64,829 110,226 66,563 94,264 38,241 0 12,551 0
Average Length of Stay ADULTS 4.6 5.4 4.4 4.4 4.5 0.0 0.0 0.0 0.0 PEDIATRICS 3.7 0.0 3.7 0.0 0.0 0.0 0.0 0.0 0.0 NICU 25.8 0.0 25.8 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE 28.0 0.0 0.0 0.0 0.0 49.2 0.0 12.1 0.0Total Adult & Peds 5.3 5.4 4.8 4.4 4.5 49.2 0.0 12.1 0.0 NEWBORNS 2.3 0.0 2.1 2.5 2.3 0.0 0.0 0.0 0.0Total Patient Days 5.1 5.4 4.5 4.2 4.3 49.2 0.0 12.1 0.0
OP Registrations EMERGENCY ROOM 151,247 37,078 39,463 43,283 31,423 0 0 0 0 OP SURGERY CASES 19,855 3,932 6,130 4,458 5,335 0 0 0 0SUBTOTAL 171,102 41,010 45,593 47,741 36,758 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS 3,859 0 0 0 0 0 3,859 0 0 HOSP BASED PHY ENCOUNTERS 161,805 0 0 0 0 0 0 0 161,805 PHYSICIAN ENCOUNTERS 495,069 0 0 0 0 0 0 0 495,069 TRAUMA 9,985 9,985 0 0 0 0 0 0 0SUBTOTAL 670,718 9,985 0 0 0 0 3,859 0 656,874
TOTAL OP 841,820 50,995 45,593 47,741 36,758 0 3,859 0 656,874
Page B.4
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING STATISTICALACTUAL TO BUDGET VARIANCEFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
ALLSYSTEM LEE HP CCH GCMC HPCC HH REHAB PHYSICIANS
Admissions ADULTS 4,022 1,229 363 1,834 596 0 0 0 0 PEDIATRICS 12 0 12 0 0 0 0 0 0 NICU 20 0 20 0 0 0 0 0 0 POST ACUTE 220 0 0 0 0 138 0 82 0Total Adult & Peds 4,274 1,229 395 1,834 596 138 0 82 0 NEWBORNS (40) 0 (247) 28 179 0 0 0 0Total Admissions 4,234 1,229 147 1,862 775 138 0 82 0
Patient DaysADULTS 26,411 10,293 4,298 5,907 5,912 0 0 0 0 PEDIATRICS 332 0 332 0 0 0 0 0 0 NICU 1,273 0 1,273 0 0 0 0 0 0 POST ACUTE 59 0 0 0 0 (1,179) 0 1,238 0Total Adult & Peds 28,075 10,293 5,904 5,907 5,912 (1,179) 0 1,238 0 NEWBORNS (217) 0 (955) 338 400 0 0 0 0Total Patient Days 27,858 10,293 4,948 6,246 6,312 (1,179) 0 1,238 0
Average Length of Stay ADULTS 0.5 0.3 0.2 (0.2) 0.2 0.0 0.0 0.0 0.0 PEDIATRICS 0.1 0.0 0.1 0.0 0.0 0.0 0.0 0.0 0.0 NICU 1.3 0.0 1.3 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE (12.2) 0.0 0.0 0.0 0.0 (12.4) 0.0 0.3 0.0Total Adult & Peds (12.1) 0.0 0.0 0.0 0.0 (12.4) 0.0 0.3 0.0 NEWBORNS 0.1 0.0 (0.1) 0.2 (0.0) 0.0 0.0 0.0 0.0Total Patient Days (12.1) 0.0 (0.1) 0.2 (0.0) (12.4) 0.0 0.3 0.0
OP Registrations EMERGENCY ROOM (6,014) (2,059) 891 (3,108) (1,738) 0 0 0 0 OP SURGERY CASES (471) 75 (183) (142) (220) 0 0 0 0SUBTOTAL (6,485) (1,984) 708 (3,250) (1,958) 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS 159 0 0 0 0 0 159 0 0 HOSP BASED PHY ENCOUNTER 2,422 0 0 0 0 0 0 0 2,422 PHYSICIAN ENCOUNTERS (47,249) 0 0 0 0 0 0 0 (47,249) TRAUMA 643 643 0 0 0 0 0 0 0SUBTOTAL (44,025) 643 0 0 0 0 159 0 (44,827)
TOTAL OP (50,509) (1,341) 708 (3,250) (1,958) 0 159 0 (44,827)
Page B.5
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING STATISTICALACTUAL TO PRIOR YEAR VARIANCEFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
ALLSYSTEM LEE HP CCH GCMC HPCC HH REHAB PHYSICIANS
Admissions ADULTS 2,858 1,144 2 1,311 401 0 0 0 0 PEDIATRICS (221) 0 44 (110) (155) 0 0 0 0 NICU 44 0 44 0 0 0 0 0 0 POST ACUTE 163 0 0 0 0 70 0 93 0Total Adult & Peds 2,844 1,144 90 1,201 246 70 0 93 0 NEWBORNS (759) 0 (365) (136) (258) 0 0 0 0Total Admissions 2,085 1,144 (275) 1,065 (12) 70 0 93 0
Patient Days ADULTS 20,475 9,017 2,361 3,513 5,584 0 0 0 0 PEDIATRICS 316 0 909 (239) (354) 0 0 0 0 NICU 265 0 265 0 0 0 0 0 0 POST ACUTE 396 0 0 0 0 (257) 0 653 0Total Adult & Peds 21,452 9,017 3,535 3,274 5,230 (257) 0 653 0 NEWBORNS (2,160) 0 (1,071) (400) (689) 0 0 0 0Total Patient Days 19,292 9,017 2,464 2,874 4,541 (257) 0 653 0
Average Length of Stay ADULTS 1.7 0.3 0.1 (0.2) 1.5 0.0 0.0 0.0 0.0 PEDIATRICS 0.2 0.0 0.2 0.0 0.0 0.0 0.0 0.0 0.0 NICU (1.6) 0.0 (1.6) 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE (5.7) 0.0 0.0 0.0 0.0 (5.2) 0.0 (0.5) 0.0Total Adult & Peds (5.4) 0.3 (1.3) (0.2) 1.5 (5.2) 0.0 (0.5) 0.0 NEWBORNS 2.5 0.0 (0.1) (0.0) 2.7 0.0 0.0 0.0 0.0Total Patient Days (2.9) 0.3 (1.3) (0.2) 4.1 (5.2) 0.0 (0.5) 0.0
OP Registrations EMERGENCY ROOM 685 1,446 2,306 (2,500) (567) 0 0 0 0 OP SURGERY CASES (452) 20 (232) 4 (244) 0 0 0 0SUBTOTAL 233 1,466 2,074 (2,496) (811) 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS 136 0 0 0 0 0 136 0 0 HOSP BASED PHY ENCOUNTER 8,747 0 0 0 0 0 0 0 8,747 PHYSICIAN ENCOUNTERS (10,274) 0 0 0 0 0 0 0 (10,274) TRAUMA 56 56 0 0 0 0 0 0 0SUBTOTAL (1,335) 56 0 0 0 0 136 0 (1,527)
TOTAL OP (1,102) 1,522 2,074 (2,496) (811) 0 136 0 (1,527)
Page B.6
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL DOLLARS - IN THOUSANDSFOR THE MONTH ENDED SEPTEMBER 30, 2009
HOME ALL CORP ALL SYSTEM LMH HPMC CCH GCMC TRAUMA OP CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVS OTHERS
INPATIENT REVENUE 178,379 35,282 50,827 35,128 54,764 0 47 1,199 0 1,131 0 0 0 0OUTPATIENT REVENUE 112,818 16,523 23,751 19,537 21,441 626 7,857 0 755 1 22,328 0 0 0TOTAL PATIENT REVENUE 291,197 51,805 74,578 54,665 76,204 626 7,904 1,199 755 1,132 22,328 0 0 0
DED FROM REV-MEDICARE 92,110 15,735 21,364 21,112 30,795 0 2,606 156 (1) 344 0 0 0 0DED FROM REV-MEDICAID 32,601 5,058 14,281 5,708 6,960 0 560 24 10 0 0 0 0 0DED FROM REV-CHARITY 9,604 3,768 2,159 2,282 1,381 0 (2) (14) 29 0 0 0 0 0DED FROM REV-HMO/PPO 32,878 4,478 9,592 7,197 10,587 0 924 0 42 59 0 0 0 0DED FROM REV-OTHER 27,714 3,281 2,137 4,030 5,856 189 808 59 2 0 11,351 0 0 0DED FROM REV-BAD DEBT 9,943 2,186 1,189 875 2,974 163 98 0 31 20 2,408 0 0 0TOTAL DED FROM REV 204,850 34,506 50,721 41,204 58,552 352 4,993 225 113 423 13,759 0 0 0
NET PATIENT REVENUE 86,347 17,299 23,857 13,461 17,652 274 2,911 974 642 709 8,569 0 0 0OTHER OPER REV 1,469 80 82 110 89 2 266 5 43 0 42 249 201 300
0TOTAL OPERATING REV 87,816 17,379 23,939 13,571 17,741 276 3,177 979 685 709 8,611 249 201 300
OPERATING EXPENSES PROD SALARIES 46,922 6,223 8,840 5,702 7,133 239 849 691 747 583 6,764 76 8,839 237 PROD OVERTIME 1,034 198 237 159 337 0 11 44 1 0 17 0 29 1 CONTRACT LABOR 6 0 0 0 1 0 0 0 0 0 6 0 0 0 NON-PROD SALARIES 3,618 445 638 406 554 29 76 57 48 53 1,065 43 179 24TOTAL SALARIES & WAGES 51,580 6,865 9,716 6,267 8,025 267 935 791 796 637 7,851 119 9,047 263
FRINGE BENEFITS 3,485 717 542 297 667 11 179 96 52 50 404 11 414 44HEALTH CARE ACCESS (987) (300) (570) (283) 131 0 0 32 0 4 0 0 0 0SUPPLIES 15,918 4,211 4,910 3,618 4,962 2 141 71 7 24 442 1 (2,533) 61OTHER SERVICES 4,885 806 700 344 950 3 636 38 30 10 747 60 515 45PURCHASED SERVICES 8,739 651 995 658 1,518 156 167 232 20 40 1,830 10 2,446 17OVERHEAD ALLOCATION 0 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL OPER EXPENSES 83,620 12,950 16,293 10,901 16,254 439 2,059 1,261 905 765 11,274 201 9,889 429
EBITDA 4,196 4,429 7,646 2,670 1,487 (163) 1,118 (282) (219) (56) (2,663) 48 (9,688) (130)
DEPRECIATION/AMORT 6,721 585 1,457 1,139 1,909 3 596 28 (9) 11 173 1 820 7INTEREST EXPENSE 2,357 224 399 237 1,170 0 253 13 0 0 46 6 9 0GAIN(LOSS) FROM OPER (4,882) 3,620 5,789 1,293 (1,593) (167) 268 (322) (210) (67) (2,882) 40 (10,516) (136)
NON OPERATING REV INT EARN & REALIZED GAIN 64 153 (2) (58) (66) 0 0 0 0 0 0 35 0 2 UNREALIZED GAIN (LOSS) 6,983 6,955 0 0 0 0 0 0 0 0 0 28 0 0 UNREALIZED GAIN (LOSS) ON SWA (609) (609) 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV 1,582 623 0 0 0 0 0 64 87 132 0 (36) 713 0 RESTRICTED GIFTS 414 6 0 0 0 0 0 0 0 0 0 408 0 0TOTAL NON OPER REV 8,433 7,126 (2) (58) (66) 0 0 64 87 132 0 435 713 2
EXCESS REV/EXPS 3,551 10,746 5,788 1,236 (1,658) (167) 268 (258) (124) 65 (2,882) 475 (9,803) (135)
Page B.7
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL TO BUDGET DOLLAR VARIANCE - IN THOUSFOR THE MONTH ENDED SEPTEMBER 30, 2009
OP HOME ALL CORP ALLSYSTEM LMH HPMC CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVCS OTHERS
INPATIENT REVENUE 20,738 4,239 6,071 5,905 4,503 0 21 119 0 (119) 0 0 0 0OUTPATIENT REVENUE 15,325 3,173 1,325 975 3,275 231 1,749 0 60 1 4,536 0 0 0TOTAL PATIENT REVENUE 36,063 7,412 7,396 6,880 7,778 231 1,770 119 60 (118) 4,536 0 0 0
DED FROM REV-MEDICARE (8,458) (1,820) (2,475) (1,787) (1,975) 0 (273) (46) 4 (86) 0 0 0 0DED FROM REV-MEDICAID (10,937) (2,248) (3,994) (2,311) (2,057) 0 (330) (0) 4 0 0 0 0 0DED FROM REV-CHARITY (506) 300 76 (616) (263) 0 2 24 (29) 0 0 0 0 0DED FROM REV-HMO/PPO 2,378 872 389 (336) 1,312 0 91 0 (3) 53 0 0 0 0DED FROM REV-OTHER (7,470) 776 1,159 (1,329) (5,483) (51) (421) (10) (2) 0 (2,108) 0 0 0DED FROM REV-BAD DEBT (591) (224) (118) 874 (318) 3 2 22 (23) 16 (824) 0 0 0TOTAL DED FROM REV (25,583) (2,343) (4,963) (5,506) (8,784) (48) (929) (10) (50) (17) (2,932) 0 0 0
NET PATIENT REVENUE 10,480 5,069 2,433 1,374 (1,006) 183 841 108 10 (135) 1,604 0 0 0OTHER OPER REV 25 29 0 11 7 (26) 175 (3) 0 0 (95) (15) (31) (27)TOTAL OPERATING REV 10,505 5,098 2,433 1,384 (1,000) 157 1,017 105 10 (135) 1,509 (15) (31) (27)
OPERATING EXPENSES PROD SALARIES (17,270) (2,469) (2,989) (1,985) (1,862) (13) (239) (294) (289) (200) (1,426) 5 (5,486) (21) PROD OVERTIME 277 (44) 161 49 145 1 (8) 6 (1) (0) (5) (0) (26) (0) CONTRACT LABOR (6) 0 0 0 (1) 0 0 0 0 0 (6) 0 0 0 NON-PROD SALARIES 338 (7) 1 3 (0) 87 (11) (20) (1) (8) 2 (38) 332 (1)TOTAL SALARIES & WAGES (16,661) (2,520) (2,827) (1,933) (1,718) 74 (258) (308) (291) (208) (1,435) (33) (5,180) (22)
FRINGE BENEFITS 2,183 158 590 456 419 7 (59) (10) 30 17 333 2 236 4HEALTH CARE ACCESS 1,849 477 864 442 90 0 0 (32) 0 8 0 0 0 0SUPPLIES 195 (1,045) (933) (679) (313) (1) 300 (7) 2 (7) (49) 1 2,931 (7)OTHER SERVICES 153 (272) (189) 115 (82) 1 (338) (14) 12 (7) (28) 49 909 (3)PURCHASED SERVICES (1,329) (308) (126) (152) 221 9 11 (121) 14 (20) (268) 4 (585) (8)OVERHEAD ALLOCATION 0 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL OPER EXPENSES (13,610) (3,510) (2,621) (1,751) (1,383) 91 (344) (492) (233) (217) (1,447) 24 (1,690) (37)
EBITDA (3,105) 1,588 (188) (367) (2,383) 248 672 (387) (223) (352) 62 9 (1,720) (64)
DEPRECIATION/AMORT (2,188) 2 (365) (687) (411) (0) (476) (3) 19 2 4 (1) (271) (0)INTEREST EXPENSE (213) (172) (35) 127 (56) (0) (51) 1 0 0 (28) (6) 7 0GAIN(LOSS) FROM OPER (5,506) 1,419 (588) (927) (2,850) 248 145 (388) (204) (350) 37 2 (1,984) (64)
NON OPERATING REV INT EARN & REALIZED GAIN (1,724) (1,691) 88 (58) (67) 0 0 0 0 0 0 5 0 (2) UNREALIZED GAIN(LOSS) 7,001 6,955 0 0 0 0 0 0 0 0 0 47 0 0 UNREALIZED GAIN(LOSS) ON SWAP (609) (609) 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV 1,536 581 0 0 1 0 0 64 132 51 0 (7) 713 0 RESTRICTED GIFTS 414 6 0 0 0 0 0 0 0 0 0 408 0 0TOTAL NON OPER REV 6,618 5,241 88 (58) (66) 0 0 64 132 51 0 453 713 (2)
EXCESS OF REV / EXPS 1,112 6,660 (499) (984) (2,916) 248 145 (324) (72) (299) 37 455 (1,272) (66)
Page B.8
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL TO PRIOR MONTH DOLLAR VARIANCE - IN THOUSFOR THE MONTH ENDED SEPTEMBER 30, 2009
OP HOME ALL CORP ALLSYSTEM LMH HP CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVCS OTHERS
INPATIENT REVENUE 24,077 6,952 4,614 6,495 6,078 0 17 106 0 (185) 0 0 0 0OUTPATIENT REVENUE 18,135 273 3,746 2,172 4,226 13 6,470 0 71 1 1,164 0 0 0TOTAL PATIENT REVENUE 42,212 7,224 8,360 8,668 10,304 13 6,486 106 71 (185) 1,164 0 0 0
DED FROM REV-MEDICARE (13,535) (2,565) (2,634) (3,152) (3,160) 0 (2,045) 32 5 (17) 0 0 0 0DED FROM REV-MEDICAID (10,777) (1,851) (3,531) (3,453) (1,445) 0 (503) (0) 7 0 0 0 0 0DED FROM REV-CHARITY (2,215) (461) (405) (864) (522) 0 3 64 (29) 0 0 0 0 0DED FROM REV-HMO/PPO (4,843) 57 (525) (1,299) (2,298) 0 (766) 0 3 (15) 0 0 0 0DED FROM REV-OTHER (2,344) 1,891 1,366 (915) (1,603) 146 (694) 29 (2) 0 (2,561) 0 0 0DED FROM REV-BAD DEBT 3,426 (441) (189) 753 1,019 (143) (86) (13) (16) 9 2,533 0 0 0TOTAL DED FROM REV (30,288) (3,370) (5,919) (8,930) (8,009) 3 (4,091) 112 (32) (23) (28) 0 0 0
NET PATIENT REVENUE 11,924 3,854 2,441 (263) 2,295 15 2,395 218 39 (208) 1,136 0 0 0OTHER OPER REV (432) (2) 8 16 (46) 2 231 (2) (1) 0 (5) (266) (356) (11)TOTAL OPERATING REV 11,492 3,852 2,449 (247) 2,249 18 2,626 217 38 (208) 1,131 (266) (356) (11)
OPERATING EXPENSES PROD SALARIES (18,320) (2,310) (3,061) (2,026) (2,030) 4 (629) (289) (328) (175) (1,624) (0) (5,803) (50) PROD OVERTIME (321) (111) (40) (66) (74) 0 (10) (1) (0) 6 (7) (0) (16) (0) CONTRACT LABOR 257 (0) 21 16 219 0 0 0 0 0 (6) 0 7 0 NON-PROD SALARIES 1,009 261 125 42 24 95 (47) (11) (10) (10) 87 (34) 492 (4)TOTAL SALARIES & WAGES (17,375) (2,160) (2,955) (2,035) (1,862) 99 (686) (301) (338) (179) (1,550) (34) (5,320) (53)
FRINGE BENEFITS 3,840 769 845 337 343 14 (102) 73 65 70 749 7 633 35HEALTH CARE ACCESS 1,598 644 877 (278) 385 0 0 (32) 0 1 0 0 0 0SUPPLIES (3,118) (1,526) (1,831) (1,024) (382) (1) (121) (6) 2 0 (25) (1) 1,791 4OTHER SERVICES (419) (135) (84) 159 (122) 3 (469) 4 8 (5) (299) 318 205 (3)PURCHASED SERVICES 965 (1,459) (98) (137) 364 1,323 (97) (114) 15 (16) 950 14 219 2OVERHEAD ALLOCATION (0) 19,782 27,209 17,758 28,367 0 561 971 778 754 11,199 163 (107,542) 0
TOTAL OPER EXPENSES (14,510) 15,916 23,963 14,781 27,093 1,438 (913) 594 531 625 11,025 468 (110,014) (16)
EBITDA (3,018) 19,768 26,411 14,534 29,342 1,456 1,713 811 569 417 12,156 202 (110,370) (27)
DEPRECIATION/AMORT 455 (162) 0 50 1,186 0 (571) 10 19 7 (261) 8 165 5INTEREST EXPENSE (1,098) (192) 7 165 (802) (0) (246) 4 0 0 (45) 1 11 0GAIN(LOSS) FROM OPER (3,049) 19,414 26,419 14,748 29,726 1,456 895 825 588 425 12,462 210 (110,194) (22)
NON OPERATING REV INT EARN & REALIZED GAIN (1,227) (786) (3) (57) (72) 0 0 0 0 0 0 (308) 0 (1) UNREALIZED GAIN(LOSS) 31,072 30,479 0 0 0 0 0 0 0 0 0 594 0 0 UNREALIZED GAIN(LOSS) ON SWAP (257) (257) 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV 252 5,543 0 (0) (503) (5,818) 0 22 27 79 0 188 713 0 RESTRICTED GIFTS (1,255) 6 0 0 0 0 0 0 0 0 0 (1,260) 0 0TOTAL NON OPER REV 28,587 34,985 (3) (57) (575) (5,818) 0 22 27 79 0 (786) 713 (1)
EXCESS OF REV / EXPS 25,537 54,399 26,415 14,691 29,151 (4,362) 895 847 615 504 12,462 (576) (109,481) (23)
Page B.9
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL DOLLARS - IN THOUSANDSFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
OP HOME ALL CORP ALL SYSTEM LMH HPMC CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVS OTHERS
INPATIENT REVENUE 2,303,098 464,536 688,657 421,397 694,333 0 624 14,094 0 19,457 0 0 0 0OUTPATIENT REVENUE 1,325,393 188,044 297,872 237,475 254,419 7,981 69,803 0 10,405 1 259,392 0 0 0TOTAL PATIENT REVENUE 3,628,491 652,580 986,528 658,872 948,753 7,981 70,427 14,094 10,405 19,459 259,392 0 0 0
DED FROM REV-MEDICARE 1,282,078 223,952 332,088 267,319 425,865 0 26,124 1,761 93 4,876 0 0 0 0DED FROM REV-MEDICAID 331,558 52,717 149,563 54,426 70,667 0 3,719 190 276 0 0 0 0 0DED FROM REV-CHARITY 115,605 48,160 29,368 23,137 13,754 0 818 127 240 0 0 0 0 0DED FROM REV-HMO/PPO 414,609 68,053 136,930 85,380 113,473 0 9,006 0 549 1,218 0 0 0 0DED FROM REV-OTHER 334,541 54,037 39,425 38,398 51,021 3,519 4,989 511 30 0 142,610 0 0 0DED FROM REV-BAD DEBT 135,568 29,021 15,735 22,805 38,113 2,401 750 222 87 373 26,060 0 0 0TOTAL DED FROM REV 2,613,959 475,940 703,109 491,466 712,893 5,920 45,407 2,810 1,276 6,467 168,671 0 0 0
NET PATIENT REVENUE 1,014,532 176,640 283,419 167,406 235,860 2,061 25,020 11,283 9,129 12,992 90,721 0 0 0OTHER OPER REV 17,049 1,016 1,209 1,232 1,443 320 1,174 70 513 0 858 2,221 2,772 4,221
TOTAL OPERATING REV 1,031,581 177,656 284,628 168,638 237,303 2,380 26,194 11,354 9,643 12,992 91,579 2,221 2,772 4,221
OPERATING EXPENSES PROD SALARIES 382,452 50,445 77,279 48,217 67,607 2,929 7,073 5,345 5,884 5,149 65,340 928 43,682 2,572 PROD OVERTIME 17,630 3,249 4,535 2,413 6,099 0 67 535 15 162 228 1 311 14 CONTRACT LABOR 2,877 159 437 545 1,584 0 0 0 0 81 41 0 30 0 NON-PROD SALARIES 44,140 5,613 8,251 5,063 7,013 729 824 530 638 577 9,509 105 4,992 297TOTAL SALARIES & WAGES 447,100 59,467 90,502 56,239 82,303 3,658 7,964 6,410 6,537 5,969 75,118 1,034 49,015 2,884
FRINGE BENEFITS 73,630 13,239 15,117 9,623 13,514 319 1,435 1,095 1,046 1,022 8,742 168 7,652 657HEALTH CARE ACCESS 11,415 2,461 3,094 2,509 3,113 0 0 160 0 79 0 0 0 0SUPPLIES 219,546 46,359 60,171 38,657 59,944 12 4,608 806 121 306 3,800 27 4,102 632OTHER SERVICES 57,700 6,205 6,658 5,072 9,689 54 3,463 297 551 54 7,903 675 16,596 483PURCHASED SERVICES 98,310 4,185 10,094 6,084 19,984 1,928 1,525 1,461 324 230 28,255 148 23,973 119OVERHEAD ALLOCATION 0 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL OPER EXPENSES 907,701 131,915 185,635 118,184 188,547 5,972 18,995 10,229 8,579 7,661 123,819 2,053 101,340 4,775
EBITDA 123,880 45,741 98,993 50,455 48,755 (3,591) 7,199 1,125 1,064 5,331 (32,239) 169 (98,567) (554)
DEPRECIATION/AMORT 64,827 8,550 15,600 6,665 21,718 40 2,109 301 100 160 1,944 1 7,556 83INTEREST EXPENSE 22,680 1,527 4,484 3,485 10,218 1 2,485 104 0 0 275 6 94 0GAIN(LOSS) FROM OPER 36,373 35,664 78,908 40,304 16,819 (3,632) 2,606 720 964 5,171 (34,459) 161 (106,217) (636)
NON OPERATING REV INT EARN & REALIZED GAIN (14,373) (13,373) (51) (649) (520) 0 0 0 0 0 0 195 0 25 UNREALIZED GAIN (LOSS) (3,490) (3,460) 0 0 0 0 0 0 0 0 0 (30) 0 0 UNREALIZED GAIN (LOSS) ON SWA (1,761) (1,761) 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV 2,373 218 1 1 152 0 0 477 849 608 0 (645) 713 0 RESTRICTED GIFTS 1,733 (45) 0 0 0 0 0 0 0 0 0 1,778 0 0TOTAL NON OPER REV (15,518) (18,421) (50) (648) (368) 0 0 477 849 608 0 1,298 713 25
EXCESS REV/EXPS 20,855 17,244 78,858 39,656 16,451 (3,632) 2,606 1,197 1,813 5,778 (34,459) 1,460 (105,505) (611)
Page B.10
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL TO BUDGET DOLLAR VARIANCE - IN THOUSFOR THE 12 MONTH ENDED SEPTEMBER 30, 2009
OP HOME ALL CORP ALLSYSTEM LMH HP CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVCS AUX OTHERS
INPATIENT REVENUE 190,244 45,492 72,911 36,454 32,618 0 271 1,231 0 1,267 0 0 0 0 0OUTPATIENT REVENUE 102,913 17,112 17,738 15,316 13,758 1,255 1,500 0 1,173 1 35,060 0 0 0 0TOTAL PATIENT REVENUE 293,158 62,604 90,649 51,770 46,376 1,255 1,771 1,231 1,173 1,269 35,060 0 0 0 0
DED FROM REV-MEDICARE (143,549) (29,687) (53,130) (25,442) (33,558) 0 (416) (423) (64) (830) 0 0 0 0 0DED FROM REV-MEDICAID (61,961) (12,113) (23,036) (11,675) (13,912) 0 (1,246) 94 (73) 0 0 0 0 0 0DED FROM REV-CHARITY (4,786) 658 (2,550) (3,143) 1,305 0 (818) 3 (240) 0 0 0 0 0 0DED FROM REV-HMO/PPO 28,421 (1,171) (1,717) 3,377 26,525 0 1,477 0 (36) (33) 0 0 0 0 0DED FROM REV-OTHER (42,186) 4,033 923 (2,306) (16,307) (1,165) (920) 87 (30) 0 (26,501) 0 0 0 0DED FROM REV-BAD DEBT (12,738) (2,892) (1,461) (588) (2,775) 424 298 41 19 143 (5,947) 0 0 0 0TOTAL DED FROM REV (236,799) (41,172) (80,970) (39,776) (38,723) (741) (1,624) (198) (425) (720) (32,448) 0 0 0 0
NET PATIENT REVENUE 56,358 21,432 9,678 11,993 7,654 514 147 1,032 748 548 2,612 0 0 0 0OTHER OPER REV (251) 392 156 (19) 95 (19) 73 (33) (6) 0 (41) (995) (44) (9) 189TOTAL OPERATING REV 56,108 21,824 9,834 11,974 7,748 495 220 1,000 742 548 2,571 (995) (44) (9) 189
OPERATING EXPENSES PROD SALARIES (15,732) (2,844) (2,796) (1,652) (2,715) (140) (305) (552) (450) (210) (722) 42 (3,484) 24 96 PROD OVERTIME 1,090 (469) 283 202 1,558 6 (26) 61 (9) (162) (90) (1) (249) 0 (13) CONTRACT LABOR (1,820) (66) (413) (487) (863) 0 0 0 0 80 (41) 0 (30) 0 0 NON-PROD SALARIES 1,200 (100) (301) 12 85 164 (58) (75) (48) (23) 172 (37) 1,420 0 (9)TOTAL SALARIES & WAGES (15,263) (3,481) (3,228) (1,927) (1,936) 30 (389) (566) (508) (315) (680) 5 (2,344) 24 73
FRINGE BENEFITS (2,965) (2,121) (764) (216) 294 (95) (104) (49) (66) (144) 234 (3) 143 (3) (75)HEALTH CARE ACCESS 37 (200) 674 (391) 6 0 0 (160) 0 108 0 0 0 0 0SUPPLIES (6,807) (3,515) (6,454) (615) 1,751 3 113 (19) (1) (63) 1,221 4 738 0 29OTHER SERVICES 2,581 250 (431) 496 561 (5) (373) (4) (41) (16) 807 656 661 4 19PURCHASED SERVICES (8,702) (825) 836 135 1,825 52 442 (132) 76 4 (9,540) 17 (1,577) (3) (16)OVERHEAD ALLOCATION 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
TOTAL OPER EXPENSES (31,119) (9,891) (9,367) (2,517) 2,502 (14) (309) (930) (539) (426) (7,958) 679 (2,378) 22 31
EBITDA 24,988 11,932 468 9,457 10,250 481 (89) 70 203 122 (5,387) (316) (2,422) 13 220
DEPRECIATION/AMORT (6,942) (836) (1,279) (928) (2,065) (1) (918) 5 16 1 41 0 (973) (5) (5)INTEREST EXPENSE (3,516) (818) 53 978 (3,069) (1) (759) 68 0 0 (83) (6) 121 0 0GAIN(LOSS) FROM OPER 14,530 10,279 (758) 9,507 5,116 478 (1,766) 143 219 123 (5,429) (322) (3,274) 8 215
NON OPERATING REV INT EARN & REALIZED GAIN (35,521) (35,205) 1,058 (649) (535) 0 0 0 0 0 0 (166) 0 (8) (23) UNREALIZED GAIN(LOSS) (3,265) (3,460) 0 0 0 0 0 0 0 0 0 195 0 0 0 UNREALIZED GAIN(LOSS) ON SWA (1,761) (1,761) 0 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV 1,030 (290) 1 1 166 0 0 477 619 (374) 0 (283) 713 0 0 RESTRICTED GIFTS 1,733 (45) 0 0 0 0 0 0 0 0 0 1,778 0 0 0TOTAL NON OPER REV (37,784) (40,761) 1,058 (648) (369) 0 0 477 619 (374) 0 1,523 713 (8) (23)
EXCESS OF REV / EXPS (23,254) (30,482) 300 8,859 4,747 478 (1,766) 620 838 (251) (5,429) 1,201 (2,561) 0 192
Page B.11
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL TO PRIOR YEAR DOLLAR VARIANCE - IN THOUSFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
OP HOME ALL CORP ALLSYSTEM LMH HP CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVCS OTHERS
INPATIENT REVENUE 347,565 99,768 99,468 71,223 73,886 0 246 1,212 0 1,763 0 0 0 0OUTPATIENT REVENUE 219,339 10,442 48,649 28,043 28,333 804 52,273 0 1,270 1 49,524 0 0 0TOTAL PATIENT REVENUE 566,904 110,210 148,117 99,265 102,218 804 52,519 1,212 1,270 1,764 49,524 0 0 0
DED FROM REV-MEDICARE (249,037) (49,260) (73,545) (46,551) (59,436) 0 (18,835) (251) (30) (1,130) 0 0 0 0DED FROM REV-MEDICAID (73,370) (18,121) (29,127) (16,976) (6,016) 0 (3,070) 57 (117) 0 0 0 0 0DED FROM REV-CHARITY (16,119) (5,859) (5,642) (4,799) 1,188 0 (800) 34 (240) 0 0 0 0 0DED FROM REV-HMO/PPO (51,119) (10,294) (13,743) (13,971) (5,679) 0 (7,157) 0 105 (380) 0 0 0 0DED FROM REV-OTHER (76,687) (6,061) (5,110) (5,865) (16,838) (451) (3,566) (3,332) (30) 0 (35,433) 0 0 0DED FROM REV-BAD DEBT (23,363) (8,061) (2,543) (3,965) (3,412) 179 (597) (41) 11 27 (4,961) 0 0 0TOTAL DED FROM REV (489,695) (97,656) (129,710) (92,127) (90,193) (272) (34,025) (3,533) (302) (1,483) (40,395) 0 0 0
NET PATIENT REVENUE 77,209 12,554 18,408 7,138 12,025 532 18,494 (2,321) 968 282 9,130 0 0 0OTHER OPER REV (1,159) (39) (143) 73 (291) (2) 743 (22) 17 0 (9) (1,519) (404) 437TOTAL OPERATING REV 76,051 12,515 18,264 7,212 11,735 529 19,237 (2,343) 985 282 9,121 (1,519) (404) 437
OPERATING EXPENSES PROD SALARIES (25,106) (522) (3,785) (1,470) (4,261) (116) (4,390) (500) (749) (312) (3,280) (2) (5,489) (231) PROD OVERTIME (2,504) (869) (360) (320) (933) 1 (55) (10) (10) (3) 100 (1) (55) 9 CONTRACT LABOR 6,586 422 1,049 558 4,319 0 0 0 32 212 (39) 0 33 0 NON-PROD SALARIES 5,628 1,072 648 647 588 476 (487) 27 (4) 51 752 (22) 1,892 (11)TOTAL SALARIES & WAGES (15,397) 103 (2,448) (585) (286) 361 (4,932) (483) (732) (52) (2,466) (25) (3,619) (233)
FRINGE BENEFITS 503 (718) (51) 211 1,483 (11) (802) (34) (22) (15) 169 (3) 337 (42)HEALTH CARE ACCESS 66 99 626 (798) 301 0 0 (160) 0 (1) 0 0 0 0SUPPLIES (10,800) (1,053) (7,385) (262) 1,338 1 (4,323) (58) (22) (48) 184 (5) 771 60OTHER SERVICES 2,004 157 (851) (414) (163) 14 (1,037) 26 (39) 9 260 1,279 2,840 (77)PURCHASED SERVICES (6,659) (537) (1,388) (1,075) 1,383 1,295 (1,042) (59) 100 (33) (4,311) 38 (1,013) (17)OVERHEAD ALLOCATION (0) 19,782 27,209 17,758 28,367 0 561 971 778 754 11,199 163 (107,542) 0
TOTAL OPER EXPENSES (30,282) 17,833 15,712 14,835 32,421 1,661 (11,575) 203 65 614 5,035 1,448 (108,226) (309)
EBITDA 45,768 30,347 33,977 22,046 44,156 2,190 7,662 (2,140) 1,050 896 14,156 (71) (108,630) 129
DEPRECIATION/AMORT (6,810) (1,195) (1,346) 456 (3,173) (3) (2,013) (4) 27 69 617 8 (252) 0INTEREST EXPENSE (4,041) (1,064) 1,160 929 (2,933) (2) (2,478) 55 0 0 184 1 106 0GAIN(LOSS) FROM OPER 33,314 28,088 33,791 23,432 38,050 2,185 3,171 (2,089) 1,077 964 13,354 (62) (108,776) 129
NON OPERATING REV INT EARN & REALIZED GAIN (64,852) (62,911) (80) (797) (615) 0 0 0 0 0 0 (443) 0 (7) UNREALIZED GAIN(LOSS) 84,084 83,337 0 0 0 0 0 0 0 0 0 746 0 0 UNREALIZED GAIN(LOSS) ON SWAP (986) (986) 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV 1,686 6,822 5 100 (338) (5,818) 0 (51) 470 (169) 0 (49) 713 0 RESTRICTED GIFTS 65 (45) 0 0 0 0 0 0 0 0 0 110 0 0TOTAL NON OPER REV 19,932 26,262 (75) (696) (952) (5,818) 0 (51) 470 (169) 0 255 713 (7)
EXCESS OF REV / EXPS 53,246 54,350 33,716 22,735 37,098 (3,632) 3,171 (2,140) 1,547 795 13,354 192 (108,064) 122
Page B.12
LEE MEMORIAL HEALTH SYSTEMOPERATING RATIOSFOR THE MONTH ENDED SEPTEMBER 30, 2009
OP HOME ALL ALL SYSTEM LMH HPMC CCH GCMC CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND OTHERS
AS % NET OPER REVWAGES & BENEFITS ACTUAL 62.7% 44.5% 42.9% 48.4% 49.0% 35.1% 90.6% 123.7% 96.9% 95.9% 52.3% 102.1% BUDGET 52.5% 45.0% 37.3% 41.7% 39.5% 36.9% 65.2% 86.9% 58.7% 100.7% 37.7% 88.1% PRIOR YR 54.4% 47.7% 37.9% 35.2% 59.0% 59.3% 86.4% 88.9% 63.1% 99.7% 20.1% 92.3%
SUPPLIES ACTUAL 18.1% 23.9% 20.5% 26.7% 28.0% 4.4% 7.3% 1.0% 3.4% 5.1% 0.4% 20.5% BUDGET 20.8% 25.5% 18.5% 24.1% 24.8% 20.4% 7.4% 1.4% 2.0% 5.5% 1.0% 16.6% PRIOR YR 16.8% 19.5% 14.3% 18.8% 22.6% 3.6% 8.6% 1.5% 2.7% 5.6% 0.1% 21.2%
ALL OTHER OPER EXPENSES ACTUAL 14.4% 7.5% 4.7% 5.3% 14.6% 25.3% 30.9% 7.3% 7.6% 29.9% 28.0% 20.6% BUDGET 17.2% 9.9% 7.8% 9.2% 15.1% 22.1% 15.4% 11.1% 4.2% 32.1% 46.6% 15.5% PRIOR YR 19.4% 155.8% 135.1% 131.9% 303.1% 145.0% 148.3% 131.5% 85.9% 192.9% 109.8% 19.4%
CAPITAL COSTS ACTUAL 10.3% 4.6% 7.8% 10.1% 17.4% 26.7% 4.1% -1.3% 1.6% 2.5% 2.9% 2.3% BUDGET 8.6% 5.2% 6.8% 6.7% 13.9% 14.9% 4.5% 1.4% 1.6% 2.7% 0.0% 2.0% PRIOR YR 11.9% 3.3% 8.7% 11.5% 54.2% 5.8% 7.1% 1.5% 2.0% 7.0% 3.0% 3.8%
EBITDA MARGIN ACTUAL 4.8% 24.2% 31.9% 19.7% 8.4% 35.2% -28.8% -32.0% -7.9% -30.9% 19.2% -43.2% BUDGET 9.4% 19.6% 36.4% 24.9% 20.6% 20.6% 12.0% 0.6% 35.1% -38.4% 14.7% -20.2% PRIOR YR 9.5% -123.0% -87.3% -85.9% -284.6% -108.0% -143.3% -121.8% -51.6% -198.1% -30.0% -32.9%
OPERATING MARGIN ACTUAL -5.6% 19.6% 24.2% 9.5% -9.0% 8.4% -32.9% -30.7% -9.5% -33.5% 16.3% -45.5% BUDGET 0.8% 14.4% 29.7% 18.2% 6.7% 5.7% 7.5% -0.9% 33.5% -41.1% 14.7% -22.1% PRIOR YR -2.4% -126.3% -96.0% -97.4% -338.8% -113.7% -150.4% -123.3% -53.6% -205.1% -33.0% -36.7%
EXCESS MARGIN ACTUAL 3.3% 42.7% 24.2% 9.1% -9.4% 8.4% -24.8% -16.0% 7.7% -33.5% 9.8% -44.6% BUDGET 3.2% 29.6% 29.2% 18.2% 6.7% 5.7% 7.5% -7.7% 43.1% -41.1% 7.7% -20.9% PRIOR YR -28.8% -286.2% -96.0% -97.4% -318.1% -113.7% -144.9% -114.0% -47.9% -205.1% 204.2% -35.8%
PER CMI ADJ ADMIT / VISITNET OPER REV ACTUAL 7,215 8,316 7,554 6,034 5,701 792 13,987 2,646 7,311 215 20 25 BUDGET 6,710 6,499 6,558 6,118 6,179 488 16,493 2,447 10,423 166 23 28 PRIOR YR 6,695 7,146 6,771 6,412 2,638 129 9,414 2,398 9,261 182 45 27
TOTAL EXPENSES ACTUAL 7,616 6,689 5,727 5,459 6,213 725 18,592 3,457 8,004 286 17 36 BUDGET 6,656 5,562 4,614 5,003 5,764 460 15,249 2,468 6,929 235 20 35 PRIOR YR 6,855 16,175 13,270 12,655 11,576 276 23,575 5,354 14,228 557 60 37
WAGES & BENEFITS ACTUAL 4,524 3,702 3,237 2,919 2,793 278 12,675 3,273 7,082 206 11 25 BUDGET 3,523 2,924 2,446 2,554 2,438 180 10,751 2,127 6,116 167 9 25 PRIOR YR 3,643 3,412 2,567 2,259 1,556 77 8,138 2,131 5,840 182 9 25
Page B.13
LEE MEMORIAL HEALTH SYSTEMOPERATING RATIOSFOR THE MONTH ENDED SEPTEMBER 30, 2009
OP HOME ALL ALL SYSTEM LMH HPMC CCH GCMC CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND OTHERS
SUPPLIES ACTUAL 1,308 1,984 1,549 1,609 1,595 35 1,021 27 250 11 0 5 BUDGET 1,398 1,660 1,213 1,475 1,533 100 1,221 34 210 9 0 5 PRIOR YR 1,123 1,392 970 1,204 595 5 809 35 246 10 0 6
ALL OTHER OPER EXPENSES ACTUAL 1,038 620 355 319 835 200 4,319 192 554 64 6 5 BUDGET 1,155 641 511 564 932 108 2,542 272 437 53 11 4 PRIOR YR 1,296 11,133 9,146 8,455 7,995 187 13,958 3,153 7,954 352 50 5
CAPITAL COSTS ACTUAL 746 383 586 612 989 212 577 (35) 118 5 1 1 BUDGET 580 337 444 410 861 73 734 35 166 5 0 1 PRIOR YR 794 238 587 738 1,430 7 670 36 188 13 1 1
OPERATING MARGIN ACTUAL (401) 1,627 1,827 575 (512) 67 (4,605) (812) (694) (72) 3 (11) BUDGET 54 937 1,945 1,114 415 28 1,245 (22) 3,495 (68) 3 (6) PRIOR YR (161) (9,029) (6,499) (6,243) (8,938) (147) (14,161) (2,956) (4,968) (374) (15) (10)
EXCESS MARGIN ACTUAL 292 4,983 1,826 549 (533) 67 (3,689) (478) 666 (72) 39 (11) BUDGET 212 1,925 1,917 1,114 415 28 1,245 (188) 4,491 (68) 2 (6) PRIOR YR (1,928) (20,455) (6,499) (6,244) (8,393) (147) (13,646) (2,735) (4,437) (374) 92 (10)
LABORPROD FTEs/ADJ DAILY ADMIT ACTUAL 22.91 22.18 17.99 16.52 19.36 1.43 62.52 10.13 28.04 0.50 0.04 0.25 BUDGET 24.07 23.83 17.26 18.42 18.69 1.05 77.79 10.08 41.01 0.50 0.05 0.29 PRIOR YR 23.06 24.15 17.72 15.83 12.71 0.45 62.51 9.84 37.27 0.47 0.05 0.26
NON PROD AS % PAID ACTUAL 9.41% 9.38% 9.75% 9.82% 9.11% 8.75% 8.74% 9.99% 12.12% 8.21% 10.93% 10.40% BUDGET 7.72% 8.52% 8.14% 7.57% 7.54% 7.51% 4.64% 6.86% 8.41% 6.59% 8.01% 8.39% PRIOR YR 7.59% 7.80% 8.23% 8.21% 7.76% 10.82% 4.61% 4.61% 6.01% 7.00% 6.05% 9.31%
AVG HOURLY RATE ACTUAL 40.18 35.79 35.54 33.80 30.52 26.04 28.88 47.81 40.58 62.32 48.58 18.38 BUDGET 28.67 26.41 26.81 25.03 25.38 23.67 19.72 29.57 25.62 48.80 34.38 16.48 PRIOR YR 29.03 27.23 26.25 24.71 24.67 20.24 20.13 28.77 25.23 53.09 36.70 15.40
OP REV % OF TOTAL REVENUE ACTUAL 38.7% 32.7% 31.8% 35.7% 28.1% 99.4% N/A 100.0% 0.1% 100.0% N/A N/A BUDGET 38.2% 30.7% 33.4% 38.8% 26.5% 99.6% N/A 100.0% N/A 100.0% N/A N/A PRIOR YR 38.0% 37.3% 30.2% 37.8% 46.2% 97.9% N/A 100.0% 0.0% 100.0% N/A N/A
Page B.14
LEE MEMORIAL HEALTH SYSTEMOPERATING RATIOSFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
OP HOME ALL ALLSYSTEM LMH HPMC CCH GCMC CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND OTHERS
AS % NET OPER REVWAGES & BENEFITS ACTUAL 50.5% 42.6% 37.1% 39.1% 40.4% 35.9% 66.1% 78.6% 53.8% 91.6% 54.1% 83.9% BUDGET 51.5% 45.0% 37.0% 40.7% 41.0% 34.3% 66.6% 78.8% 52.5% 93.7% 37.4% 87.8% PRIOR YR 52.9% 45.8% 38.7% 40.6% 45.5% 52.7% 51.0% 78.9% 54.5% 98.9% 31.4% 86.3%
SUPPLIES ACTUAL 21.3% 25.8% 21.1% 22.9% 25.3% 17.6% 7.1% 1.3% 2.4% 4.1% 1.2% 15.0% BUDGET 21.8% 27.2% 19.5% 24.3% 26.9% 18.2% 7.6% 1.4% 2.0% 5.6% 1.0% 16.4% PRIOR YR 21.8% 27.1% 19.8% 23.8% 20.0% 4.1% 5.5% 1.2% 2.0% 4.8% 0.6% 18.3%
ALL OTHER OPER EXPENSES ACTUAL 16.2% 8.2% 7.0% 8.1% 13.8% 19.0% 16.9% 9.1% 2.8% 39.5% 37.1% 14.3% BUDGET 16.5% 8.9% 7.6% 8.9% 15.3% 19.5% 15.7% 10.2% 3.7% 30.8% 46.5% 15.0% PRIOR YR 17.0% 21.3% 17.1% 18.0% 32.1% 49.9% 19.7% 19.8% 8.6% 52.5% 61.6% 13.4%
CAPITAL COSTS ACTUAL 8.5% 5.6% 7.1% 6.0% 13.5% 17.5% 3.6% 1.0% 1.2% 2.4% 0.3% 2.0% BUDGET 7.9% 5.4% 6.9% 6.5% 11.7% 11.2% 4.6% 1.3% 1.3% 2.4% 0.0% 1.9% PRIOR YR 7.9% 4.7% 7.5% 7.1% 22.2% 1.5% 3.3% 1.5% 1.8% 1.7% 0.4% 2.2%
EBITDA MARGIN ACTUAL 12.0% 23.4% 34.8% 29.9% 20.5% 27.5% 9.9% 11.0% 41.0% -35.2% 7.6% -13.1% BUDGET 10.1% 18.9% 35.9% 26.2% 16.8% 28.1% 10.2% 9.7% 41.9% -30.2% 15.1% -19.2% PRIOR YR 8.2% 5.8% 24.4% 17.6% 2.3% -6.6% 23.8% 0.2% 34.9% -56.3% 6.4% -18.0%
OPERATING MARGIN ACTUAL 3.5% 17.8% 27.7% 23.9% 7.1% 9.9% 6.3% 10.0% 39.8% -37.6% 7.3% -15.1% BUDGET 2.2% 13.5% 29.0% 19.7% 5.1% 16.8% 5.6% 8.4% 40.6% -32.6% 15.0% -21.1% PRIOR YR 0.3% 1.1% 16.9% 10.5% -19.9% -8.1% 20.5% -1.3% 33.1% -58.0% 6.0% -20.2%
EXCESS MARGIN ACTUAL 1.9% 8.5% 27.7% 23.6% 6.9% 9.9% 10.1% 17.3% 42.5% -37.6% -9.1% -14.4% BUDGET 4.5% 27.7% 28.6% 19.7% 5.1% 16.8% 5.6% 10.9% 48.5% -32.6% 8.0% -19.9% PRIOR YR -3.4% -22.2% 16.9% 10.5% -18.8% -8.1% 24.4% 3.1% 39.2% -58.0% 30.9% -19.4%
PER CMI ADJ ADMIT / VISITNET OPER REV ACTUAL 6,712 6,706 6,729 5,928 6,238 435 14,593 2,499 10,110 185 14 27 BUDGET 6,700 6,367 6,515 6,070 6,189 443 16,178 2,406 10,519 164 22 28 PRIOR YR 6,569 6,402 6,460 5,966 4,078 115 19,346 2,326 10,873 163 26 26
TOTAL EXPENSES ACTUAL 6,475 5,513 4,863 4,511 5,796 391 13,668 2,249 6,086 255 13 32 BUDGET 6,550 5,508 4,626 4,877 5,873 368 15,278 2,204 6,252 218 19 34 PRIOR YR 6,548 6,335 5,366 5,343 4,889 125 15,379 2,356 7,274 258 24 31
WAGES & BENEFITS ACTUAL 3,388 2,856 2,497 2,315 2,519 156 9,647 1,965 5,440 169 8 23 BUDGET 3,452 2,867 2,410 2,469 2,539 152 10,767 1,894 5,521 154 8 24 PRIOR YR 3,478 2,930 2,501 2,420 1,857 61 9,871 1,835 5,923 161 8 22
LEE MEMORIAL HEALTH SYSTEMPage B.15
OPERATING RATIOSFOR THE 12 MONTHS ENDED SEPTEMBER 30, 2009
OP ALL CORPSYSTEM LMH HPMC CCH GCMC CENTERS HPCC HH REHAB PHYSICIANS FOUND SVC
SUPPLIES ACTUAL 1,428 1,727 1,422 1,359 1,576 76 1,037 31 238 8 0 4 BUDGET 1,461 1,730 1,274 1,474 1,663 80 1,230 33 206 9 0 5 PRIOR YR 1,435 1,737 1,280 1,419 817 5 1,057 27 221 8 0 5
ALL OTHER OPER EXPENSES ACTUAL 1,089 553 469 480 862 83 2,464 227 283 73 5 4 BUDGET 1,108 569 496 539 948 86 2,533 246 389 51 10 4 PRIOR YR 1,120 1,366 1,102 1,077 1,308 58 3,807 460 934 86 16 3
CAPITAL COSTS ACTUAL 569 377 475 357 839 76 521 26 125 4 0 1 BUDGET 529 342 447 395 723 50 748 31 136 4 0 1 PRIOR YR 516 301 483 426 906 2 644 34 196 3 0 1
OPERATING MARGIN ACTUAL 237 1,193 1,865 1,417 442 43 925 250 4,024 (70) 1 (4) BUDGET 150 859 1,889 1,193 316 75 901 201 4,267 (54) 3 (6) PRIOR YR 21 67 1,094 624 (811) (9) 3,967 (30) 3,598 (95) 2 (5)
EXCESS MARGIN ACTUAL 136 507 1,864 1,394 432 43 1,538 470 4,497 (70) 9 (4) BUDGET 303 1,761 1,863 1,193 316 75 901 263 5,097 (54) 2 (6) PRIOR YR (223) (1,421) 1,095 625 (767) (9) 4,713 71 4,263 (95) 8 (5)
LABORPROD FTEs/ADJ DAILY ADMIT ACTUAL 22.38 21.96 17.39 15.58 19.03 0.86 65.70 8.22 34.53 5.95 0.04 0.25 BUDGET 23.86 23.71 17.20 17.89 19.24 0.89 77.56 9.05 37.37 5.81 0.05 0.28 PRIOR YR 23.46 23.68 17.69 17.13 13.61 0.40 70.56 8.53 38.82 5.78 0.05 0.26
NON PROD AS % PAID ACTUAL 8.91% 8.97% 9.13% 9.18% 8.40% 9.65% 7.95% 10.71% 10.19% 7.96% 8.07% 9.99% BUDGET 8.16% 8.21% 8.30% 8.23% 8.00% 8.55% 8.52% 8.49% 8.05% 7.37% 8.66% 8.37% PRIOR YR 8.31% 8.37% 8.58% 8.87% 8.21% 10.24% 6.64% 8.66% 8.37% 7.69% 8.50% 9.22%
AVG HOURLY RATE ACTUAL 28.93 26.54 26.73 25.55 25.45 24.41 20.15 32.13 26.15 50.00 34.74 16.43 BUDGET 28.09 26.04 26.38 24.68 25.49 23.29 18.80 28.76 25.46 46.57 34.12 16.43 PRIOR YR 28.22 26.08 26.08 24.71 25.77 19.61 19.39 29.23 25.91 48.85 32.99 15.35
OP REV % OF TOTAL REVENUE ACTUAL 36.5% 29.7% 30.2% 36.0% 26.8% 99.1% 0.0% 100.0% 0.0% 100.0% N/A N/A BUDGET 36.7% 29.8% 31.3% 36.6% 26.7% 99.5% 0.0% 100.0% N/A 100.0% N/A N/A PRIOR YR 36.1% 33.6% 29.7% 37.4% 42.1% 97.9% 0.0% 100.0% 0.0% 100.0% N/A N/A
Page B.16
LEE MEMORIAL HEALTH SYSTEMFOR THE PERIOD ENDING: SEPTEMBER 30, 2009CONSOLIDATED STAFFING SUMMARY
OP ALL ALLSYSTEM LMH HP CCH GCMC TRAUMA CENTERS HPCC HH REHAB PHYSICIANS FOUND CORP OTHERS
MONTH TO DATE
BUDGET 7,105.05 1,017.23 1,498.85 1,010.08 1,449.40 18.07 166.86 143.03 99.60 97.50 766.86 14.59 737.86 85.12
ACTUAL 7,489.32 1,143.85 1,594.62 1,081.57 1,533.96 18.65 209.55 159.85 97.13 91.50 734.88 14.29 726.10 83.36
DIFFERENCE (384.27) (126.62) (95.77) (71.49) (84.56) (0.58) (42.69) (16.82) 2.47 6.00 31.98 0.30 11.76 1.76
YEAR TO DATE
BUDGET 7,369.92 1,080.55 1,586.09 1,055.20 1,511.52 18.10 155.92 149.07 100.52 106.49 766.37 14.59 739.23 86.26
ACTUAL 7,408.48 1,122.04 1,623.17 1,055.35 1,550.52 18.40 156.44 152.55 97.55 109.44 720.30 14.27 704.32 84.13
DIFFERENCE (38.56) (41.49) (37.08) (0.14) (39.00) (0.30) (0.53) (3.48) 2.97 (2.95) 46.06 0.33 34.91 2.14
Page B.17
LMH/HP CCH SWR/GCH HPCC HHA HBP/LPG TOTALGross A/R 118,525 36,900 122,392 1,581 1,536 36,198 317,132Allowances 49,632 15,925 82,311 386 63 23,818 172,135Net A/R 68,893 20,975 40,081 1,194 1,473 12,381 144,997
Net Revenue Per Day 1,375 433 617 32 23 263 2,743
Net Days in A/R Current Month 50.1 48.4 65.0 37.5 64.3 47.1 52.9 Net Days in A/R Same Month Prior Yr 60.8 48.7 63.1 36.0 64.6 60.8 59.0 % Change 3.8% 2.2% -7.1% 3.1% 31.5% 12.6%
In Thousands (000)September 30, 2009
Summary of Accounts ReceivableLEE MEMORIAL HEALTH SYSTEM
Page B.18
LEE MEMORIAL HEALTH SYSTEM
LEE COUNTY, FLORIDA
UNCONSOLIDATED
FINANCIAL STATEMENTS AND
STATISTICAL REPORTS
SEPTEMBER 30, 2009
LEE MEMORIAL HEALTH SYSTEM
UNCONSOLIDATED
TABLE OF CONTENTS
SECTION C
PAGE LEESAR REGIONAL SERVICE CENTER C.1 ACCESS INFUSION PARTNERS C.2 ACCESS MEDICAL SOUTH, LC C.3 BONITA COMMUNITY HEALTH CENTER, INC. C.4
VAR VAR % VAR % VAR VAR % VAR %BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
TOTAL SALES 9,008,301 9,245,737 7,442,196 237,436 2.6% 24.2% 114,442,229 112,130,983 107,378,542 (2,311,245) -2.0% 4.4%
COST OF GOODS SOLD 8,224,125 7,998,707 6,802,709 225,418 2.7% -17.6% 104,221,176 102,038,957 98,058,638 2,182,221 2.1% -4.1% GROSS PROFIT 784,176 1,247,030 639,487 462,854 59.0% 95.0% 10,221,053 10,092,026 9,319,904 (129,024) -1.3% 8.3%
OTHER OPERATING REVENUE 1,350 7,129 264 5,779 428.1% 2600.4% 16,240 20,873 37,095 4,634 28.5% -43.7%
TOTAL OPERATING REVENUE 785,526 1,254,159 639,751 468,633 59.7% 96.0% 10,237,293 10,112,899 9,356,999 (124,390) -1.2% 8.1%
OPERATING EXPENSES SALARIES/WAGES 377,155 305,230 297,866 71,925 19.1% -2.5% 4,297,605 4,182,080 3,913,338 115,525 2.7% -6.9% BENEFITS 122,961 107,232 60,067 15,729 12.8% -78.5% 1,713,394 1,462,660 1,147,736 250,734 14.6% -27.4% OTHER SUPPLIES 30,610 58,375 65,724 (27,765) -90.7% 11.2% 469,074 488,210 473,642 (19,136) -4.1% -3.1% OTHER SERVICES 144,560 208,052 81,822 (63,492) -43.9% -154.3% 1,954,912 1,809,952 1,791,881 144,960 7.4% -1.0% PURCHASED SERVICES 31,300 75,407 43,059 (44,107) -140.9% -75.1% 446,831 487,924 586,702 (41,093) -9.2% 16.8% DEPRECIATION/AMORTIZATION 59,300 63,754 62,142 (4,454) -7.5% -2.6% 743,880 759,355 706,139 (15,476) -2.1% -7.5%
TOTAL OPERATING EXPENSES 765,886 818,050 610,680 (52,164) -6.8% -25.3% 9,625,696 9,190,181 8,619,438 435,515 4.5% -6.6%
GAIN(LOSS) FROM OPERATIONS 19,640 436,109 29,071 416,469 2120.5% 1400.2% 611,597 922,718 737,561 311,121 50.9% 25.1%
INTEREST EARNINGS 14,800 1,064 9,709 (13,736) -92.8% -812.5% 211,960 29,741 185,512 (182,219) -86.0% -84.0% GAIN(LOSS) ON DISPOSITION 0 0 0 0 0.0% 0.0% 0 0 0 0 0.0% 0.0%
EXCESS OF REV OVER EXPENSES 34,440 437,173 38,780 402,733 1169.4% 1027.3% 823,557 952,459 923,073 128,898 15.7% 3.2%
Page C.1
LEESAR REGIONAL SERVICE CENTERCOMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING SEPTEMBER 30, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2009
ACCESS INFUSION PARTNERS
COMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING SEPTEMBER 30, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2009VAR VAR % VAR % FORMULA DRIVEN VAR VAR % VAR %
BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
GROSS PRODUCT REVENUE 605,400 685,142 643,106 79,742 13.2% 6.5% 7,763,400 8,419,007 7,503,524 655,607 8.4% 12.2%
DEDUCTIONS FROM REVENUE 348,105 387,780 365,779 (39,675) -11.4% -6.0% 4,463,958 4,899,376 4,360,179 (435,418) -9.8% -12.4% NET PRODUCT REVENUE 257,295 297,362 277,327 40,067 15.6% 7.2% 3,299,442 3,519,631 3,143,345 220,189 6.7% 12.0%
COST OF PRODUCTS SOLD 127,140 149,146 129,573 (22,006) -17.3% -15.1% 1,630,360 1,725,964 1,553,168 (95,604) -5.9% -11.1%
GROSS PROFIT 130,155 148,216 147,754 18,061 13.9% 0.3% 1,669,082 1,793,667 1,590,177 124,585 7.5% 12.8%
OPERATING EXPENSES SALARIES/WAGES 64,262 80,974 66,890 (16,712) -26.0% -21.1% 654,327 701,746 570,123 (47,419) -7.2% -23.1% BENEFITS 8,815 10,152 8,605 (1,337) -15.2% -18.0% 98,502 85,636 114,540 12,866 13.1% 25.2% OTHER SUPPLIES & SERVICES 32,134 34,467 32,277 (2,333) -7.3% -6.8% 394,694 425,123 418,346 (30,429) -7.7% -1.6% PURCHASED SERVICES 15,500 12,419 12,101 3,081 19.9% -2.6% 206,500 169,218 157,258 37,282 18.1% -7.6% DEPREC, INTEREST, & AMORT 2,285 2,704 1,192 (419) -18.3% -126.8% 21,810 24,240 14,830 (2,430) -11.1% -63.5%
TOTAL OPERATING EXPENSES 122,996 140,716 121,065 (17,720) -14.4% -14.0% 1,375,833 1,405,963 1,275,097 (30,130) -2.2% -10.3%
GAIN(LOSS) FROM OPERATIONS 7,159 7,501 26,689 342 4.8% -255.8% 293,249 387,704 315,080 94,455 32.2% 23.0%
NON OPERATING REVENUE 0 504 986 504 0.0% -48.9% 0 9,745 9,525 9,745 0.0% 2.3%
EXCESS OF REV OVER EXPENSES 7,159 8,005 27,675 846 11.8% -71.1% 293,249 397,449 324,605 104,200 35.5% 22.4%
MINORITY INTEREST 3,580 4,003 13,838 423 11.8% -71.1% 146,625 198,724 162,303 52,100 35.5% 22.4% NET INCOME (LOSS) 3,580 4,003 13,838 423 11.8% -71.1% 146,625 198,724 162,303 52,100 35.5% 22.4%
Page C.2
ACCESS MEDICAL SOUTH, LCCOMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING SEPTEMBER 30, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2009VAR VAR % VAR % VAR VAR % VAR %
BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
NET PRODUCT REVENUE 186,074 193,158 172,631 7,084 3.8% 11.9% 2,297,576 2,197,125 2,226,657 (100,451) -4.4% -1.3%
COST OF PRODUCTS SOLD 51,545 35,072 27,458 16,473 32.0% -27.7% 636,015 450,649 423,802 185,366 29.1% -6.3%
GROSS PROFIT 134,529 158,086 145,173 23,557 17.5% 8.9% 1,661,561 1,746,476 1,802,855 84,915 5.1% -3.1%
OPERATING EXPENSES SALARIES/WAGES 50,038 62,846 50,028 (12,808) -25.6% -25.6% 610,742 718,557 763,159 (107,815) -17.7% 5.8% BENEFITS 12,691 14,956 10,341 (2,265) -17.8% -44.6% 152,292 153,101 179,621 (809) -0.5% 14.8% OTHER SERVICES 35,211 32,271 29,437 2,940 8.3% -9.6% 422,532 337,682 371,135 84,850 20.1% 9.0% BAD DEBT 26,050 21,265 15,075 4,785 18.4% -41.1% 321,660 153,850 337,517 167,810 52.2% 54.4% DEPREC, INTEREST, & AMORT 1,500 14,465 15,654 (12,965) -864.3% 7.6% 18,000 179,035 163,631 (161,035) -894.6% -9.4%
TOTAL OPERATING EXPENSES 125,490 145,803 120,535 (20,313) -16.2% -21.0% 1,525,226 1,542,225 1,815,063 (16,999) -1.1% 15.0%
GAIN(LOSS) FROM OPERATIONS 9,039 12,283 24,638 3,244 35.9% 50.1% 136,335 204,251 -12,208 67,916 49.8% -1773.1%
NON OPERATING REVENUE 100 0 482 (100) -100.0% -100.0% 1,200 2,222 8,370 1,022 85.2% -73.5%
EXCESS OF REV OVER EXPENSES 9,139 12,283 25,120 3,144 34.4% -51.1% 137,535 206,473 (3,838) 68,938 50.1% -5479.7%
MINORITY INTEREST 4,570 6,142 12,560 1,572 34.4% -51.1% 68,768 103,237 -1,919 34,469 50.1% -5479.7% NET INCOME (LOSS) 4,570 6,142 12,560 1,572 34.4% -51.1% 68,768 103,237 (1,919) 34,469 50.1% -5479.7%
Page C.3
VAR VAR % VAR % VAR VAR % VAR %BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
GROSS PATIENT REVENUE 1,212,070 1,217,459 1,194,767 5,389 0.4% 1.9% 19,669,660 16,089,931 17,590,638 (3,579,729) -18.2% -8.5%
DEDUCTIONS FROM REVENUE 828,863 813,537 836,912 15,326 1.8% 2.8% 13,223,831 10,398,737 11,521,072 2,825,094 21.4% 9.7% NET PATIENT REVENUE 383,207 403,922 357,855 20,715 5.4% 12.9% 6,445,829 5,691,194 6,069,566 (754,635) -11.7% -6.2%
OTHER OPERATING REVENUE 105,000 87,855 102,499 (17,145) -16.3% -14.3% 1,221,000 1,110,599 1,232,315 (110,401) -9.0% -9.9%
TOTAL OPERATING REVENUE 488,207 491,777 460,354 3,570 0.7% 6.8% 7,666,829 6,801,793 7,301,881 (865,036) -11.3% -6.8%
OPERATING EXPENSES SALARIES/WAGES/BENEFITS 309,448 251,157 298,970 58,291 18.8% 16.0% 3,873,107 3,701,385 3,711,447 171,722 4.4% 0.3% OTHER SUPPLIES 176,365 197,437 183,881 (21,072) -11.9% -7.4% 2,441,912 2,129,948 2,294,910 311,964 12.8% 7.2% PURCHASED SERVICES 86,474 88,552 84,841 (2,078) -2.4% -4.4% 1,117,044 1,313,478 1,106,634 (196,434) -17.6% -18.7% DEPRECIATION/AMORTIZATION 80,662 75,854 85,569 4,808 6.0% 11.4% 967,944 907,384 994,584 60,560 6.3% 8.8% BAD DEBT EXPENSE 8,431 20,236 25,168 (11,805) -140.0% 19.6% 141,807 164,408 169,846 (22,601) -15.9% 3.2% INTEREST 115,689 148,361 165,104 (32,672) -28.2% 10.1% 1,410,415 2,068,802 1,537,372 (658,387) -46.7% -34.6%
TOTAL OPERATING EXPENSES 777,069 781,597 843,533 (4,528) -0.6% 7.3% 9,952,229 10,285,405 9,814,793 (333,176) -3.3% -4.8%
GAIN(LOSS) FROM OPERATIONS (288,862) (289,820) (383,179) (958) 0.3% -24.4% (2,285,400) (3,483,612) (2,512,912) (1,198,212) 52.4% 38.6%
INTEREST EARNINGS 2,750 42 8,822 (2,708) -98.5% -99.5% 49,600 60,906 149,324 11,306 22.8% -59.2% GAIN ON SALE OF EQUIPMENT 0 0 0 0 0.0% 0.0% 0 (7,529) 0 (7,529) 0.0% 0.0% CHANGE IN NET UNREALIZED G/L-INV 0 0 (8,299) 0 0.0% -100.0% 0 (45,271) (47,400) (45,271) 0.0% -4.5% INCRS(REDUCT) FV INT RATE SWAPS 0 (7,644) 145,134 (7,644) 0.0% 0.0% 0 (923,728) (591,821) (923,728) 0.0% 0.0%
EXCESS OF REV OVER EXPENSES (286,112) (297,422) (237,522) (11,310) -4.0% -25.2% (2,235,800) (4,399,234) (3,002,809) (2,163,434) -96.8% -46.5%
Page C.4
BONITA COMMUNITY HEALTH CENTER, INC.COMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING SEPTEMBER 30, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2009
Lee Memorial Health SystemBoard of Directors
Committee of the WholeFinancial Update
For the Fiscal Year Ending 9/30/09Presented November 19, 2009
System Adjusted Admits
Percent of Total Operating Revenue for the month ended 9/30/09
54.41%
16.77%
19.37%11.85%
-2.40%
62.70%
18.13%14.39% 10.34%
-5.56%
Percent of Total Operating Revenue for the 12 months ended 9/30/09
Comparison of Net Revenue per CMAAfor 12 month period ended 9/30/09
Gain (Loss) From Operations ( in 000’s )
Financial Statements for the fiscal year ended 9/30/09
Fiscal Year 2009
BUDGET PR YRBUDGET ACTUAL PR YR VAR % %
VOLUME:ADJUSTED ADMISSIONS 103,252 109,783 104,642 6,530 6% 5%
REVENUES: (000's)INPATIENT $2,112,854 $2,303,098 $1,955,533 190,244$ 9% 18%OUTPATIENT 1,239,779 1,342,442 1,124,262 102,663 8% 19% TOTAL OPERATING REV 3,352,633 3,645,540 3,079,795 292,907 9% 18%
DEDUCTIONS 2,377,160 2,613,959 2,124,265 (236,799) -9% -19%
TOTAL OPERATING REVENUES 975,473 1,031,581 955,531 56,108 6% 8%
OPERATING EXPENSES: (000's)OPERATING 876,582 907,701 877,419 (31,119) -4% -3%CAPITAL 77,048 87,507 75,053 (10,459) -14% -14%TOTAL OPERATING EXP 953,630 995,208 952,471 (41,578) -4% -4%
OPERATING GAIN: $21,843 $36,373 $3,059 14,530$ 67% 1089%
INVESTMENT INCOME 22,266 (15,518) (35,514) (37,784) -170% -56%
EXCESS OF REVENUES OVER EXPENSES $44,110 $20,855 ($32,455) (23,254)$ -53% 164%
Net Patient Revenue
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 958,174$ Actual Adj Admits-System 109,783 Actual Net Rev/Adj Admit 9,241$
Budget Adj Adm-System 103,252 Budget Net Rev/Adj Admit 9,280$ ACTUAL 1,014,532$ Variance 6,530 Variance (39)$
VARIANCE 56,358$ Budget Net Rev/Adj Admit 9,280$ Actual Adj Admits 109,783
Total Volume Variance 60,601,563$ Total Rate Variance (4,243,186)$
Net Revenue - Rate & Volume Variance 56,358,377$
Medicare Medicaid
Commmercial, HMO/PPO,
Other TOTAL Budgeted Payor Mix 47.9% 12.0% 40.1% 100%Actual Payor Mix 49.7% 13.4% 36.9% 100%Budget Gross Rev/Adj Adm 37,557 23,973 28,519 32,303Actual Gross Rev/Adj Adm 38,483 25,364 28,528 33,052Budget Net Rev/Adj Admit 8,480 5,943 11,234 9,280Actual Net Rev/Adj Admit 8,637 6,053 11,213 9,241Reimbursement % 22% 24% 39% 28%
Payor Mix Variance 16,757,242 9,134,146 (39,465,625) (13,574,237) Rate/Adj Admit Variance 7,764,888 1,362,931 203,232 9,331,051 Total Rate Variance 24,522,130$ 10,497,077$ (39,262,393)$ (4,243,186)$
Net Patient Revenue - Rate Variance
Total Salaries & Wages
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 431,837$ Actual Total FTEs 7,408 Actual Rate/FTE 28.93$
Budget Total FTEs 7,370 Budget Rate/FTE 28.09$ ACTUAL 447,100$ Prod FTE Variance (39) Rate Variance (0.84)$
VARIANCE (15,263)$ Budget Rate/FTE 28.09 Actual Total FTEs 7,408 Hours/FTE 2,086 Hours/FTE 2,086
Total Volume Variance (2,259,405) Total Rate Variance (13,003,397)
Rate & Volume Var (15,262,802)$
Description: FTEs Amount FTE's Earned Budget 7,602 (based on Adj Adm & 50% flex) Budget Prod FTEs 7,370 Var due to Volume (232) (13,598,618)$
Actual FTEs 7,408 FTE's Earned Budget 7,602 Productivity Inc(Dec) 194 11,339,213 Total FTE-Volume Var (39) (2,259,405)$
Total FTE Volume Variance:
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Productive Salaries & Wages
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 385,440$ Actual Prod FTEs 6,473 Actual Rate/FTE 29.63$
Budget Prod FTEs 6,501 Budget Rate/FTE 28.42$ ACTUAL 400,082$ Prod FTE Variance 28 Rate Variance (1.21)$
VARIANCE (14,642)$ Budget Rate/FTE 28.42$ Actual Prod FTEs 6,473 Hours/FTE 2,086 Hours/FTE 2,086
Total Volume Variance 1,642,059 Total Rate Variance (16,284,437)
Rate & Volume Var (14,642,378)$
Description: FTEs Amount FTE's Earned Budget 6,706 (based on Adj Adm & 50% flex) Budget Prod FTEs 6,501 Var due to Volume (205) (12,149,148)$
Actual FTEs 6,473 FTE's Earned Budget 6,706 Productivity Inc(Dec) 233 13,791,208 Prod FTE-Volume Var 28 1,642,060$
Prod FTE Volume Variance:
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Contract Labor
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 1,057$ Actual Contract FTEs 25 Actual Rate/FTE 54.46$
Budget Contract FTEs 9 Budget Rate/FTE 55.26$ ACTUAL 2,877$ Contract FTE Var (16) Rate Variance 0.80$
VARIANCE (1,820)$ Budget Rate/FTE 55.26$ Actual Contract FTEs 25 Hours/FTE 2,086 Hours/FTE 2,086
Total Volume Variance (1,862,550)$ Total Rate Variance 42,112$
Rate & Volume Var (1,820,438)$
Phys (41,000)$ Home Health - Rehab 80,000 HPCC - Corporate (30,000) Acute Care - Volume Related 67,000 Other Staffing Changes (1,896,438)
Total Labor Rate & Volume Var (1,820,438)$
Contract Labor Volume/Rate Variance
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Non-Productive Salaries
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
BUDGET 45,340$ PTO 2,375,000 Bonus 486,000
ACTUAL 44,140$ Leave & Other Adjustments (1,661,000)
VARIANCE 1,200$ Total Variance 1,200,000$
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Other Supplies
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 212,738$ Actual Adj Admissions 109,783 Actual Supplies/Adj Adm 2,000$
Budget Adj Admissions 103,252 Budget Supplies/Adj Adm 2,060$ ACTUAL 219,546 Variance (6,530) Rate Variance 61$
VARIANCE (6,807)$ Budget Supplies/Adj Adm 2,060$ Actual Adj Admissions 109,783
Total Volume Variance (13,455,060) Total Rate Variance 6,647,969
Rate & Volume Var (6,807,090)$
Budget/AA Actual/AA Variance
(Inc) Dec in Drug Expense 435$ 445$ (1,165,113)$ (Inc) Dec in Implant Costs 673$ 655$ 2,042,033 (Inc) Dec in Med/Surg Supplies 653$ 634$ 2,119,989 (Inc) Dec in Other Supplies 1,333,060 (Inc) in Rebates 2,318,000 Total Variance 1,108 1,100 6,647,969
Rate Variance
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Other Services
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
Leases 1,190,000 BUDGET 60,280$ Legal Fees 926,000
Foundation Activities 730,000 ACTUAL 57,700 Recruiting Exp 273,000
Freight 345,000 VARIANCE 2,581$ Repairs (551,000)
Utilities (523,000) Total 2,390,000$
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Purchased Services
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands) Radiology Fees (5,300,000)
Lab Reference Fees (539,000) BUDGET 89,609$ Equipment Rental (616,000)
Transcription (415,000) ACTUAL 98,310 Marketing (444,000)
Contracted Services (682,000) VARIANCE (8,702)$ Total (7,996,000)$
Consolidated Income Statement Analysis of Variancefor the fiscal year ended 9/30/09
Bad Debt Expense
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
Budget Bad Debt Percent 3.7%BUDGET 122,830$
Actual Gross Revenue 3,628,491,285$ ACTUAL 135,568
Bad Debt Expense-Vol Adj 133,528,479$ VARIANCE (12,738)$
Over (Under) Budget 2,039,000
Actual Bad Debt Expense 135,567,479$
Lee Memorial Health System Operating Highlights
For the year ended September 30, 2009 Actual adjusted admits (overall inpatient & outpatient volume indicator) for the year ended September 30, 2009 are 109,783 which is 6.3% greater than budget and 4.9% greater than FY2008. Year-to-Date (YTD) actual inpatient admits are 69,682 or 6.5% greater than budget and 4.2% greater than last year. Emergency room visits are 3.8% less than budget but 0.5% greater than last year. Outpatient surgeries are 2.3% less than budget and last year. The YTD length of stay is 5.3 days is equal to budget but 0.1 day greater than last year. YTD net patient revenue reflects a $56.4 million or a 5.9% favorable variance to budget. This 5.9% increase in net patient revenue is primarily from the 6.3% increase in adjusted admits. Net patient revenue per case mix adjusted admit is $6,712 for a 0.1% favorable variance against budget. The YTD total operating expenses before depreciation and interest expense are $31.1 million greater than budget. However, the actual total operating costs per case mix adjusted admit is 1.2% less than budget (6,475 act, 6,550 budget). YTD depreciation expense exceeded budget by $6.9 million due to the early completion of GCMC, changes in selected asset lives and the classification of the Regional Cancer Center(RCC)/Sanctuary as capital leases. Interest expense exceeds budget by $3.5 million due to the classification of the RCC/Sanctuary leases and the added financing costs incurred on the variable rate debt when the market collapsed in October 2008. Productivity as measured by FTEs/AOB improved by 6.8% (4.60 actual, 4.94 budget) throughout the year. For the year ended September 30, 2009, the gain from operations is $36.4 million versus a budgeted gain of $21.8 million. Excess revenue over expenses is a gain of $20.9 million versus a budgeted gain of $44.1 million. Investments were budgeted to return $22.3 million for the fiscal year but the market did not fully recover from its October 2008 correction so investment losses for the year are $15.5 million. For the year, Cash & Investments increased by $36.7 million to $449.7 million. Operations increased cash by $83.9 million due to the favorable gain from operations while working capital increased cash by $46.3 million. Cash was reduced by $65.3 million for the construction project at Metro/Daniels and $12.6 million for routine capital equipment. The Regional Cancer Center & Sanctuary were recorded as capital leases which increased both the net borrowings and capital expenditures by $46.6 million. Principal payments on debt reduced cash by $15.1 million. Days in Accounts Receivable are 52.9 days and resulted in a $0.5 million decrease in cash. Total Notes & Bonds payable on September 30, 2009 is $690.6 million resulting in a Cash to Debt ratio of 65.1%. Net Patient Revenue per adjusted admit CMI for the year ended September 30, 2009 is $6,712 while the Operating Expense per adjusted admit CMI is $6,475. The difference which represents the gain from operations per adjusted admit is $237.00 while the budgeted gain from operations is $150.00. Wages & Benefits as a percent of Net Operating Revenue is 50.5% for fiscal year 2009 versus a budget of 51.5% and 52.9% for FY2008. The actual hourly pay rate is $28.93 which is 71 cents or 2.5% greater than last year. Post Acute entities provided the following YTD contributions to Acute Care by allowing charity care patients into their respective programs: Lee Memorial Home Health $437,000; HealthPark Care Center $477,000; The Rehabilitation Hospital $608,000; Access Medical South (DME joint venture) $72,000. The Lee Physician Group YTD loss per physician is $38,325. This includes practice revenue and expenses along with ancillary revenue referred to LMHS. This YTD loss is greater than expected due to reduced visits during the fiscal year.
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED EXECUTIVE SUMMARYFOR THE PERIOD ENDING SEPTEMBER 30, 2009
Current period Year-to-DateBudget Actual Prior Year Var % Budget Actual Prior Year Var %
ACT TO BUD ACT TO BUDInpatient Volumes: Admits - Adults & Peds 5,049 5,442 5,120 7.8% 65,408 69,682 66,838 6.5% Patient Days - Adults & Peds 26,913 28,428 26,556 5.6% 343,930 372,005 350,553 8.2%
Length of Stay (LOS) 5.3 5.2 5.2 -1.9% 5.3 5.3 5.2 0.0%
Inpatient Surgeries 1,240 1,500 1,382 20.9% 18,552 19,228 19,073 3.6%
Outpatient Volumes: Emergency Room Visits 12,600 14,125 11,075 12.1% 157,261 151,247 150,562 -3.8% OutPatient Surgeries 1,531 1,506 1,576 -1.6% 20,326 19,855 20,307 -2.3%
Adjusted Admits 8,171 8,884 8,262 8.7% 103,252 109,783 104,642 6.3% (overall in/outpat volume indicator)
Operating Ratios: Net Revenue/Adj Adm CMI 6,710 7,215 6,695 7.5% 6,700 6,712 6,569 0.2% Operating Exp/Adj Adm CMI 6,656 7,616 6,855 -12.6% 6,550 6,475 6,548 1.2%
Wages/Ben - % of Net Oper Rev 52.5% 62.7% 54.4% -16.3% 51.5% 50.5% 52.9% 2.1% Supplies as a % of Net Oper Rev 20.8% 18.1% 16.8% 15.0% 21.8% 21.3% 21.8% 2.5%
Charity/Bad Debt - % of Gross Rev 7.2% 6.7% 8.3% 7.7% 7.0% 6.9% 6.9% 1.2%
Financial Ratios: Operating Margin (%) 0.8% -5.6% -2.4% -789.6% 2.2% 3.5% 0.3% 57.5% Excess Margin (%) 3.2% 3.3% -28.8% 3.3% 4.5% 1.9% -3.4% -58.4%
Liquidity Ratios: Cash to Debt (%) 67.3% 65.1% 64.1% Days Cash on Hand (net of VRDB) 106.8 86.9 96.3 Days In Acct Receivable 60.0 52.9 59.0
Income Statement Summary (In Thousands):Total Net Operating Revenue 77,311$ 87,816$ 76,325$ 13.6% 975,473$ 1,031,581$ 955,531$ 5.8%Total Operating Expenses 76,688 92,698 78,158 -17.3% 953,630 995,208 952,471 -4.2% Consolidated Gain(Loss) from Oper 623 (4,882) (1,833) 883.3% $21,843 36,373 $3,059 -66.5%
Investment Earnings/Non Op Income 1,815 8,433 (20,153) 364.5% 22,266 (15,518) (35,514) -169.7%
Consolidated Excess Rev over Exp 2,439$ 3,551$ (21,987)$ 45.6% 44,110$ 20,855$ (32,455)$ -52.7%
Trauma District Gain(Loss) from Oper (414)$ (167)$ (1,622)$ 59.7% (4,110)$ (3,632)$ (5,818)$ 11.6%
Balance Sheet Highlights (In Thousands): Cash & Investments 526,649$ 449,727$ 417,494$ Bonds & Notes Payable 650,660$ 690,602$ 651,388$
VRDB = variable rate demand bondsCMI = case mix index
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATISTICAL SUMMARYFOR THE PERIOD ENDING SEPTEMBER 30, 2009
Current period Year-to-DateBudget Actual Prior Year Variance Var % Budget Actual Prior Year Variance Var %
ACT TO BUD ACT TO BUD ACT TO BUD ACT TO BUD
Admissions ADULTS 4,499 4,868 4,551 369 8.2% 58,764 62,786 59,928 4,022 6.8% PEDIATRICS 379 370 375 (9) -2.4% 4,470 4,482 4,703 12 0.3% NICU 53 48 49 (5) -9.4% 580 600 556 20 3.4% POST ACUTE 118 156 145 38 32.3% 1,594 1,814 1,651 220 13.8%Total Adult & Peds 5,049 5,442 5,120 393 7.8% 65,408 69,682 66,838 4,274 6.5% NEWBORNS 533 572 600 39 7.3% 6,490 6,450 7,209 (40) -0.6%Total Admissions 5,582 6,014 5,720 432 7.7% 71,898 76,132 74,047 4,234 5.9%
Patient Days ADULTS 20,242 21,982 19,840 1,740 8.6% 262,896 289,307 268,832 26,411 10.0% PEDIATRICS 1,385 1,332 1,236 (53) -3.8% 16,093 16,425 16,109 332 2.1% NICU 1,265 1,243 1,435 (22) -1.7% 14,208 15,481 15,216 1,273 9.0% POST ACUTE 4,021 3,871 4,045 (150) -3.7% 50,733 50,792 50,396 59 0.1%Total Adult & Peds 26,913 28,428 26,556 1,515 5.6% 343,930 372,005 350,553 28,075 8.2% NEWBORNS 1,223 1,334 1,321 111 9.1% 14,886 14,669 16,829 (217) -1.5%Total Patient Days 28,136 29,762 27,877 1,626 5.8% 358,816 386,674 367,382 27,858 7.8%
Average Length of Stay ADULTS 4.5 4.5 4.4 0.0 0.4% 4.5 4.6 4.5 0.1 3.0% PEDIATRICS 3.7 3.6 3.3 (0.1) -1.5% 3.6 3.7 3.4 0.1 1.8% NICU 23.9 25.9 29.3 2.0 8.5% 24.5 25.8 27.4 1.3 5.3% POST ACUTE 34.1 24.8 27.9 (9.3) -27.2% 31.8 28.0 30.5 (3.8) -12.0%Total Adult & Peds 5.3 5.2 5.2 (0.1) -2.0% 5.3 5.3 5.2 0.1 1.5% NEWBORNS 2.3 2.3 2.2 0.0 1.7% 2.3 2.3 2.3 (0.0) -0.8%Total Patient Days 5.0 4.9 4.9 (0.1) -1.8% 5.0 5.1 5.0 0.1 1.8%
OP Registrations EMERGENCY ROOM 12,600 14,125 11,075 1,525 12.1% 157,261 151,247 150,562 (6,014) -3.8% OP SURGERY CASES 1,531 1,506 1,576 (25) -1.6% 20,326 19,855 20,307 (471) -2.3%SUBTOTAL 14,131 15,631 12,651 1,500 10.6% 177,587 171,102 170,869 (6,485) -3.7%
Visits / Encounters HOME HEALTH ADMISSIONS 276 259 270 (17) -6.2% 3,700 3,859 3,723 159 4.3% HOSP BASED PHY ENCOUNTERS 12,133 14,401 11,670 2,268 18.7% 159,383 161,805 153,058 2,422 1.5% PHYSICIAN ENCOUNTERS 42,713 40,121 40,996 (2,592) -6.1% 542,318 495,069 505,343 (47,249) -8.7% TRAUMA SERVICES DISTRICT 549 760 806 211 38.5% 9,342 9,985 9,929 643 6.9%SUBTOTAL 55,671 55,541 53,742 (130) -0.2% 714,743 670,718 672,053 (44,025) -6.2%
TOTAL OP 69,802 71,172 66,393 1,370 2.0% 892,329 841,820 842,922 (50,509) -5.7%
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATEMENT OF OPERATIONSFOR THE PERIOD ENDING: SEPTEMBER 30, 2009( IN THOUSANDS )
BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR % BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR %ACT TO BUD ACT TO BUD PR YR ACT TO BUD ACT TO BUD PR YR
INPATIENT REVENUE 157,640 178,379 154,302 20,738 13.2% 15.6% 2,112,854 2,303,098 1,955,533 190,244 9.0% 17.8%OUTPATIENT REVENUE 97,494 112,818 94,683 15,325 15.7% 19.2% 1,222,480 1,325,393 1,106,054 102,913 8.4% 19.8%TOTAL PATIENT REVENUE 255,134 291,197 248,985 36,063 14.1% 17.0% 3,335,334 3,628,491 3,061,587 293,158 8.8% 18.5%
DED FROM REV-MEDICARE 83,652 92,110 78,575 (8,458) -10.1% -17.2% 1,138,529 1,282,078 1,033,041 (143,549) -12.6% -24.1%DED FROM REV-MEDICAID 21,664 32,601 21,824 (10,937) -50.5% -49.4% 269,597 331,558 258,189 (61,961) -23.0% -28.4%DED FROM REV-CHARITY 9,098 9,604 7,389 (506) -5.6% -30.0% 110,819 115,605 99,487 (4,786) -4.3% -16.2%DED FROM REV-HMO/PPO 35,256 32,878 28,035 2,378 6.7% -17.3% 443,031 414,609 363,490 28,421 6.4% -14.1%DED FROM REV-OTHER 20,244 27,714 25,370 (7,470) -36.9% -9.2% 292,355 334,541 257,854 (42,186) -14.4% -29.7%DED FROM REV-BAD DEBT 9,352 9,943 13,369 (591) -6.3% 25.6% 122,830 135,568 112,205 (12,738) -10.4% -20.8%TOTAL DED FROM REV 179,267 204,850 174,562 (25,583) -14.3% -17.4% 2,377,160 2,613,959 2,124,265 (236,799) -10.0% -23.1%
NET PATIENT REVENUE 75,867 86,347 74,423 10,480 13.8% 16.0% 958,174 1,014,532 937,323 56,358 5.9% 8.2%OTHER OPER REV 1,444 1,469 1,901 25 1.7% -22.7% 17,300 17,049 18,208 (251) -1.4% -6.4%
TOTAL OPERATING REV 77,311 87,816 76,325 10,505 13.6% 15.1% 975,473 1,031,581 955,531 56,108 5.8% 8.0%
OPERATING EXPENSES PROD SALARIES 29,653 46,922 28,602 (17,270) -58.2% -64.1% 366,720 382,452 357,346 (15,732) -4.3% -7.0% PROD OVERTIME 1,310 1,034 713 277 21.1% -45.0% 18,720 17,630 15,125 1,090 5.8% -16.6% CONTRACT LABOR 0 6 263 (6) 0.0% 97.5% 1,057 2,877 9,463 (1,820) -172.2% 69.6% NON-PROD SALARIES 3,956 3,618 4,627 338 8.6% 21.8% 45,340 44,140 49,768 1,200 2.6% 11.3%TOTAL SALARIES & WAGES 34,919 51,580 34,205 (16,661) -47.7% -50.8% 431,837 447,100 431,703 (15,263) -3.5% -3.6%
FRINGE BENEFITS 5,668 3,485 7,325 2,183 38.5% 52.4% 70,665 73,630 74,134 (2,965) -4.2% 0.7%HEALTH CARE ACCESS 862 (987) 611 1,849 214.4% 261.5% 11,452 11,415 11,482 37 0.3% 0.6%SUPPLIES 16,113 15,918 12,800 195 1.2% -24.4% 212,738 219,546 208,746 (6,807) -3.2% -5.2%OTHER SERVICES 5,038 4,885 4,466 153 3.0% -9.4% 60,280 57,700 59,704 2,581 4.3% 3.4%PURCHASED SERVICES 7,410 8,739 9,704 (1,329) -17.9% 9.9% 89,609 98,310 91,651 (8,702) -9.7% -7.3%
TOTAL OPER EXPENSES 70,010 83,620 69,111 (13,610) -19.4% -21.0% 876,582 907,701 877,419 (31,119) -3.6% -3.5%
EBITDA 7,301 4,196 7,214 (3,105) -42.5% -41.8% 98,891 123,880 78,112 24,988 25.3% 58.6%
DEPRECIATION/AMORT 4,533 6,721 7,698 (2,188) -48.3% 12.7% 57,885 64,827 56,783 (6,942) -12.0% -14.2%INTEREST EXPENSE 2,145 2,357 1,349 (213) -9.9% -74.7% 19,163 22,680 18,270 (3,516) -18.3% -24.1%GAIN(LOSS) FROM OPER 623 (4,882) (1,833) (5,506) -883.3% 166.3% 21,843 36,373 3,059 14,530 66.5% 1089.0%
CURRENT MONTH YEAR TO DATE
Lee Memorial Health SystemConsolidated Balance Sheet As of SEPTEMBER 30, 2009
in Thousands (000's)
ASSETS: Current Prior Month Prior Year LIABILITIES: Current Prior Month Prior Year
Current Assets: Current Liabilities:Cash And Cash Equivalents * 18,590 16,161 8,806 Accounts Payable 43,728 33,116 43,070Operating Fund Investments * 413,708 415,676 382,127 Wages and Benefits Payable 65,142 48,512 47,427Accrued Interest Receivable 280 299 464 Notes Payable - Short Term 1,936 2,961 2,118Accounts Receivable (net) 132,616 127,713 130,633 Current Portion Bonds Payable 12,170 12,170 11,045Accounts Receivable - Phys (Net) 12,381 10,906 13,861 Due to State of Florida 13,768 5,974 11,873Inventories 27,787 28,313 26,737 Malpractice Liability - Short Term 5,936 5,936 5,936Third Party Settlements 0 0 0 Accrued Bond Costs 11,271 9,622 11,724Other Current Assets 12,932 7,807 15,313 Due to LMHS 0 0 0
Other Current Liabilities 28,093 31,951 16,786
Total Current Assets: 618,293 606,875 577,941 Total Current Liabilities 182,045 150,243 149,979
Other Assets Other Liabilities and Fund BalanceLimited or Restricted Use Assets * 17,298 8,135 21,954 Benefits Payable - Long Term 0 0 0Bond Issuance Costs 5,680 5,707 7,730 Notes Payable - Long Term 55,232 54,600 10,552Trustee Held Funds * 31 34 1 Due to State of Florida - Long Term 3,193 14,983 5,751Directors/Officers Indemnity Fund * 100 100 100 Malpractice Liability - Long Term 7,268 8,338 7,220Long Term Operating Fund Investments * 0 0 0 Bonds Payable 621,264 621,452 635,839Other Assets 94,939 93,259 95,898 Other Long Term Liabilities 16,891 15,789 13,822
UnRestricted Fund Balance 527,918 524,781 508,796Restricted Fund Balance 24,150 22,004 20,683
Total Other Assets 118,049 107,235 125,683 Total Other Liabilities & Fund Balance 1,255,917 1,261,947 1,202,665
Property and Equipment:Plant In Use 1,156,168 1,144,141 899,107Construction in Process 47,910 49,991 206,546Accumulated Depreciation (524,224) (517,955) (476,741)
Total Property & Equipment (Net) 679,854 676,177 628,912
Restricted Assets 21,766 21,903 20,107
TOTAL ASSETS 1,437,962 1,412,190 1,352,644 TOTAL LIABILITIES AND EQUITY 1,437,962 1,412,190 1,352,644
* Cash and InvestmentsAbove Balance Sheet has been adjusted to eliminate intercompany receivables, payables and investments in subsidiaries
LEE MEMORIAL HEALTH SYSTEMCASHFLOW AVAILABLE FOR CAPITAL
FOR THE TWELVE MONTHS ENDING SEPTEMBER 30, 2009In 000's
YTD
Excess Revenue over Expenses 20,855Add/(Subtract):
Depreciation & Amortization 64,827Net (Inc)/Dec in Accounts Receivable (502)Net Inc/(Dec) in Assets & Liabilities 46,318Principal Payments 31,048
Total Cashflow 162,546
Total Actual Cashflow available for Capital @ 22.3% 36,248
YTD Budgeted Capital Allocation 19,365
YTD Capital Dollars Approved 14,715
YTD Capital $'s Spent 124,073
LEE MEMORIAL HEALTH SYSTEM
LEE COUNTY, FLORIDA CONSOLIDATED FINANCIAL STATEMENTS AND STATISTICAL REPORTS OCTOBER 31, 2009
LEE MEMORIAL HEALTH SYSTEM CONSOLIDATED FINANCIAL STATEMENTS & STATISTICAL REPORTS TABLE OF CONTENTS SECTION A PAGE CONSOLIDATED SCHEDULES HIGHLIGHTS A.1 CONSOLIDATED STATISTICAL REPORT A.3 CONSOLIDATED INCOME STATEMENT A.4 SOURCES & APPLICATIONS OF FUNDS A.6 CONSOLIDATED BALANCE SHEET A.7 CONSOLIDATED FINANCIAL RATIOS A.8 CONSOLIDATED PAYOR MIX A.10 CAPITAL STATUS REPORT A.11 INVESTMENT PERFORMANCE SUMMARY A.12
Lee Memorial Health System Operating Highlights
For the month ended October 31, 2009 Actual adjusted admits (overall inpatient & outpatient volume indicator) for the month ended October 31, 2009 are 9,373 which is 1.2% greater than budget. Actual inpatient admits for the month are 5,768 or 0.6% greater than budget and actual patient days are 31,036 or 3.8% greater than budget which resulted in a 3.2% increase in length of stay. Emergency room visits are 17.8% greater than budget and outpatient surgeries are 6.8% less than budget. Net patient revenue for October 2009 reflects a $0.5 million or a 0.5% unfavorable variance to budget. This unfavorable variance in net patient revenue is the net result of a 1.2% increase in adjusted admits and a 1.7% decline in the net patient revenue per adjusted admit. Total operating expenses before depreciation and interest expense are $1.2 million less than budget. This favorable variance is primarily due to reduced purchased services expenses from medical services fees and maintenance expenses being under budget. This favorable expense variance resulted in actual total operating costs per case mix adjusted admit being 1.4% less than budget (6,502 act, 6,595 budget). Productivity as measured by FTEs/AOB improved by 2.6% (4.79 actual, 4.92 budget) during October 2009. For October 2009, the gain from operations is $2.5 million versus a budgeted gain of $1.7 million. Excess revenue over expenses is a gain of $2.3 million versus a budgeted gain of $4.6 million. Investments were budgeted to return $2.9 million for the month but there was a slight market loss in the portfolio of $0.2 million.
Page A.1
Lee Memorial Health System Operating Highlights
For the month ended October 31, 2009 For the month, Cash & Investments decreased by $22.5 million to $427.3 million. Operations increased cash by $6.9 million due to the favorable gain from operations while the change in working capital decreased cash by $30.3 million. Cash was reduced by $.7 million for the construction project at Metro/Daniels. Principal payments on debt reduced cash by $0.4 million. Days in Accounts Receivable are 52.3 days and resulted in a $2.1 million increase in cash. Total Notes & Bonds payable on October 31, 2009 is $690.2 million resulting in a Cash to Debt ratio of 61.9%. Net Patient Revenue per adjusted admit CMI for the month ended October 31, 2009 is $6,704 while the Operating Expense per adjusted admit CMI is $6,502. The difference which represents the gain from operations per adjusted admit is $202.00 while the budgeted gain from operations is $135.00. Wages & Benefits as a percent of Net Operating Revenue is 52.2% for October 2009 versus a budget of 51.5%. The actual hourly pay rate is $27.64 which is 30 cents less than budget. Post Acute entities provided the following YTD contributions to Acute Care by allowing charity care patients into their respective programs: Lee Memorial Home Health $41,000; HealthPark Care Center $55,000; The Rehabilitation Hospital $30,000; Access Medical South (DME joint venture) $6,000. The Lee Physician Group YTD loss per physician is $3,206. This includes practice revenue and expenses along with ancillary revenue referred to LMHS. This YTD loss is less than expected due to increased visits and lower operating cost then budget.
Page A.2
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATISTICAL SUMMARYFOR THE PERIOD ENDING OCTOBER 31, 2009
Current period Year-to-DateBudget Actual Prior Year Variance Var % Budget Actual Prior Year Variance Var %
ACT TO BUD ACT TO BUD ACT TO BUD ACT TO BUD
Admissions ADULTS 5,082 5,160 5,014 78 1.5% 5,082 5,160 5,014 78 1.5% PEDIATRICS 455 392 428 (63) -13.8% 455 392 428 (63) -13.8% NICU 46 66 46 20 43.5% 46 66 46 20 43.5% POST ACUTE 154 150 157 (4) -2.5% 154 150 157 (4) -2.5%Total Adult & Peds 5,736 5,768 5,645 32 0.6% 5,736 5,768 5,645 32 0.6% NEWBORNS 614 548 570 (66) -10.7% 614 548 570 (66) -10.7%Total Admissions 6,350 6,316 6,215 (34) -0.5% 6,350 6,316 6,215 (34) -0.5%
Patient Days ADULTS 22,584 24,119 22,341 1,535 6.8% 22,584 24,119 22,341 1,535 6.8% PEDIATRICS 1,635 1,444 1,425 (191) -11.7% 1,635 1,444 1,425 (191) -11.7% NICU 1,258 1,172 1,398 (86) -6.8% 1,258 1,172 1,398 (86) -6.8% POST ACUTE 4,418 4,301 4,311 (117) -2.7% 4,418 4,301 4,311 (117) -2.7%Total Adult & Peds 29,895 31,036 29,475 1,141 3.8% 29,895 31,036 29,475 1,141 3.8% NEWBORNS 1,230 1,253 1,266 23 1.9% 1,230 1,253 1,266 23 1.9%Total Patient Days 31,125 32,289 30,741 1,164 3.7% 31,125 32,289 30,741 1,164 3.7%
Average Length of Stay ADULTS 4.4 4.7 4.5 0.2 5.2% 4.4 4.7 4.5 0.2 5.2% PEDIATRICS 3.6 3.7 3.3 0.1 2.4% 3.6 3.7 3.3 0.1 2.4% NICU 27.3 17.8 30.4 (9.6) -35.1% 27.3 17.8 30.4 (9.6) -35.1% POST ACUTE 28.7 28.7 27.5 (0.0) -0.2% 28.7 28.7 27.5 (0.0) -0.2%Total Adult & Peds 5.2 5.4 5.2 0.2 3.2% 5.2 5.4 5.2 0.2 3.2% NEWBORNS 2.0 2.3 2.2 0.3 14.1% 2.0 2.3 2.2 0.3 14.1%Total Patient Days 4.9 5.1 4.9 0.2 4.3% 4.9 5.1 4.9 0.2 4.3%
OP Registrations EMERGENCY ROOM 12,228 14,409 11,412 2,181 17.8% 12,228 14,409 11,412 2,181 17.8% OP SURGERY CASES 1,711 1,595 1,778 (116) -6.8% 1,711 1,595 1,778 (116) -6.8%SUBTOTAL 13,939 16,004 13,190 2,065 14.8% 13,939 16,004 13,190 2,065 14.8%
Visits / Encounters HOME HEALTH ADMISSIONS 262 286 346 24 9.1% 262 286 346 24 9.1% HOSP BASED PHY ENCOUNTERS 12,605 15,072 12,353 2,467 19.6% 12,605 15,072 12,353 2,467 19.6% PHYSICIAN ENCOUNTERS 43,394 41,187 41,133 (2,207) -5.1% 43,394 41,187 41,133 (2,207) -5.1% TRAUMA SERVICES DISTRICT 836 457 816 (379) -45.4% 836 457 816 (379) -45.4%SUBTOTAL 57,098 57,002 54,648 (96) -0.2% 57,098 57,002 54,648 (96) -0.2%
TOTAL OP 71,037 73,006 67,838 1,969 2.8% 71,037 73,006 67,838 1,969 2.8%
Page A.3
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATEMENT OF OPERATIONSFOR THE PERIOD ENDING: OCTOBER 31, 2009( IN THOUSANDS )
BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR % BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR %ACT TO BUD ACT TO BUD PR YR ACT TO BUD ACT TO BUD PR YR
INPATIENT REVENUE 193,412 192,973 181,923 (439) -0.2% 6.1% 193,412 192,973 181,923 (439) -0.2% 6.1%OUTPATIENT REVENUE 118,985 120,612 107,181 1,627 1.4% 12.5% 118,985 120,612 107,181 1,627 1.4% 12.5%TOTAL PATIENT REVENUE 312,397 313,585 289,105 1,188 0.4% 8.5% 312,397 313,585 289,105 1,188 0.4% 8.5%
DED FROM REV-MEDICARE 107,166 109,098 97,250 (1,932) -1.8% -12.2% 107,166 109,098 97,250 (1,932) -1.8% -12.2%DED FROM REV-MEDICAID 29,042 36,760 28,256 (7,718) -26.6% -30.1% 29,042 36,760 28,256 (7,718) -26.6% -30.1%DED FROM REV-CHARITY 9,880 9,474 8,458 406 4.1% -12.0% 9,880 9,474 8,458 406 4.1% -12.0%DED FROM REV-HMO/PPO 33,749 32,058 34,363 1,691 5.0% 6.7% 33,749 32,058 34,363 1,691 5.0% 6.7%DED FROM REV-OTHER 36,010 30,557 30,168 5,453 15.1% -1.3% 36,010 30,557 30,168 5,453 15.1% -1.3%DED FROM REV-BAD DEBT 11,396 10,969 9,950 426 3.7% -10.2% 11,396 10,969 9,950 426 3.7% -10.2%TOTAL DED FROM REV 227,243 228,917 208,445 (1,674) -0.7% -9.8% 227,243 228,917 208,445 (1,674) -0.7% -9.8%
NET PATIENT REVENUE 85,154 84,668 80,659 (486) -0.6% 5.0% 85,154 84,668 80,659 (486) -0.6% 5.0%OTHER OPER REV 1,524 1,418 1,353 (107) -7.0% 4.8% 1,524 1,418 1,353 (107) -7.0% 4.8%
TOTAL OPERATING REV 86,678 86,085 82,012 (593) -0.7% 5.0% 86,678 86,085 82,012 (593) -0.7% 5.0%
OPERATING EXPENSES PROD SALARIES 32,895 32,870 30,141 25 0.1% -9.1% 32,895 32,870 30,141 25 0.1% -9.1% PROD OVERTIME 1,270 1,219 941 51 4.0% -29.5% 1,270 1,219 941 51 4.0% -29.5% CONTRACT LABOR 0 5 191 (5) -12822718.2% 97.5% 0 5 191 (5) -12822718.2% 97.5% NON-PROD SALARIES 3,778 4,086 3,202 (308) -8.2% -27.6% 3,778 4,086 3,202 (308) -8.2% -27.6%TOTAL SALARIES & WAGES 37,943 38,180 34,475 (237) -0.6% -10.7% 37,943 38,180 34,475 (237) -0.6% -10.7%
FRINGE BENEFITS 6,673 6,715 6,245 (42) -0.6% -7.5% 6,673 6,715 6,245 (42) -0.6% -7.5%HEALTH CARE ACCESS 1,021 1,137 1,028 (116) -11.4% -10.6% 1,021 1,137 1,028 (116) -11.4% -10.6%SUPPLIES 18,559 18,362 18,471 196 1.1% 0.6% 18,559 18,362 18,471 196 1.1% 0.6%OTHER SERVICES 5,332 4,903 4,861 429 8.0% -0.9% 5,332 4,903 4,861 429 8.0% -0.9%PURCHASED SERVICES 8,720 7,701 6,961 1,018 11.7% -10.6% 8,720 7,701 6,961 1,018 11.7% -10.6%
TOTAL OPER EXPENSES 78,247 76,998 72,041 1,249 1.6% -6.9% 78,247 76,998 72,041 1,249 1.6% -6.9%
EBITDA 8,431 9,087 9,971 656 7.8% -8.9% 8,431 9,087 9,971 656 7.8% -8.9%
DEPRECIATION/AMORT 4,624 4,308 5,009 316 6.8% 14.0% 4,624 4,308 5,009 316 6.8% 14.0%INTEREST EXPENSE 2,063 2,192 1,455 (129) -6.3% -50.6% 2,063 2,192 1,455 (129) -6.3% -50.6%GAIN(LOSS) FROM OPER 1,745 2,588 3,507 843 48.3% -26.2% 1,745 2,588 3,507 843 48.3% -26.2%
CURRENT MONTH YEAR TO DATE
Page A.4
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED INCOME STATEMENT BY ENTITYFOR THE MONTH ENDED OCTOBER 31, 2009(IN THOUSANDS)
ENTITY BUDGET ACTUAL VARIANCE PRIOR YR BUDGET ACTUAL VARIANCE PRIOR YR
LEE MEMORIAL HOSPITAL 1,656 2,623 967 1,428 1,656 2,623 967 1,428HEALTHPARK MEDICAL CTR 5,908 7,032 1,123 6,848 5,908 7,032 1,123 6,848CAPE CORAL HOSPITAL 3,805 3,536 (270) 3,488 3,805 3,536 (270) 3,488GULF COAST MEDICAL CENTER 1,629 1,622 (7) 884 1,629 1,622 (7) 884TRAUMA SERVICES DIST (320) (499) (179) (313) (320) (499) (179) (313)OUTPATIENT CENTERS 1,370 1,366 (4) 354 1,370 1,366 (4) 354HEALTHPARK CARE CTR 135 48 (87) 118 135 48 (87) 118HOME HEALTH AGENCIES 58 46 (12) 125 58 46 (12) 125FOUNDATION 2 0 (2) (309) 2 0 (2) (309)REHAB HOSPITAL 565 408 (157) 538 565 408 (157) 538PHYSICIANS (LPG-MSO-HBP) (3,217) (3,679) (462) (1,237) (3,217) (3,679) (462) (1,237)CORPORATE SERVICES (9,777) (9,856) (79) (8,373) (9,777) (9,856) (79) (8,373)AUXILIARY (3) (3) (1) (2) (3) (3) (1) (2)CHILD DEVELOP/PPEC (68) (56) 12 (40) (68) (56) 12 (40)PHO (0) (0) 0 (1) (0) (0) 0 (1)
TOTAL GAIN FROM OPS 1,745 2,588 843 3,507 1,745 2,588 843 3,507
INT EARN & REALIZED GAIN 2,719 212 (2,507) 263 2,719 212 (2,507) 263UNREALIZED GAIN (LOSS) (17) 123 140 (35,250) (17) 123 140 (35,250)UNREALIZED GAIN (LOSS) ON SWAP 0 0 0 0 0 0 0 0OTHER NON OPERATING 148 (352) (500) 45 148 (352) (500) 45RESTRICTED GIFTS 15 (230) (245) 230 15 (230) (245) 230
TOTAL NON OPERATING 2,864 (248) (3,112) (34,713) 2,864 (248) (3,112) (34,713)
EXCESS OF REV/EXPS 4,609 2,340 (2,269) (31,206) 4,609 2,340 (2,269) (31,206)
CURRENT MONTH YEAR TO DATE
Page A.5
MONTH YTDSources of Funds:
Excess Revenue Over Expenses 2,340 2,340 Depreciation/Amortization Expense 4,308 4,308 Restricted Gifts 230 230 Total Sources 6,878 6,878
Uses of Funds:
Dec(Inc) in Accts Receivable (8,882) (8,882) Provision for Bad Debts 10,969 10,969 Dec(Inc) in Net Accts Receivable 2,088 2,088
Net borrowings (404) (404) Dec(Inc) in Other Assets (371) (371) Inc(Dec) in Liabilities (29,908) (29,909) Capital Expenditures, net (738) (738) Total Uses (29,333) (29,334)
Net Increase(Decrease) In Funds (22,455) (22,456)
Cash & Investments at beginning of period 449,727 449,727
Cash & Investments at end of period 427,271 427,271
Total Bonds & Notes Payable-end of period 690,198
Cash to Debt Ratio 61.9%
LEE MEMORIAL HEALTH SYSTEM
FOR THE PERIOD ENDING OCTOBER 31, 2009In Thousands (000's)
SOURCES & APPLICATIONS OF FUNDS
Page A.6
Lee Memorial Health SystemConsolidated Balance Sheet
As of OCTOBER 31, 2009 in Thousands (000's)
ASSETS: Current Prior Month Prior Year LIABILITIES: Current Prior Month Prior Year
Current Assets: Current Liabilities:Cash And Cash Equivalents * 500 18,590 18,590 Accounts Payable 31,207 43,728 43,728Operating Fund Investments * 419,345 413,708 413,708 Wages and Benefits Payable 52,845 65,142 65,142Accrued Interest Receivable 307 280 280 Notes Payable - Short Term 1,927 1,936 1,936Accounts Receivable (net) 132,870 132,616 132,616 Current Portion Bonds Payable 11,964 12,170 12,170Accounts Receivable - Phys (Net) 10,041 12,381 12,381 Due to State of Florida 14,054 13,768 13,768Inventories 27,712 27,787 27,787 Malpractice Liability - Short Term 5,936 5,936 5,936Third Party Settlements 0 0 0 Accrued Bond Costs 2,187 11,271 11,271Other Current Assets 11,631 12,932 12,932 Due to LMHS 0 0 0
Other Current Liabilities 30,901 28,093 28,093
Total Current Assets: 602,406 618,293 618,293 Total Current Liabilities 151,022 182,045 182,045
Other Assets Other Liabilities and Fund BalanceLimited or Restricted Use Assets * 7,295 17,298 17,298 Benefits Payable - Long Term 0 0 0Bond Issuance Costs 5,653 5,680 5,680 Notes Payable - Long Term 55,025 55,232 55,232Trustee Held Funds * 31 31 31 Due to State of Florida - Long Term 4,024 3,193 3,193Directors/Officers Indemnity Fund * 100 100 100 Malpractice Liability - Long Term 7,528 7,268 7,268Long Term Operating Fund Investments * 0 0 0 Bonds Payable 621,281 621,264 621,264Other Assets 94,175 93,206 93,206 Other Long Term Liabilities 17,223 16,891 16,891
UnRestricted Fund Balance 530,489 527,918 527,918Restricted Fund Balance 22,300 22,417 22,417
Total Other Assets 107,255 116,315 116,315 Total Other Liabilities & Fund Balance 1,257,871 1,254,184 1,254,184
Property and Equipment:Plant In Use 1,156,168 1,156,168 1,156,168Construction in Process 48,683 47,910 47,910Accumulated Depreciation (528,515) (524,224) (524,224)
Total Property & Equipment (Net) 676,337 679,854 679,854
Restricted Assets 22,896 21,766 21,766
TOTAL ASSETS 1,408,893 1,436,229 1,436,229 TOTAL LIABILITIES AND EQUITY 1,408,893 1,436,229 1,436,229
* Cash and InvestmentsAbove Balance Sheet has been adjusted to eliminate intercompany receivables, payables and investments in subsidiaries
Page A.7
LEE MEMORIAL HEALTH SYSTEMFINANCIAL RATIOSFOR THE 1 MONTHS ENDED OCTOBER 31, 2009
2008 UnauditedMoody's 2010 FYE YTDMedian Goals 2009 10/31/2009
PROFITABILITY RATIOS:Operating Margin (%) - Total 2.2% 2.8% 3.5% 3.0% +Excess Margin (%) 4.6% 4.8% 2.2% 3.0% +Operating CashFlow Margin (%) 9.1% 10.0% 12.0% 10.6% +
LIQUIDITY RATIOS:Days Cash on Hand (net of VRDB) 157.2 68.0 87.1 77.9 +Cushion Ratio (x) 15.3 9.4 10.4 10.7 +Cash-to-Debt (%) 113.9% 63.0% 65.1% 61.9% +
CAPITALIZATION RATIOS:Debt to Capitalization(%) - (net of VRDB) 38.1% 43.0% 46.7% 46.6% (-)Annual Debt Service Coverage (x) 4.6 2.9 3.4 2.8 +Debt to Cashflow (net of VRDB) 3.5 4.7 5.2 6.0 (-)
NOTE: + = Ratios that should be above the Moody's median(-) = Ratios that should be lower than the Moody's median
Page A.8
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED OPERATING RATIOSFOR THE PERIOD ENDING OCTOBER 31, 2009
YEAR TO DATESAME MO SAME MO
BUDGET ACTUAL PRIOR YR ACT-BUD ACT-PRIOR BUDGET ACTUAL PRIOR YR ACT-BUD ACT-PRIOR
AS % NET OPER REV
WAGES & BENEFITS 51.5% 52.2% 49.7% -1.3% -5.0% 51.5% 52.2% 49.7% -1.3% -5.0%SUPPLIES 21.4% 21.3% 22.5% 0.4% 5.3% 21.4% 21.3% 22.5% 0.4% 5.3%ALL OTHER OPER EXPENSES 17.4% 16.0% 15.7% 8.9% -1.9% 17.4% 16.0% 15.7% 8.9% -1.9%CAPITAL COSTS 7.7% 7.6% 7.9% 2.2% 4.2% 7.7% 7.6% 7.9% 2.2% 4.2%EBITDA MARGIN 9.7% 10.6% 12.2% 8.5% -15.2% 9.7% 10.6% 12.2% 8.5% -15.2%OPERATING MARGIN 2.0% 3.0% 4.3% 49.4% -42.2% 2.0% 3.0% 4.3% 49.4% -42.2%EXCESS MARGIN 5.3% 3.0% -38.1% -43.7% 1370.6% 5.3% 3.0% -38.1% -43.7% 1370.6%
PER CMI ADJ ADMIT / VISIT
NET OPER REV 6,730 6,704 6,577 -0.4% 1.9% 6,730 6,704 6,577 -0.4% 1.9%TOTAL EXPENSES 6,595 6,502 6,296 1.4% -3.3% 6,595 6,502 6,296 1.4% -3.3%WAGES & BENEFITS 3,464 3,496 3,266 -0.9% -7.0% 3,464 3,496 3,266 -0.9% -7.0%SUPPLIES 1,441 1,430 1,481 0.8% 3.4% 1,441 1,430 1,481 0.8% 3.4%ALL OTHER OPER EXPENSES 1,170 1,070 1,031 9.3% -3.8% 1,170 1,070 1,031 9.3% -3.8%CAPITAL COSTS 519 506 518 2.6% 2.3% 519 506 518 2.6% 2.3%OPERATING MARGIN 135 202 281 49.6% -39.1% 135 202 281 49.6% -39.1%EXCESS MARGIN 358 182 (2,503) -49.2% 1475.3% 358 182 (2,503) -49.2% 1475.3%
LABOR
PROD FTEs/ADJ DAILY ADMIT 23.5 23.4 21.8 0.7% -7.5% 23.5 23.4 21.8 0.7% -7.5%NON PROD AS % PAID 8.2% 9.4% 8.4% -11.9% -10.8% 8.2% 9.4% 8.4% -11.9% -10.8%AVG HOURLY RATE 27.9 27.6 27.4 1.1% -0.9% 27.9 27.6 27.4 1.1% -0.9%
OP REV % OF TOTAL REVENU 38.1% 38.5% 37.1% 1.0% 3.7% 38.1% 38.5% 37.1% 1.0% 3.7%
Page A.9
CURRENT MONTH % VARIANCE% VARIANCE
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED - PAYOR MIXOctober 31, 2009
Budget Actual Same Mo Budget Actual Same MoPrior Year Prior Year
MEDICARE 47.5% 48.4% 47.4% 47.5% 48.4% 47.4%MEDICAID 10.8% 12.1% 10.9% 10.8% 12.1% 10.9%MEDICAID HMO 3.1% 4.0% 3.1% 3.1% 4.0% 3.1%HMO/PPO 23.9% 22.1% 23.8% 23.9% 22.1% 23.8%COMMERCIAL 4.1% 2.9% 3.7% 4.1% 2.9% 3.7%OTHER 10.6% 10.5% 11.2% 10.6% 10.5% 11.2%
100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Budget Actual % Variance Budget Actual % VarianceMEDICARE CASE MIX INDEX 1.60 1.62 1.3% 1.60 1.62 1.3%SYSTEM CASE MIX INDEX 1.39 1.37 -1.4% 1.39 1.37 -1.4%
09/30/09 10/31/09 VarianceGross Accounts Receivable 317,132 315,656 (1,476) Net Accounts Receivable 144,997 142,911 (2,086) Net Days in Accounts Receivable 52.9 52.3 (0.6)
CURRENT MONTH YEAR-TO-DATE
Page A.10
LEE MEMORIAL HEALTH SYSTEMFY 2010
CAPITAL STATUS REPORTOctober 31, 2009
CAPITAL BUDGET POOL
$ CERF $'s
APPROVEDCERF $'s SPENT
CERF's PENDING
APPROVALCAPITAL BALANCE
ROUTINE CAPITALROUTINE 3,873,384 1,713,336 73,182 0 4,189,485SURGICAL 2,194,080 45,000 0 0 2,115,654RADIOLOGY 567,116 487,465 0 0 629,008
INFORMATION SYSTEMS 11,500,000 78,814 0 0 3,942,629
MAJOR FACILITIES/PLANT OPS 2,160,000 237,115 0 0 4,990,285
TACTICAL PLANS 788,477 81,362 0 0 254,638
CONTINGENCY 600,000 4,480 0 0 595,520
TOTAL FY 2010 21,683,057 2,647,572 73,182 0 16,717,219
Unbudgeted- Board Approved 785,986 0 0 785,986
Metro Expansion Project 285,000,000 79,534,034 1,264,355 78,269,679
Outside Funding 469,793 0 46,818 469,793
FY09 & PRIOR YRS CERF'S- OPEN 33,204,094 1,129,411 32,074,683
TOTAL CASH OUTLAY FOR CAPITAL IN FY'10 2,466,948
128,317,360
Page A.11
INTEREST REALIZED BOOK UNREALIZED MARKET MONTHLY %INCOME GAINS/(LOSSES) VALUE GAINS/(LOSSES) VALUE RETURN
CASH MANAGERSGENERAL OPERATING ACCOUNTS 4,722 0 500,000 0 500,000LIMITED/RESTRICTED ASSET ACCTS 57 0 3,834,564 0 3,834,564 0.00%NORTHERN TRUST 12,113 0 3,411,474 (5,359) 3,406,115 0.20%COMPASS BANK MONEY MARKET 3,134 0 4,505,980 0 4,505,980 0.07%COMPASS BANK 7 MONTH CD 5,611 0 7,513,612 0 7,513,612 0.07% ML Treasury 91 Day 0.00%
SEI CASH & EQUIVALENTSSEI DAILY INCOME TREAS II FUND #37 1,548 0 80,219,123 0 80,219,123 0.00% ML Treasury 91 Day 0.00%
TOTAL CASH & CASH EQUIVALENT 27,185 0 99,984,753 (5,359) 99,979,393
FIXED INCOME COMPOSITEMFO SEI INSTL INVTS TR CORE FIXED INCOME 0.353 231,699 0 54,838,351 604,431 55,442,782 1.50% Lehman US Aggregate Index 0.50%
MFO SEI DAILY INCOME TR ULTRA SHORT BOND 0.093 15,247 0 7,109,419 102,237 7,211,657 1.70% Lehman 9-12 Month US Treasury 0.10%
SIIT REAL RETURN 0.353 67,557 0 53,485,442 778,914 54,264,356 1.50% Lehman 1-5 YR US Treasury 1.40%
MFO SEI INSTL INVTS TR ENHANCED INCOME 0.257 220,706 (169,922) 41,659,797 508,449 42,168,246 1.40% Merrill Lynch 3 mo Cons-Ma 0.00%
TOTAL FIXED INCOME COMPOSITE 535,209 (169,922) 157,093,009 1,994,031 159,087,041
EQUITY COMPOSITE DOMESTIC EQUITY
RIDGEWORTH SEL L/C GRW ST-I 0 0 19,066,848 (234,459) 18,832,388 -1.20% Russell 1000 Growth -1.30%
MFO SEI INSTL INVTS TR LARGECAP 23.4% 124,210 0 31,684,825 (669,398) 31,015,427 -1.70% S&P 500 -1.90%
MFO SEI SIIT SMALL/MID CAP 6.5% 21,109 0 9,889,141 (540,731) 9,348,410 -5.20% Russell 2500 -5.80%
INTERNATIONAL EQUITYWORLD EQUITY EX-US 0 0 23,645,259 (531,354) 23,113,905 -2.20% MSCI ACWI EX-US -1.20%
TOTAL EQUITY COMPOSITE 145,320 0 84,286,072 (1,975,942) 82,310,130
ALTERNATIVE INVESTMENTSSEI OFFSHORE OPPORTUNITY FUND LI, LTD 0 0 73,496,370 833,628 74,329,998 1.10% ML Treasury 91 Day 0.00%
REAL ESTATE INVESTMENT TRUSTREIT FUND 0 0 12,098,554 (719,235) 11,379,320 -5.30% DJ WILSHIRE RESI -4.90%
TOTAL OTHER COMPOSITE 0 0 85,594,925 114,393 85,709,318
FOUNDATION 2,671 (4,776) (3,928) MISCELLANEOUS OTHER INCOME 44,239 VARIABLE RATE INTEREST EXPENSE OFFSET (135,797) INVESTMENT MANAGER FEES (232,341)
GRAND TOTAL 386,487 (174,698) 426,958,759 123,195 427,085,882 0.20%PORTFOLIO INDEX 0.00%
FOR THE MONTH ENDING OCTOBER 31, 2009DETAILED PERFORMANCE HISTORY
LEE MEMORIAL HEALTH SYSTEM INVESTMENT PORTFOLIO
Page A.12
LEE MEMORIAL HEALTH SYSTEM CONSOLIDATED FINANCIAL STATEMENTS & STATISTICAL REPORTS TABLE OF CONTENTS SECTION B PAGE CONSOLIDATING SCHEDULES CONSOLIDATING STATISTICAL REPORT B.1 CONSOLIDATING INCOME STATEMENT B.4 CONSOLIDATING FINANCIAL RATIOS B.7 STAFFING SUMMARY B.9 SUMMARY OF ACCOUNTS RECEIVABLE B.10
LEE MEMORIAL HEALTH SYSTEMSTATISTICAL SUMMARYCONSOLIDATING ACTUALFOR THE MONTH ENDING OCTOBER 31, 2009
HOME ALLSYSTEM LEE HPMC CCH GCMC HPCC HEALTH REHAB PHYSICIANS
Admissions ADULTS 5,160 1,008 1,366 1,215 1,571 0 0 0 0 PEDIATRICS 392 0 366 26 0 0 0 0 0 NICU 66 0 66 0 0 0 0 0 0 POST ACUTE 150 0 0 0 0 60 0 90 0Total Adult & Peds 5,768 1,008 1,798 1,241 1,571 60 0 90 0 NEWBORNS 548 0 267 123 158 0 0 0 0Total Admissions 6,316 1,008 2,065 1,364 1,729 60 0 90 0
Patient DaysADULTS 24,119 5,636 5,781 5,299 7,403 0 0 0 0 PEDIATRICS 1,444 0 1,387 57 0 0 0 0 0 NICU 1,172 0 1,172 0 0 0 0 0 0 POST ACUTE 4,301 0 0 0 0 3,286 0 1,015 0Total Adult & Peds 31,036 5,636 8,340 5,356 7,403 3,286 0 1,015 0 NEWBORNS 1,253 0 589 307 357 0 0 0 0Total Patient Days 32,289 5,636 8,929 5,663 7,760 3,286 0 1,015 0
Average Length of Stay ADULTS 18.9 5.6 4.2 4.4 4.7 0.0 0.0 0.0 0.0 PEDIATRICS 6.0 0.0 3.8 2.2 0.0 0.0 0.0 0.0 0.0 NICU 17.8 0.0 17.8 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE 66.0 0.0 0.0 0.0 0.0 54.8 0.0 11.3 0.0Total Adult & Peds 5.4 5.6 4.6 4.3 4.7 54.8 0.0 11.3 0.0 NEWBORNS 7.0 0.0 2.2 2.5 2.3 0.0 0.0 0.0 0.0Total Patient Days 5.1 5.6 4.3 4.2 4.5 54.8 0.0 11.3 0.0
OP Registrations EMERGENCY ROOM 14,409 3,475 3,922 3,973 3,039 0 0 0 0 OP SURGERY CASES 1,595 311 486 352 446 0 0 0 0SUBTOTAL 16,004 3,786 4,408 4,325 3,485 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS 286 0 0 0 0 0 286 0 0 HOSP BASED PHY ENCOUNTERS 15,072 0 0 0 0 0 0 0 15,072 PHYSICIAN ENCOUNTERS 41,187 0 0 0 0 0 0 0 41,187 TRAUMA 457 457 0 0 0 0 0 0 0SUBTOTAL 57,002 457 0 0 0 0 286 0 56,259
TOTAL OP 73,006 4,243 4,408 4,325 3,485 0 286 0 56,259
Page B.1
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING STATISTICALACTUAL TO BUDGET VARIANCEFOR THE MONTH ENDED OCTOBER 31, 2009
ALLSYSTEM LEE HP CCH GCMC HPCC HH REHAB PHYSICIANS
Admissions ADULTS 78 61 38 36 (58) 0 0 0 0 PEDIATRICS (63) 0 (33) (30) 0 0 0 0 0 NICU 20 0 20 0 0 0 0 0 0 POST ACUTE (4) 0 0 0 0 (7) 0 3 0Total Adult & Peds 32 61 25 6 (58) (7) 0 3 0 NEWBORNS (66) 0 (15) (0) (51) 0 0 0 0Total Admissions (34) 61 11 6 (108) (7) 0 3 0
Patient Days ADULTS 1,535 662 (44) 572 345 0 0 0 0 PEDIATRICS (191) 0 (110) (81) 0 0 0 0 0 NICU (86) 0 (86) 0 0 0 0 0 0 POST ACUTE (117) 0 0 0 0 (62) 0 (55) 0Total Adult & Peds 1,141 662 (240) 492 345 (62) 0 (55) 0 NEWBORNS 23 0 102 14 (93) 0 0 0 0Total Patient Days 1,164 662 (138) 506 251 (62) 0 (55) 0
Average Length of Stay ADULTS 0.9 0.3 (0.2) 0.4 0.4 0.0 0.0 0.0 0.0 PEDIATRICS (0.2) 0.0 0.0 (0.3) 0.0 0.0 0.0 0.0 0.0 NICU (9.6) 0.0 (9.6) 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE (0.0) 0.0 0.0 0.0 0.0 4.8 0.0 (1.0) 0.0Total Adult & Peds (9.0) 0.3 (9.7) 0.1 0.4 4.8 0.0 (1.0) 0.0 NEWBORNS 0.7 0.0 0.5 0.1 0.1 0.0 0.0 0.0 0.0Total Patient Days (8.3) 0.3 (9.2) 0.2 0.5 4.8 0.0 (1.0) 0.0
OP Registrations EMERGENCY ROOM 2,181 548 924 289 421 0 0 0 0 OP SURGERY CASES (116) (14) (43) (35) (24) 0 0 0 0SUBTOTAL 2,065 534 880 254 397 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS 24 0 0 0 0 0 24 0 0 HOSP BASED PHY ENCOU 2,467 0 0 0 0 0 0 0 2,467 PHYSICIAN ENCOUNTERS (2,207) 0 0 0 0 0 0 0 (2,207) TRAUMA (379) (379) 0 0 0 0 0 0 0SUBTOTAL (96) (379) 0 0 0 0 24 0 259
TOTAL OP 1,969 155 880 254 397 0 24 0 259
Page B.2
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING STATISTICALACTUAL TO PRIOR MONTH VARIANCEFOR THE MONTH ENDED OCTOBER 31, 2009
SYSTEM LEE HP CCH GCMC HPCC HH REHAB PHYSICIANSAdmissions ADULTS 146 89 50 49 (42) 0 0 0 0 PEDIATRICS (36) 0 (62) 26 0 0 0 0 0 NICU 20 0 20 0 0 0 0 0 0 POST ACUTE (7) 0 0 0 0 (10) 0 3 0Total Adult & Peds 123 89 8 75 (42) (10) 0 3 0 NEWBORNS (22) 0 7 5 (34) 0 0 0 0Total Admissions 101 89 15 80 (76) (10) 0 3 0
Patient Days ADULTS 1,778 736 91 460 491 0 0 0 0 PEDIATRICS 19 0 (38) 57 0 0 0 0 0 NICU (226) 0 (226) 0 0 0 0 0 0 POST ACUTE (10) 0 0 0 0 (20) 0 10 0Total Adult & Peds 1,561 736 (173) 517 491 (20) 0 10 0 NEWBORNS (13) 0 14 36 (63) 0 0 0 0Total Patient Days 1,548 736 (159) 553 428 (20) 0 10 0
Average Length of Stay ADULTS 0.8 0.3 (0.1) 0.2 0.4 0.0 0.0 0.0 0.0 PEDIATRICS 0.5 0.0 0.5 0.0 0.0 0.0 0.0 0.0 0.0 NICU (12.6) 0.0 (12.6) 0.0 0.0 0.0 0.0 0.0 0.0 POST ACUTE 7.3 0.0 0.0 0.0 0.0 7.5 0.0 (0.3) 0.0Total Adult & Peds (4.1) 0.3 (12.3) 0.2 0.4 7.5 0.0 (0.3) 0.0 NEWBORNS 2.5 0.0 (0.0) 0.2 2.3 0.0 0.0 0.0 0.0Total Patient Days (1.7) 0.3 (12.3) 0.4 2.7 7.5 0.0 (0.3) 0.0
OP Registrations EMERGENCY ROOM 2,997 766 1,180 430 621 0 0 0 0 OP SURGERY CASES (183) (24) (90) (37) (32) 0 0 0 0SUBTOTAL 2,814 742 1,090 393 589 0 0 0 0
Visits / Encounters HOME HEALTH ADMISSIONS (60) 0 0 0 0 0 (60) 0 0 HOSP BASED PHY ENCOUNTE 2,719 0 0 0 0 0 0 0 2,719 PHYSICIAN ENCOUNTERS 54 0 0 0 0 0 0 0 54 TRAUMA (359) (359) 0 0 0 0 0 0 0SUBTOTAL 2,354 (359) 0 0 0 0 (60) 0 2,773
TOTAL OP 5,168 383 1,090 393 589 0 (60) 0 2,773
Page B.3
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL DOLLARS - IN THOUSANDSFOR THE MONTH ENDED OCTOBER 31, 2009
HOME ALL CORP ALL SYSTEM LMH HPMC CCH GCMC TRAUMA OP CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVS OTHERS
INPATIENT REVENUE 192,973 41,319 55,342 36,141 57,174 0 66 1,197 0 1,735 0 0 0 0OUTPATIENT REVENUE 120,612 16,573 24,171 22,022 23,495 408 10,686 0 747 13 22,498 0 0 0TOTAL PATIENT REVENUE 313,585 57,892 79,513 58,162 80,669 408 10,752 1,197 747 1,748 22,498 0 0 0
DED FROM REV-MEDICARE 109,098 21,770 23,796 23,379 35,789 0 3,589 168 (0) 608 0 0 0 0DED FROM REV-MEDICAID 36,760 5,274 16,671 6,257 7,820 0 727 (1) 13 0 0 0 0 0DED FROM REV-CHARITY 9,474 4,513 1,649 2,046 1,105 0 98 32 31 0 0 0 0 0DED FROM REV-HMO/PPO 32,058 4,878 8,937 7,053 9,848 0 1,243 0 36 63 0 0 0 0DED FROM REV-OTHER 30,557 4,384 3,680 3,480 4,209 355 1,291 56 4 0 13,098 0 0 0DED FROM REV-BAD DEBT 10,969 3,086 1,276 1,780 2,285 50 187 0 3 23 2,279 0 0 0TOTAL DED FROM REV 228,917 43,906 56,010 43,994 61,056 405 7,135 255 87 694 15,376 0 0 0
NET PATIENT REVENUE 84,668 13,986 23,503 14,168 19,613 3 3,617 942 661 1,054 7,121 0 0 0OTHER OPER REV 1,418 64 95 121 89 61 62 5 44 0 88 158 225 406
0TOTAL OPERATING REV 86,085 14,050 23,598 14,289 19,702 64 3,679 947 705 1,054 7,209 158 225 406
OPERATING EXPENSES PROD SALARIES 32,870 4,175 6,467 4,067 5,924 249 920 462 451 445 5,910 77 3,487 236 PROD OVERTIME 1,219 239 289 173 406 0 10 43 2 10 16 0 29 1 CONTRACT LABOR 5 0 0 0 3 0 0 0 0 0 2 0 0 0 NON-PROD SALARIES 4,086 482 679 476 634 121 116 40 48 50 983 5 425 27TOTAL SALARIES & WAGES 38,180 4,896 7,435 4,716 6,967 369 1,046 545 501 505 6,911 82 3,942 264
FRINGE BENEFITS 6,715 1,136 1,348 865 1,220 26 110 99 86 91 688 14 972 59HEALTH CARE ACCESS 1,137 252 338 240 266 0 0 35 0 6 0 0 0 0SUPPLIES 18,362 3,792 4,695 3,416 4,930 1 420 70 9 29 238 2 683 78OTHER SERVICES 4,903 434 524 404 757 6 327 23 37 2 676 57 1,603 52PURCHASED SERVICES 7,701 371 686 456 1,427 158 (43) 94 25 2 2,133 3 2,384 5
TOTAL OPER EXPENSES 76,998 10,882 15,026 10,098 15,567 559 1,860 865 658 635 10,646 158 9,584 459
EBITDA 9,087 3,168 8,572 4,191 4,134 (496) 1,818 82 47 419 (3,437) 0 (9,359) (53)
DEPRECIATION/AMORT 4,308 424 1,160 436 1,353 3 199 24 1 10 197 0 493 7INTEREST EXPENSE 2,192 122 380 220 1,160 0 253 9 0 0 44 0 4 0GAIN(LOSS) FROM OPER 2,588 2,623 7,032 3,536 1,622 (499) 1,366 48 46 408 (3,679) 0 (9,856) (59)
NON OPERATING REV INT EARN & REALIZED GAIN 212 336 (6) (58) (66) 0 0 0 0 0 0 2 0 3 UNREALIZED GAIN (LOSS) 123 127 0 0 0 0 0 0 0 0 0 (4) 0 0 UNREALIZED GAIN (LOSS) ON SWA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV (352) (465) 0 0 0 0 0 55 60 30 0 (32) 0 0 RESTRICTED GIFTS (230) (1) 0 0 0 0 0 0 0 0 0 (229) 0 0TOTAL NON OPER REV (248) (3) (6) (58) (66) 0 0 55 60 30 0 (263) 0 3
EXCESS REV/EXPS 2,340 2,620 7,026 3,478 1,556 (499) 1,366 103 107 438 (3,679) (263) (9,856) (56)
Page B.4
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL TO BUDGET DOLLAR VARIANCE - IN THOUSFOR THE MONTH ENDED OCTOBER 31, 2009
OP HOME ALL CORP ALLSYSTEM LMH HPMC CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVCS OTHERS
INPATIENT REVENUE (439) 2,904 (2,678) 800 (1,311) 0 12 (50) 0 (115) 0 0 0 0OUTPATIENT REVENUE 1,627 528 (748) 649 1,359 (252) 317 0 (24) 12 (215) 0 0 0TOTAL PATIENT REVENUE 1,188 3,432 (3,426) 1,449 47 (252) 329 (50) (24) (103) (215) 0 0 0
DED FROM REV-MEDICARE (1,932) (2,839) 3,474 (1,100) (335) 0 (956) (16) 9 (170) 0 0 0 0DED FROM REV-MEDICAID (7,718) (975) (3,476) (1,444) (1,566) 0 (280) 19 4 0 0 0 0 0DED FROM REV-CHARITY 406 (273) 790 (189) 105 0 9 (19) (17) 0 0 0 0 0DED FROM REV-HMO/PPO 1,691 (132) 2,093 212 (399) 0 (165) 0 1 81 0 0 0 0DED FROM REV-OTHER 5,453 2,236 1,051 478 1,444 (144) 599 (20) (2) 0 (188) 0 0 0DED FROM REV-BAD DEBT 426 (616) 55 150 859 247 8 22 2 18 (319) 0 0 0TOTAL DED FROM REV (1,674) (2,600) 3,987 (1,892) 109 103 (785) (15) (3) (71) (508) 0 0 0
NET PATIENT REVENUE (486) 832 561 (443) 156 (149) (456) (64) (27) (174) (722) 0 0 0OTHER OPER REV (107) (11) (3) (4) (13) 57 (36) (1) (1) 0 (5) (49) (31) (11)TOTAL OPERATING REV (593) 822 557 (447) 144 (92) (492) (65) (28) (174) (727) (49) (31) (11)
OPERATING EXPENSES PROD SALARIES 25 (80) 119 101 (422) (2) 69 (10) (5) 14 15 9 213 4 PROD OVERTIME 51 (29) 53 14 75 0 (8) 1 (1) (10) (15) (0) (27) (1) CONTRACT LABOR (5) 0 0 0 (3) 0 0 0 0 0 (2) 0 0 0 NON-PROD SALARIES (308) (9) 23 (10) (20) (94) 1 5 5 (1) (285) 1 76 (1)TOTAL SALARIES & WAGES (237) (118) 195 105 (370) (96) 62 (5) (0) 3 (286) 10 262 2
FRINGE BENEFITS (42) 42 15 27 (121) (6) 72 (3) 0 (0) 141 2 (214) 2HEALTH CARE ACCESS (116) (66) (24) (45) 3 0 24 (14) 0 4 0 0 0 0SUPPLIES 196 17 208 (205) 235 1 105 (2) 3 (4) 90 1 (263) 10OTHER SERVICES 429 84 53 62 94 2 69 1 11 1 55 23 (29) 2PURCHASED SERVICES 1,018 6 133 164 44 11 105 2 3 13 269 11 251 6
TOTAL OPER EXPENSES 1,249 (35) 581 109 (115) (87) 437 (19) 16 18 269 47 7 22
EBITDA 656 787 1,138 (337) 29 (179) (55) (84) (12) (156) (458) (2) (24) 11
DEPRECIATION/AMORT 316 198 58 53 23 0 49 (1) (0) (0) (4) 0 (58) (0)INTEREST EXPENSE (129) (17) (72) 15 (59) 0 2 (2) 0 0 0 0 3 0GAIN(LOSS) FROM OPER 843 967 1,123 (270) (7) (179) (4) (87) (12) (157) (462) (2) (79) 11
NON OPERATING REV INT EARN & REALIZED GAIN (2,507) (2,573) 28 49 (1) 0 0 0 0 0 0 (11) 0 1 UNREALIZED GAIN(LOSS) 140 127 0 0 0 0 0 0 0 0 0 13 0 0 UNREALIZED GAIN(LOSS) ON SWAP 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV (500) (652) 0 0 11 0 0 55 46 30 0 11 0 0 RESTRICTED GIFTS (245) (1) 0 0 0 0 0 0 0 0 0 (244) 0 0TOTAL NON OPER REV (3,112) (3,098) 28 49 10 0 0 55 46 30 0 (231) 0 1
EXCESS OF REV / EXPS (2,269) (2,131) 1,151 (221) 2 (179) (4) (33) 34 (127) (462) (233) (79) 12
Page B.5
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATING INCOME STATEMENTACTUAL TO PRIOR MONTH DOLLAR VARIANCE - IN THOUSFOR THE MONTH ENDED OCTOBER 31, 2009
OP HOME ALL CORP ALLSYSTEM LMH HP CCH GCMC TRAUMA CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND SVCS OTHERS
INPATIENT REVENUE 11,049 6,138 1,658 3,154 (39) 0 21 19 0 98 0 0 0 0OUTPATIENT REVENUE 13,431 1,198 (323) 2,618 1,699 (193) 6,843 0 (157) 13 1,732 0 0 0TOTAL PATIENT REVENUE 24,480 7,336 1,335 5,772 1,661 (193) 6,865 19 (157) 111 1,732 0 0 0
DED FROM REV-MEDICARE (11,849) (4,509) 269 (2,784) (2,242) 0 (2,307) (15) 11 (271) 0 0 0 0DED FROM REV-MEDICAID (8,504) (1,133) (3,663) (1,755) (1,395) 0 (594) 13 23 0 0 0 0 0DED FROM REV-CHARITY (1,016) (719) (168) (483) 490 0 (97) (8) (31) 0 0 0 0 0DED FROM REV-HMO/PPO 2,304 482 2,236 (57) 265 0 (708) 0 17 69 0 0 0 0DED FROM REV-OTHER (389) 656 601 (302) 1,425 (75) (934) (20) (4) 0 (1,735) 0 0 0DED FROM REV-BAD DEBT (1,019) (846) (34) 133 628 95 (179) 0 9 10 (836) 0 0 0TOTAL DED FROM REV (20,472) (6,070) (759) (5,247) (828) 20 (4,819) (30) 24 (192) (2,570) 0 0 0
NET PATIENT REVENUE 4,008 1,266 576 525 833 (173) 2,045 (11) (133) (81) (839) 0 0 0OTHER OPER REV 65 (44) 5 (4) (28) 20 23 (2) 3 0 (31) (16) 52 85TOTAL OPERATING REV 4,073 1,223 581 521 805 (152) 2,069 (13) (130) (81) (869) (16) 52 85
OPERATING EXPENSES PROD SALARIES (2,729) (160) (337) (291) (496) (0) (463) (41) (3) (32) (552) 4 (342) (17) PROD OVERTIME (278) (96) (19) (41) (92) 0 (3) (6) (1) (9) (0) (0) (10) (0) CONTRACT LABOR 186 0 13 22 148 0 0 0 0 0 (2) 0 5 0 NON-PROD SALARIES (884) (6) (17) (61) (53) (99) (57) 9 34 (2) (647) 1 17 (3)TOTAL SALARIES & WAGES (3,705) (262) (360) (371) (493) (99) (523) (38) 29 (43) (1,201) 4 (330) (20)
FRINGE BENEFITS (470) (13) 10 2 (14) 1 (13) (11) 4 (6) (76) (0) (350) (4)HEALTH CARE ACCESS (109) (7) (1) (11) (56) 0 0 (35) 0 1 0 0 0 0SUPPLIES 108 64 6 (348) 456 1 (171) (8) (1) (8) 98 (1) 77 (57)OTHER SERVICES (42) 109 (80) (0) (94) (2) (51) 5 3 0 38 299 (248) (19)PURCHASED SERVICES (740) (93) 10 6 152 65 127 18 7 4 (278) 23 (781) (1)
TOTAL OPER EXPENSES (4,957) (202) (414) (721) (50) (33) (631) (69) 42 (53) (1,420) 325 (1,632) (101)
EBITDA (884) 1,021 167 (200) 755 (185) 1,438 (81) (88) (134) (2,289) 309 (1,580) (16)
DEPRECIATION/AMORT 917 183 31 71 594 (0) (173) 0 9 5 108 0 89 (0)INTEREST EXPENSE (647) (9) (13) 177 (612) 0 (253) 12 0 0 45 0 6 0GAIN(LOSS) FROM OPER (919) 1,195 184 48 738 (186) 1,012 (70) (79) (129) (2,442) 309 (1,484) (16)
NON OPERATING REV INT EARN & REALIZED GAIN (51) 120 (8) (61) (70) 0 0 0 0 0 0 (32) 0 0 UNREALIZED GAIN(LOSS) 35,374 34,725 0 0 0 0 0 0 0 0 0 649 0 0 UNREALIZED GAIN(LOSS) ON SWAP 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OTHER NON OPER REV (397) (241) 0 (0) 0 0 0 (0) (73) (52) 0 (32) 0 0 RESTRICTED GIFTS (460) (1) 0 0 0 0 0 0 0 0 0 (459) 0 0TOTAL NON OPER REV 34,466 34,602 (8) (61) (70) 0 0 (0) (73) (52) 0 127 0 0
EXCESS OF REV / EXPS 33,547 35,798 176 (13) 668 (186) 1,012 (70) (151) (181) (2,442) 436 (1,484) (16)
Page B.6
LEE MEMORIAL HEALTH SYSTEMOPERATING RATIOSFOR THE MONTH ENDED OCTOBER 31, 2009
OP HOME ALL ALL SYSTEM LMH HPMC CCH GCMC CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND OTHERS
AS % NET OPER REVWAGES & BENEFITS ACTUAL 52.2% 45.5% 37.2% 39.1% 41.6% 31.4% 68.0% 83.3% 56.5% 105.4% 60.7% 79.7% BUDGET 51.5% 46.7% 39.0% 38.8% 39.4% 30.9% 62.9% 80.1% 48.7% 93.9% 52.1% 78.4% PRIOR YR 49.7% 46.4% 36.6% 37.9% 40.6% 38.5% 62.0% 74.3% 48.1% 78.3% 57.2% 93.4%
SUPPLIES ACTUAL 21.3% 26.9% 19.9% 23.9% 25.0% 11.4% 7.4% 1.3% 2.7% 3.3% 1.1% 19.2% BUDGET 21.4% 28.5% 21.3% 21.8% 26.4% 12.6% 6.7% 1.6% 2.0% 4.1% 1.6% 21.1% PRIOR YR 22.5% 29.6% 20.4% 22.3% 28.5% 15.5% 6.5% 0.9% 1.8% 4.2% 0.4% 6.6%
ALL OTHER OPER EXPENSES ACTUAL 16.0% 8.6% 6.6% 7.7% 12.4% 7.7% 16.0% 8.8% 1.0% 39.0% 38.0% 14.1% BUDGET 17.4% 9.4% 7.4% 8.7% 13.2% 11.6% 14.0% 10.3% 2.4% 39.5% 45.4% 15.7% PRIOR YR 15.7% 9.9% 6.4% 8.0% 13.0% 22.4% 14.5% 8.6% 1.4% 31.8% 219.9% 11.5%
CAPITAL COSTS ACTUAL 7.6% 3.9% 6.5% 4.6% 12.8% 12.3% 3.5% 0.1% 1.0% 3.3% 0.0% 1.7% BUDGET 7.7% 5.4% 6.6% 4.9% 12.7% 12.1% 3.0% 0.1% 0.8% 3.0% 0.0% 1.7% PRIOR YR 7.9% 5.5% 6.8% 6.6% 13.2% 1.7% 4.7% 1.2% 1.3% 1.1% 0.0% 2.1%
EBITDA MARGIN ACTUAL 10.6% 18.9% 36.3% 29.3% 21.0% 49.4% 8.6% 6.7% 39.7% -47.7% 0.1% -12.9% BUDGET 9.7% 15.4% 32.3% 30.7% 21.0% 44.9% 16.4% 8.0% 46.8% -37.5% 0.9% -15.2% PRIOR YR 12.2% 14.1% 36.5% 31.9% 17.9% 23.6% 17.0% 16.2% 48.7% -14.2% -177.5% -11.4%
OPERATING MARGIN ACTUAL 3.0% 15.1% 29.8% 24.7% 8.2% 37.1% 5.1% 6.5% 38.7% -51.0% 0.1% -14.6% BUDGET 2.0% 10.0% 25.6% 25.8% 8.3% 32.8% 13.4% 7.9% 46.0% -40.5% 0.9% -16.8% PRIOR YR 4.3% 8.5% 29.8% 25.3% 4.7% 22.0% 12.3% 15.0% 47.4% -15.3% -177.5% -13.5%
EXCESS MARGIN ACTUAL 3.0% 15.0% 29.8% 24.4% 7.9% 37.1% 10.3% 13.9% 40.4% -51.0% 32.1% -13.7% BUDGET 5.3% 33.1% 25.5% 25.1% 7.9% 32.8% 13.4% 9.9% 46.0% -40.5% -14.4% -16.2% PRIOR YR -38.1% -256.8% 29.8% 25.4% 4.7% 22.0% 18.0% 30.9% 54.5% -15.3% -401.5% -12.6%
PER CMI ADJ ADMIT / VISITNET OPER REV ACTUAL 6,704 6,126 7,308 5,679 6,305 878 15,785 2,464 10,331 175 12 32 BUDGET 6,730 6,237 6,638 5,857 6,223 863 15,112 2,795 11,368 183 16 32 PRIOR YR 6,577 6,378 6,541 5,809 5,974 318 11,035 2,413 10,511 196 14 26
TOTAL EXPENSES ACTUAL 6,502 5,204 5,130 4,274 5,786 552 14,979 2,303 6,328 264 12 36 BUDGET 6,595 5,614 4,936 4,344 5,704 580 13,090 2,574 6,137 257 16 38 PRIOR YR 6,296 5,833 4,595 4,338 5,695 248 9,677 2,051 5,531 226 39 29
WAGES & BENEFITS ACTUAL 3,496 2,790 2,720 2,218 2,620 276 10,733 2,052 5,842 184 7 25 BUDGET 3,464 2,912 2,591 2,271 2,449 267 9,505 2,239 5,538 172 8 25 PRIOR YR 3,266 2,961 2,397 2,199 2,428 122 6,840 1,793 5,059 154 8 24
Page B.7
LEE MEMORIAL HEALTH SYSTEMOPERATING RATIOSFOR THE MONTH ENDED OCTOBER 31, 2009
OP HOME ALL ALL SYSTEM LMH HPMC CCH GCMC CENTERS HPCC HEALTH REHAB PHYSICIANS FOUND OTHERS
SUPPLIES ACTUAL 1,430 1,646 1,454 1,358 1,578 100 1,162 31 282 6 0 6 BUDGET 1,441 1,776 1,412 1,276 1,643 109 1,017 44 233 8 0 7 PRIOR YR 1,481 1,887 1,336 1,295 1,703 49 715 22 190 8 0 2
ALL OTHER OPER EXPENSES ACTUAL 1,070 530 480 437 784 68 2,527 217 103 68 5 4 BUDGET 1,170 586 493 510 824 100 2,110 288 273 72 7 5 PRIOR YR 1,031 632 420 462 775 71 1,604 208 142 62 31 3
CAPITAL COSTS ACTUAL 506 238 477 261 804 108 557 3 101 6 0 1 BUDGET 519 340 440 288 788 104 459 2 93 5 0 1 PRIOR YR 518 353 443 381 789 5 519 28 140 2 0 1
OPERATING MARGIN ACTUAL 202 922 2,178 1,405 519 326 805 161 4,003 (89) 0 (5) BUDGET 135 623 1,702 1,512 518 284 2,022 221 5,231 (74) 0 (5) PRIOR YR 281 545 1,946 1,472 279 70 1,357 362 4,979 (30) (25) (3)
EXCESS MARGIN ACTUAL 182 921 2,176 1,382 498 326 1,714 373 4,295 (89) (20) (4) BUDGET 358 2,065 1,692 1,470 494 284 2,022 276 5,231 (74) (2) (5) PRIOR YR (2,503) (16,377) 1,947 1,473 281 70 1,984 746 5,732 (30) (56) (3)
LABORPROD FTEs/ADJ DAILY ADMIT ACTUAL 23.38 23.00 18.10 15.24 20.67 18.41 75.83 9.07 35.58 0.54 0.04 0.27 BUDGET 23.54 22.99 18.27 15.46 19.37 17.68 66.24 10.92 37.98 0.53 0.05 0.28 PRIOR YR 21.75 22.52 16.43 14.87 18.21 0.69 58.29 7.58 33.05 0.48 0.04 0.26
NON PROD AS % PAID ACTUAL 9.35% 8.98% 9.39% 9.99% 8.99% 14.24% 8.06% 10.77% 10.58% 7.91% 7.72% 10.21% BUDGET 8.24% 8.45% 8.67% 7.64% 7.86% 8.62% 8.55% 7.85% 9.27% 8.50% 3.38% 7.08% PRIOR YR 8.44% 8.79% 8.54% 9.35% 8.03% 9.69% 6.69% 13.64% 10.60% 6.07% 8.11% 8.74%
AVG HOURLY RATE ACTUAL 27.64 25.64 25.22 24.41 24.22 23.95 19.27 30.18 24.50 50.43 32.83 16.48 BUDGET 27.94 25.91 26.34 25.44 24.46 24.44 19.49 28.23 24.42 46.14 33.57 16.84 PRIOR YR 27.40 25.18 25.58 24.22 24.87 23.76 19.65 29.58 24.30 45.64 34.53 16.35
OP REV % OF TOTAL REVENUE ACTUAL 38.5% 29.1% 30.4% 37.9% 29.1% 99.4% N/A 100.0% 0.7% 100.0% N/A N/A BUDGET 38.1% 30.3% 30.0% 37.7% 27.5% 99.5% N/A 100.0% 0.0% 100.0% N/A N/A PRIOR YR 37.1% 31.2% 31.3% 37.0% 27.6% 98.9% N/A 100.0% N/A 100.0% N/A N/A
Page B.8
LEE MEMORIAL HEALTH SYSTEMFOR THE PERIOD ENDING: OCTOBER 31, 2009CONSOLIDATED STAFFING SUMMARY
OP ALL ALLSYSTEM LMH HP CCH GCMC TRAUMA CENTERS HPCC HH REHAB PHYSICIANS FOUND CORP OTHERS
MONTH TO DATE
BUDGET 7,666.82 1,081.72 1,635.42 1,069.55 1,522.61 18.73 255.98 156.51 100.14 117.30 810.55 15.50 793.52 89.29
ACTUAL 7,799.13 1,140.70 1,664.28 1,090.83 1,623.78 18.72 246.51 159.64 93.74 116.35 773.67 14.16 766.22 90.52
DIFFERENCE (132.30) (58.98) (28.86) (21.27) (101.17) 0.00 9.47 (3.13) 6.40 0.94 36.88 1.34 27.30 (1.23)
YEAR TO DATE
BUDGET 7,666.82 1,081.72 1,635.42 1,069.55 1,522.61 18.73 255.98 156.51 100.14 117.30 810.55 15.50 793.52 89.29
ACTUAL 7,799.12 1,140.70 1,664.28 1,090.83 1,623.78 18.72 246.51 159.64 93.74 116.35 773.67 14.16 766.22 90.52
DIFFERENCE (132.30) (58.98) (28.86) (21.27) (101.17) 0.00 9.47 (3.13) 6.40 0.94 36.88 1.34 27.30 (1.23)
Page B.9
LMH/HP CCH SWR/GCH HPCC HHA HBP/LPG TOTALGross A/R 123,143 37,862 117,443 1,498 1,471 34,239 315,656Allowances 51,464 16,721 79,938 372 53 24,199 172,745Net A/R 71,679 21,141 37,505 1,126 1,418 10,041 142,911
Net Revenue Per Day 1,380 435 607 31 22 255 2,730
Net Days in A/R Current Month 52.0 48.6 61.8 35.9 64.1 39.3 52.3 Net Days in A/R Same Month Prior Yr 62.6 52.9 73.6 39.6 70.4 57.9 62.7 % Change 3.8% 2.2% -7.1% 3.1% 31.5% 12.6%
In Thousands (000)October 31, 2009
Summary of Accounts ReceivableLEE MEMORIAL HEALTH SYSTEM
Page B.10
LEE MEMORIAL HEALTH SYSTEM
LEE COUNTY, FLORIDA
UNCONSOLIDATED
FINANCIAL STATEMENTS AND
STATISTICAL REPORTS
OCTOBER 31, 2009
LEE MEMORIAL HEALTH SYSTEM
UNCONSOLIDATED
TABLE OF CONTENTS
SECTION C
PAGE LEESAR REGIONAL SERVICE CENTER C.1 ACCESS MEDICAL SOUTH, LC C.2 LEE MEDICAL RESOURCES C.3 BONITA COMMUNITY HEALTH CENTER, INC. C.4
VAR VAR % VAR % VAR VAR % VAR %BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
TOTAL SALES 9,451,929 10,123,049 9,325,350 671,120 7.1% 8.6% 9,451,929 10,123,049 9,325,350 671,121 7.1% 8.6%
COST OF GOODS SOLD 8,564,640 9,202,727 8,574,678 (638,087) -7.5% -7.3% 8,564,640 9,202,727 8,574,678 (638,085) -7.5% -7.3% GROSS PROFIT 887,289 920,322 750,672 33,033 3.7% 22.6% 887,289 920,322 750,672 33,036 3.7% 22.6%
OTHER OPERATING REVENUE 1,324 416 1,878 (908) -68.6% -77.8% 1,324 416 1,878 (907) -68.6% -77.8%
TOTAL OPERATING REVENUE 888,613 920,738 752,550 32,125 3.6% 22.3% 888,613 920,738 752,550 32,129 3.6% 22.3%
OPERATING EXPENSES SALARIES/WAGES 377,490 360,272 359,529 17,218 4.6% -0.2% 377,490 360,272 359,529 17,218 4.6% -0.2% BENEFITS 159,949 138,266 122,973 21,683 13.6% -12.4% 159,949 138,266 122,973 21,683 13.6% -12.4% OTHER SUPPLIES 36,956 43,432 43,736 (6,476) -17.5% 0.7% 36,956 43,432 43,736 (6,476) -17.5% 0.7% OTHER SERVICES 156,755 126,970 136,146 29,785 19.0% 6.7% 156,755 126,970 136,146 29,785 19.0% 6.7% PURCHASED SERVICES 41,709 40,371 47,955 1,338 3.2% 15.8% 41,709 40,371 47,955 1,338 3.2% 15.8% DEPRECIATION/AMORTIZATION 63,754 62,911 63,729 843 1.3% 1.3% 63,754 62,911 63,729 842 1.3% 1.3%
TOTAL OPERATING EXPENSES 836,613 772,222 774,068 64,391 7.7% 0.2% 836,613 772,222 774,068 64,391 7.7% 0.2%
GAIN(LOSS) FROM OPERATIONS 52,000 148,516 (21,518) 96,516 185.6% 790.2% 52,000 148,516 (21,518) 96,516 185.6% 790.2%
INTEREST EARNINGS 3,333 1,180 7,500 (2,153) -64.6% -84.3% 3,333 1,180 7,500 (2,153) -64.6% -84.3% GAIN(LOSS) ON DISPOSITION 0 0 0 0 0.0% 0.0% 0 0 0 0 0.0% 0.0%
EXCESS OF REV OVER EXPENSES 55,333 149,696 (14,018) 94,363 170.5% 1167.9% 55,333 149,696 (14,018) 94,359 170.5% 1167.9%
Page C.1
LEESAR REGIONAL SERVICE CENTERCOMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING OCTOBER 31, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2010
ACCESS INFUSION PARTNERS
COMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING OCTOBER 31, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2010VAR VAR % VAR % FORMULA DRIVEN VAR VAR % VAR %
BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
GROSS PRODUCT REVENUE 695,700 622,175 615,650 (73,525) -10.6% 1.1% 695,700 622,175 615,650 (73,525) -10.6% 1.1%
DEDUCTIONS FROM REVENUE 406,985 341,138 367,237 65,847 16.2% 7.1% 406,985 341,138 367,237 65,847 16.2% 7.1% NET PRODUCT REVENUE 288,715 281,037 248,413 (7,678) -2.7% 13.1% 288,715 281,037 248,413 (7,678) -2.7% 13.1%
COST OF PRODUCTS SOLD 146,100 135,731 119,093 10,369 7.1% -14.0% 146,100 135,731 119,093 10,369 7.1% -14.0%
GROSS PROFIT 142,615 145,305 129,320 2,690 1.9% 12.4% 142,615 145,305 129,320 2,690 1.9% 12.4%
OPERATING EXPENSES SALARIES/WAGES 62,079 60,873 51,522 1,206 1.9% -18.2% 62,079 60,873 51,522 1,206 1.9% -18.2% BENEFITS 9,456 8,089 5,934 1,367 14.5% -36.3% 9,456 8,089 5,934 1,367 14.5% -36.3% OTHER SUPPLIES & SERVICES 34,375 38,549 37,076 (4,174) -12.1% -4.0% 34,375 38,549 37,076 (4,174) -12.1% -4.0% PURCHASED SERVICES 13,025 13,532 12,717 (507) -3.9% -6.4% 13,025 13,532 12,717 (507) -3.9% -6.4% DEPREC, INTEREST, & AMORT 2,750 2,718 1,176 32 1.2% -131.1% 2,750 2,718 1,176 32 1.2% -131.1%
TOTAL OPERATING EXPENSES 121,685 123,762 108,425 (2,077) -1.7% -12.4% 121,685 123,762 108,425 (2,077) -1.7% -14.1%
GAIN(LOSS) FROM OPERATIONS 20,930 21,543 20,895 613 2.9% 3.0% 20,930 21,543 20,895 613 2.9% 3.1%
NON OPERATING REVENUE 0 538 674 538 0.0% -20.2% 0 538 674 538 0.0% -20.2%
EXCESS OF REV OVER EXPENSES 20,930 22,082 21,569 1,152 5.5% 2.4% 20,930 22,082 21,569 1,152 5.5% 2.4%
MINORITY INTEREST 10,465 11,041 10,785 576 5.5% 2.4% 10,465 11,041 10,785 576 5.5% 2.4% NET INCOME (LOSS) 10,465 11,041 10,785 576 5.5% 2.4% 10,465 11,041 10,785 576 5.5% 2.4%
Page C.2
ACCESS MEDICAL SOUTH, LCCOMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING OCTOBER 31, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2010VAR VAR % VAR % VAR VAR % VAR %
BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
NET PRODUCT REVENUE 166,884 192,605 188,677 25,721 15.4% 2.1% 166,884 192,605 188,677 25,721 15.4% 2.1%
COST OF PRODUCTS SOLD 32,262 40,145 32,444 (7,883) -24.4% -23.7% 32,262 40,145 32,444 (7,883) -24.4% -23.7%
GROSS PROFIT 134,622 152,460 156,233 17,838 13.3% -2.4% 134,622 152,460 156,233 17,838 13.3% -2.4%
OPERATING EXPENSES SALARIES/WAGES 57,068 60,896 58,632 (3,828) -6.7% -3.9% 57,068 60,896 58,632 (3,828) -6.7% -3.9% BENEFITS 13,549 15,495 14,437 (1,946) -14.4% -7.3% 13,549 15,495 14,437 (1,946) -14.4% -7.3% OTHER SERVICES 27,647 28,981 29,590 (1,334) -4.8% 2.1% 27,647 28,981 29,590 (1,334) -4.8% 2.1% BAD DEBT 13,041 15,620 14,407 (2,579) -19.8% -8.4% 13,041 15,620 14,407 (2,579) -19.8% -8.4% DEPREC, INTEREST, & AMORT 15,234 14,489 15,634 745 4.9% 7.3% 15,234 14,489 15,634 745 4.9% 7.3%
TOTAL OPERATING EXPENSES 126,539 135,481 132,700 (8,942) -7.1% -2.1% 126,539 135,481 132,700 (8,942) -7.1% -2.1%
GAIN(LOSS) FROM OPERATIONS 8,083 16,979 23,533 8,896 110.1% 27.9% 8,083 16,979 23,533 8,896 110.1% -27.9%
NON OPERATING REVENUE 245 0 461 (245) -100.0% -100.0% 245 0 461 (245) -100.0% -100.0%
EXCESS OF REV OVER EXPENSES 8,328 16,979 23,994 8,651 103.9% -29.2% 8,328 16,979 23,994 8,651 103.9% -29.2%
MINORITY INTEREST 4,164 8,490 11,997 4,326 103.9% -29.2% 4,164 8,490 11,997 4,326 103.9% -29.2% NET INCOME (LOSS) 4,164 8,490 11,997 4,326 103.9% -29.2% 4,164 8,490 11,997 4,326 103.9% -29.2%
Page C.3
VAR VAR % VAR % VAR VAR % VAR %BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR BUDGET ACTUAL PRIOR YR ACT TO BUD ACT TO BUD PR YR
GROSS PATIENT REVENUE 1,103,258 1,101,161 1,180,502 (2,097) -0.2% -6.7% 1,103,258 1,101,161 1,180,502 (2,097) -0.2% -6.7%
DEDUCTIONS FROM REVENUE 735,568 700,946 800,385 34,622 4.7% 12.4% 735,568 700,946 800,385 34,622 4.7% 12.4% NET PATIENT REVENUE 367,690 400,215 380,117 32,525 8.8% 5.3% 367,690 400,215 380,117 32,525 8.8% 5.3%
OTHER OPERATING REVENUE 86,000 89,671 102,322 3,671 4.3% -12.4% 86,000 89,671 102,322 3,671 4.3% -12.4%
TOTAL OPERATING REVENUE 453,690 489,886 482,439 36,196 8.0% 1.5% 453,690 489,886 482,439 36,196 8.0% 1.5%
OPERATING EXPENSES SALARIES/WAGES/BENEFITS 259,817 264,642 309,069 (4,825) -1.9% 14.4% 259,817 264,642 309,069 (4,825) -1.9% 14.4% OTHER SUPPLIES 152,871 142,771 181,063 10,100 6.6% 21.1% 152,871 142,771 181,063 10,100 6.6% 21.1% PURCHASED SERVICES 99,352 89,551 99,948 9,801 9.9% 10.4% 99,352 89,551 99,948 9,801 9.9% 10.4% DEPRECIATION/AMORTIZATION 73,662 69,832 75,006 3,830 5.2% 6.9% 73,662 69,832 75,006 3,830 5.2% 6.9% BAD DEBT EXPENSE 9,192 10,839 11,942 (1,647) -17.9% 9.2% 9,192 10,839 11,942 (1,647) -17.9% 9.2% INTEREST 177,250 134,671 186,779 42,579 24.0% 27.9% 177,250 134,671 186,779 42,579 24.0% 27.9%
TOTAL OPERATING EXPENSES 772,144 712,306 863,807 59,838 7.7% 17.5% 772,144 712,306 863,807 59,838 7.7% 17.5%
GAIN(LOSS) FROM OPERATIONS (318,454) (222,420) (381,368) 96,034 -30.2% -41.7% (318,454) (222,420) (381,368) 96,034 -30.2% -41.7%
INTEREST EARNINGS 0 19 11,619 19 0.0% -99.8% 0 19 11,619 19 0.0% -99.8% GAIN ON SALE OF EQUIPMENT 0 0 0 0 0.0% 0.0% 0 0 0 0 0.0% 0.0% CHANGE IN NET UNREALIZED G/L-INV 0 0 (5,592) 0 0.0% -100.0% 0 0 (5,592) 0 0.0% -100.0% INCRS(REDUCT) FV INT RATE SWAPS 0 (608) (271,816) (608) 0.0% 99.8% 0 (608) (271,816) (608) 0.0% 99.8%
EXCESS OF REV OVER EXPENSES (318,454) (223,009) (647,157) 95,445 30.0% 65.5% (318,454) (223,009) (647,157) 95,445 30.0% 65.5%
Page C.4
BONITA COMMUNITY HEALTH CENTER, INC.COMPARATIVE INCOME STATEMENT (UNAUDITED)
FOR THE PERIOD ENDING OCTOBER 31, 2009
CURRENT MONTH YEAR TO DATE FISCAL 2010
Lee Memorial Health SystemBoard of Directors
Committee of the WholeFinancial Update
For the Month Ending 10/31/09Presented November 19, 2009
System Adjusted Admits
Percent of Total Operating Revenue for the month ended 10/31/09
Comparison of Net Revenue per CMAAfor 1 month period ended 10/31/09
Gain (Loss) From Operations ( in 000’s )
Financial Statements for the month ended 10/31/09
October, 2009
BUDGET PR YRBUDGET ACTUAL PR YR VAR % %
VOLUME:ADJUSTED ADMISSIONS 9,265 9,373 8,971 108 1% 4%
REVENUES: (000's)INPATIENT $193,412 192,973$ 181,923$ (439)$ 0% 6%OUTPATIENT 120,509 122,030 108,534 1,520 1% 12% TOTAL OPERATING REV 313,921 315,003 290,457 1,082 0% 8%
DEDUCTIONS 227,243 228,917 208,445 (1,674) -1% -9%
TOTAL OPERATING REVENUES 86,678 86,085 82,012 (593) -1% 5%
OPERATING EXPENSES: (000's)OPERATING 78,247 76,998 72,041 1,249 2% -6%CAPITAL 6,687 6,500 6,464 187 3% -1%TOTAL OPERATING EXP 84,933 83,497 78,505 1,436 2% -6%
OPERATING GAIN: $1,745 $2,588 $3,507 843$ 48% -26%
INVESTMENT INCOME 2,864 (248) (34,713) (3,112) -109% -99%
EXCESS OF REVENUES OVER EXPENSES $4,609 $2,340 ($31,206) (2,269)$ -49% 107%
Net Patient Revenue
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 85,154$ Actual Adj Admits-System 9,373 Actual Net Rev/Adj Admit 9,033$
Budget Adj Adm-System 9,265 Budget Net Rev/Adj Admit 9,190$ ACTUAL 84,668$ Variance 108 Variance (157)$
VARIANCE (486)$ Budget Net Rev/Adj Admit 9,190$ Actual Adj Admits 9,373
Total Volume Variance 989,733$ Total Rate Variance (1,475,717)$
Net Revenue - Rate & Volume Variance (485,984)$
Medicare Medicaid
Commmercial, HMO/PPO,
Other TOTAL Budgeted Payor Mix 47.5% 13.9% 38.6% 100%Actual Payor Mix 48.4% 16.1% 35.5% 100%Budget Gross Rev/Adj Adm 41,207 27,902 26,645 33,716Actual Gross Rev/Adj Adm 40,497 26,462 27,027 33,456Budget Net Rev/Adj Admit 8,690 7,156 10,550 9,190Actual Net Rev/Adj Admit 8,775 5,535 10,971 9,033Reimbursement % 22% 21% 41% 27%
Payor Mix Variance 773,798 1,475,630 (3,065,542) (816,114) Rate/Adj Admit Variance 373,698 (2,087,679) 1,054,378 (659,603) Total Rate Variance 1,147,496$ (612,049)$ (2,011,164)$ (1,475,717)$
Net Patient Revenue - Rate Variance
Total Salaries & Wages
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 37,943$ Actual Total FTEs 7,799 Actual Rate/FTE 27.66$
Budget Total FTEs 7,667 Budget Rate/FTE 27.96$ ACTUAL 38,180$ Prod FTE Variance (132) Rate Variance 0.30$
VARIANCE (237)$ Budget Rate/FTE 27.96 Actual Total FTEs 7,799 Hours/FTE 177 Hours/FTE 177
Total Volume Variance (654,776) Total Rate Variance 417,944
Rate & Volume Var (236,832)$
Description: FTEs Amount FTE's Earned Budget 7,713 (based on Adj Adm & 50% flex) Budget Prod FTEs 7,667 Var due to Volume (46) (228,529)$
Actual FTEs 7,799 FTE's Earned Budget 7,713 Productivity Inc(Dec) (86) (426,247) Total FTE-Volume Var (132) (654,776)$
Total FTE Volume Variance:
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Productive Salaries & Wages
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 34,165$ Actual Prod FTEs 7,075 Actual Rate/FTE 27.22$
Budget Prod FTEs 6,979 Budget Rate/FTE 27.66$ ACTUAL 34,089$ Prod FTE Variance (96) Rate Variance 0.44$
VARIANCE 76$ Budget Rate/FTE 27.66$ Actual Prod FTEs 7,075 Hours/FTE 177 Hours/FTE 177
Total Volume Variance (468,968) Total Rate Variance 544,906
Rate & Volume Var 75,938$
Description: FTEs Amount FTE's Earned Budget 7,021 (based on Adj Adm & 50% flex) Budget Prod FTEs 6,979 Var due to Volume (42) (205,083)$
Actual FTEs 7,075 FTE's Earned Budget 7,021 Productivity Inc(Dec) (54) (263,885) Prod FTE-Volume Var (96) (468,968)$
Prod FTE Volume Variance:
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Contract Labor
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 0$ Actual Contract FTEs 1 Actual Rate/FTE 26.27$
Budget Contract FTEs - Budget Rate/FTE 26.27$ ACTUAL 5$ Contract FTE Var (1) Rate Variance 0.00$
VARIANCE (5)$ Budget Rate/FTE 26.27$ Actual Contract FTEs 1 Hours/FTE 177 Hours/FTE 177
Total Volume Variance (4,702)$ Total Rate Variance 1$
Rate & Volume Var (4,701)$
Phys 2,000$ Home Health - Rehab - HPCC - Corporate - Acute Care - Volume Related - Other Staffing Changes (6,702)
Total Labor Rate & Volume Var (4,702)$
Contract Labor Volume/Rate Variance
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Non-Productive Salaries
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
BUDGET 3,778$ PTO 212,000 Bonus (360,000)
ACTUAL 4,086$ Leave & Other Adjustments (160,000)
VARIANCE (308)$ Total Variance (308,000)$
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Other Supplies
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
VOLUME VARIANCE RATE VARIANCEBUDGET 18,559$ Actual Adj Admissions 9,373 Actual Supplies/Adj Adm 1,959$
Budget Adj Admissions 9,265 Budget Supplies/Adj Adm 2,003$ ACTUAL 18,362 Variance (108) Rate Variance 44$
VARIANCE 196$ Budget Supplies/Adj Adm 2,003$ Actual Adj Admissions 9,373
Total Volume Variance (215,706) Total Rate Variance 412,055
Rate & Volume Var 196,350$
Budget/AA Actual/AA Variance
(Inc) Dec in Drug Expense 412$ 419$ (63,273)$ (Inc) Dec in Implant Costs 706$ 648$ 546,135 (Inc) Dec in Med/Surg Supplies 590$ 595$ (44,418) (Inc) Dec in Other Supplies (26,389)
Total Variance 1,118 1,067 412,055
Rate Variance
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Other Services
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
BUDGET 5,332$ Fuel 104,000 Repairs 72,000
ACTUAL 4,903 Freight and Adjustments 76,000 Telephone 77,000
VARIANCE 429$ Recruitment 73,000
Total 402,000$
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Purchased Services
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
Contract Svcs 349,000 BUDGET 8,720$ Maintenance Contract 359,000
Non Annual Expense 209,000 ACTUAL 7,701 Air Quality Expense 54,000
Specialty Bed Rental 46,000 VARIANCE 1,018$ Total 1,017,000$
Consolidated Income Statement Analysis of Variancefor the month ended 10/31/09
Bad Debt Expense
SUMMARY OF VARIANCE: EXPLANATION: (In Thousands)
Budget Bad Debt Percent 3.7%BUDGET 11,396$
Actual Gross Revenue 313,585,052$ ACTUAL 10,969
Bad Debt Expense-Vol Adj 11,477,213$ VARIANCE 426$
Over (Under) Budget (508,000)
Actual Bad Debt Expense 10,969,213$
Lee Memorial Health System Operating Highlights
For the month ended October 31, 2009 Actual adjusted admits (overall inpatient & outpatient volume indicator) for the month ended October 31, 2009 are 9,373 which is 1.2% greater than budget. Actual inpatient admits for the month are 5,768 or 0.6% greater than budget and actual patient days are 31,036 or 3.8% greater than budget which resulted in a 3.2% increase in length of stay. Emergency room visits are 17.8% greater than budget and outpatient surgeries are 6.8% less than budget. Net patient revenue for October 2009 reflects a $0.5 million or a 0.5% unfavorable variance to budget. This unfavorable variance in net patient revenue is the net result of a 1.2% increase in adjusted admits and a 1.7% decline in the net patient revenue per adjusted admit. Total operating expenses before depreciation and interest expense are $1.2 million less than budget. This favorable variance is primarily due to reduced purchased services expenses from medical services fees and maintenance expenses being under budget. This favorable expense variance resulted in actual total operating costs per case mix adjusted admit being 1.4% less than budget (6,502 act, 6,595 budget). Productivity as measured by FTEs/AOB improved by 2.6% (4.79 actual, 4.92 budget) during October 2009. For October 2009, the gain from operations is $2.5 million versus a budgeted gain of $1.7 million. Excess revenue over expenses is a gain of $2.3 million versus a budgeted gain of $4.6 million. Investments were budgeted to return $2.9 million for the month but there was slight market loss in the portfolio of $0.2 million. For the month, Cash & Investments decreased by $22.5 million to $427.3 million. Operations increased cash by $6.9 million due to the favorable gain from operations while working capital decreased cash by $30.3 million. Cash was reduced by $.7 million for the construction project at Metro/Daniels. Principal payments on debt reduced cash by $0.4 million. Days in Accounts Receivable are 52.3 days and resulted in a $2.1 million increase in cash. Total Notes & Bonds payable on October 31, 2009 is $690.2 million resulting in a Cash to Debt ratio of 61.9%. Net Patient Revenue per adjusted admit CMI for the month ended October 31, 2009 is $6,704 while the Operating Expense per adjusted admit CMI is $6,502. The difference which represents the gain from operations per adjusted admit is $202.00 while the budgeted gain from operations is $135.00. Wages & Benefits as a percent of Net Operating Revenue is 52.2% for October 2009 versus a budget of 51.5%. The actual hourly pay rate is $27.64 which is 30 cents less than budget. Post Acute entities provided the following YTD contributions to Acute Care by allowing charity care patients into their respective programs: Lee Memorial Home Health $41,000; HealthPark Care Center $55,000; The Rehabilitation Hospital $30,000; Access Medical South (DME joint venture) $6,000. The Lee Physician Group YTD loss per physician is $3,206. This includes practice revenue and expenses along with ancillary revenue referred to LMHS. This YTD loss is less than expected due to increased visits and lower operating cost then budget.
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED EXECUTIVE SUMMARYFOR THE PERIOD ENDING OCTOBER 31, 2009
Current period Year-to-DateBudget Actual Prior Year Var % Budget Actual Prior Year Var %
ACT TO BUD ACT TO BUDInpatient Volumes: Admits - Adults & Peds 5,736 5,768 5,645 0.6% 5,736 5,768 5,645 0.6% Patient Days - Adults & Peds 29,895 31,036 29,475 3.8% 29,895 31,036 29,475 3.8%
Length of Stay (LOS) 5.2 5.4 5.2 3.8% 5.2 5.4 5.2 3.8%
Inpatient Surgeries 1,694 1,578 1,623 -6.9% 1,694 1,578 1,623 -6.9%
Outpatient Volumes: Emergency Room Visits 12,228 14,409 11,412 17.8% 12,228 14,409 11,412 17.8% OutPatient Surgeries 1,711 1,595 1,778 -6.8% 1,711 1,595 1,778 -6.8%
Adjusted Admits 9,265 9,373 8,971 1.2% 9,265 9,373 8,971 1.2% (overall in/outpat volume indicator)
Operating Ratios: Net Revenue/Adj Adm CMI 6,730 6,704 6,577 -0.4% 6,730 6,704 6,577 -0.4% Operating Exp/Adj Adm CMI 6,595 6,502 6,296 1.4% 6,595 6,502 6,296 1.4%
Wages/Ben - % of Net Oper Rev 51.5% 52.2% 49.7% -1.3% 51.5% 52.2% 49.7% -1.3% Supplies as a % of Net Oper Rev 21.4% 21.3% 22.5% 0.4% 21.4% 21.3% 22.5% 0.4%
Charity/Bad Debt - % of Gross Rev 6.8% 6.5% 6.4% 4.5% 6.8% 6.5% 6.4% 4.5%
Financial Ratios: Operating Margin (%) 2.0% 3.0% 4.3% 49.4% 2.0% 3.0% 4.3% 49.4% Excess Margin (%) 5.3% 3.0% -38.1% -43.7% 5.3% 3.0% -38.1% -43.7%
Liquidity Ratios: Cash to Debt (%) 63.0% 61.9% 53.9% Days Cash on Hand (net of VRDB) 68.0 77.9 71.1 Days In Acct Receivable 60.0 52.3 62.7
Income Statement Summary (In Thousands):Total Net Operating Revenue 86,678$ 86,085$ 82,012$ -0.7% 86,678$ 86,085$ 82,012$ -0.7%Total Operating Expenses 84,933 83,497 78,505 1.7% 84,933 83,497 78,505 1.7% Consolidated Gain(Loss) from Oper 1,745 2,588 3,507 -48.3% 1,745 2,588 3,507 -48.3%
Investment Earnings/Non Op Income 2,864 (248) (34,713) -108.6% 2,864 (248) (34,713) -108.6%
Consolidated Excess Rev over Exp 4,609$ 2,340$ (31,206)$ -49.2% 4,609$ 2,340$ (31,206)$ -49.2%
Trauma District Gain(Loss) from Oper (320)$ (499)$ (313)$ -55.9% (320)$ (499)$ (313)$ -55.9%
Balance Sheet Highlights (In Thousands): Cash & Investments 404,125$ 427,271$ 350,956$ Bonds & Notes Payable 637,217$ 690,198$ 651,311$
VRDB = variable rate demand bondsCMI = case mix index
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATISTICAL SUMMARYFOR THE PERIOD ENDING OCTOBER 31, 2009
Current period Year-to-DateBudget Actual Prior Year Variance Var % Budget Actual Prior Year Variance Var %
ACT TO BUD ACT TO BUD ACT TO BUD ACT TO BUD
Admissions ADULTS 5,082 5,160 5,014 78 1.5% 5,082 5,160 5,014 78 1.5% PEDIATRICS 455 392 428 (63) -13.8% 455 392 428 (63) -13.8% NICU 46 66 46 20 43.5% 46 66 46 20 43.5% POST ACUTE 154 150 157 (4) -2.5% 154 150 157 (4) -2.5%Total Adult & Peds 5,736 5,768 5,645 32 0.6% 5,736 5,768 5,645 32 0.6% NEWBORNS 614 548 570 (66) -10.7% 614 548 570 (66) -10.7%Total Admissions 6,350 6,316 6,215 (34) -0.5% 6,350 6,316 6,215 (34) -0.5%
Patient Days ADULTS 22,584 24,119 22,341 1,535 6.8% 22,584 24,119 22,341 1,535 6.8% PEDIATRICS 1,635 1,444 1,425 (191) -11.7% 1,635 1,444 1,425 (191) -11.7% NICU 1,258 1,172 1,398 (86) -6.8% 1,258 1,172 1,398 (86) -6.8% POST ACUTE 4,418 4,301 4,311 (117) -2.7% 4,418 4,301 4,311 (117) -2.7%Total Adult & Peds 29,895 31,036 29,475 1,141 3.8% 29,895 31,036 29,475 1,141 3.8% NEWBORNS 1,230 1,253 1,266 23 1.9% 1,230 1,253 1,266 23 1.9%Total Patient Days 31,125 32,289 30,741 1,164 3.7% 31,125 32,289 30,741 1,164 3.7%
Average Length of Stay ADULTS 4.4 4.7 4.5 0.2 5.2% 4.4 4.7 4.5 0.2 5.2% PEDIATRICS 3.6 3.7 3.3 0.1 2.4% 3.6 3.7 3.3 0.1 2.4% NICU 27.3 17.8 30.4 (9.6) -35.1% 27.3 17.8 30.4 (9.6) -35.1% POST ACUTE 28.7 28.7 27.5 (0.0) -0.2% 28.7 28.7 27.5 (0.0) -0.2%Total Adult & Peds 5.2 5.4 5.2 0.2 3.2% 5.2 5.4 5.2 0.2 3.2% NEWBORNS 2.0 2.3 2.2 0.3 14.1% 2.0 2.3 2.2 0.3 14.1%Total Patient Days 4.9 5.1 4.9 0.2 4.3% 4.9 5.1 4.9 0.2 4.3%
OP Registrations EMERGENCY ROOM 12,228 14,409 11,412 2,181 17.8% 12,228 14,409 11,412 2,181 17.8% OP SURGERY CASES 1,711 1,595 1,778 (116) -6.8% 1,711 1,595 1,778 (116) -6.8%SUBTOTAL 13,939 16,004 13,190 2,065 14.8% 13,939 16,004 13,190 2,065 14.8%
Visits / Encounters HOME HEALTH ADMISSIONS 262 286 346 24 9.1% 262 286 346 24 9.1% HOSP BASED PHY ENCOUNTERS 12,605 15,072 12,353 2,467 19.6% 12,605 15,072 12,353 2,467 19.6% PHYSICIAN ENCOUNTERS 43,394 41,187 41,133 (2,207) -5.1% 43,394 41,187 41,133 (2,207) -5.1% TRAUMA SERVICES DISTRICT 836 457 816 (379) -45.4% 836 457 816 (379) -45.4%SUBTOTAL 57,098 57,002 54,648 (96) -0.2% 57,098 57,002 54,648 (96) -0.2%
TOTAL OP 71,037 73,006 67,838 1,969 2.8% 71,037 73,006 67,838 1,969 2.8%
LEE MEMORIAL HEALTH SYSTEMCONSOLIDATED STATEMENT OF OPERATIONSFOR THE PERIOD ENDING: OCTOBER 31, 2009( IN THOUSANDS )
BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR % BUDGET ACTUAL PRIOR YEAR VAR VAR % VAR %ACT TO BUD ACT TO BUD PR YR ACT TO BUD ACT TO BUD PR YR
INPATIENT REVENUE 193,412 192,973 181,923 (439) -0.2% 6.1% 193,412 192,973 181,923 (439) -0.2% 6.1%OUTPATIENT REVENUE 118,985 120,612 107,181 1,627 1.4% 12.5% 118,985 120,612 107,181 1,627 1.4% 12.5%TOTAL PATIENT REVENUE 312,397 313,585 289,105 1,188 0.4% 8.5% 312,397 313,585 289,105 1,188 0.4% 8.5%
DED FROM REV-MEDICARE 107,166 109,098 97,250 (1,932) -1.8% -12.2% 107,166 109,098 97,250 (1,932) -1.8% -12.2%DED FROM REV-MEDICAID 29,042 36,760 28,256 (7,718) -26.6% -30.1% 29,042 36,760 28,256 (7,718) -26.6% -30.1%DED FROM REV-CHARITY 9,880 9,474 8,458 406 4.1% -12.0% 9,880 9,474 8,458 406 4.1% -12.0%DED FROM REV-HMO/PPO 33,749 32,058 34,363 1,691 5.0% 6.7% 33,749 32,058 34,363 1,691 5.0% 6.7%DED FROM REV-OTHER 36,010 30,557 30,168 5,453 15.1% -1.3% 36,010 30,557 30,168 5,453 15.1% -1.3%DED FROM REV-BAD DEBT 11,396 10,969 9,950 426 3.7% -10.2% 11,396 10,969 9,950 426 3.7% -10.2%TOTAL DED FROM REV 227,243 228,917 208,445 (1,674) -0.7% -9.8% 227,243 228,917 208,445 (1,674) -0.7% -9.8%
NET PATIENT REVENUE 85,154 84,668 80,659 (486) -0.6% 5.0% 85,154 84,668 80,659 (486) -0.6% 5.0%OTHER OPER REV 1,524 1,418 1,353 (107) -7.0% 4.8% 1,524 1,418 1,353 (107) -7.0% 4.8%
TOTAL OPERATING REV 86,678 86,085 82,012 (593) -0.7% 5.0% 86,678 86,085 82,012 (593) -0.7% 5.0%
OPERATING EXPENSES PROD SALARIES 32,895 32,870 30,141 25 0.1% -9.1% 32,895 32,870 30,141 25 0.1% -9.1% PROD OVERTIME 1,270 1,219 941 51 4.0% -29.5% 1,270 1,219 941 51 4.0% -29.5% CONTRACT LABOR 0 5 191 (5) -12822718.2% 97.5% 0 5 191 (5) -12822718.2% 97.5% NON-PROD SALARIES 3,778 4,086 3,202 (308) -8.2% -27.6% 3,778 4,086 3,202 (308) -8.2% -27.6%TOTAL SALARIES & WAGES 37,943 38,180 34,475 (237) -0.6% -10.7% 37,943 38,180 34,475 (237) -0.6% -10.7%
FRINGE BENEFITS 6,673 6,715 6,245 (42) -0.6% -7.5% 6,673 6,715 6,245 (42) -0.6% -7.5%HEALTH CARE ACCESS 1,021 1,137 1,028 (116) -11.4% -10.6% 1,021 1,137 1,028 (116) -11.4% -10.6%SUPPLIES 18,559 18,362 18,471 196 1.1% 0.6% 18,559 18,362 18,471 196 1.1% 0.6%OTHER SERVICES 5,332 4,903 4,861 429 8.0% -0.9% 5,332 4,903 4,861 429 8.0% -0.9%PURCHASED SERVICES 8,720 7,701 6,961 1,018 11.7% -10.6% 8,720 7,701 6,961 1,018 11.7% -10.6%
TOTAL OPER EXPENSES 78,247 76,998 72,041 1,249 1.6% -6.9% 78,247 76,998 72,041 1,249 1.6% -6.9%
EBITDA 8,431 9,087 9,971 656 7.8% -8.9% 8,431 9,087 9,971 656 7.8% -8.9%
DEPRECIATION/AMORT 4,624 4,308 5,009 316 6.8% 14.0% 4,624 4,308 5,009 316 6.8% 14.0%INTEREST EXPENSE 2,063 2,192 1,455 (129) -6.3% -50.6% 2,063 2,192 1,455 (129) -6.3% -50.6%GAIN(LOSS) FROM OPER 1,745 2,588 3,507 843 48.3% -26.2% 1,745 2,588 3,507 843 48.3% -26.2%
CURRENT MONTH YEAR TO DATE
Lee Memorial Health SystemConsolidated Balance Sheet
As of OCTOBER 31, 2009 in Thousands (000's)
ASSETS: Current Prior Month Prior Year LIABILITIES: Current Prior Month Prior Year
Current Assets: Current Liabilities:Cash And Cash Equivalents * 500 18,590 18,590 Accounts Payable 31,207 43,728 43,728Operating Fund Investments * 419,345 413,708 413,708 Wages and Benefits Payable 52,845 65,142 65,142Accrued Interest Receivable 307 280 280 Notes Payable - Short Term 1,927 1,936 1,936Accounts Receivable (net) 132,870 132,616 132,616 Current Portion Bonds Payable 11,964 12,170 12,170Accounts Receivable - Phys (Net) 10,041 12,381 12,381 Due to State of Florida 14,054 13,768 13,768Inventories 27,712 27,787 27,787 Malpractice Liability - Short Term 5,936 5,936 5,936Third Party Settlements 0 0 0 Accrued Bond Costs 2,187 11,271 11,271Other Current Assets 11,631 12,932 12,932 Due to LMHS 0 0 0
Other Current Liabilities 30,901 28,093 28,093
Total Current Assets: 602,406 618,293 618,293 Total Current Liabilities 151,022 182,045 182,045
Other Assets Other Liabilities and Fund BalanceLimited or Restricted Use Assets * 7,295 17,298 17,298 Benefits Payable - Long Term 0 0 0Bond Issuance Costs 5,653 5,680 5,680 Notes Payable - Long Term 55,025 55,232 55,232Trustee Held Funds * 31 31 31 Due to State of Florida - Long Term 4,024 3,193 3,193Directors/Officers Indemnity Fund * 100 100 100 Malpractice Liability - Long Term 7,528 7,268 7,268Long Term Operating Fund Investments * 0 0 0 Bonds Payable 621,281 621,264 621,264Other Assets 94,175 93,206 93,206 Other Long Term Liabilities 17,223 16,891 16,891
UnRestricted Fund Balance 530,489 527,918 527,918Restricted Fund Balance 22,300 22,417 22,417
Total Other Assets 107,255 116,315 116,315 Total Other Liabilities & Fund Balance 1,257,871 1,254,184 1,254,184
Property and Equipment:Plant In Use 1,156,168 1,156,168 1,156,168Construction in Process 48,683 47,910 47,910Accumulated Depreciation (528,515) (524,224) (524,224)
Total Property & Equipment (Net) 676,337 679,854 679,854
Restricted Assets 22,896 21,766 21,766
TOTAL ASSETS 1,408,893 1,436,229 1,436,229 TOTAL LIABILITIES AND EQUITY 1,408,893 1,436,229 1,436,229
* Cash and InvestmentsAbove Balance Sheet has been adjusted to eliminate intercompany receivables, payables and investments in subsidiaries
PROJECTED ACTUAL2009 2009
TOTAL OPERATING REV 1,036,428 1,031,581
TOTAL OPER EXPENSES 924,190 907,701
EBITDA 112,237 123,880
GAIN(LOSS) FROM OPER 41,677 36,373
NON-OPERATING REVENUE 22,938 (15,518)
EXCESS REVENUE OVER EXPENSES 64,615 20,855
Length of Stay (LOS) 5.09 5.30
Adjusted Admits 108,849 109,783
Operating Ratios: Net Revenue/Adj Adm 9,522 9,195 Operating Exp/Adj Adm 9,139 8,871
FTEs/Adj Occupied Bed 4.71 4.60 Wages/Ben - % of Net Oper Rev 49.0% 50.5% Supplies as a % of Net Oper Rev 22.6% 21.3%
Charity/Bad Debt - % of Gross Rev 7.0% 6.9%
Liquidity Ratios: Cash to Debt (%) 67.3% 65.1%
___________________ L E E M E M O R I A L HEALTH SYSTEM
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DATE OF THE *NEXT REGULARLY SCHEDULED
MEETING
FINANCE Committee of the Whole
MEETING
THURSDAY, January 21, 2010
1:00pm
Lee Memorial Hospital Boardroom 2776 Cleveland Ave, Ft. Myers, FL 33901
