Regional ReviewCentral Region

Robert L. SmithSenior Vice President

Key Messages

• Attractive markets

• Physician employment

• Expanding the outpatient footprint

• Increasing case mix intensity or patient severity

Hospitals

St. Louis

Des Peres,

St. Louis University

2

Total Beds 523

Hospitals

Memphis

St. Francis,

St. Francis-Bartlett2

Total Beds 619

Missouri and Tennessee

• Certificate of Need Regulations

Hospitals

El PasoProvidence, Sierra, Eastside 3

Dallas

Centennial, Doctors at White Rock, Lake Pointe

3

Houston

Cypress Fairbanks,

Houston Northwest,

Park Plaza

3

East Texas

Nacogdoches1

Total Beds 2,644

Texas

• Dallas-Fort Worth currently adding more residents than any other metro area nationwide and projected to be 3rd largest in the country by 2030

• Houston 4th largest city in the nation

• El Paso’s Ft. Bliss BRAC (base realignment and closure) is in the process of adding

65,000 soldiers and their families through 2013

High Population Growth Service Areas

2000 - 2007 2007 - 2012

Dallas MSA 16.4% 9.7%

Centennial 85.9% 30.6%

Lake Pointe 37.2% 17.9%

Houston MSA 16.4% 8.7%

Cypress Fairbanks 39.9% 17.0%

Houston Northwest 17.8% 9.0%

El Paso MSA 8.2% 5.3%

Sierra Providence East 17.8% 9.0%

Source: Thomson Medstat – 2007 Claritas Data

Central Region TGI Actions

• Physician employment in primary care specialties

• Expansion of the outpatient footprint

• Growth of service intensity

Central Region MarketsHealthGrades 2007 statistics

• 3.7 million searches for a physician

• 780,000 physician reports opened

• Consumers clicked on “appointment request”

button over 208,000 times

• HealthGrades results show consumers are 33%

more likely to contact the physician when they have

more information about the practice

Cypress Fairbanks Regional Health NetworkHouston, Texas

Physician Employment

2006 2007

PROJ

2008

PROJ

2009

Markets 1 6 9 9

Clinics 3 12 19 23

Physicians 5 19 27 40

Primary Care Physician Productivity

Source: Tenet – McKinsey analysis

Annual admissions per productive physician average

65

185

120

70• Family Practice

• Internal Medicine

• OB/GYN

• Pediatrics

Lake Pointe Regional NetworkOutpatient Footprint

Lake Pointe Regional NetworkOutpatient Footprint

Outpatient Footprint

• New Offsite Clinics Include

– 5 Imaging Centers

– 2 Sleep Labs

– 2 Urgent Care Centers

– Wound Care Center

– Physical Therapy Clinic

• 6 - 7 mile average distance from hospital campus

Lake Pointe Regional NetworkOutpatient Footprint

Lake Pointe Regional NetworkOutpatient Footprint

Ease of Access a Priority

• Ease of access to results for physician

– PACS

– Physician Portal

• Ease of access in scheduling for physicians and patients

– Evening and Saturday appointments

– Centralized scheduling

– Online scheduling and precertification

• Ease of access in registration for patients

– Online

– Kiosk

– SmartCard

Patient Kiosk

Growing IntensityAcute Case Mix Index

• 8 of 13 hospitals increased both Medicare and total CMI from

2006 to 2007

• 12 hospitals have increased in total CMI and 5 have increased in

Medicare CMI from 2007 into 2008

Total Medicare

2006 1.326 1.519

2007 1.330 1.520

2008 YTD 1.369 1.539

Service Lines Growing Intensity

• Neonatal ICUs

• Vascular Programs

• Neurosciences/Stroke

• Spine & Orthopedic Surgery

• Oncology Programs

• Cardiac Programs

• ER Trauma Designations

Growing Intensity

2006 2007

Medicare LOS 6.13 6.02

Medicare CMI 1.519 1.520

• Every .01 increase in CMI change across the Region

creates an estimated $5.6 million in net revenue

Central Region Summary

• Attractive growing markets

• Continued TGI focus from 2005

• Physician employment

• Expanding outpatient access points

• Growing intensity