The MGH Journey. Shaping the Future of an Entire Region

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1 The MGH Journey Shaping the Future of an Entire Region

2 Navigating History, Building on Our Past Northwestern Hospital 1890 First General 1896 St. Luke s 1897 New St. Luke s opens 1915 Northern Michigan Children s Clinic Completed 1931

3 Building on Our Past 1973 Two hospitals in Marquette Merged to form MGH Marquette General Hospital and Health System 307 Licensed Beds 62 Specialties and Subspecialties 12,000 Inpatients and more than 350,000 Outpatients a Year 2,600 Employees 280 Active Staff Physicians 150 Employed Physicians and Mid Level Providers $320 Million Annual Budget Solid financial position Federally Designated Regional Referral Center for about 317,000 People Level II Trauma Center Clinics and Outreach Services in 22 Communities Family Medicine Residency UPHEC Community Campus of MSU College of Human Medicine 1973: Two Community Hospitals Merged St. Luke s Hospital St. Mary s Hospital

4 Building on Our Past 2000: Bridge Building Completed

5 Reaching a Crossroad Prolonged economic downturn All payers creating reimbursement pressures Increased need for capital for outpatient and inpatient facilities (age of plant) and information technology (meaningful use) Need to increase admissions, market share and covered lives Need for size and scale Future payments based on Value NOT Volume Payers are Partners

6 PRIORITIZED KEY CONSIDERATIONS TO AFFILIATION IDEAL FUTURE 1. Fiscal Health 2. Access to Capital 3. Physician Inclusiveness 4. Clinical Distinction and Quality of Care Achievements 5. Depth and Breadth of Services and Locations 6. Mission/Vision/Values Match 7. Affiliate s Reputation 8. No bias either to remain Not for Profit or to change to Investor Owned

7 Board Decision Process Board led (with third-party advisor) Management and Physician facilitated Controlled, competitive, fair process Launched on November 8 th, 2011 Requests for Proposal 26 November, Presentations to MGH Board January, 2012 Trips by MGH Board 3 January, 2012 Final Proposals February, 2012 Board Decision Unanimous February, 2012 Memorandum of Understanding Approved with Duke LifePoint March, 2012

8 Quality Factors The Duke quality reputation Top 10 National 22 years Quality Oversight Governance Local/Advisory Duke Member Charity Care Existing Board Policy Employees All Retained/Current Compensation Community New Sales, Property Taxes Medical Staff Existing Privileges Services All Retained, Expanded

9 Founding Principles Dedication to Quality and Service Physician Collaboration and Support Investing in Our Hospitals and Communities Resources to Achieve Operations Excellence

10 Acquisition Timetable Due Diligence March June, 2012 Final Documents Approved June, 2012 Michigan Attorney General Approval, August 2012 Closed August 31, 2012 On Schedule Transition of Organization

11 The 4 Pronged Progress Measurement QUALITY Tool PHYSICIANS FINANCIAL FACILITY

12 Quality

13 Quality

14 Strategic Plan: The Deep Dive 1. Anesthesia 2. Access/Case Management 3. Process Improvement 4. Hospital Based Services 5. Physician Engagement Optimize Workflow Patient First Scheduling: OP & IP Admissions Process Discharge Plan Capital Allocation LEAN Information Technology Foundation Stabilize Radiology Restructure Hospitalists, Intensivists Support Emergency Department Business Development Role Engage Private Physicians Expand Marquette General Medical Group 6. Improve Patient Experience Service Training

15 Quality Unification via SHP 8 UP Hospitals +BCBS of Michigan = Superior Health Partners

16 Total Patient Experience Dynamic Assess at a Partnership and at a facility level; create a custom roadmap to drive significant and sustainable culture change Transfer knowledge and hardwire processes to drive outcomes that achieve patient centered excellence Engage all leaders, physicians and front line staff in creating and owning the patient experience Translate patient experience and internal horsepower to external messaging and strategic branding initiative SHP Spirit of Service Journey

17 LifePoint Alignment Milestones

18 Physicians Upper Recruitment Plan Specialty Peninsula Net Need Primary Care Total (32.8) 7 5 Allergy & Immunology Cardiology (10.6) 1 Dermatology Endocrinology Oncology (2.6) 2 Infectious Disease (0.7) 1 1 Nephrology (2.1) 1 Neurology (2.9) 2 OB/Gyn Pulmonology (2.7) 1 1 Rheumatology Radiology 3 2 Medicine Total (12.4) Upper Peninsula Medical Staff Development Plan Upper Peninsula Net Need Recruitment Plan Specialty Bariatrics (2.5) Gastroenterology General Surgery (7.6) 4 4 Neurosurgery (1.4) 2 Ophthalmology 4.8 Orthopedics (1.1) 2 Hand 1 ENT (1.3) Plastic Surgery Thoracic Surgery Urology Vascular Surgery Total Psychiatry PM&R Rad Onc (0.5) Neonatology 1 1 Pain Management 1 Emergency Medicine 6 3 Other Total TOTAL Source: Coker Group

19 Financial Pension $95 million Bonds other debt $73 million Superior Health Foundation $23 million A $475 million, 10 year investment

20 Regional Economic Impact

21 Entering an Era of Facility Renaissance

22 Facility Master Facility Planning Information Technology Enhancements, Upgrades Spring, 2013 Routine Maintenance, Facility Interior Upgrades Spring, 2013 Preliminary Planning Meetings January, 2013 Mechanical, HVAC Assessment January, 2013 Preliminary Design Spring, 2013 Final Design for Bids Summer/Fall, 2013 Begin Construction Fall, 2013

23 Future Capital Projects Requests FY2013 Original Budget Requests 4Q2012 Approved CY2013 Pending Requests Routine 3,284, ,000 2,786,668 CAMS 4,954,268 4,954,268 FAC 4,084, ,200 3,796,300 IT 6,537,000 2,549,500 3,987,500 Aesthetics & Renovations 3,300,000 Grand Total 18,860,436 3,335,700 18,824,736 KEY DRIVERS COMMENTS Business plans for CAMS projects will be completed as capital budgets are prioritized.

24 Recommendation Development Process Medical Staff Surveys Market Analytics Service Line Facilitated Discussions Interviews 75+ Total (60+ Physicians) Federal, State Policies Recommendations QUASARS MGH Recruitment Plan Best Practices Facility Layout Duke Assessments

25 Ties that Bind Progress Strategy Tactics Measurable Result One Destination for All Cancer Services Co-locate Medical Oncologist on campus near radiation oncology Improve Service Comprehensive Chemo/Infusion Center Co-locate comprehensive chemo/infusion center on campus near Medical Oncologist office Improve Service Explore Duke Oncology Network Develop a cohesive, consistent Brand Enhance clinical development Enhance education and research Develop tele-health program with outlying clinics Increase Quality

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