This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Fall 2012

Confidential

Information

Memorandum

This document is confidential and proprietary to LSU Health Shreveport and is not to be

copied, reproduced, or otherwise given to other parties without explicit written consent.

This memorandum is a preliminary draft and for internal purposes only.

This document is in draft form and was prepared for the LSU Health Sciences Foundation, a supporting

organization of LSUHSC-S, for discussion with LSUHSC-S.

This document was not released to any potential investors nor does it constitute a request for bids or other

act by LSUHSC-S. The Foundation, its consultants and Management do not make any representations as to

the accuracy of the included information.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

2

CONFIDENTIAL

INFORMATION

MEMORANDUM

Table Of Contents

TBD

EXECUTIVE SUMMARY INVESTMENT HIGHLIGHTS REGULATORY ENVIRONMENT HEALTH SYSTEM OVERVIEW SERVICES PROVIDED OPERATING STATISTICS INSTITUTIONS & FOUNDATIONS SERVICE AREA & COMPETITION FACILITIES ORGANIZATION & EXECUTIVE MANAGEMENT EMPLOYEES QUALITY OPERATIONS FINANCIAL MATTERS APPENDIX A: INSTRUCTION LETTER

3 7 11 13 20 28 34 39 46 49 56 59 64 66 72

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Executive Summary

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

4

CONFIDENTIAL

INFORMATION

MEMORANDUM

Purpose

This Information Memorandum (the “Information” or “Memorandum”) provides a summary of selected

information relating to Louisiana State University Health Sciences Center at Shreveport (“LSUHSC-S” or the

“LSU Shreveport System”). This Memorandum has been prepared by the current management and

administration team of LSUHSC-S (the “Administration”) with the assistance of i3Healthcare Consulting and

SC&H Capital (collectively, the “Consultants”). The Memorandum is being furnished solely for use by interested

parties in determining whether to proceed with further analysis of the opportunity described herein.

Neither the Management nor Consultants makes any representation or warranty, express or implied, as to the

accuracy or completeness of any of the Information. The Information is not intended to be the sole basis for

evaluation by any interested party. Should the LSUHSC-S enter into negotiations with a recipient of the

Information, it is expected that such recipient would be afforded an opportunity to perform its own

independent due diligence and investigation of the operations and financial affairs of LSUHSC-S pertinent to a

proposed transaction.

The statements in these materials have been made as of the date hereof unless it is stated otherwise. Neither

the delivery of these materials, nor the consummation of any proposed transaction after the date of these

materials, shall create any implication that the information contained herein or the affairs of LSUHSC-S have not

changed since the date hereof or that such information is correct at any time subsequent to this date. In

furnishing this information, neither LSUHSC-S nor its agents or other representatives undertakes any obligation

to update or correct the information. The information set out herein is preliminary, unaudited and has been

supplied for “information purposes” only.

LSU Health Sciences Center at Shreveport

LSUHSC-S is northern Louisiana’s regional academic medical center and teaching hospital serving the citizens of

Louisiana, as well as the communities of southwestern Arkansas, northeastern Texas and parts of Oklahoma.

LSUHSC-S operates Shreveport Medical Center, a 452 licensed-bed (352 staffed-bed) hospital, an accredited

School of Medicine, a School of Graduate Studies, and a School of Allied Health Professions in Shreveport,

Louisiana. In addition, LSUHSC-S operates as E.A. Conway Medical Center, a 247 licensed-bed (117 staffed-

bed) acute hospital in Monroe, Louisiana, and Huey P. Long Medical Center, a 137 licensed-bed (60 staffed-

bed) hospital in Pineville, Louisiana.

In fiscal year (“FY”) 2011, LSUHSC-S had approximately 30,000 total admissions, 176,000 patient days, 134,000

ER visits and nearly 510,000 outpatient clinical visits. LSUHSC-S operates by balancing missions of healthcare,

education, research, and community, serving the advanced healthcare needs of the region through its state-

designated Centers of Excellence, a Regional Trauma Center, Regional Burn Center and Feist-Weiller Cancer

Center. The LSU Health Shreveport system is one of only six US hospitals affiliated with the world-famous St.

Jude Children’s Research Hospital.

LSUHSC-S has established itself as the leading academic medical institution in Louisiana by integrating the

outstanding clinical care delivered by its medical centers’ staff and physicians, while maintaining a steadfast

commitment to over 600 faculty members currently teaching over 850 students at the Medical School, School

of Allied Health Professions and School of Graduate Studies.

Executive Summary

DRAFT

This

document

is in draft

form and

was

prepared

for

LSUHSC-S

for

discussion

with its

financial

consultants

This

document

was not

released to

any

potential

investors

nor does it

constitute a

request for

bids or

other act

by

LSUHSC-S

The

Foundation

, its

consultants

and

Manageme

nt do not

make any

representat

ions as to

the

accuracy of

the

included

information

.

5

CONFIDENTIAL

INFORMATION

MEMORANDUM

Currently, the LSU Shreveport System is under the governance of The Louisiana State University (“LSU”) Board

of Supervisors and is supported by an affiliated, nonprofit, 501(c) 3 organization: the LSU Health Services

Foundation in Shreveport. As part of its significant commitment to research and education, LSUHSC-S also

maintains a strong partnership with the Biomedical Research Foundation of Northwest Louisiana (“BRF”) which

has bonding authority.

In FY 2011, LSUHSC-S generated $355.6 million, $90.4 million, and $59.4 million in revenues and $24.5 million,

$3.1 million, and $0.5 million in EBITDA from the Shreveport Medical Center, EA Conway Medical Center in

Monroe, and Huey P. Long Medical Center in Pineville, respectively. LSUHSC-S’s success is best attributed by

the following investment highlights:

• Leading Academic Medical Center in the Ark-La-Tex Region • Access to Highly Skilled Medical Staff and Clinical Workforce • Leading Edge Patient Electronic Health Information and Care Network (“PELICAN”) • Unique Community Partnerships • Experienced Administrative Team with Proven Abilities to Run a Unified Organization • Strong Community Support

Executive Summary

Transaction Summary and Considerations

The assets of LSUHSC-S, as part of LSU Health, are currently owned by the State of Louisiana (the “State”). The

State and LSUHSC-S have expressed a preference for development of a public-private partnership(s). LSUHSC-S

and the State are willing to consider various structures, and are seeking information from strategic partners that

will specify how the mission of the LSUHSC-S academic center as a teaching and access point for patient care

will be preserved, medical education will be enhanced, and how any proposed partnership offers financial

stability, resources and growth opportunities to the entity. The potential strategic partner should provide

detailed information for their participation as outlined in the Instruction Letter (see Appendix A). The State and

LSUHSC-S have expressed a strong preference for parties indicating an ability to target a June 30, 2013 closing

date, subject to regulatory approval. In addition to commenting on mission, financial stability and growth, each

respondent should address valuation, form of consideration, transaction structure, financing, approvals and

conditions, due diligence needs and timing.

Respondents should not assume that current laws governing higher education, Civil Service, procurement, or

control of LSU hospitals will be amended or repealed. Please be advised that should a strategic partner provide

information related to a transaction, the information will be used in order to support the overall evaluative

process; however, there are no assurances that it will be considered as an acceptable transaction alternative. By

considering multiple options, the State and LSUHSC-S maintain flexibility as it seeks to achieve the goals

outlined in the separately provided Instruction Letter.

There are currently a variety of structures in which an affiliation exists between a U.S. based teaching hospital

or health system, and a school medicine.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

6

CONFIDENTIAL

INFORMATION

MEMORANDUM

Executive Summary

Transaction Summary and Considerations – Cont’d

Additionally, the manner in which the staff of physicians and other health professionals practice varies

significantly. The organizational structure can be not-for-profit, for-profit, or other corporate models involving

individuals or groups and different governing structures. In many instances, affiliates are tightly defined, while in

some situations affiliations are very loosely defined.

Proposed Structure

In light of the potential for a variety of structures, the State and LSUHSC-S examined a variety of options and

agreed separating the Hospital operations from the Physician Group and the Schools of Medicine, Allied Health

Professionals and Graduate studies, or a variation thereof is a sound starting point for seeking a public private

partnership arrangement.

For example, a private, nonprofit organization could be formed and could establish an ownership or lease

arrangement to operate LSU Medical Center-Shreveport, EA Conway Medical Center, and Huey P. Long

Medical Center. Current state employees may be transitioned into employment by a nonprofit organization.

LSUHSC-S believes it may be most appropriate that the Schools of Medicine, Allied Health Professions, and the

Faculty Practice Plan be converted into a nonprofit structure.

The Faculty Practice Plan and the hospital will be bound through a contractual relationship.

Hospital as a

Public

Organization

Faculty

Practice

Plan

Schools of

Medicine, Allied

Health, and

Graduate as

public entities

Hospital with a

Public/Private

Organization Faculty

Practice

Plan

Schools of

Medicine, Allied

Health, Graduate

as public entities

Representative Current Structure

Example of Possible New Structure

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Investment Highlights

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

8

CONFIDENTIAL

INFORMATION

MEMORANDUM

Investment Highlights Leading Academic Medical Center in Louisiana

Drawing on the LSUHSC-S’s legacy of service and teaching, area physicians and other prominent citizens

tirelessly pursued their dream of building a major academic medical center in Shreveport to create a continuum

of care with existing community hospitals and physicians. Laying the groundwork for the collaborative

relationship that continues decades later these area physicians and prominent citizens instilled opportunities for

the many public/private partnerships that have elevated healthcare services throughout the region.

Every day, incredible things happen at LSUHSC-S. As a regional referral center, the Medical Center in

Shreveport serves patients with complex medical and surgical conditions. In the role of a community resource,

LSUHSC-S provides primary and secondary healthcare for patients of all ages. In 2011, LSUHSC-S had

approximately 30,000 admissions, 176,000 patient days, 134,000 ER visits and nearly 510,000 outpatient clinical

visits. LSUHSC-S offers a comprehensive array of primary care and specialty services. Tertiary services include

a Regional Trauma Center, the region’s only Burn Center, the Feist-Weiller Cancer Center - a state-designated

Center of Excellence; an in-house Bone Marrow Transplant facility, the Sickle Cell Clinic, Children’s Hospital

and the state-designated Arthritis and Rheumatology Center of Excellence. LSUHSC-S is established in north

Louisiana, southwest Arkansas and northeast Texas as the regional referral center. LSUHSC-S has a dedicated

Transfer Center, which enables other facilities to quickly and efficiently seek transfer for their patients to higher

levels of care and specialization in the Medical Center in Shreveport.

LSUHSC-S is identified with excellence in health care, and maintains a commitment to provide ambulatory and

inpatient care for those who do not have the means to afford such care.

Access to Highly Skilled Medical Staff and Clinical Workforce

As partners in the LSUHSC-S, the School of Medicine, the School of Graduate Studies, and the School of Allied

Health play an integral role in the operations and care delivery of the Medical Center in Shreveport. The faculty

of the schools trains their respective students within the ambulatory and inpatient facilities. Most of the

graduates of the three schools choose to stay and work within the region following their graduation. Since

1973, over 66% of the graduates of the Medicine and residency teaching programs have chosen to practice in

Louisiana.

In order to offer the greatest advantage to its medical staff and the highest service to the community, LSUHSC-S

has partnered with other hospitals to share the expertise of LSUHSC-S faculty/medical staff in several medical

specialties. This has allowed the community to benefit from their expertise and experience without any

barriers. Sharing has allowed LSUHSC-S to attract an even stronger faculty.

LSUHSC-S serves as a resource for the surrounding region. Through hundreds of formal agreements that

support education and training, LSUHSC-S partners with local public school boards, other institutions of higher

education, area hospitals, and emergency first responders.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

9

CONFIDENTIAL

INFORMATION

MEMORANDUM

Investment Highlights

Leading Edge Patient Electronic Health Information and Care Network

LSUHSC-S unveiled $144 million Patient Electronic Health Information and Care Network (“PELICAN”) in late

2011, to transition from paper medical records to electronic medical records. The LSU Health System was the

first statewide, public health care network in the United States to deploy electronic health records throughout

each of its hospitals and physician clinics. PELICAN, which is based on software from Epic, will create

opportunities for more efficient management and will result in safer and higher quality patient care.

Unique Community Partnerships

LSUHSC-S is involved in a number of partnerships which have enabled them to bring highly sophisticated clinical

services to the region, which independently would not have been supportable. A few examples of this strategy

in action are:

The Regional Transplant Center (“RTC”) partnership with Willis-Knighton Health System was formed in

1989 and is certified by Medicare to provide kidney, pancreas, kidney/pancreas, liver, and liver/kidney

transplants.

The Shriners Hospitals for Children in Shreveport and LSUHSC-S combine medical teams of doctors,

nurses, therapists and orthotists to create a child-friendly environment with world-class medical care for

children with a host of orthopedic and neuromusculoskeletal disorders and diseases.

LSUHSC-S provides pediatric subspecialties for the CHRISTUS Sutton Children's Medical Center in

Shreveport.

LSUHSC-S is also affiliated with the St. Jude Children’s Research Hospital to provide world class pediatric

hematology/oncology at the Feist-Weiller Cancer Center. The hospital is one of only six hospitals in the

nation affiliated with the world-famous St. Jude Children’s Research Hospital.

Experienced Administrative Team with Proven Abilities to Run a Unified Organization

The LSUHS-S executive management team or Administration has over 250 years of combined experience in the

healthcare industry including both for-profit and non-profit hospitals. The team’s experience in the academic

health care arena is unparalleled. The Administration is comprised of Medical Doctors, Juris Doctorates, MBAs,

and professionals with other advanced degrees. As one of about 100 institutions in the U.S. constituting an

academic health sciences center that combines a medical school, a Ph.D. program in biomedical sciences, degree

programs in allied health professions and one or more teaching hospitals, the Administration has demonstrated

its ability to run a highly effective organization across many core competencies.

Throughout its history, LSUHSC-S has taken pride in its ability to manage within its financial means. Without

fail, LSUHSC-S has provided excellence in tertiary healthcare, served the needs of the uninsured and under-

insured, supported the commitment to educating and training new physicians and healthcare staff, and

sponsored clinical research.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

10

CONFIDENTIAL

INFORMATION

MEMORANDUM

Investment Highlights

Strong Community Support

LSUHSC-S enjoys strong support from the Northeast, Northwest, and Central Louisiana regions. LSUHSC-S

employs over 5,900 people, making it the largest employer in the City of Shreveport and the fourth largest in

Northwest Louisiana. As one of the largest employers in the region, it is recognized as an economic engine.

Members of the regional community have made substantial philanthropic contributions to LSUHSC-S programs.

The LSU Health Sciences Foundation in Shreveport, which is a private, nonprofit corporation, exempt from

Federal income tax under 501(c)(3) of the Internal Revenue Code, was chartered by the Secretary of State in

1997 and manages and invests LSUHSC-S endowments, which include seven chairs and 40 professorships.

Additionally, The Biomedical Research Foundation (BRF) is an independent, nonprofit, 501(c)(3) organization

established in 1986, which supports biomedical research at LSUHSC-S in addition to other initiatives.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Regulatory Environment

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

12

CONFIDENTIAL

INFORMATION

MEMORANDUM

Rules & Regulations

Charity Care

Hospitals are permitted to acquire tax-exempt status under the Internal Revenue Code (the “Code”) formerly

the Internal Revenue Code of 1986, because the provision of health care has been historically treated as a

“charitable” enterprise. This treatment arose before most Americans had health insurance, when charitable

donations were required to fund the health care provided to the sick and disabled. Some commentators have

taken the position that, with the onset of employer health insurance and governmental reimbursement

programs, there is no longer any justification for special tax treatment for the health care industry, and the

availability for tax-exempt status should be eliminated. LSUHSC-S considers the likelihood of such a dramatic

change in the law to be remote; nevertheless, federal and state tax authorities are beginning to demand that tax-

exempt hospitals justify their tax-exempt status by documenting their charitable care and other community

benefits.

The Senate Finance Committee is also considering a policy option that would codify organizational and

operational requirements for determining whether a hospital is a charitable organization under Section

501(c)(3) of the Code. Such requirements include, among other things, that Section 501(c)(3) hospitals

regularly conduct a community needs analysis, provide a minimum annual level of charitable patient care, not

refuse service based on a patient’s inability to pay and follow certain procedures before instituting collection

actions against patients.

Louisiana Medicaid

In Louisiana, the total annual expenditure for the Medicaid program is limited by the State legislature in the

general appropriations bills. The recommended appropriation for State Fiscal Year 2012-2013 is $7.5 billion

allocated to medical vendor payments and $333 million allocated to medical vendor administration, which

includes claims processing.

The appropriation for State Fiscal Year 2011-2012 was over $6.6 billion allocated to medical vendor payments,

and almost $308 million allocated to medical vendor administration.

Licensing, Surveys, Investigations and Audits

Health facilities, including LSUHSC-S, are subject to numerous legal, regulatory, professional and private

licensing, certification and accreditation requirements. These include, but are not limited to, requirements

relating to Medicare Conditions of Participation, requirements for participation in Medicaid, state licensing

agencies, private payors and the accreditation standards of The Joint Commission. Renewal and continuation of

certain of these licenses, certifications and accreditations are based on inspections, surveys, audits,

investigations or other reviews, some of which may require affirmative actions by LSUHSC-S and the other

Members of the Obligated Group. Management of LSUHSC-S currently anticipates no difficulty renewing or

continuing currently held licenses, certifications or accreditations.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Health System Overview

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Arkansas

Texas

Louisiana

Total Service Area

14 CONFIDENTIAL

INFORMATION

MEMORANDUM

Shreveport Medical

Center

Huey P. Long Medical

Center

EA Conway Medical

Center

LSUHSC-S currently serves three Primary Service Areas (“PSAs”) through it facilities in Shreveport, Monroe

and Pineville defined as (1) the Northwest Louisiana Region, which encompasses the Shreveport-Bossier

Metropolitan Statistical Area (“MSA”) , (2) the Northeast Louisiana Region, which encompasses the Monroe

MSA, and (3) the Central Louisiana Region which encompasses the Alexandria MSA. In fiscal year 2011, these

PSAs accounted for 96.3% of LSUHSC-S total inpatient visits and 97.9% of total outpatient visits.

Additionally, LSUHSC-S attracts patients from throughout the State of Louisiana due to its high quality of care,

as well as from east Texas and southwest Arkansas, commonly referred to as Ark-La-Tex.

Northeast Louisiana (Shreveport Medical Center Service Area)

Northwest Louisiana (EA Conway Service Area)

Central Louisiana (Huey P. Long Service Area)

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Current Organization

15 CONFIDENTIAL

INFORMATION

MEMORANDUM

LSUHSC-S is currently under the governing authority of The Louisiana State University System, which consists

of six campuses, two academic centers, and the Health Care Services Division. Four entities are specifically

devoted to health care– the Health Care Services Division, two health sciences centers (LSU Health Sciences

Center at New Orleans and LSU Health Sciences Center at Shreveport, and Pennington Biomedical Research

Center. Since 1997, the Health Care Services Division administers all of the medical centers—the former

charity hospitals in Louisiana—except those located in north and central Louisiana, which are business units of

LSUHSC-S.

This proposed transaction only involves the three medical centers, as highlighted in the diagram below.

LSUHSC-S encompasses the Schools of Medicine, Graduate Studies, and Allied Health Professions in

Shreveport, the Shreveport Medical Center, EA Conway Medical Center in Monroe, and Huey P. Long Medical

Center in Pineville.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Overview and History LSUHSC-S is the leading regional academic medical center and teaching hospital in the northern part of

Louisiana (the “State”) and serves the healthcare needs of the citizens the State as well as the communities of

southwestern Arkansas, northeastern Texas and parts of Oklahoma. The Company operates a 452 licensed-bed

(352 staffed-bed) Medical Center in Shreveport (“SMC”), Louisiana which encompasses the operations of an

accredited School of Medicine, School of Graduate Studies, School of Allied Health Professions, as well as

administrative control of the 247 licensed-bed (117 staffed-bed) E.A. Conway Medical Center in Monroe,

Louisiana and the 137 licensed-bed (60 staffed-bed) Huey P. Long Medical Center in Pineville, Louisiana.

LSUHSC-S roots date to 1876 as Shreveport Charity Hospital. In 1976 the State Legislature authorized the

transfer of the Charity Hospital to the LSU System and granted LSUHSC-S the right to retain self-generated

funds above budgeted amounts which could be reinvested into facilities or programs. The requirement for

legislative approval prior to modifying clinical programs was also dropped leading the way for change of

philosophy from a state charity hospital to a university teaching hospital. In 2000, the LSU Board of Supervisors

established an autonomous chancellorship at LSUHSC in Shreveport. Shortly thereafter, the Schools of

Graduate Studies and Allied Health Professions gained accreditations independent of their New Orleans

counterparts, formally becoming autonomous schools. In 2003 and 2007, respectively, the Legislature

transferred administrative control of the E.A. Conway Medical Center in Monroe and the Huey P. Long Center

in Pineville to LSUHSC-S.

Today Shreveport Medical Center is a university teaching hospital offering primary, tertiary, and quaternary care

to its patients. It also serves as a safety net hospital, dedicated to providing basic healthcare for the

underprivileged in the area through outpatient and wellness clinics as well as access to urgent and emergency

care. As a training site for many medical, nursing and allied health students, including more than 500 doctors

who receive advanced training in residency programs, the hospital has achieved distinction and international

recognition for basic science and clinical research programs that contribute to the body of knowledge and

practice in science and medicine. It supports the region and the State of Louisiana in economic growth and

prosperity by utilizing research and knowledge to engage in productive partnerships with the private sector.

As a healthcare organization receiving the Joint Commission's Gold Seal of Approval, Shreveport Medical

Center boasts many specialized programs such as the Feist-Weiller Cancer Center and Department of Arthritis

and Rheumatology, which were both designed by the Louisiana Board of Regents as Centers of Excellence. The

Shreveport Medical Center is one of only six hospitals in the nation affiliated with the world-famous St. Jude

Children’s Research Hospital. Through the expertise of medical school faculty who compose the hospital's

medical and dental staff, the hospital has developed sophisticated resources such as a regional Trauma Center,

Regional Burn Center, Extracorporeal Membrane Oxygenation (ECMO) program, and Gamma Knife.

In 2011, Shreveport Medical Center became the first in the LSU Health system to implement electronic health

records. The hospital also added robotic surgery and a hybrid vascular operating room. This dedication to

improvement proves the hospital’s dedication to continuous growth and technological advancement.

16

Overview

CONFIDENTIAL

INFORMATION

MEMORANDUM

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

17

Overview

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Clinical Integration The primary mission of Louisiana State University Health Sciences Center Shreveport (LSUHSC-S) is to provide education,

patient care services, research, and community outreach. LSUHSC-S encompasses the LSU Schools of Medicine, Graduate

Studies, and Allied Health Professions in Shreveport, the LSU Medical Center in Shreveport, E. A. Conway Medical Center

in Monroe, and Huey P. Long Medical Center in Pineville. In implementing its mission, LSUHSC-S is committed to:

Educating physicians, basic scientists, residents, fellows and allied health professionals based on state-of-the-art curricula,

methods, and facilities, preparing students for careers in health care service, teaching or research.

Providing state-of-the-art clinical care, including a range of tertiary special services, to an enlarging and diverse regional

base of patients.

Achieving distinction and international recognition for basic science and clinical research programs that contribute to the

body of knowledge and practice in science and medicine.

Supporting the region and the State in economic growth and prosperity by utilizing research and knowledge to engage in

productive partnerships with the private sector.

Together, the leaders and staff of the LSUHSC-S have assessed and determined the clinical care needs of the region’s

population. Jointly, the member institutions of the LSUHSC-S have brought together the resources, including staff, facilities

and technology to answer these needs. Led by a single management team, a single vision for integrating the many assets

and skills has been established. This vision defines the strategy for the leadership and is the blueprint for their operating

initiatives. By doing so, the members of the LSUHSC-S have provided, and will continue to provide, a wide variety of

specialized services with strong connectivity between campuses, specialties and disciplines.

Some of the key advantages offered by the LSUHSC-S’s model for integrated care are:

One leadership team oversees the physician/faculty services and our three medical centers in Shreveport, EA Conway

Medical Center in Monroe and Huey P Long Medical Center in Pineville.

Full range of medical specialties offered within our three medical centers, many delivered at a tertiary level of care to

patients at the Medical Center in Shreveport.

Emergency services at each of our three medical centers, including a Regional Trauma designation at our Shreveport

facility. Our Regional Trauma service is completely integrated with our critical care, neurology/neurosurgery,

orthopedic and surgical programs so that we can achieve the best outcomes for our patients.

The Ambulatory Care Clinics, located in the Ambulatory Care Building, serve the Ark-La-Tex community by providing

excellence in patient care services, a teaching facility for training future medical and allied health professionals, and an

environment conducive to medical and scientific research. The clinics provide varying degrees of care: urgent, acute,

chronic, specialty, primary, diagnostic, rehabilitation, minor surgical procedures, and heath care prevention/maintenance

for all ages.

In 2011, the Shreveport campus completed implementation of an electronic health information record (EHR) system.

The EHR’s chief benefit is enhanced patient safety, and improved quality of care by making all of a patient’s medical

information readily available and easy to find for clinicians throughout the campus. With Shreveport’s implementation

complete, the project team has moved to LSU Health Shreveport’s EA Conway Medical Center in Monroe and Huey P.

Long Medical Center in Pineville.

LSUHSC-S maintains strong alliances and affiliations with other health care providers based on its belief that it must

maximize the benefits of limited resources within the community by avoiding unnecessary duplication. A few examples

include:

o Shriners Hospitals for Children in Shreveport, an affiliate program for Pediatric Orthopedic Surgery

o St. Jude Children's Research Hospital, an affiliate program for Pediatric Oncology

o Willis-Knighton Health System, affiliate programs for Neurosurgery, Transplantation Surgery, and Urology

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

18

Overview

CONFIDENTIAL

INFORMATION

MEMORANDUM

EA Conway Medical Center, located in Monroe, Louisiana, serves a 12-parish area in northeast Louisiana

with a full range of diagnostic and treatment services with a medical staff of 48 physicians. With services

dating from 1941, the current facility opened in 1987.

The hospital has adult critical care and neonatal units, as well as a fully staffed emergency department.

Inpatient services also include family medicine, medicine, pediatrics, obstetrics/gynecology, general surgery,

orthopedics, urology, ophthalmology and psychiatry. For diagnostic services, the hospital has a state-of-the-

art MRI system and 24-hour teleradiology for off-site and after-hours readings. EA Conway has also recently

opened a satellite outpatient clinic of the Feist-Weiller Cancer Center.

As a public hospital, EA Conway also serves the healthcare needs of the area corrections facilities with

secure and separate inpatient and outpatient clinic facilities and provides evaluation for emergency psychiatric

admissions in an isolated and locked seven-bed unit.

Since 1982, EA Conway has served as the sponsoring institution for a three-year Family Medicine Residency

Program. In addition to the benefit of training future physicians, the program has an ongoing positive impact

on healthcare in the region since about half of the graduates remain in northeast Louisiana to practice.

Resident physicians based at Shreveport Medical Center rotate through EA Conway for part of their training.

These include Surgery, Ob/Gyn, Psychiatry, and Pediatric residents. EA Conway also train pharmacy, nursing,

and allied health program students.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

19

Overview

CONFIDENTIAL

INFORMATION

MEMORANDUM

Built in 1939, Huey P. Long is a 137 licensed-bed (60 staffed-bed) acute care hospital with inpatient and

outpatient services in Pineville. It provides service for a nine-parish region of central Louisiana. In 2011, the

hospital earned the Louisiana Hospital Capstone Award for Quality Improvement. In October 2012, the

hospital was recognized as one of the top performers on key quality measures by the Joint Commission.

In 2011, it had 2,353 inpatient admissions and 119,438 outpatient visits.

Huey P. Long is a site for clinical rotations for physician residents and medical students from LSU and Tulane.

The medical center also offers an accredited pharmacy practice residency in conjunction with the School of

Pharmacy at the University of Louisiana in Monroe.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Services Provided

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

The physicians and staff of LSUHCS-S provide state-of-the-art healthcare services and high-quality patient care

within a setting that advances medical science through research while educating the next generation of leaders.

Departments and services offered by each LSUHSC-S hospital and Center of Excellence are outlined below as

follows:

Shreveport Medical Center Shreveport Medical Center is a 452 licensed-bed (352 staffed-bed) facility serving north Louisiana, east Texas,

and southern Arkansas. LSUHSC-S had 22,062 inpatient admissions and 422,733 outpatient visits in 2011.

Specialties

Services Provided

o Allergy & Immunology

o Anesthesiology

• Pain Medicine

o Colon & Rectal Surgery

o Emergency Medicine

o Family Medicine

o Forensic Psychiatry

o Hematology

o Hematology/Oncology

o Internal Medicine

• Cardiovascular

• Clinical Cardiology

• Critical Care

• Endocrinology

• Gastroenterology

• Hematology

• Hematology/Oncology

• Infectious Disease

• Medical Oncology

• Nephrology

• Pulmonary Disease

• Rheumatology

• Sleep Medicine

• Transplant Health

o Medical Genetics

• Clinical Cytology

o Neurology

o Neurosurgery

o Obstetrics and Gynecology

o Ophthalmology

o Oral and Maxillofacial Surgery

o Oral Surgery

o Orthopaedic Surgery

o Orthopedics

o Otolaryngology

o Plastic Surgery

o Pathology

• Clinical

• Cytopathology

• Forensic

o Adolescent Medicine

o Pediatrics

• Neonatal-Perinatal

• Endocrinology

• Gastroentology

• Hematology

• Infectious Disease

• Nephrology

• Pulmonology

• Cardiology

o Plastic Surgery

o Psychiatry

• Addiction

• Forensic

• Psychosomatic

o Radiology

• Nuclear Radiology

• Radiation Oncology

o Sleep Medicine

o Surgery

• Oncology

• Pediatric

• Surgical Critical Care

• Thoracic

o Trauma

o Urology

21

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Services Provided

EA Conway Medical Center – Monroe EA Conway Medical Center is a 247 licensed-bed (117 staffed-bed) facility serving a 12-parish area in Northeast

Louisiana. EA Conway’s medical staff of 48 physicians provide a full range of diagnostic and treatment services.

The Center had 6,672 inpatient admissions and 169,384 outpatient visits in 2011.

Hospital-Based Services and Specialties

o Emergency Medicine

o Family Medicine

o Internal Medicine

o Medicine/Pediatrics

o Ophthalmology

o Orthopedics

o Obstetrics/Gynecology

o Pathology

o Pediatrics Medicine

o Psychiatry

o Radiology

o Surgery

Huey P Long Medical Center – Pineville and Alexandria Huey P Long Medical Center is a 137 licensed-bed (60 staffed-bed) acute care hospital with inpatient services in

Pineville and extensive outpatient clinics. The hospital in Pineville was built in 1939, and provides services for a

nine-parish region of Central Louisiana. The Center had 2,353 inpatient admissions and 119,438 outpatient

visits in 2011.

Hospital-Based Services

o Gynecology

o Adult Cardiology

o Pediatric Medicine

o Psychiatry

o Medicine

22

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

23

Selected Specialties

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Neurosurgery

The University Neurosurgery department provides cutting-edge patient care, conducts world-class clinical and

basic research, and offers the highest quality undergraduate and graduate medical education experiences. The

department provides comprehensive treatment of injuries associated with the brain, spine and spinal cord

trauma. The hospital integrates training, research, and technology to help it identify problems and provide the

best treatment for each individual.

The hospital provides state-of-the-art neuroscience treatment facilities including Gamma Knife, Neuro ICU, and

Interventional Neuroradiology and are recognized as the leader for neuroscience in the South.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

24

Selected Specialties

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Gamma Knife

The Gamma Knife has been used in the treatment of more than 200,000 patients at leading healthcare

institutions worldwide. Almost half of these Gamma Knife centers are located in the U.S., and University

Neurosurgery at LSUHSC-S is the first in the State of Louisiana to acquire this technologically advanced

machine. LSUHSC-S has completed over 800 procedures, becoming a leader in stereotactic radiosurgery in the

South.

Unique Treatment Possibilities

The procedure stands unique in its ability to reach areas of the

brain that remain inaccessible through conventional surgery. This

enables patients who were once considered inoperable due to

deeply seated abnormalities or critically located lesions to receive

treatment/cure for their disorders.

Non-invasive & Cost-effective

Through its non-invasive approach to neurological disorders,

Gamma Knife radiosurgery has proven to be a highly cost-effective

method of treatment. By significantly reducing hospital stays and

eliminating post-operative complications such as infection and

hemorrhage, the procedure can cost 30 – 70% less than

conventional surgery.

Sophisticated Technology & Experienced Staff

Patients who choose Gamma Knife radiosurgery at LSUHSC-S for

the treatment of their neurological disorders can remain confident

that their surgery is performed using the most advanced

technology and experienced staff in the field.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

25

Selected Specialties

CONFIDENTIAL

INFORMATION

MEMORANDUM

Center of Excellence

Feist-Weiller Cancer Center

Feist-Weiller Cancer Center was designated as a Center for

Excellence in Cancer Research, Treatment, and Education in

1993 and is made up of both inpatient and outpatient

services. The inpatient unit has 16 beds dedicated to Adult

Oncology patients and 12 beds for Bone Marrow Transplants

patients. Medical oncologists and hematologists at Feist-Weiller Cancer

Center are board certified in internal medicine, then specially

trained and certified in medical oncology and/or

hematology. Specialists in Surgical Oncology, ENT Oncology,

Radiation Oncology, GYN Oncology, Urologic Oncology,

Neuro Oncology and Orthopedic Oncology join forces

with adult and pediatric oncologists and hematologists to

develop the most appropriate and personalized treatment plan

for each patient.

Patient care at Feist-Weiller Cancer Center is comprehensive and unique. Through LSUHS’s partnership with

St. Jude Children's Research Hospital, the outpatient facility includes a St. Jude Affiliate Clinic in which children

are treated according to detailed St. Jude protocols. In addition, adult patients have opportunities to participate

in clinical trials with the newest treatments to combat cancer. Feist-Weiller Cancer Center is humbled by the

number of patients who, by their own choice, take advantage of exploring novel therapeutic interventions. Feist-

Weiller Cancer Center leads enrollment for numerous clinical trials in the Southwest Oncology Group.

Feist-Weiller Cancer Center offers a full-service dedicated outpatient facility with breast imaging including digital

mammography; multidisciplinary cancer clinics for breast, head and neck, gastrointestinal, and lung cancers;

Hereditary Cancer Risk Assessment Program; Molecular Pathology; Cytogenetic Laboratory. Patients are

hospitalized in the adjoining Shreveport Medical Center.

In addition to the ambulatory treatment, the Center also provides genetics counseling for prevention and

detection, data registry, support groups for cancer patients, patient education, quality assurances for both

inpatients and outpatients, and patient relations, which pursues quality-of-life issues and patient satisfaction.

Case management and social services personnel work with patients and agencies for hospice and home health

care follow-up. Radiation therapy is available in the adjacent main hospital facility, as is PET imaging.

Excellence in Cancer

Research, Treatment and

Education

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

26

Selected Specialties

CONFIDENTIAL

INFORMATION

MEMORANDUM

Center of Excellence

Arthritis and Rheumatology

The Center of Excellence for Arthritis and Rheumatology at the Shreveport

Medical Center was established and funded as an Academic Administrative

Unit and budgetary cost center by the Louisiana Legislature in 1990 for the

development and expansion of multidisciplinary, interdepartmental clinical

programs, research, and education.

Since its inception, the Center has sustained and expanded programs of excellence in clinical patient care,

medical education, and research. The development of these comprehensive programs related to arthritis and

other rheumatic diseases has established the Center of Excellence for Arthritis and Rheumatology as one of the

country's exemplary rheumatology programs.

Trauma Center

In 1991, the Shreveport Medical Center was verified and

licensed as the first Regional Trauma Center in Louisiana,

and in 2006, the Center received additional verification as

a Pediatric Trauma Center. Currently the Center receives

the most serious injury cases from northwestern

Louisiana, east Texas, and southwest Arkansas. The

Trauma Center provides round-the-clock, in-hospital

presence of a multidisciplinary trauma team. This includes

emergency physicians, nurses, Trauma surgeons,

anesthesiologists, orthopedic surgeons, operating room teams, radiologic technologists, blood bank personnel,

laboratory personnel, respiratory therapists and social service personnel ready to respond immediately.

The hospital offers a Trauma Transfer Center called LSU STAT. LSU STAT is a 24/7 call center which facilitates

interhospital patient transfers, specifically between ERs and inpatient areas. The new LSU STAT Transfer

Center is designed to expedite transfers from community hospitals and physicians throughout the state directly

to patient units. It provides callers with one call access – taking care of getting an accepting physician, bed

assignment and financial clearance if indicated. In the Trauma Transfer Center’s first twelve months of

operations, September 2011 thru August 2012, 3,400 patient transfers were successfully executed.

With 28 beds in the emergency department, the emergency department receives approximately 65,000 visits in

2011.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

27

Selected Specialties

CONFIDENTIAL

INFORMATION

MEMORANDUM

Regional Burn Center

Established in 1978, the Shreveport Medical Center Regional Burn Center is the

only burn facility in the north and central Louisiana regions. The Burn Unit cares

for both children and adults as well as high level trauma care for severely burned

patients and outpatient care for minor burns.

All burn patients, regardless of the extent of injury, are fast-tracked and seen by specialists in the burn center.

The center has a 15-bed capacity, 7 ICU and 8 step-down beds, operating and recovery rooms, hydrotherapy

unit, outpatient clinic, and research laboratory.

The burn center has a yearly inpatient enrollment of 200 patients. Pediatric admissions range from 30-35% per

year. The outpatient clinic has over 2,500 visits a year from acute burn and healed burn patients.

Approximately 200 operations are performed on acutely burned patients a year, while elective reconstructive

surgery is performed on 70-80 patients annually. The average length of stay is 11 days.

Regional Transplant Center

The Regional Transplant Center (“RTC”) is a value added

partnership between LSUHSC-Sand Willis-Knighton Health

Systems. RTC is certified by Medicare to provide kidney,

pancreas, kidney/pancreas, liver, and liver/kidney transplants.

pancreas transplants. Since its opening in 1989, RTC has

performed over 1,300 organ transplants for residents of

northern Louisiana and beyond. The success of RTC is a

testament to collaborative efforts of LSUHSC-S and Willis-

Knighton to provide clinical expertise and quality care to

patients.

In addition to transplant physicians, hepatologists,

nephrologists, anesthesiologists, pulmonologists and hospital

intensivists, patients are provided with quality care and

assistance from transplant coordinators, dieticians, social

workers, pharmacists, financial coordinators, and

administrators.

RTC is uniquely situated approximately 350 miles south of

Memphis, Tennessee, 400 miles west of Birmingham, Alabama,

250 miles east of Dallas, Texas, and 200 miles north of

Houston, Texas, which are the closest hospitals providing

similar services.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Operating Statistics

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

29

Statistics

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Discharged Patients

Shreveport Medical Center’s top 20 specialty practice areas by charges submitted for reimbursement, are

presented in the table below.

Rank Specialty

Number of

Discharged

Patients Charges

1 Internal Medicine

4,312 $ 60,534,277

2 Neurosurgery

1,116 $ 36,041,525

3 Trauma

836 $ 30,889,320

4 Surgery

1,155 $ 27,575,750

5 Psychiatry

901 $ 20,205,600

6 Medical ICU

350 $ 18,364,762

7 Obstetrics

1,528 $ 15,940,904

8 Pediatrics

1,253 $ 15,190,348

9 Neonatology

1,197 $ 13,283,590

10 Orthopedics

588 $ 12,247,574

11 Cardiothoracic Surgery

179 $ 11,289,641

12 Hematology

429 $ 9,684,555

13 Neonatal ICU

74 $ 8,097,454

14 Cardiology

360 $ 8,035,585

15 Emergency Medicine

672 $ 7,669,427

16 Neurology

602 $ 7,429,803

17 Otolaryngology/ENT

311 $ 5,766,618

18 Oncology

176 $ 5,645,715

19 Transplant

114 $ 4,957,901

20 Gynecology

368 $ 4,780,560

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

30

Statistics

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Top 20 Base MS-DRGs

The table below presents the top 20 DRGs measured by number of unique patients diagnosed at Shreveport

Medical Center for the ten months ended June 30, 2012.

DRG Description Total

Patients

Average

LOS

Case

Mix

885 PSYCHOSES 870 17.73 0.9004

567 VAGINAL DELIVERY W/O COMPLICATING DIAGNOSES 598 2.07 .5176

795 NORMAL NEWBORN 580 2.05 .1640

812 RED BLOOD CELL DISORDERS W/O MCC 567 3.80 .7910

313 CHEST PAIN 467 1.68 .5474

794 NEONATE W OTHER SIGNIFICANT PROBLEMS 403 2.74 1.2123

781 OTHER ANTEPARTUM DIAGNOSES W MEDICAL COMPLIC 366 5.59 0.6693

392 ESOPHAGITIS, GASTROENT & MISC DIGEST DISORDERS W 344 2.69 0.7106

765 CESAREAN SECTION W CC/MCC 335 5.22 1.1225

603 CELLULITIS W/O MCC 329 3.61 0.8316

774 VAGINAL DELIVERY W COMPLICATING DIAGNOSES 310 3.10 0.6853

743 UTERINE & ADNEXA PROC FOR NON-MALIGNANCY W/O 300 2.13 0.9005

101 SEIZURES W/O MCC 293 2.60 0.7607

641 NUTRITIONAL & MISC METABOLIC DISORDERS W/O MCC 232 3.59 0.6901

494 LOWER EXTREM & HUMER PROC EXCEPT HIP,FOOT,FEM 212 2.54 1.2988

287 CIRCULATORY DISORDERS EXCEPT AMI, W CARD CATH 209 3.44 1.0743

847 CHEMOTHERAPY W/O ACUTE LEUKEMIA AS SECONDARY 206 3.93 0.9729

897 ALCOHOL/DRUG ABUSE OR DEPENDENCE W/O REHABILI 198 6.84 0.6465

766 CESAREAN SECTION W/O CC/MCC 187 2.88 0.7865

027 CRANIOTOMY & ENDOVASCULAR INTRACRANIAL PROC 185 4.56 2.1195

(1) LOS stands for length of stay.

(1)

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

31

Statistics

CONFIDENTIAL

INFORMATION

MEMORANDUM

For the 10 months ended August 31, 2012, LSUHSC-S submitted total patient charges for reimbursement of

$355.4 million. For presentation purposes, only service lines for which patient charges exceeded $100,000 are

included in the table below. Omitted from the table are Endocrinology, Infectious Disease, Maternal-Fetal

Medicine, Gastroenterology, Cardiac Cath, and Pulmonology.

$- $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000

Pediatric Sedation

Radiology

Cardiac ICU

Ophthalmology

Neuro ICU

Plastic Surgery

Surgical ICU

Vascular Surgery

Family Medicine

Urology

Oral & Maxillofacial Surgery

Burn

Nephrology

Pediatric ICU

Gynecology

Transplant

Oncology

Otolaryngology/ENT

Neurology

Emergency Medicine

Cardiology

Neonatal ICU

Hematology

Cardiothoracic Surgery

Orthopedics

Neonatology

Pediatrics

Obstetrics

Medical ICU

Psychiatry

Surgery

Trauma

Neurosurgery

Internal Medicine

Patient Charges by Specialty

10 Mos. Ended 8/31/2012

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

2009 2010 2011 2009 2010 2011 2009 2010 2011

Capacity

Licensed beds 459 459 452 137 137 137 247 247 247

Adult/pediatric staffed beds 502 429 386 44 40 44 158 103 103

Psychiatric staffed beds 51 51 51 16 16 16 27 26 26

Neonatal ICU staffed beds 40 40 40 - - - 13 13 13

Inpatient Admissions

Adult/pediatric 20,990 21,389 18,237 2,313 2,063 1,827 5,781 5,647 5,353

Psychiatric 653 981 1,164 454 433 483 524 390 348

Neonatal 425 371 327 - - - 81 91 69

Nursery 1,296 1,173 1,174 146 96 43 950 940 878

Live births 2,283 1,516 1,471 146 96 42 1,029 1,030 949

Adult/pediatric 143,582 136,087 130,021 12,010 10,688 8,828 26,751 27,325 24,108

Psychiatric 18,519 18,473 18,465 5,512 5,537 5,731 8,954 8,424 8,661

Neonatal 12,380 10,854 9,071 - - - 1,784 1,997 1,448

Nursery 3,481 3,195 2,939 454 349 151 2,486 2,421 2,121

Outpatient

Outpatient encounters 451,341 447,295 422,733 87,161 75,325 75,262 147,992 147,461 141,280

Emergency dept. encounters 57,493 58,388 60,425 36,564 38,916 37,758 32,668 37,805 35,618

Outpatient clinic visits 393,848 388,907 362,308 50,597 42,361 41,954 115,324 109,656 105,662

Shreveport Medical Center

Inpatient days

Huey P. Long Medical Center EA Conway Medical Center

32

Key Indicators

CONFIDENTIAL

INFORMATION

MEMORANDUM

2011 Key Indicators

Combined licensed-beds: 863; Combined staffed-beds: 529

Total inpatient admissions: 29,903

Outpatient encounters: 639,275

(1)

(1) At fiscal year end June 30, 2011, LSUHC-S, EA Conway, and HP Long had 352 staffed beds, 117 staffed beds, and

60 staffed beds, respectively.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

33 CONFIDENTIAL

INFORMATION

MEMORANDUM

Funding Sources

Shreveport Medical Center

For fiscal years 2009, 2010 and 2011, government insurance programs accounted for 81.5% of 2009 revenue,

82% of 2010 revenue, and 79% of 2011 revenue. General Funds Direct, Self-Generated, and IAT Other account

for the other portion of annual revenue.

Huey P. Long Medical Center

For fiscal years 2009, 2010 and 2011, government insurance programs accounted for 75.2% of 2009 revenue,

76% of 2010 revenue, and 77.6% of 2011 revenue. General Funds Direct and Self-Generated accounted for the

other portion of annual revenue.

EA Conway Medical Center

For fiscal years 2009, 2010 and 2011, government insurance programs accounted for 81.7% of 2009 revenue,

84% of 2010 revenue, and 90.4% of 2011 revenue. General Funds Direct and Self-Generated accounted for the

other portion of annual revenue.

Shreveport Medical Center Huey P. Long E. A. Conway

2009 2010 2011 2009 2010 2011 2009 2010 2011

Uncompensated Care 33.5% 32.0% 44.8% 46.5% 44.0% 53.4% 41.8% 40.0% 64.0%

Medicaid Claims 29.7% 33.0% 25.9% 23.3% 24.0% 17.6% 29.5% 35.0% 20.3%

Medicare Claims 18.3% 17.0% 8.3% 5.4% 8.0% 6.6% 10.4% 9.0% 6.1%

General Funds Direct 4.6% 4.0% 6.3% 21.8% 21.0% 19.5% 15.0% 13.0% 7.6%

Self-Generated 13.8% 14.0% 5.9% 3.0% 3.0% 2.8% 3.2% 3.0% 2.1%

IAT Other 0.0% 0.0% 8.8% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Total 99.9% 100.0% 100.0% 100.0% 100.0% 99.9% 99.9% 100.0% 100.1%

Payor Mix

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Institutions & Foundations

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

35

Academic Institutions

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Louisiana State University Medical School is comprised of two separate academic institutions: LSU

School of Medicine in Shreveport and LSU School of Medicine in New Orleans. When discussing or

referencing academic institution going forward, we are referring to LSU School of Medicine in

Shreveport.

Founded in 1969, the LSU School of Medicine in Shreveport (the “Academic Institution”) supplies

North and Central Louisiana with high quality medical professionals. The Academic Institution offers

Medical School & Residency Programs, School of Allied Health Professionals, and School of Graduate

Studies.

Medical School and Residency Programs

o 3,521 physicians trained since 1973

o Approximately seven (7) out ten (10) graduates practice

medicine in the region upon completion of the Residency

Program

School of Allied Health Professions

o 2,514 Graduates

o Areas of specialization include therapy (speech, occupational, and

physical), wound care, physician assistants, cardio-pulmonary, and

lab technologists.

School of Graduate Studies

o 402 Graduates

o Areas of specialization include research, faculty, and pharma

2011 LSU Health -

Shreveport Facts

472 medical students, 327 Allied

Health Students, and 71 graduate

students

7 BS, MS & PhD Programs

604 faculty members (509 full-

time and 95 part-time)

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

36

SUPPORTING FOUNDATIONS

CONFIDENTIAL

INFORMATION

MEMORANDUM

LSU Health Sciences Foundation in Shreveport

The LSU Health Sciences Foundation in Shreveport is an affiliated, private, nonprofit corporation dedicated to

supporting LSUHSC-S. The Foundation is an institutionally-related foundation, exempt from Federal income

tax under 501(c)(3) of the Internal Revenue Code.

The Foundation was chartered by the Secretary of State in 1997. Over the years, the Foundation has played a

valuable role in supporting LSUHSC-S. It maintains and invests LSUHSC-S endowments, which include seven

chairs and 40 professorships.

The organizations goal is to support, enhance, and assist the LSUHSC-S in its many endeavors by expanding the

public's awareness of the LSUHSC-S's many contributions to medical research, education of medical

professionals, and quality health care, to develop and enhance financial support for the Center, and provide the

means through which financial support is received and administered.

The Foundation also seeks to create additional avenues of funding that will allow LSUHSC-S to grow. It’s

mission is to inspire donors to invest in LSU Health Shreveport and steward contributions toward its support.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

37

SUPPORTING FOUNDATIONS

CONFIDENTIAL

INFORMATION

MEMORANDUM

Biomedical Research Foundation of Northwest Louisiana

The Biomedical Research Foundation of Northwest Louisiana (BRF) is an independent, nonprofit, 501(c)(3)

organization established in 1986. The Foundation was founded through a recommendation from the Mt. Auburn

Study, an economic development report that identified new initiatives to diversify the Shreveport-Bossier

economy. Seed funding for the creation of the Foundation was provided by the Caddo Parish Commission and

the Shreveport Chamber of Commerce.

With 51 employees and a volunteer board of directors, the Foundation manages a $16 million operating budget

and $93 million in assets. In fulfilling its mission, the Foundation supports these four initiatives:

InterTech Science Park for life science and related technologies

Positron Emission Tomography (PET) Imaging Center and Southern Isotopes

Education and Workforce Development programs

Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) support

Since its inception, the Biomedical Research Foundation of Northwest Louisiana has been a major supporter of

the scientific and teaching efforts at LSUHSC-S. To increase the scientific capacity of Shreveport Medical

Center, in 1994 the Foundation completed the Virginia K. Shehee Biomedical Research Institute, a 160,000

square foot, $37 million research facility with 56 wet laboratories where over 240 investigators and technicians

from LSUHSC-S conduct basic research. In addition the Foundation supports LSUHSC-S research by providing

annually over $500,000 of seed research grants and extramural transitional funding to investigators in the

Institute, and has granted to date over $2.4 million to acquire specialized technology and hire renowned medical

specialists.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

38

Affiliations/Partnerships

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

LSUHSC-S serves as a community resource for the surrounding region. Through hundreds of formal

agreements that support education and training, LSUHSC-S partners with local public school boards, other

institutions of higher education, area hospitals, and emergency first responders. Listed below are some of our

most prominent partners and the programs in which we collaborate:

LSU Shreveport Health Sciences Foundation is a charitable foundation inspires donors to contribute

capital to LSUHSC-S for the betterment of the local population. Donors’ financial contributions are used to

attract, develop and retain exceptional faculty and students as well as fund research programs and patient

care initiatives.

LSU Shreveport (School) opened its doors in 1967 and has become the leading regional urban

comprehensive university in the Shreveport-Bossier metropolitan area. Through a long-standing partnership

between LSUHSC-S and LSU Shreveport (School), students are able to earn a Master’s in Public Health.

Biomedical Research Foundation of Northwest Louisiana (“Biomedical Research Foundation”)

was established in 1986 with initial funding provided by the Caddo parish Commission and the Shreveport

Chamber of Commerce. The Biomedical Research Foundation mission is to pioneer a knowledge-based

economy by cultivating and attracting life science enterprises and related technologies.

Overton Brooks Veteran Affairs Medical Center (“OVAMC”), located in Shreveport, Louisiana,

admitted its first patient in 1950. OVAMC and associated CBOC's (Community Based Outpatient Clinics)

are part of the South Central Health Care Network, VISN 16. "VISN" stands for Veterans Integrated Service

Network. VISN 16 provides comprehensive inpatient and outpatient health care, and limited nursing home

and domiciliary care, to eligible veterans of the U.S. Armed Services.

Shriners Hospitals for Children in Shreveport (“Shriners Hospitals”) founded in 1922, Shriners

Hospitals for Children® — Shreveport combines a child-friendly environment with world-class medical care

for children with a host of orthopaedic and neuromusculoskeletal disorders and diseases. Colorful treatment

rooms, a spacious outdoor playground, and a wide range of rehabilitation activities give kids confidence and

build life skills. Our medical team – from doctors and nurses to therapists and orthotists – puts the family

first every step of the way.

St. Jude Children’s Research Hospital (“St. Jude”) opened its doors in 1962 with the primary mission

to find cures for children with cancer and other catastrophic diseases through research and treatment. St.

Jude is unlike any other pediatric treatment and research facility. Discoveries made at St. Jude have changed

how the world treats children with cancer and other catastrophic diseases. With research and patient care

under one roof, St. Jude is where some of today's most gifted researchers are able to do science more

quickly.

Willis-Knighton Health System (“Willis-Knighton”) is a community based health care system in

Shreveport, Louisiana. The Regional Transplant Center, a value added partnership formed in 1989 between

LSUHSC-S and Willis-Knighton, is certified by Medicare to provide kidney, pancreas, kidney/pancreas, liver,

and liver/kidney transplants.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Service Area & Competition

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

40 CONFIDENTIAL

INFORMATION

MEMORANDUM

Primary Service Area

Northwest Louisiana PSA

The Northwest Louisiana PSA is served primarily by the Shreveport Medical Center and accounts for

56.7% of LSUHSC-S’s inpatient visits and 50.4% of its outpatient visits. The service territory encompasses

seven parishes: Bienville, Bossier, Caddo, Claiborne, Desoto, Lincoln, Natchitoches, Red River, Sabine, and

Webster.

The Shreveport-Bossier MSA best describes this region, which includes three parishes: De Soto, Bossier,

and Caddo. Shreveport is the third largest city in the State of Louisiana and the commercial and cultural

center of the tri-state area where Arkansas, Louisiana, and Texas meet. As of July 2011, the MSA had a

population of approximately 403,600. Notably, Shreveport’s population grew 8.9% from 2000 to 2010.

The Shreveport-Bossier MSA is ranked seventh among mid-size metropolitan areas in Forbes’ annual “Best

Cities for Jobs.” The cost of living is 4.8% below the national average.

Northeast Louisiana PSA

The Northeast Louisiana PSA is served primarily by the EA Conway Medical Center and accounts for

28.6% LSUHSC-S’s inpatient visits and 26.3% of its outpatient visits. The service territory includes eleven

parishes: Caldwell, East Carroll, Franklin, Jackson, Lincoln, Madison, Morehouse, Ouachita, Richland,

Tensas, and Union.

The Monroe MSA best describes this region, which encompasses two parishes: Ouachita and Union.

Monroe is located in northeast Louisiana, approximately 100 miles from Shreveport, Louisiana and 120

miles west of Jackson, Mississippi. As of July 2011, there were approximately 177,700 people residing

within the MSA. Monroe, Louisiana is the ninth largest city in the state. The economic sectors accounting

for the most jobs in Monroe, Louisiana include government, education and health services, and trade,

transportation and utilities. The median household income in Monroe, Louisiana was $38,207 in 2010 and

is projected to increase to $40,853 in 2015. In Louisiana, the Monroe MSA is expected to see the largest

percentage job growth over the next two years. The cost of living is 7.4% below the national average.

Central Louisiana PSA

The Central Louisiana PSA is served primarily by the Huey P. Long Medical center and accounts for 11.0%

of LSUHSC-S’s inpatient visits and 21.3% of its outpatient visits. The service territory encompasses eight

parishes: Avoyelles, Catahoula, Concordia, Grant, La Salle, Rapides, Vernon, and Winn.

The Alexandria MSA best describes this region, which includes two parishes: Rapides and Grant. Located

approximately 125 miles from Shreveport and 120 miles from Baton Rouge, Alexandria is the principal

city of the MSA, and its neighboring city is Pineville. As Alexandria is at the cusp of Cajun culture's

extension to the north, the city recognizes Mardi Gras as an official holiday, and a major cultural festivity.

As of July 2011, the MSA had a population of 154,600. The economic sectors accounting for the most

jobs in Alexandria, Louisiana include government, and trade, transportation and utilities. The median

household income in Monroe, Louisiana was $35,692 in 2010. The cost of living is 7.2% below the national

average.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Arkansas

Mississippi

Texas

Cad

do

Boss

ier

Webst

er

Claiborne Union Morehouse

Eas

t C

arro

ll

Madison

Franklin

Ouachita

Lincoln

Bienville Jackson

Red River De Soto

Winn

Caldwell Tensas

La

Sal

le

Grant

Nat

chitoch

es

Sabine Cat

ahoula

Conco

rdia

Vernon Rapides Avoyelles

Beauregard Allen

Eva

nge

line

Sai

nt

Lan

dry

Calcasieu

Cameron Vermilion

Arcadia

East Feliciana

Lafayette Saint Martin

Iberia

Saint Mary

Ass

um

ption

Ascension Iberville

West Feliciana

Sain

t H

ele

na

Livingston

Washington

Tan

gipah

oa

St. Tammany

Saint James

Saint Charles

Jeffers

on

Orleans

Saint Bernard

Plaquemines

Lafourche

Terrebonne

East Baton Rouge West

Baton Rouge

41 CONFIDENTIAL

INFORMATION

MEMORANDUM

Service Area

TOTAL REGIONS

Inpatients = 22,062

Outpatients = 450,546

Inpatient = 525

Outpatient = 6,643

Inpatient = 276

Outpatient = 2,619

Inpatient = 25

Outpatient = 172

Inpatient = 15

Outpatient = 128

Inpatient = 19

Outpatient = 125

Inpatient = 34

Outpatient = 322

Inpatient = 1,260

Outpatient = 39,939

Inpatient = 2,423

Outpatient = 31,162

Inpatient = 17,485

Outpatient = 369,616

Secondary Service Area -

North

Shreveport Medical Center Total Patient Visits By Region

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Arkansas

Mississippi

Texas

Cad

do

Boss

ier

Webst

er

Claiborne Union Morehouse

Eas

t C

arro

ll

Madison

Franklin

Ouachita

Lincoln

Bienville Jackson

Red River De Soto

Winn

Caldwell Tensas

La

Sal

le

Grant

Nat

chitoch

es

Sabine Cat

ahoula

Conco

rdia

Vernon Rapides Avoyelles

Beauregard Allen

Eva

nge

line

Sai

nt

Lan

dry

Calcasieu

Cameron Vermilion

Arcadia

East Feliciana

Lafayette Saint Martin

Iberia

Saint Mary

Ass

um

ption

Ascension Iberville

West Feliciana

Sain

t H

ele

na

Livingston

Washington

Tan

gipah

oa

St. Tammany

Saint James

Saint Charles

Jeffers

on

Orleans

Saint Bernard

Plaquemines

Lafourche

Terrebonne

East Baton Rouge West

Baton Rouge

Secondary Service Area -

North

42

Service Area

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$2.10 MM

35.8%

$2.10 MM

TOTAL REGIONS

Inpatients = 6,649

Outpatients = 168,951

Inpatient = 61

Outpatient = 1,503

Inpatient = 6,438

Outpatient = 162,912

Inpatient = 3

Outpatient = 32

Inpatient = 7

Outpatient = 59

Inpatient = 4

Outpatient = 50

Inpatient = 3

Outpatient = 83

Inpatient = 124

Outpatient = 4,218

Inpatient = 6

Outpatient = 59

Inpatient = 3

Outpatient = 35

EA Conway Medical Center Total Patient Visits By Region

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

43

Service Area

CONFIDENTIAL

INFORMATION

MEMORANDUM

TOTAL REGIONS

Inpatients = 2,355

Outpatients = 121,209

Arkansas

Mississippi

Texas

Cad

do

Boss

ier

Webst

er

Claiborne Union Morehouse

Eas

t C

arro

ll

Madison

Franklin

Ouachita

Lincoln

Bienville Jackson

Red River De Soto

Winn

Caldwell Tensas

La

Sal

le

Grant

Nat

chitoch

es

Sabine Cat

ahoula

Conco

rdia

Vernon Rapides Avoyelles

Beauregard Allen

Eva

nge

line

Sai

nt

Lan

dry

Calcasieu

Cameron Vermilion

Arcadia

East Feliciana

Lafayette Saint Martin

Iberia

Saint Mary

Ass

um

ption

Ascension Iberville

West Feliciana

Sain

t H

ele

na

Livingston

Washington

Tan

gipah

oa

St. Tammany

Saint James

Saint Charles

Jeffers

on

Orleans

Saint Bernard

Plaquemines

Lafourche

Terrebonne

East Baton Rouge West

Baton Rouge

Secondary Service Area -

North

$2.10 MM $2.10 MM

Inpatient = 64

Outpatient = 1,827

Inpatient = 28

Outpatient = 456

Inpatient = 115

Outpatient = 2,990

Inpatient = 56

Outpatient = 1,824

Inpatient = 5

Outpatient = 48

Inpatient = 2

Outpatient = 74

Inpatient = 2,048

Outpatient = 113,566

Inpatient = 14

Outpatient = 55

Inpatient = 23

Outpatient = 369

Huey P. Long Medical Center Total Patient Visits By Region

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Texas

Mississippi

Arkansas

Caddo

Bossier Webster

Claiborne Union

Morehouse

West Carroll

East Carroll

Madison

Franklin

Ouachita

Lincoln

Bienville Jackson

Red River De Soto

Winn

Caldwell

Tensas

La Salle Grant

Natchitoches

Sabine

Catahoula

Concordia

Vernon Rapides

Avoyelles

Richard

Northwest Louisiana PSA

Hospital

Licensed

Beds

1. Willis-Knighton Health System 902

2. CHRISTUS Schumpert Medical Center 330

3. Shreveport Medical Center 452

4. CHRISTUS Highland Medical Center 160

5. Overton Brooks VA Medical Center 112

Northeast Louisiana PSA

Hospital

Licensed

Beds

6. St. Francis Medical Center 331

7. EA Conway Medical Center

247

1 2 5 4

6

8

EA Conway

Medical Center

Huey P. Long

Medical Center

Shreveport

Medical Center

44 CONFIDENTIAL

INFORMATION

MEMORANDUM

Competitive Landscape

The LSUHSC-S has 863 combined licensed-beds, including 452 in the Shreveport Medical Center, 247 in the EA

Conway Medical Center, and 137 in the Huey P. Long Medical Center. LSUHSC-S staffs 352 beds in Shreveport

Medical Center, 117 in EA Conway Medical Center and 60 in Huey P. Long Medical Center.

3 7

9

Central Louisiana PSA

Hospital

Licensed

Beds

8. CHRISTUS St. Frances Cabrini Hospital 241

9. Huey P. Long Medical Center

137

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

45 CONFIDENTIAL

INFORMATION

MEMORANDUM

Willis-Knighton Health System

Shreveport, Louisiana

5,725 Employees Willis-Knighton Health System is a community based health system in the Shreveport-Bossier City area. This

health system is rated one of the top 100 hospitals in the U.S. and includes four hospitals as well as a retirement

community and a full range of support services. Willis-Knighton Medical Center has 902 beds. The hospital had

56,903 admissions in the latest year for which data are available. It performed 12,830 annual inpatient and

23,619 outpatient surgeries.

Willis-Knighton Health System and LSUHSC-S have had a unique partnership since 1989 when they opened the

Regional Transplant Center. The Regional Transplant Center has performed more than 1,300 organ transplants

for those living in the northern Louisiana area and beyond. Its success is the result of a continued commitment

from the two major health systems to provide clinical expertise and quality care to patients in this region.

St. Francis Medical Center

Monroe, Louisiana

2,262 Employees St. Francis Medical Center is a general medical and surgical hospital in Monroe. It is Northeast Louisiana’s only

faith-based not-for-profit healthcare provider and is proud to be the largest private employer in Ouachita

Parish. St. Francis Medical Center has 331 beds. The hospital had 16,407 admissions in the latest year for which

data are available. It performed 3,053 annual inpatient and 3,267 outpatient surgeries. Its emergency room had

53,902 visits.

CHRISTUS Health System

Dallas, Texas

1,900 Employees (Louisiana) Ranked among the top 10 Catholic health systems in the United States by size, the CHRISTUS Health system

includes more than 40 hospitals and facilities in seven U.S. states and six states in Mexico, with assets of more

than $4.6 billion. In Louisiana, the health system operates CHRISTUS Health Shreveport-Bossier, a 731-bed

integrated health system with CHRISTUS Schumpert Medical Center and CHRISTUS Highland Medical Center,

and CHRISTUS St. Frances Cabrini Hospital in Alexandria.

Overton Brooks VA Medical Center

Shreveport, Louisiana

1,588 Employees Overton Brooks Veterans Affairs Medical Center is a general medical and surgical hospital in Shreveport with

112 beds. The Medical Center serves a population of over 131,000 veterans residing within its primary service

area which encompasses 15 northeast Texas counties, five southwestern Arkansas counties and 12 northwest

Louisiana parishes. Outpatient visits are over 330,900 visits per year.

The Medical Center is affiliated with LSUHSC-Sand has sharing agreements with the 2d Medical Group at

Barksdale Air Force Base and LSU Health Sciences Center.

Competitive Landscape

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Facilities

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

47

Facilities

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

The Shreveport Medical Center campus occupies a key strategic location between Shiners' Hospital for

Children, the InterTech Science Park, and Willis-Knighton’s main campus to create a medical district for the

City of Shreveport.

The following page illustrate the location and purposes of the many buildings located in Shreveport, Louisiana

that are owned by the LSUHSC-S.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

48

Shreveport Campus Map

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

1 School of Medicine

School

Built: 1975;Ten Stories; 480,250 SF

2 Allied Health School

Built: 2007; Four Stories; 71,400 SF

3 Hospital

Medical Center

Built: 1953; Eleven Stories; 416,985 SF

4 Outpatient Department

Medical Center

Built: 1973; Four Stories; 52,250

5 Biomedical Research Institute

Independent

Built: 1994; Ten Stories; 160,250 SF

6 Ambulatory Care Center

Medical Center

Built: 2004; Three Stories; 164,250 SF

7 Women’s and Children’s Center

Medical Center

Built: 2000; Two Stories; 47,850 SF

8 Feist-Weiller Cancer Center Medical Center Built: 2004; Four Stories; 57,750 SF

9 Speech & Hearing Center

School & Medical Center

Built: 2002; One Story; 9,000 SF

14 Patient Admitting (K-Wing)

Medical Center

Built: 1982; Twelve Stories; 241,530 SF

15 Physical Plant Building

School & Medical Center

Built: 1993; Two Stories; 21,275 SF

16 Student Union

School

Built: 1989; One Story; 2,000 SF

17 Comprehensive Care

Medical Center

Built: 1975; Five Stories; 49,000 SF

10 Clinical Research Building

School

Built: 1967; One Story; 19,250 SF

11 Administration Building

School & Medical Center

Built: 1953; Seven Stories; 68,500 SF

12 Radiation Therapy Center

Medical Center

Built: 2002; Two Stories; 28,200 SF

13 Eye Clinic

Medical Center

Built: 1967; One Story; 10,500 SF

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Organization & Executive Management

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Organization

50 CONFIDENTIAL

INFORMATION

MEMORANDUM

Catherine

Nobile, ESQ

Foundation

President

Susan Armstrong,

RN JD MBA

Senior Counsel

Compliance

Committee

Robert Walter, MD

MPH

Medical Director

HRPP

Joseph

McCulloch, PhD,

Dean School of

Allied Health

Professions

Sandra Roerig,

PhD

Dean School of

Graduate Studies

Andrew Chesson,

Jr, MD

Dean School of

Medicine

Hugh Mighty,

MD MBA

Vice Chancellor

For Clinical Affairs

Robert Barish,

MD MBA

Chancellor

Mimi Hedgcock

Executive Director

Government

Relations

Joseph Miciotto,

MS

Administrator

LSU Medical Center

John Dailey

JD MPA

Vice Chancellor for

Administration

Gary Crockett

Administrator

HP Long MC

Aryon McGuire

Administrator

EA Conway MC

Kevin Sittig, MD

Senior Associate Dean

Chief Medical Officer

Sally Croom

Executive Director of Communications and

Public Relations

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

51 CONFIDENTIAL

INFORMATION

MEMORANDUM

Executive Management Robert A. Barish, MD, MBA, Chancellor

Chancellor Robert A. Barish, MD, MBA, assumed leadership of the LSU Health Sciences Center at Shreveport in April

2009 following a distinguished 24-year career in academic medicine at the University of Maryland Medical Center. It was in

Maryland where he founded a nationally recognized emergency medicine program before rising to Vice Dean of Clinical

Affairs at the University of Maryland School of Medicine.

After earning his medical degree from New York Medical College in 1979, Dr. Barish interrupted his residency training for

one year to help care for malaria victims and starving children in refugee camps in Cambodia and Somalia. Returning to the

United States, he completed his internal medicine residency training and subsequently completed a second residency in

emergency medicine. He became one of the youngest chiefs of emergency services at a university hospital in the nation.

Dr. Barish received his MBA from Loyola College and BA from the University of New Hampshire. He is a member of

Alpha Omega Alpha Honor Medical Society, a Fellow of the American College of Emergency Physicians, a Fellow of the

American Academy of Emergency Medicine, and is a Distinguished Eagle Scout and the recipient of numerous teaching

awards. Following the 2005 devastation of Hurricane Katrina to the Gulf Coast, he helped lead a medical regiment

dispatched by the State of Maryland that delivered emergency care to more than 6,000 hurricane victims in Jefferson

Parish. A former lieutenant colonel and flight surgeon in the Maryland Air National Guard, Dr. Barish in 1992 was among a

select group invited to become a NASA astronaut candidate at the Johnson Space Center in Houston.

Hugh E. Mighty, MD, MBA

Dr. Mighty joined the LSUHSC-S leadership team in 2010 as the Vice Chancellor of Clinical Affairs. In this role he has

oversight of the faculty practice plan, the offices of budget and finance for the Shreveport medical center and its two

affiliates EA Conway and Huey P Long, as well as the Information Technology divisions of the three hospitals. Additionally

he oversees the Department of EEO and Diversity.

In the past year he has shepherded the deployment and implementation of the electronic medical record (EPIC) into a

system wide integration of both clinical and revenue cycle processes; while also helping to convert the financial model from

a traditionally cost based to a revenue based operation.

Dr Mighty received a BS from Georgetown University, an MD degree from the University of Maryland, and his MBA from

Loyola University in Baltimore.

Immediately prior to assuming his post at LSUHSC-S, Dr. Mighty served for 10 years as chairman of Obstetrics,

Gynecology and Reproductive Services at the University of Maryland School of Medicine and Chief of obstetrics/gynecology

at the University of Maryland Medical Center. While there he served on many committees and boards including President

of the medical staff, Chairman of the Clinical Advisory Committee for the faculty practice plan, member of the University

Board of Trustees for the medical School, and Member of the Fiscal Affairs Advisory Committee.

Dr. Mighty is among a small number of physicians nationally who are Board certified not only in Obstetrics and

Gynecology, and Maternal and Fetal Medicine, but also board certified in critical care medicine. His special clinical interests

are, maternal medical disorders, critical care medicine, and the use of simulation in competency evaluation.

He has developed successful programs in the use of simulation for improving clinical competence and the use of a

statewide telemedicine program in Maryland to improve access to specialty care.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

52 CONFIDENTIAL

INFORMATION

MEMORANDUM

Executive Management John Dailey JD MPA, Vice Chancellor Administration

In 2009, John Dailey joined LSU Health Shreveport as the Vice Chancellor for Administration. Mr. Dailey provides

executive oversight for selected administrative services and operations. This includes communications/public

affairs, human resources, master facility planning, material management, and auxiliary services. Beyond

Shreveport, he oversees the Huey P Long Medical Center in Pineville/Alexandria and the EA Conway Medical

Center in Monroe. In Shreveport, he is responsible for the transfer center and trauma service line. Prior to joining

LSU, Mr. Dailey was a Vice President with Navvis Healthcare, a national consultancy where he assisted hospital

clients with practice acquisitions, service line implementation and surgery center development. His background

also includes senior roles with the University of Maryland Medical Center and New York-Presbyterian Healthcare

System. A former paramedic, his credentials include a JD from the University of Maryland School of Law, an MPA

from the University of Baltimore and a BA from the State University of New York at Stony Brook. He is admitted to

legal practice in Maryland and a Fellow of the American College of Healthcare Executives. His publications cover

a number of subjects including the economics of trauma center closures, substance use and injury, and the

biodynamics of high speed car crashes. Over his career, he has helped to develop group practices, referral

centers as well as the Charles McC. Mathias, Jr. National Study Center for Trauma/EMS, a Congressionally

designated injury research center in Baltimore. In 2011, Mr. Dailey was appointed by Governor Bobby Jindal to

the Board of Directors of the Louisiana Emergency Response Network.

Sally Croom, Executive Director of Communications and Public Relations

LSU Health Shreveport’s Executive Director of Communications and Public Relations, Sally Croom is a former

journalist with more than 20 years experience in medical marketing and communications. She was a member of

the management team for the local ABC-TV affiliate station in Shreveport and also worked on national television

projects for several major pharmaceutical and medical device manufacturers. In addition, she previously led

marketing and public relations efforts for a local not-for-profit hospital system. Sally is a graduate of Ball State

University.

Joseph Miciotto, Hospital Administrator

Joseph Miciotto, a graduate of the health care administration program at Trinity University, San Antonio, TX (Masters of

Science) has enjoyed a long outstanding career with the Health Sciences Center. After his recruitment to Shreveport, Joe

served as one of a handful of leaders, who would facilitate the emergence of LSUHSC from the Confederate Memorial

Medical Center in the mid 70’s.

Instrumental in the organizational transfer of the institution from a charity hospital into a university teaching facility, Joe

was involved in every facet of the transformation including faculty recruitment, tertiary program development, employee

development and capital development. His contribution relative to capital improvements/projects is evident in most

hospital projects.

Prior to joining the staff of Confederate Memorial a year prior of the transfer to LSU, he was a member of the senior

administrative staff at St. Francis Medical Center in Monroe, LA. Throughout his professional carrier Joe has served on

many community boards and committees. A member of the American College of Healthcare Executives, Joe is a preceptor

in health care administration for several universities. His commitment to furthering the development of young professions

has resulted in residents from Trinity University, LSU-S and the University of Arkansas.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

53 CONFIDENTIAL

INFORMATION

MEMORANDUM

Kevin Mark Sittig, MD, Chief Medical Officer

Dr. Sittig is the Senior Associate Dean and the Chief Medical Officer at LSU Health Sciences Center in Shreveport. As a

skilled surgeon, he has served in many other distinguished roles including the Director of the LSU Regional Burn Center

since 1994.

After earning his BS from Louisiana State University in Baton Rouge, Louisiana, he continued with his medical degree from

LSU Health Science Center in Shreveport and went on to do an Internship and Residency in surgery from 1983-1989, with

an overlapping fellowship in burns in 1986 and 1987. He obtained advanced endoscopic training in Opelika, Alabama at the

East Alabama Medical Center and soon returned to LSU Health Science Center to continue his surgical and burn career.

The Percy Johnson Burn Foundation was established in 1989 by a grateful patient and Dr. Sittig has been the President of

the foundation since 1992. The foundation sponsors an annual children's summer camp. The establishment of the Chaler-

Rods House in 2003 provides lodging and support for out-of-town relatives of patients being treated at the LSU Regional

Burn Center.

Dr. Sittig is a member of the Board of Directors of the LSU Health Sciences Foundation and Advisory Board of the Center

of Excellence for Arthritis and Rheumatology (CEAR). Medical Society memberships include American Burn Association,

Alpha Omega Alpha, American College of Surgeons Fellow, American Medical Association, LSU-Shreveport Surgical

Society, LA Chapter, American College of Surgeons, Southern Medical Association, Shreveport Medical Society to mention

a few. He holds membership in many Hospital and Medical School Committees.

Aryon McGuire, Hospital Administrator - E.A. Conway Medical Center

A healthcare executive with over thirty-eight years' tenure, Mr. McGuire specializes in organizational efficiency and

improvement with a long-term successful track record of fiscal management. He began his career at E. A. Conway in 1991

as the Chief Financial Officer and was promoted in 1999 to the Associate Hospital Administrator as the Chief Operating

Officer and Acting Hospital Administrator. He moved into the role of Hospital Administrator in early 2005.

Prior to his tenure at E. A. Conway Medical Center, he worked eighteen years in various administrative roles at a state

operated Intermediate Care Facility for Mentally Challenged. Additionally, he served a short time as a State Loss

Prevention Officer in Louisiana's Risk Management Initiative. The vast array of administrative and operational experience

gained in those positions has served him well in his current position.

Mr. McGuire obtained his Bachelor of Business Administration Management Degree from Northeast Louisiana University.

He later completed a year of continuing education from the University of Alabama's Mental Retardation Management

Training Program. Mr. McGuire maintained Louisiana Association of Nursing Home Administrators License from 1974 to

1991. He is a Fellow of the National Association of Public Hospitals Program focusing on "The Growing Demand for

Ambulatory Care: How it is Changing Safety Net Health Systems

Executive Management

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

54 CONFIDENTIAL

INFORMATION

MEMORANDUM

Gary L. Crockett, Administrator Huey P. Long Medical Center

Mr. Crockett joined the LSU Health system in 2005 as an interim administrator at Huey P. Long Medical Center and was

named the permanent administrator in 2006. His career in hospital administration began at Lallie Kemp Regional Medical

Center, where he became Chief Financial Officer, after beginning his career in the banking industry. From Lallie Kemp, he

joined the Washington-St. Tammany Regional Medical Center, first as CFO and later becoming the administrator for six

years. He has also worked in administration for Rehabilitation hospitals and centers in Mississippi and Louisiana and

served on the Governor’s Healthcare Reform Panel during the Kathleen Blanco administration. Mr. Crockett earned a BA

degree from Southeastern Louisiana University in Hammond, LA.

Andrew Chesson, Jr, MD, Dean, School of Medicine

A member of the LSU Health Sciences Center-Shreveport faculty for 33 years, Dr. Chesson has served as Dean of the

School of Medicine since 2009. He was previously Acting Chancellor, Acting Dean and Associate Dean for Academic

Affairs. He earned his undergraduate degree at University of Texas at Austin and completed his M.D. and residency

training at UTMB in Galveston. He is Professor of Neurology and the Director of the LSUHSC Sleep Disorders Center.

He developed the first accredited sleep center in Louisiana and has been very active in the American Academy of Sleep

Medicine, where he helped to establish the Standards of Practice process. He also helped to establish the fellowship in

Sleep Medicine as the first multidisciplinary, multi-board based specialty under the American Board of Medical Specialties

and the Sleep Medicine Fellowship program under the ACGME. While holding the helm of the Medical School, he

continues to teach in all 4 years of the medical school curriculum as well as remaining active in patient care. Over the

years, he has led numerous committees for the health sciences center related to accreditation. He has been listed by his

national peers in Best Doctors in America and has more than 100 peer reviewed publications. Dr. Chesson is one of the

authors in the AASM Manual for the Scoring of Sleep and Associated Events, which is used in all accredited sleep centers

nationally and internationally.

Sandra Roerig, Ph.D., Dean, School of Graduate Studies and Associate Dean of Research

Dr. Roerig became the first dean for the LSU Health Shreveport School of Graduate Studies in 2004. She joined the

faculty in 1991 as an Assistant Professor in the Department of Pharmacology, Toxicology and Neuroscience and she is

currently a Professor in that Department. Dr. Roerig earned her Ph.D. from the Medical College of Wisconsin and

completed postdoctoral training at the University of Minnesota. Her research interests have focused on mechanisms of

opioid-induced tolerance and physical dependence. Her research has been funded by the NIH, National Institutes on

Drug Abuse.

Joseph M. McCulloch, Jr., Ph.D., Dean, School of Allied Health Professions

Dr. McCulloch became the first Dean of the school of Allied Health Professions after it became a separate entity from

New Orleans in 2004. Prior to that he was Professor and Head of the Department of Physical Therapy at Shreveport. A

graduate of the University of South Carolina, and Medical College of Virginia, he earned a Master of Arts degree from

New York University and his Ph.D. from University of New Orleans. From 1981-2001, he was Director of Rehabilitation

Services for LSU Medical Center. Dr. McCulloch is a member of the American Physical Therapy Association and the

Louisiana chapter. He still teaches PT courses at the LSU Health Shreveport School of Allied Health Professions. He is

also an active member of the Association for the Advancement of Wound Care and American Academy of Wound

Management. He is a member of the Louisiana Health Works Commission and Shreveport Chamber of Commerce.

Executive Management

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

55 CONFIDENTIAL

INFORMATION

MEMORANDUM

Robert Walter, M.D., M.P.H., Associate Professor of Medicine, Division of Pulmonary and Critical Care;

Associate Professor of Clinical Sciences, School of Allied Health Professions; Director of Pulmonary

Hypertension Clinic; Director, Human Research Protections Program

Dr. Walter joined LSU Health Sciences Center in 2007 after serving as Assistant Professor in Medicine, Division of Allergy,

Pulmonary and Critical Care Medicine at Boston University School of Medicine in Boston, MA. He earned his MD at the

University of Texas Health Sciences Center, Houston and a Master’s in Public Health at Boston University School of Public

Health. He completed residency training at University of Colorado Health Sciences Center and fellowship training in the

Division of Allergy, Pulmonary, and Critical Care Medicine at Boston University School of Medicine, Boston, MA. Along

with undergraduate work at Dartmouth College and Oxford University in Oxford, England, he coordinated pulmonary

function measures for the NHLBI’s Framingham Heart Study and received the Flight Attendants’ Medical Research Institute

Young Clinical Scientist Award to study biomarkers of COPD.

Susan Armstrong, J.D., M.B.A., Senior In-House Legal Counsel

Prior to becoming a lawyer, Ms. Armstrong worked more than ten years in healthcare, as a staff nurse for LSU Medical

Center and nursing instructor at Northwestern State University. She earned an MBA from Centenary College of Louisiana

while attending LSU Law Center, where she received her Juris Doctorate. After receiving an undergraduate degree from

Northwestern State University School of Nursing, she went on to earn a Master’s from the University of Arkansas for

Health Sciences. Ms. Armstrong practiced general law with a Shreveport firm for six years and was the Compliance Officer

for LSU Health Sciences Center in Shreveport for twelve years before assuming her current role.

Mimi Hedgcock, Executive Director of Governmental Affairs

After 2 years in U.S. Rep. Jim McCrery office, Ms. Hedgcock became the Deputy Director of Legislative Affairs for the

Federal Coordinator of Gulf Coast Rebuilding. Following this she moved to the position of Director of Advocacy,

Legislative Affairs and Community Outreach at CHRISTUS Schumpert Health System. Most recently Mimi served in the

role of healthcare policy advisor for Louisiana Governor Bobby Jindal. Ms. Hedgcock is a graduate of the University of the

South in Sewanee, Tennessee . While serving in the governor’s office, she was appointed to the Louisiana Health Works

Commission and the Coordinated System of Care Board for at-risk juveniles. Her legislative affairs experience also

includes the U.S. Department of Labor and Microsoft Corporation in Washington DC.

Catherine S. Nobile, Esq., President, LSU Health Sciences Foundation

A former corporate strategic planner for a diversified nonprofit hospital system, and later their in-house counsel, Ms.

Nobile has consulted with hospital and healthcare-related organizations around the country on matters of nonprofit

governance, policy development, business reorganizations, and strategic and business planning. After law school, she rose

to the position of managing partner in one of Baton Rouge’s oldest defense firms, concentrating in medical malpractice

defense, health law and general representation of hospitals and physicians. She served as strategic advisor and project

manager in the merger of Indiana University Hospitals and Methodist Hospital of Indianapolis, and performed a strategic

positioning analysis for University Health System Consortium that led to the formation of Novation. Ms. Nobile holds

Masters of Social Work and Juris Doctor degrees from LSU. She is a member of the National Health Lawyers Association,

the Association of Corporate Counsel, and the Louisiana State Bar Association.

Executive Management

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Employees

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

57

Employees

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Physicians

LSUHSC-S has approximately 579 physicians. The LSUHSC-S requires Board certification for all new physicians

joining the medical staff.

SpecialtyNumber of

Physicians

Allergy and Immunology 4

Anesthesiology 35

Colon & Rectal Surgery 4

Dermatology 7

Emergency Medicine 22

Family Medicine 46

Internal Medicine 42

Internal Medicine - Cardiology 9

Internal Medicine, Critical Care Medicine 7

Internal Medicine, Endocrinology, Diabetes and Metabolism 6

Internal Medicine, Gastroenterology 5

Internal Medicine, Hematology 19

Internal Medicine, Infectious Disease 7

Internal Medicine, Nephrology 13

Internal Medicine, Pulmonary Disease 5

Internal Medicine, Rheumatology 3

Internal Medicine, Sleep Medicine 3

Medical Genetics 2

Neurological Surgery 15

Neurology 13

Obstetrics & Gynecology General 24

Obstetrics and Gynecology, Maternal and Fetal Medicine 2

Obstetrics and Gynecology, Reproductive Endocrinology 1

Ophthalmology 25

Oral and Maxillofacial Surgery 11

Orthopaedic Surgery 31

SpecialtyNumber of

Physicians

Otolaryngology 18

Pain Management 2

Pathology 20

Pediatrics 48

Pediatrics, Neonatal-Perinatal Medicine 9

Pediatrics, Pediatric Cardiology 3

Pediatrics, Pediatric Endocrinology 2

Pediatrics, Pediatric Gastroenterology 1

Pediatrics, Pediatric Hematology-Oncology 1

Pediatrics, Pediatric Infectious Diseases 1

Pediatrics, Pediatric Nephrology 2

Pediatrics, Pediatric Pulmonology 1

Pediatrics, Pediatric Rheumatology 1

Plastic Surgery 4

Psychiatry 23

Radiology 22

Radiology, Nuclear Radiology 2

Radiology, Radiation Oncology, Neuroradiology 3

Surgery 29

Surgery, Pediatric Surgery 2

Surgery, Surgical Critical Care 1

Surgery, Vascular Surgery 2

Thoracic Surgery, Congenital Cardiac Surgery 5

Trauma 2

Urology 14

Total Physicians = 579

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

58

Employees

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8% $1.77 MM

$4.49 MM $2.10 MM

Nurses

LSUHSC-S has approximately 1,429 Nurse FTEs.

Total Employees

As of October 29, 2012, LSUHSC-S had a total staff of 2,445 FTEs.

Total Staff Total FTEs

Registered Nurses 1,160

Licensed Practical Nurses 163

CRNAs 50

Nurse Practitioners 56

Total 1,429

Total Staff FTEs Part-Time Total

Classified 2,130 35 2,165

Other Academic 12 - 12

Unclassified 265 2 267

Total 2,407 38 2,445

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Quality

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

60

Quality - Accreditation

CONFIDENTIAL

INFORMATION

MEMORANDUM

The Health Sciences Center maintains many accreditations and licenses which indicate they meet or exceed

national standards intended to ensure patient safety, the quality of educational programs and compliance with

State and Federal regulations.

Gold Seal of Approval ™

In August 2010, LSUHSC-S was awarded the Joint Commission’s Gold Seal of Approval™

indicating compliance with the Joint Commission’s national standards for health care quality and

safety. The accreditation is for three years, the maximum term possible.

Organizations which grant and monitor for compliance the accreditations and licenses held by LSUHSC-S are

presented below.

The Accreditation Council for Graduate Medical Education (ACGME) is responsible for the accreditation of

post-MD medical training programs within the United States.

The Association for the Accreditation of Human Research Protection Programs (AAHRPP) promotes the

highest quality research through an accreditation process. The Health Sciences Center is fully accredited

research organization.

The Association for the Accreditation of Human Research Protection Programs (AAHRPP) promotes the

highest quality research through an accreditation process. The Health Sciences Center is fully accredited

research organization.

The Louisiana Department of Health and Hospitals licenses hospitals that operate within the State.

The US Department of Health and Human Services (HHS) operates a website where interested persons can

review a hospital's most recent quality survey.

College of American Pathologists (CAP) - The LSU Health Shreveport Pediatric Pulmonary Laboratory has

been awarded re-accreditation

AABB (formerly the American Association of Blood Banks) has re-accredited the Feist-Weiller Cancer

Center at LSU Health Shreveport’s Bone Marrow Transplant and Leukemia Service in the area of Cell

Therapy Activity and Bone Marrow Transplantation.

Louisiana State University Health Sciences Center - Shreveport is accredited by the Commission on Colleges

of the Southern Association of Colleges and Schools (SACS) to award baccalaureate degrees, masters

degrees, doctoral degrees and first-professional degrees.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

61

Awards & Accolades

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Over the years, LSUHSC-S has received numerous awards and accolades. Most

recently, it has received the following prominent designations:

Awards – Global, National & Local Recognition (Last Three Years)

LSU Professor and Physician appointed to National Chronic Fatigue Committee

Professor and Chairman honored at Central European Neurosurgical Meeting

Recipient of $1.35M grant by the National Cancer Institute for FWCC

Professor Awarded $1.8M grant from NIH for artery disease research

Professor Awarded over $1.0M grant from NIH for aging-related research

“Apple Distinguished Program” designation by Apple

“DiversityFIRST Corporate Award” from the Louisiana Diversity Council

Physicians Selected for Inclusion as “Best Doctors in America for 2011 – 2012”

Physicians and Dentists named to SB Magazine’s 2011 list of Top Doctors & Dentists

First credentialed Wound Management Post-Grad PT program in country

“Top Performing” U.S. News and World Report rating in Nephrology

Second hospital in state in “Spine Surgery Excellence” by Louisiana Life Magazine

Louisiana Hospital Quality Awards recipient (all three teaching hospitals)

Extracorporeal Life Support Organization “Excellence in Life Support” Award

Election of Professor as President-Elect of the Louisiana State Medical Society

American Advertising Federation of Shreveport - Bossier “Image Award”

Ongoing Physician, Staff, Faculty, and Student Recognitions and Honors

Accolades – Specialty Services & Centers for Excellence

Center for Excellence for Arthritis & Rheumatology

Children’s Hospital

Extracorporeal Membrane Oxygenation (ECMO) Services

Feist-Weiller Cancer Center

Regional Trauma Center

Regional Burn Center

St. Jude Affiliate Clinic

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Cost per Adjusted Day FTEs Per Adjusted Occupied Bed

50th 50th

Hospital 2008 2009 2010 2011 Percentile 2008 2009 2010 2011 Percentile

EAC $ 1,219 $ 1,260 $ 1,302 $ 1,441 $ 1,852 4.7 4.6 4.5 4.9 4.5

HPL $ 1,019 $ 1,258 $ 1,002 $ 1,310 $ 1,892 3.7 3.9 4.0 3.9 4.5

SMC $ 1,774 $ 1,763 $ 2,085 $ 1,844 $ 2,373 6.2 6.1 5.8 5.4 5.5

Quality - Efficiency

Cost per Adjusted Patient Bed

Cost per adjusted patient bed is a common metric used by healthcare providers to gauge the efficiency of a

hospital's operations. In fiscal year 2011, LSUHSC-S is in the 25th percentile in terms of cost per adjusted

patient bed which means it LSUHSC-Sis able to treat patients which have been admitted at a lower cost than

75% of the other University HealthSystem Consortium (“UHC”) members. UHC is an alliance of 116 academic

medical centers and 276 affiliated hospitals, representing 90% of the academic medical centers in the U.S.

As salaries are a large component of a hospital’s cost structure, cost per adjusted patient bed is a commonly

used metric to gauge occupancy rates, workload on staff, operating costs per patient, and many other critical

business numbers.

Full-Time Employees per Adjusted Occupied Bed

Full-Time Employees (“FTEs”) per Adjusted Occupied Bed is a commonly used metric which serves as a starting

point in assessing whether or not a hospital is over or under staffed.

62 CONFIDENTIAL

INFORMATION

MEMORANDUM

Total Expense (exluding provider) per Adjusted Patient Day

FY UHC 25th UHC 50th UHC 75th %

Hospital 2011 Percentile Percentile Percentile Rank

EAC E.A. Conway Medical Center $ 1,441 $ 1,558 $ 1,852 $ 2,237 < 25%

HPL Huey P. Long Medical Center $ 1,310 $ 1,650 $ 1,892 $ 2,237 < 25%

SMC Shreveport Medical Center $ 1,844 $ 2,007 $ 2,373 $ 2,716 < 25%

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

63

Quality - Utilization

CONFIDENTIAL

INFORMATION

MEMORANDUM

Average Length of Stay

Average Length of Stay (“ALOS”) is commonly used as an indicator of hospital efficiency. Management has made

the criteria for overnight stays more strict, improved patient discharge plans and efficiency, and added utilization

managers to the floor in an effort to decrease the ALOS and to become as efficient as possible. Accordingly,

Adult and Pediatric ALOS has dropped in each of the hospitals and is now closer to the 50th percentile. The

most significant change in ALOS was in the neonatal intensive care unit (NICU), which dropped from over 30

days to 16 days in 2011.

Days of Revenue in Accounts Receivable

Measures the number of days, on average, it takes for a hospital to collect on account receivables. For the

years 2008 thru 2011, LSUHSC-S collected on account receivables every 31 days over the four year period.

ALOS - Adult & Pediatric ALOS - Psychiatric

50th 50th

Hospital 2008 2009 2010 2011 Percentile 2008 2009 2010 2011 Percentile

EAC 5.1 4.7 5 4.6 4.7 17.7 17 21.4 24.6 7.6

HPL 5.4 5.3 5.2 4.8 4.7 11.7 12.2 12.8 11.7 7.6

SMC 6.5 6.4 5.9 5.6 5 25.2 28.3 18.8 16.7 7.8

Days of Revenue in Accounts Receivable

50th

Hospital 2008 2009 2010 2011 Percentile

EAC 26 17 17 15 44

HPL 19 13 17 11 41

SMC 27 31 29 37 42

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Operations

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

65

Information Systems

10.3% 17.4%

39.3%

CONFIDENTIAL

INFORMATION

MEMORANDUM

35.8%

$1.23 MM

$1.77 MM

$4.49 MM $2.10 MM

Overview of LSU Systems Health Information Technology

The System determined in 2006 that information technology for the LSU Health Sciences Centers and LSU

hospitals should be centrally coordinated. A primary component of this initiative was the implementation of a

complete electronic health record (EHR) system for the 10 LSU hospitals.

One hundred clinical subsystems were identified that comprised a complete electronic health record.

Consultants were hired to assist in estimating the cost, duration, and scope of the project, and the 5-year

budget estimate developed was $84 million in one-time costs and $5.6 million per year in start-up costs. An

Operations Council was created to coordinate central management of all IT operations and to lead the effort to

implement the electronic health records system for LSU’s ten hospitals.

Coordination within the LSU system and across state agencies was a goal, so members of the Operations

Council included representatives from the hospitals, the Health Sciences Center campuses, the LSU Baton

Rouge campus, and DHH; the OIT liaison was also invited to Council meetings.

The Legislature has appropriated $33 million towards the one-time costs for the new EHR system and initial

indications are that the 10 LSU hospitals will receive $64 million in federal stimulus money through Medicare

and Medicaid incentive payments over a four-year period for use of EHR Systems.

PELICAN

In late 2011, LSUHSC-S unveiled PELICAN (Patient Electronic Health Information and Care Network), a $144

million initiative to transition from paper medical records to electronic medical records. The LSU Health

System was the first statewide, public health care network in the United States to deploy electronic health

records throughout each of its hospitals and physician clinics. LSUHSC-S has replaced the antiquated record

keeping practice of using pens and paper with an information system that utilizes iPads and touchscreens.

Significant cost savings are likely to be realized through a more effective use of the LSUHSC-S resources.

By making health care data availability in “real-time” to clinicians and nurses, facilitates the ease with which

extensive research could be conducted on ailments plaguing human beings and thus benefiting the community

and society as a whole.

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Financial

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

67

Revenue and Expenses Revenues and Expenses

Historically, the financial operations and reporting for the LSUHSC-S, have included three primary

components:

The combined operations of the Shreveport Medical Center, LSU School of Medicine in

Shreveport, LSU School of Allied Health Professionals and LSU School of Graduate Studies,

The operations of HP Long Medical Center, and

The operations of EA Conway Medical Center.

For purposes of this memorandum, management of the LSUHSC-S has developed unaudited special

purpose statements of revenues and expenses for the Shreveport Medical Center separate from the

Schools collectively (the Schools) for fiscal years 2010 and 2011.

In developing these special purpose statements, revenues earned by the Shreveport Medical Center

have been assigned accordingly. Patient revenues are reported net of free services and contractual

adjustments, including estimated retroactive adjustments under payment agreements with third-party

payors. The State of Louisiana reimburses each of the medical centers for the cost of serving patients

who are without health insurance and ineligible for Medicaid or Medicare coverage. The amount of

this reimbursement has been subject to determination and payment by the State and is reflected in the

special purpose statements.

Expenses directly and fully associated with the operation of the Shreveport Medical Center have been

so assigned. Expenses which are borne by either entity for the benefit of both entities have been

allocated based upon the historic methodologies and allocations maintained by the LSUHSC-S for

regulatory cost reporting. The cost of teaching and training by physician faculty provided within the

clinical programs of the Shreveport Medical Center are included as an expense of the Medical Center

as $16,466,352 and $16,098,253 for fiscal 2010 and 2011, respectively.

In addition to teaching and training compensation, as part of a special agreement with LSU School of

Medicine, the Shreveport Medical Center has provided financial support for deficits of the School in

the amount of $30,000,000 and $26,022,045 in fiscal 2010 and 2011, respectively. This financial support

is not considered an expense of the Shreveport Medical Center for purposes of these special purpose

statements.

CONFIDENTIAL

INFORMATION

MEMORANDUM

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

2010 2011

Fiscal Year Ended June 30

Net Revenues in Excess of Expenses 29,244,381$ 10,263,658$

Plus Depreciation 13,489,323 17,905,072

EBITDA 42,733,704$ 28,168,730$

Unaudited Special Purpose Combining Statements of Revenues and Expenses

2010 2011

UMC -Shreveport HP Long EA Conway Total UMC -Shreveport HP Long EA Conway Total

Revenues

Commercial 46,077,480$ 1,323,783$ 2,579,130$ 49,980,393$ 46,566,840$ 1,426,737$ 3,330,674$ 51,324,251$

Medicare 61,285,444 5,266,801 7,948,447 74,500,692 59,855,587 4,612,005 7,739,387 72,206,979

Medicaid 120,486,585 14,602,244 30,534,059 165,622,888 92,261,066 14,364,878 28,329,541 134,955,485

Reimbursement for Uncompensated Care 138,901,499 25,408,376 33,333,029 197,642,904 138,889,168 26,226,913 38,271,631 203,387,712

Self Pay 2,206,893 443,077 404,242 3,054,211 3,409,913 558,921 532,964 4,501,798

Other 13,377,093 14,187,311 13,301,153 40,865,557 14,640,840 12,235,469 12,239,675 39,115,985

Total Revenues 382,334,994 61,231,592 88,100,060 531,666,646 355,623,413 59,424,924 90,443,873 505,492,210

Expenses

Compensation 180,712,096 24,368,975 38,825,358 243,906,429 176,191,566 22,879,287 36,032,857 235,103,710

Benefits 34,312,100 7,054,349 10,836,074 52,202,523 39,024,126 7,479,244 11,241,322 57,744,692

Other Post Employment Benefits 14,913,395 2,449,660 4,709,859 22,072,914 12,476,145 2,263,646 4,485,334 19,225,125

Supplies & Services 103,192,682 26,292,117 36,197,009 165,681,808 100,433,688 25,288,589 34,371,748 160,094,025

Utilities 3,001,249 944,458 1,123,561 5,069,268 3,010,497 981,468 1,163,963 5,155,928

Depreciation 10,976,661 1,140,852 1,371,810 13,489,323 15,525,766 904,025 1,475,281 17,905,072

Total Expenses 347,108,183 62,250,411 93,063,671 502,422,265 346,661,788 59,796,259 88,770,505 495,228,552

Net Revenues in Excess of Expenses 35,226,811$ (1,018,819)$ (4,963,611)$ 29,244,381$ 8,961,625$ (371,335)$ 1,673,368$ 10,263,658$

68

Revenue and Expenses

Earnings before Interest, Taxes, Depreciation & Amortization (EBITDA)

As provided in the table below, on a combined basis, the three medical centers have generated EBITDA

of $42,733,704 and $28,168,730 during fiscal 2010 and 2011, respectively. The most significant factor

which caused the volatility in EBITDA from 2010 to 2011 was a 40% reduction in Louisiana Medicaid

reimbursement implemented in August 2010. This reduction resulted in an increase in Medicaid

contractual adjustments of approximately $28.5 million for the Shreveport Medical Center. In addition

the Medicaid Cost Report Adjustment for the Shreveport Medical Center was approximately $10.9

million. The increase in Medicaid contractual and cost report adjustments between fiscal 2010 and

2011 was partially offset by an increase in Medicaid Upper Payment Limit reimbursement of $16.6

million.

CONFIDENTIAL

INFORMATION

MEMORANDUM

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

69

CONFIDENTIAL

INFORMATION

MEMORANDUM

Selected Assets and Liabilities

Assets

The LSUHSC-S has maintained a single balance sheet for its operations including the assets and liabilities of the

Shreveport Medical Center and the Schools. For purposes of this Memorandum, the assets and liabilities of the

Shreveport Medical Center have been segregated from those of the Schools. The assets and liabilities of the

Shreveport Medical Center, HP Long Medical Center, and EA Conway Medical Center as of June 30, 2011 are

described and listed below.

Patient Accounts Receivable-

Charges to accounts receivable are recognized at the time of service and provided based on the established

rates for those services. Reductions to accounts receivable result from cash collections, discounts under

contractual agreements, bad debts, and charity care (free services) adjustments. The Medical Centers

maintains an allowance for doubtful accounts based on management's assessment of collectability.

Allowances for discounts on accounts receivable from Medicare, Medicaid and certain other third-party payors

are based primarily on the latest discount percentages experienced with each payor.

Accounts receivable for the three medical centers as of June 30, 2011 are provided below.

Supply Inventories

The medical centers purchase and maintain stores of supplies for clinical services. Once purchased the

inventories are reported principally at cost using a first-in, first-out cost flow (FIFO) assumption. Inventories for

the three medical centers as of June 30, 2011 are provided below.

Supply Inventories

As of June 30, 2011

Shreveport Medical Center $ 9,642,776

HP Long Medical Center 872,336

EA Conway Medical Center 1,284,807

Total $ 11,799,919

Patient Accounts Receivable

As of June 30, 2011

Shreveport Medical Center $ 81,183,326

HP Long Medical Center 2,282,594

EA Conway Medical Center 14,530,939

Total $ 97,996,859

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

70

CONFIDENTIAL

INFORMATION

MEMORANDUM

Selected Assets and Liabilities

Assets – Cont’d

Buildings and Equipment

The Shreveport Medical Center and the Schools share a common campus in Shreveport, Louisiana. As

described earlier in this memorandum, most of the facilities on the campus are designated for use solely by the

Medical Center or the Schools. However, the use of several buildings is shared by the Medical Center and the

School of Medicine. For purposes of this Memorandum, the cost and related accumulated depreciation has

been assigned to the Shreveport Medical Center or the Schools based on their use.

In addition to buildings, the Shreveport Medical Center and the Schools maintain and depreciate equipment.

The cost and accumulated depreciation associated with the equipment used by the Medical Center has been

defined and identified for reporting here.

The net book value of the property and equipment (net of depreciation and any remaining liability for associated

capital leases) associated with the three medical centers as of June 30, 2011 is provided below.

Liabilities

Liabilities for Compensated Absences and Other Post-Employment Benefits

The LSU System maintains employment benefits for all qualified personnel who work on behalf of the medical

centers and the Schools. Among the benefits provided, the personnel of the medical centers and Schools are

provided with a defined number of days of compensated absences each year. To the extent these days are not

used, the unused days are accumulated and carried over to the next year. The accumulated cost of the Medical

Center employee’s unused compensated absences is maintained as a liability.

The accumulated periodic cost of retirement benefits, reduced by amounts contributed by the medical centers

for such benefits is recognized as a liability.

The medical centers’ liability for post-employment benefits and compensated absences as of June 30, 2011 is

provided below.

Property and Equipment, Net

As of June 30, 2011

Shreveport Medical

Center

$ 63,339,668

HP Long Medical Center 2,806,722

EA Conway Medical

Center

8,134,397

Total $ 74,280,787

Post Employment Beneft Compensated Absences

As of June 30, 2011

Shreveport medical Center 63,015,843$ 9,681,345$

HP Long Medical Center 10,002,470 3,589,550

EA Conway Medical Center 19,794,962 2,117,765

Total $ 92,813,275 $ 15,388,660

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

71

CONFIDENTIAL

INFORMATION

MEMORANDUM

Selected Assets and Liabilities

Liabilities

Other Liabilities

Other liabilities held by the medical centers as of June 30, 2011 are listed below.

Other Liabilities

Shreveport Medical Center HP Long Medical Center EA Conway Medical Center Total

As of June 30, 2011

Accounts Payable & Accrued Liabilities $ 13,501,529 $ 3,529,257 $ 4,120,863 $ 21,151,649

Due to State Treasury 21,080,309 1,263,714 234 22,344,257

Notes Payable 228,342 100,281 - 328,623

Total $ 34,810,180 $ 4,893,252 $ 4,121,097 $ 43,824,529

DRAFT

This document

is in draft form

and was

prepared for the

LSU Health

Sciences

Foundation, a

supporting

organization of

LSUHSC-S, for

discussion with

LSUHSC-S .This

document was

not released to

any potential

investors nor

does it constitute

a request for

bids or other act

by LSUHSC-S

The Foundation,

its consultants

and

Management do

not make any

representations

as to the

accuracy of the

included

information.

Appendix A: Instruction Letter