Prime Healthcare Presentation

Prime Healthcare Services

• Prime Healthcare Services and the Prime Healthcare Foundation together are one of of the largest hospital systems in

the U.S

– Founded by Dr. Prem Reddy, M.D., FACC, FCCP.

– Began by rescuing Desert Valley Hospital and Desert Valley Medical Group in Victorville from bankruptcy.

– Specializes in saving failing hospitals from bankruptcy – saving hospitals, saving jobs, saving lives.

– Largest for-profit operator of hospitals in the state of California based on number of facilities.

– Recent diversification into Pennsylvania, Indiana, Kansas, Michigan, Nevada, New Jersey, Rhode Island and Texas.

– Hospitals provide full range of both inpatient and outpatient services including general acute care services,

emergency room, general and specialty surgery, intensive/critical care, obstetrics, behavioral health, rehabilitation

and diagnostic services.

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• Prime Healthcare hospitals are known for always keeping their emergency rooms open, rarely requiring patient diversion

to other hospitals.

• Operates 29 acute care hospitals (includes 6 managed by the non-profit Prime Healthcare Foundation) with 5.2

thousand licensed beds and more than 30,000 employees; facilities are located in the following states:

– California: 15

– Texas: 4

– Indiana: 1

– Kansas: 2

– Michigan: 1

– Nevada: 1

– New Jersey 1

– Pennsylvania: 2

– Rhode Island: 2

Dr. Prem Reddy, Chairman of the Board, President and CEO

Prem Reddy, MD, FACC, FCCP

Dr. Prem Reddy is double Board-Certified in Internal Medicine and Cardiology. During his 25 years of practice in California, he performed more than 5,000 cardiac procedures, including coronary angiography and angioplasty and permanent pacemaker implantations.

In 2001, Dr. Reddy founded Prime Healthcare Services, which owns and operates 22 hospitals. In addition, Dr. Reddy and his family founded and entirely funded the non-profit Prime Healthcare Services Foundation, which owns six non-profit acute care hospitals both in California and Texas. Combined, Prime Healthcare Services and the Foundation have hospitals in nine states: California, Indiana, Kansas, Michigan, Nevada, New Jersey, Pennsylvania, Rhode Island and Texas.

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Among the many accolades, Prime Healthcare was recognized as one of the “Top 15 Health Systems” in the nation in 2013. This was the third time in six years Prime Healthcare has been recognized. In addition, since 2003, Prime Healthcare hospitals have been recognized among the “100 Top Hospitals” in the nation 27 times.

The Foundation, with current assets of over $800 million, also funds various charities that support health education, education scholarships, public healthcare education and free community clinics.

Dr. Reddy was named as one of the “50 Most Influential Physician Executives” in health care by Modern Healthcare in 2014, the fourth time in six years. He wasalso recognized as one of the “Top 25 Minority Executives” in 2014 for the third time.

Prime Healthcare Affiliated Foundations

Dr. Prem Reddy Family Foundation, 501(c)(3), Est. 1989

• Has donated more than $5 million to Victor Valley Community College toward scholarships and the

construction of a new health and science building.

• Donated $500,000 to Cal State San Bernardino and its department of nursing. To recognize his gift, the

nursing lab was renamed the Dr. Prem Reddy Nursing Laboratory.

• Supports the Public Health Library.

• Awards scholarships for students entering the field of healthcare, including the Dr. Prem Reddy Academic

Excellence Scholarship.

• Provides grants and support for free community clinics, community education, public projects and to other non-

profit organizations.

The Prime Healthcare Services Foundation, 501(c)3, nonprofit public charity, Est. 2008The Prime Healthcare Services Foundation, 501(c)3, nonprofit public charity, Est. 2008

• Donated $40 million to build and start a new nonprofit medical school, which will be called the California

University of Science and Medicine.

• Includes five non-profit hospitals donated debt free to the Foundation:

– Encino Hospital Medical Center

– Huntington Beach Hospital

– Montclair Hospital Medical Center

– Pampa Regional Medical Center

– Sherman Oaks Hospital

• Knapp Medical Center acquired directly by the Foundation in 2013.

Both foundations, founded and funded by Dr. Reddy and his family, have combined assets of more than

$800 million.

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Company History: Long Term Track Record of Facility Growth

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1619

222 3

4

6

6

10

15

20

25

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Prime Healthcare Hospitals Non-Profit/Donated Hospitals

• Recent expansion focused on diversifying outside CA and into KS, MI, NV, NJ, PA, RI and TX.

• Signed purchase agreements in NJ.

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1 2

7

9 13 13 12 12

0

5

2001 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014E

Acquired Desert Valley Chino Valley Sherman

Oaks

Montclair

Huntington

Beach

La Palma

West Anaheim

Paradise

Valley

Centinela

Encino

Garden Grove

Shasta

San Dimas

Alvarado Harlingen (TX) Roxborough

(PA)

Saint Mary’s

(NV)

Lower Bucks

(PA)

Dallas (TX)

Pampa (TX)

St. John (KS)

Providence (KS)

Landmark (RI)

Rehabilitation

Hospital of RI

(RI)

St. Mary’s (NJ) -

APA

St. Michaels (NJ)

– APA

St. Clare’s Health

System (NJ) –

APA

3 Hospitals

Garden City (MI)

Glendora (CA)

Donated Encino Montclair Sherman

Oaks

Huntington

Beach

Knapp (TX) –

acquired by

Foundation

Pampa Regional

(TX)

Facility Characteristics

Prime Healthcare Today: Strong, Growing, and Diversified Acute

Care Footprint

Facility Locations

Shasta Regional Medical Center

Roxborough Memorial Hospital

Saint Mary's Regional Medical Center

Nevada

California

Lower Bucks Hospital

Dallas Medical Center

Providence Medical Center

St. John Hospital

Kansas

Texas

Hospitals

Occupied

beds

Licensed

beds

Acquisition

date

1. Desert Valley Hospital 148 148 6/1/01

2. Chino Valley Medical Center 70 126 9/1/05

3. La Palma Intercommunity Hospital 75 141 10/1/06

4. West Anaheim Medical Center 110 219 10/1/06

5. Paradise Valley Hospital 195 291 3/1/07

6. Centinela Hospital Medical Center 220 369 11/1/07

7. Garden Grove Medical Center 85 167 7/1/08

8. San Dimas Community Hospital 101 101 7/1/08

9. Shasta Regional Medical Center 120 246 11/1/08

10. Alvarado Hospital Medical Center 120 306 11/17/10

26. Glendora Community Hospital 128 128 5/23/14

California 1,372 2,242

16. St. John Hospital 70 80 4/01/13

17. Providence Medical Center 120 400 4/01/13

Kansas 190 480

27. Garden City Hospital 323 323 7/01/14

Michigan 323 323

Pennsylvania LandmarkMedicalCenter

RehabilitationHospitalof Rhode

Island

MichiganGarden City Hospital

St. Mary’s

Monroe Hospital

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Harlingen Medical Center

Knapp Medical Center

Pampa Regional Medical Center

Paradise Valley Hospital

Alvarado Hospital Medical Center

Garden Grove Hospital Medical Center

West Anaheim Medical Center

La Palma Intercommunity Hospital San Dimas Community Hospital

Centinela Hospital Medical Center

Desert Valley Hospital

Encino Hospital Medical Center

Huntington Beach Hospital

Montclair Hospital Medical Center

Sherman Oaks Hospital

Chino Valley Medical Center

Michigan 323 323

18. Saint Mary’s Regional Medical Center 200 380 7/01/12

Nevada 200 380

28 St. Mary’s Hospital 110 264 8/15/14

New Jersey 110 264

14. Roxborough Memorial Hospital 80 140 2/22/12

15. Lower Bucks Hospital 85 168 10/02/12

Pennsylvania 165 308

11. Landmark Medical Center 140 214 12/31/13

12. Rehabilitation Hospital of Rhode Island 20 82 12/31/13

Rhode Island 160 296

11. Harlingen Medical Center 80 112 12/1/11

12. Dallas Medical Center 50 150 9/26/12

Texas 130 262

Prime Healthcare Services 2,650 4,555

19. Sherman Oaks Hospital 85 153 3/1/06

20. Montclair Hospital Medical Center 102 102 7/1/06

21. Huntington Beach Hospital 100 131 10/1/06

22. Encino Hospital Medical Center 80 150 6/1/08

23. Pampa Regional Medical Center 30 115 6/1/12

25. Knapp Medical Center 120 226 1/2/13

Prime Healthcare Foundation 517 877

Glendora Community Hospital

St. Mary’s Hospital of New Jersey

Prime Healthcare has been recognized by Truven Health Analytics (formerly Thomson Reuters) as one of the “Top 15 Health Systems” in the U.S. based on clinical performance

• Prime Healthcare named as a Top 15 Health System in 2012 and 2013 based on

quality of care, efficiency and patient satisfaction by Truven Health Analytics

(formerly Thomson Reuters)

– Also ranked in the Top 10 in 2009

– Only for profit health system named in the Top 15 in the nation in 2013

• Eight Prime Healthcare hospitals named 100 Top Hospitals in the nation by

Recognized Quality Healthcare Provider

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• Eight Prime Healthcare hospitals named 100 Top Hospitals in the nation by

Truven Health Analytics (formerly Thomson Reuters) in 2014. Prime Healthcare

hospitals have been ranked among the 100 Top Hospitals 27 times.

• Key criteria evaluated:

– Mortality rates

– Medical complications

– Medicare core measures (quality measures) and patient safety standards

– Risk-adjusted length of stay

– Patient satisfaction

Top 15 Health Systems in the Nation by Truven Health Analytics – 2012 Detail

Top 15 Health Systems Clinical Metrics of Top Health Systems

Recognized Quality Healthcare Provider (Cont’d)

Health System Location

Large Health Systems (> $1.5 bn)

Banner Health Phoenix, AZ

CareGroup Healthcare System Boston, MA

Jefferson Health System Radnor, PA

Memorial Hermann Healthcare System Houston, TX

St. Vincent Health Indianapolis, IN

Medium Health Systems ($750 mm - $1.5 bn)

Baystate Health Springfield, MA

Winning Health SystemMortality

Index

Complic-ationsIndex

Patient SafetyIndex

Core Measure Percent

(%) ALOS (days)

Banner Health 0.85 0.98 0.91 96.4 4.8

Baptist Health 0.93 0.72 0.72 97.2 4.5

Baystate Health 0.65 0.86 0.60 96.6 4.8

CareGroup Healthcare System 0.81 1.42 0.70 97.3 4.8

Geisinger Health System 0.80 1.04 0.82 96.2 4.5

HCA Central and West Texas Division 0.83 0.86 0.86 99.2 5.2

Top performer

Second in class

Third in class

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Baystate Health Springfield, MA

Geisinger Health System Danville, PA

HCA Central and West Texas Division Austin, TX

Mission Health System Asheville,NC

Prime Healthcare Services Ontario, CA

Small Health Systems (<$750 mm)

Baptist Health Montgomery, AL

Maury Regional Healthcare System Columbia, TN

Poudre Valley Health System Fort Collins, CO

Saint Joseph Regional Health System Mishawaka, IN

Tanner Health System Carrollton, GA

HCA Central and West Texas Division 0.83 0.86 0.86 99.2 5.2

Jefferson Health System 0.81 0.85 1.01 98.1 4.9

Maury Regional Healthcare System 0.70 0.62 0.77 95.3 4.1

Memorial Hermann Healthcare System 0.70 0.73 0.94 97.4 4.9

Mission Health System 0.97 0.73 0.69 96.9 4.7

Poudre Valley Health System 0.91 1.05 0.63 95.5 4.2

Prime Healthcare Services 0.55 0.63 0.55 99.0 4.3

Saint Joseph Regional Health System 0.99 0.79 0.77 97.6 4.4

St. Vincent Health 1.04 0.68 0.88 93.8 4.7

Tanner Health System 0.92 0.62 0.76 96.8 4.5

Benchmark Health Systems Medians 0.83 0.79 0.77 96.9 4.7

Peer Group Medians 1.04 0.98 0.98 95.8 5.1

Note: Prime’s performance measures place the Company in the top quintile of all health systems

Top 15 Health Systems in the Nation by Truven Health Analytics – 2013 Detail

Top 15 Health Systems Clinical Metrics of Top Health Systems

Recognized Quality Healthcare Provider (Cont’d)

Health System Location

Large Health Systems (> $1.5 bn)

Advocate Health Care Oak Brook, IL

Banner Health Phoenix, AZ

Memorial Hermann Healthcare System Houston, TX

OhioHealth Columbus, OH

Scripps Health San Diego, CA

Medium Health Systems ($750 mm - $1.5 bn)

Alegent Creighton Health Omaha, NE

Winning Health SystemMortality

Index

Complic-ationsIndex

Patient SafetyIndex

Core Measure Percent

(%) ALOS (days)

Advocate Health Care 0.97 0.95 0.97 98.4 4.7

Alegent Creighton Health 1.00 0.99 0.93 98.7 4.8

Asante 0.98 0.94 0.81 97.1 4.4

Banner Health 0.96 1.00 0.94 97.2 4.4

Cape Cod Healthcare 0.97 1.02 0.79 97.2 4.5

Exempla Healthcare 0.93 1.01 0.97 97.4 4.4

Top performer

Second in class

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Alegent Creighton Health Omaha, NE

Exempla Healthcare Denver, CO

Mission Health Asheville, NC

Prime Healthcare Services Ontario, CA

TriHealth Cincinnati, OH

Small Health Systems (<$750 mm)

Asante Medford, OR

Cape Cod Healthcare Hyannis, MA

Mercy Health Southwest Ohio Region Cincinnati, OH

Poudre Valley Health System Fort Collins, CO

Roper St. Francis Healthcare Charleston, SC

Exempla Healthcare 0.93 1.01 0.97 97.4 4.4

Memorial Hermann Healthcare Sys 0.96 0.95 1.08 98.1 4.7

Mercy Health Southwest Ohio Region 0.93 0.95 0.89 97.4 4.5

Mission Health 1.01 0.97 0.87 97.7 5.0

Ohio Health 0.98 0.97 0.99 98.6 4.4

Poudre Valley Health System 0.96 0.99 0.91 96.9 4.0

Prime Healthcare Services 0.94 0.89 0.72 97.8 4.0

Roper St. Francis Healthcare 0.99 0.91 0.93 97.3 5.0

Scripps Health 0.97 0.99 0.98 98.5 4.6

TriHealth 0.97 0.98 0.89 97.6 4.7

Bench Median 0.97 0.97 0.93 97.6 4.5

Peer Median 1.00 1.00 1.00 96.5 5.1

Note: Prime’s performance measures place the Company in the top quintile of all health systems

Recognized Quality Healthcare Provider (Cont’d)

• Truven Health Analytics (formerly Thomson Reuters) with Modern

Healthcare Magazine also issues a study each year that recognizes

the 100 Top Hospitals in the Nation. Prime Healthcare hospitals are

regularly among the 100 Top Hospitals:

• Centinela Hospital Medical Center – 3 Times including 2014

• Chino Valley Medical Center – 3 Times including 2014

• Desert Valley Hospital – 5 Times

• Garden Grove Hospital Medical Center – 3 Times including 2014

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• Garden Grove Hospital Medical Center – 3 Times including 2014

• La Palma Intercommunity Hospital – 2014

• Montclair Hospital Medical Center – 2 Times

• Paradise Valley Hospital – 2014

• San Dimas Community Hospital – 2 Times including 2014

• Shasta Regional Medical Center – 2 Times including 2014

• West Anaheim Medical Center – 5 Times including 2014

The Company's hospitals have been recognized numerous times in the past by various renowned national benchmarking organizations for their quality and efficiency in patient care

Recognized Quality Healthcare Provider (Cont’d)

Eleven Prime Healthcare Hospitals were recognized as Top Performers

by The Joint Commission in 2013, the leading accreditation agency

of health care organizations in the nation (eight in California):

• Centinela Hospital Medical Center

• Encino Hospital Medical Center (Non-Profit)

• Garden Grove Hospital Medical Center

• Huntington Beach Hospital (Non-Profit)

• La Palma Intercommunity Hospital

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• Paradise Valley Hospital

• San Dimas Community Hospital

• Shasta Regional Medical Center

• In Kansas: Saint John Hospital

• In Pennsylvania: Roxborough Memorial Hospital

• In Texas: Harlingen Medical Center

The Company's hospitals have been recognized numerous times in the past by various renowned national benchmarking organizations for their quality and efficiency in patient care

Infrastructure Improvements

In 2013, Prime Healthcare spent approximately $138 million on Capital Improvements and Equipment.

Since 2005, the organization has invested approximately $788 Million on Capital Improvements and Equipment for its facilities.

� 65 bed expansion at Desert Valley Hospital including new operating rooms and new Heart Center with full cardiac surgery program.

� New Cardiac Cath Labs at Desert Valley Hospital, Chino Valley Medical Center, Huntington Beach Hospital, and Sherman Oaks Hospital.

Prime Healthcare Hospitals continuously strive to improve patient care and experience by improving their infrastructure by investing in:

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� ER expansion at Roxborough Memorial Hospital in Pennsylvania.

� $40 million investment in Landmark Medical Center and the Rehabilitation Hospital of Rhode Island.

� $30 million investment in St. Mary’s Hospital in New Jersey.

� $40 Million ER expansion and seismic upgrades at Centinela Hospital Medical Center.

� New state-of-the-art Patient Monitoring and IT Systems.

� State of the art medical/radiology equipment.

� Information Systems Infrastructure.

� Hospital Physical Environment/ Plant improvements.

� Modernization of Hospital Systems to increase safety.

Charity Care

Prime Healthcare’s for-profit and non-profit hospitals provide more charity and uncompensated care on a per patient day basis than their competitors.

Since 2010, Prime Healthcare hospitals have provided more than $2 Billion in charity and uncompensated care.

The Prime Healthcare Foundation also operates two indigent community clinics.

Prime Healthcare Hospitals continuously strive to provide safety net acute care services to uninsured and indigent residents of the communities they serve.

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� 2010 - $ 383 million

� 2011 - $ 395 million

� 2012 - $ 487 million

� 2013 - $ 739 million