July 31, 2008

Executive Briefing For The Prince George’s Hospital Authority

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Executive Briefing Outline

• Mission, Vision & Values• Patient Safety and Quality Initiatives• System Facilities• Key Community Services• Demographics and Market Dynamics• Selected Operational Issues• Desirable Attributes For A New Owner

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Mission, Vision & Values

• Our mission is to provide high quality and efficient healthcare services to preserve, restore and improve health status, in partnership with our community.

• Our vision is to be recognized as a premier regional healthcare system.

• Our values consistently show that Dimensions CARES. These values include: Compassion, Accountability, Respect, Excellence, and Service.

Source: DHS Strategic Plan.

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Quality and Patient Safety Initiatives• Accreditation and Licensure• Initiatives to Meet 2008 National Patient Safety Goals

– Patient Identification– Verbal / Telephone Orders– Critical Test Results– Fall Prevention– Appropriate Abbreviations– “Time Out” Wrong Site Surgery

• Participation with the Maryland Patient Safety Center– Rapid response teams to reduce “code blues” – LRH / PGHC– Hand Off Collaborative - PGHC– MRSA Collaborative – LRH / PGHC– Nursing Retention Collaborative - PGHC– Perinatal Collaborative – LRH / PGHC– Critical Care Collaborative – LRH / PGHC

• Core Measures and Quality Scorecards• Active Corporate Risk / Trust Committee

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Prince George’s Hospital Center

PGHC is located in Cheverly and licensed for 248 beds. Services include general medical/surgical, cardiac care, Level III Perinatal Center, Level II Trauma Center and behavioral health. PGHC also operates the Glenridge Medical Clinic in Lanham.

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Gladys Spellman Specialty Hospital & Nursing Center

GSSH&NC is located on PGHC’s campus and is licensed for 107 beds. Major services include chronic care for ventilator dependent patients and comprehensive nursing care. Spellman also operates the Senior Health Center in Brentwood.

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Laurel Regional Hospital

LRH is located in Laurel and licensed for 125 beds. Services include general medical/surgical, behavioral health, obstetrics, and comprehensive rehabilitation.

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Bowie Health Center

BHC is a full service, freestanding emergency department located in Bowie. Hours of operation are 8 am to midnight (16 hours/day).

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Bowie Medical Office Building & Surgery Center

Immediately adjacent to BHC is a 50,000 square foot Medical Office Building that is fully occupied with physician offices and a busy Ambulatory Surgery Center.

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Larkin Chase Nursing Center

Larkin Chase is a 120 bed nursing home located on the Bowie Campus in partnership with SunBridge Health (SunBridge = 75% & DHS = 25% ownership).

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County Health Status

• Prince George’s County ranks higher than State averages for numerous rates of mortality, morbidity and prevalence of chronic diseases:

Indicator Our Response  – Death rates for accidents Emergency /Trauma Programs

and homicide– Perinatal indicators, including Maternal / Child Program

infant mortality and low birth

weight– Death rates for heart disease Cardiac Programs– Death rates for septicemia, Internal Medicine Programs

Nephritis, and HIV– Death rates for diabetes mellitus Diabetes Treatment– Mental illness Behavioral Health Programs

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Key Community Services

• Emergency Services– Total emergency visits system-wide (including trauma) in FY 2008

were 115,055 or 315 per day. – ER physician staffing at PGHC is contracted through George

Washington University Faculty Associates. ER physician staffing at BHC and LRH is through EmCare.

– The ER at LRH has recently been renovated and expanded with State grant funds and donations from the Foundation/Auxiliary.

– The ER at PGHC requires extensive renovation or replacement.

• Trauma– County has higher mortality rates than the State for accidents. (PG =

29.7 v MD = 25.0) and homicides (PG = 17.3 v. MD = 10.2) – PGHC is the second busiest Trauma Center in the State with 3,000

patients annually.– Serves Prince George’s, Calvert, Charles, St. Mary’s and D.C.– 95% “save” rate.– Medical direction of trauma program at PGHC is contracted through

the University of Maryland.

Sources: Internal records and DHMH Vital Statistics. Age adjusted mortality rates per 100,000.

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Key Community Services

• Maternal & Child Health– Although substantial progress has been made, the infant mortality rate

in the County continues to exceed the State. (PG = 8.8 v MD = 7.9) – 6,800 mothers, newborns and pediatric patients annually system-wide.– 75% Medicaid and Medicaid Managed Care Organizations (MCO). – OB/GYN group operates prenatal clinic at Glenridge and provides

staffing for Health Department sites.– Level III NICU with 20 bassinets at PGHC. New subspecialty affiliation

with Children’s Hospital.– Perinatology program for high risk mothers at PGHC currently with

physician coverage affiliation through Johns Hopkins.– Maternal/Child Unit at LRH under cosmetic renovation to help attract

physicians and their patients.– Mt. Washington Pediatrics leases a 15 bed unit at PGHC for care of

post-NICU babies and kids with developmental disabilities.– Small acute pediatric unit at PGHC.

Sources: Internal records and DHMH Vital Statistics. Infant mortality rates per 1,000 live births.

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Key Community Services• Cardiac Care

– Heart disease is the leading cause of death in the County. (PG = 233.2 v MD = 205.7)

– 3,700 inpatient admissions annually system-wide for circulatory disorders.– Full service cardiac program at PGHC

• Cath Lab at PGHC performs over 1,500 procedures annually• Low volume cardiac surgery program represents potential opportunity

for new owner– New Cath Lab being installed at LRH.– Cardiac Rehab Unit at PGHC recently renovated and expanded.

• Internal Medicine– Cerebrovascular disorders, respiratory diseases, influenza & pneumonia,

septicemia, nephritis and HIV are among the top causes of death in the County.

– 7,200 inpatient admissions annually system-wide.– Internal medicine training program at PGHC with 46 residents provides

inpatient coverage and staffs the Glenridge Medical Center• Glenridge has a Ryan White grant to support HIV outpatient care

– RFP for system-wide “hospitalist” coverage currently in process.

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Key Community Services• Diabetes

– The CDC estimates that the incidence of diabetes in the County is 8.8% and that there are 52,000 diabetics in the County.

– Care was provided system-wide in FY 2008 to nearly 12,000 patients with a primary or secondary diagnosis of diabetes.

– PGHC offers a Diabetes Center for inpatient management and outpatient education.

• Surgery– Surgery has largely shifted to an outpatient basis with 9,324

ambulatory surgery cases performed system-wide in FY 2008.– Surgical and anesthesia equipment at PGHC have been significantly

upgraded through State grants.

• Rehabilitation and Chronic Care– LRH operates the only CARF accredited comprehensive rehabilitation

program in the County.– GSSH&NC operates the only chronic beds (52) in the County for long-

term ventilator dependent patients.

Sources: Internal records and Baltimore Sun article 6/26/08.

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Key Community Services• Behavioral Health

– Behavioral health is a major health status issue in the County.– LRH and PGHC each operate emergency, inpatient, and partial

hospitalization services.– Involuntary admission capabilities exist at PGHC and are under

consideration for LRH.– Nearly 1,800 inpatient admissions annually system-wide.– LRH has contract with Psychiatric Institute of Washington (PIW) and

PGHC has contract with Allied Behavioral Health for coverage.– PGHC operates the designated Sexual Assault Center in the County.

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Projected County Population

500,000

600,000

700,000

800,000

900,000

1,000,000

Total Pop. 665,071 728,553 801,515 841,550 883,750 925,550 950,250 968,450 981,550

1980 1990 2000 2005 2010 2015 2020 2025 2030

Key Point:• With a population approaching 1 million, the County needs an excellent healthcare system.

Source: Maryland Department of Planning.

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Projected County Population By Age

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

2005 250,050 313,540 205,400 72,560

2010 254,150 311,490 230,900 87,210

2015 254,410 319,790 242,400 108,950

2020 258,500 320,560 241,480 129,710

2025 260,660 327,080 229,340 151,370

2030 263,420 328,740 217,720 171,670

0 - 19 20 - 44 45- 64 65+

Key Point:• Significant growth is projected in the age cohort 65+ most likely to have chronic conditions and require healthcare and hospital services.

Source: Maryland Department of Planning.

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County Physicians By Age

13%

26%

7%

41%

13%

<5050-5960-6465+Unknown

Source: MHA / MedChi Survey..

Key Points:• At the same time that the County is experiencing growth in the older population that will increase healthcare demand, it is also experiencing an aging of the physician work force with one quarter now over age 60. • Significant physician development will be required.

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50,000 Inpatients Leave The County

7%

29%

17%

47%

Source: 2003 Maryland & DC hospital databases.

Remain In Prince George’s

Go To Montgomery

Go To D.C.

Go To Other Md. Counties

Key Point:• At $10,000 per admission, out-migration represents about half a billion dollars annually leaving the County.• Out-migration represents a substantial opportunity for a new owner.

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Medicaid / Uninsured Discharges: CY 2007

Ft. Wash.3%

PGHC50%

LRH11%

SMHC24%

Doctors12%

Mercy10% Hopkins

Bayview14%

Univ. of MD18%

Hopkins20%

Bon Secours5%

Union Mem.6%

Harbor7%

Sinai10%

MD General10%

Prince George’sCounty Hospitals

Baltimore CityHospitals

Key Points: • Indigent care in the County is heavily concentrated at PGHC. • There is no major academic center with supporting HSCRC rates in the County.

Source: HSCRC Database.

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Payor Mix Drives Heavy Physician Payments Not Included In HSCRC Rates

• PGHC / DHA -$11,500,000

Key Points: • The hospital cannot operate without physicians to cover ER/Trauma, OB,

NICU, Psychiatry, Critical Care, and Anesthesia.

• The physician losses are real and not sustainable.• Negotiations with physicians are aggressive. • Whoever operates the system will need a stable source of ongoing funding

for un-reimbursed physician costs. • With an academic affiliation, a portion of these costs could be offset

through the development of additional teaching programs.

Source: Schedule UR 6 for FY 2007.

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Age Of Plant & Equipment: FY 2006

0

2

4

6

8

10

12

14

16

18

Years 17.6 16.7 10.4 11.7 6.6 9.3 16.1 7.4 10.3

PGHC LRH Doctors SMHCHoward

CtyHoly

CrossWAH

Anne Arundel

MD Avg.

Key Points:• Competitors have newer plant and equipment. • The MHA’s target is 8.5 years. DHS is now at 22.4 year (5/2008 Financial Statement)• Major construction initiatives are currently underway at Doctors, Howard County, and Anne Arundel. Washington Adventist plans to relocate and build a new hospital.• Significant capital investment is needed to address a decade of under-funding for plant and equipment. Source: MHA Audited Financial Conditions Report.

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Desirable Attributes For A New Owner

• Strong commitment to quality care and patient safety

• Mission driven

• Multi-institutional experience

• Academic training programs

• Primary care network development

• Access to capital

Questions FromThe Authority