Via Christi Hospital Manhattan. Continuing Annual Disclosure. as of June 30, 2015
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1 Via Christi Hospital Manhattan Continuing Annual Disclosure Annual Report to MSRB as of June 30, 2015 Contacts: Carol Karp Jeff Seirer Chief Financial Officer Sr. Administrator-Accounting
2 Via Christi Hospital Manhattan, Inc. City of Manhattan, Kansas Hospital Refunding Revenue Bonds Series 2013 Serial Bonds Maturity (Nov 15) Principal Amount Interest Rate CUISP 2015 $ 1,080, % 56301P AV $ 1,125, % 56301P AW $ 1,175, % 56301P AX $ 1,230, % 56301P AY $ 1,285, % 56301P AZ $ 1,350, % 56301P BA $ 1,420, % 56301P BB $ 1,495, % 56301P BC $ 1,570, % 56301P BD $ 1,650, % 56301PBE1 Term Bonds 2029 $ 9,615, % 56301P BF8
3 TABLE OF CONTENTS VIA CHRISTI HOSPITAL MANHATTAN... 4 NON-OBLIGATED AFFILIATES... 4 FACILITIES... 5 SERVICES... 6 MEDICAL STAFF... 7 PHYSICIAN INTEGRATION... 7 SERVICE AREA... 8 HISTORICAL UTILIZATION... 9 EMPLOYEES... 9 AUDITED CONSOLIDATED FINANCIAL INFORMATION. (Ascension Health Alliance d/b/a Ascension Years Ended June 30, 2015 and 2014 with Reports of Independent Auditors Posted to DAC on 10/14/15) 3
4 INFORMATION CONCERNING VIA CHRISTI MANHATTAN VIA CHRISTI MANHATTAN Via Christi Hospital Manhattan, Inc. ( VCHM or the Corporation ) formerly named Mercy Regional Health Center, Inc. is a Kansas not-for-profit corporation and is a Section 501(c)(3) organization as described in the Internal Revenue Code of The Corporation is licensed to operate a 150-bed hospital at its Manhattan campus and currently operates 116 beds. To meet the healthcare needs of north central and northeastern Kansas, VCHM offers a wide range of services including medical and surgical care, cardiopulmonary services, laboratory and Pathology, a nutrition clinic, occupational health services, cardiac catheterization laboratory, rehabilitation services, emergency services, endoscopy laboratory, pharmacy and urodynamic laboratory. See SERVICES below for a more complete description of VCHM services. During 2013 MRHC changed its fiscal year from September 30 to June 30. All 2013 Financial information presented in this report is for a nine month period. CORPORATE MEMBER On February 28, 2014, Via Christi Health (VCH), a subsidiary of Ascension Health, became the sole corporate member of Mercy Regional Health Center, Inc. through a membership transfer agreement with Memorial Hospital Association (MHA). Prior to the transaction date, Via Christi Health held a 50% controlling interest in MRHC. VCH is a Kansas not-for-profit corporations and 501(c)(3). On April 24, 2015 Mercy Regional Health Center, Inc. changed its name to Via Christi Hospital Manhattan, Inc. NON-OBLIGATED AFFILIATES Other principal ministries within Via Christi Hospital Manhattan are described below. These ministries are not obligated to make any payments in respect of the principal or premium of, if any, or interest on the Series 2013 Bonds, as defined and described in the Official Statement. The operating revenues of the Via Christi Hospital Manhattan ministries that are not obligated collectively accounted for approximately 12.6% of the consolidated operating revenues of VCHM and all consolidated subsidiaries for the period ending June 30, 2015, and the assets of the VCHM ministries that are not obligated collectively constituted approximately 5.8% of the total assets of VCHM and all consolidated subsidiaries as of June 30, Wamego Hospital Association ( WHA ). Established in 2002, WHA was created when VCHM and Wamego City Hospital ( WCH ) entered into an agreement on July 1, WHA operates as a notfor-profit critical access hospital located in Wamego, Kansas. WCH contributed assets and transferred liabilities and MRHC contributed cash in exchange for 49% and 51% ownership respectively, in WHA. WHA has a management agreement with VCH and VCHM and a leased employee agreement with VCHM. Under these arrangements, the Chief Executive Officer of WHA is an employee of VCH; VCH and VCHM provide a number of services to WHA including information technology, purchasing, legal, financial, and human resources. Via Christi Imaging, LLC ( VCILLC ) formerly named Mercy Imaging, LLC. VCILLC is an imaging joint venture between Manhattan Radiology, LLP and VCHM with ownership allocated 25% and 75% respectively. 4
5 Mercy Community Health Foundation (the Foundation ) is a not-for-profit charitable foundation which was created to support the operations of VCHM. Mercy Community Health Foundation was deconsolidated for fiscal year FACILITIES College Campus. The College Campus is located at 1823 College Avenue, Manhattan, Kansas on approximately 16 acres of land. The College Campus is the primary provider of acute care services. Sunset Campus. In February 2014 Mercy sold its Sunset Campus to Kansas State University. Minimal services continue at the Sunset location under a rental agreement with Kansas State University with future plans to consolidate these services to the main Hospital Campus. [Remainder of this page intentionally left blank] 5
6 SERVICES VCHM provides a full range of services as shown below: Anesthesiology Cardiovascular (except Open Heart) Dental Surgery Dermatology Emergency Services (Level III) Emergency Surgery Gastroenterology Family Practice Radiology Gynecology/Obstetrics Industrial Medicine Internal Medicine Laser Surgery Neurology Nuclear Medicine Oncology Ophthalmology Orthopedics Otolaryngology Pathology Psychiatry Pulmonary Medicine General Surgery Rehabilitation Medicine Renal Dialysis Robotic Surgery Thoracic Surgery (Lung biopsies & Thoroscopy) Urology Vascular Surgery (Limited vascular cases) These major service specialties are supported and complemented by many ancillary services, including the following: Audiology Auxiliary and Volunteers Blood Bank Cardiac Cath Lab Cardiac Rehabilitation CT Scanning Diagnostic Radiology Electrocardiology Industrial Sports Medicine IV Therapy Laboratory Services Sleep Laboratory Social Services Speech Therapy Stroke Rehabilitation Occupational Therapy Outpatient Chemotherapy One Day Surgery Pastoral Care Pharmacy Physical Therapy Pulmonary Rehabilitation Radiation Therapy Recreational Therapy Respiratory Therapy Lithotripsy MRI Nuclear Medicine Nursing Services Pain Clinic EDUCATIONAL AFFILIATIONS VCHM has educational affiliations with Kansas State University and other area colleges and universities, offering clinical site, preceptor and internship programs for nurses, pharmacists, physical therapists, occupational therapists, social workers, dieticians, emergency medical technicians and industrial engineering students. 6
7 MEDICAL STAFF The active/associate medical staff at VCHM was comprised of 139 physicians as of September 3, In addition, there were 32 members of the courtesy/consulting staff. The active/associate medical staff includes those physicians who regularly admit patients and provide most of the admissions to VCHM. The average age of the active/associate medical staff members was 48.7 years. The medical staff information is provided as of September 11, Department Number of Active Members Number of Board-Certified Average Age Members Anesthesiology Cardiology Emergency Medicine Family Practice Gastroenterology General Surgery Infectious Disease Internal Medicine Medical Oncology/Hematology Nephrology Obstetrics/Gynecology Oral/Maxillofacial Surgery Orthopedics Otolaryngology Pain Medicine Pathology Pediatrics Podiatry Psychiatry Radiology Urology Top Ten Admitters. VCHM top ten admitting physicians together accounted for a combined total of approximately 95.3% of the total discharges for fiscal year The average age of the top ten admitting physicians during fiscal year 2015 was 43.4 years. PHYSICIAN INTEGRATION VCHM has 10 employed physicians and 4 midlevel providers integrated in VCHM. 7
8 SERVICE AREA The primary service area for VCHM is Geary, Pottawatomie and Riley Counties in Kansas. The projected population for the primary service area was 133,970 in 2013 and is expected to increase 13.8% to 152,418 by Based upon inpatient discharges (excluding newborns), approximately 83.4% of VCHM inpatient discharges in fiscal year 2013 originated within the primary service area. VCHM has 41.6% market share in its primary service area. The secondary service area for VCHM includes six Kansas counties surrounding Geary, Pottawatomie and Riley Counties. The projected population for the secondary service area was 57,618 in 2013 and is expected to increase to 57,944 or 0.6% by Based upon inpatient discharges (excluding newborns), approximately 16.6% of VCHM inpatient discharges originated within the secondary service area for fiscal year Competitive Service Area Facilities: There is one other full service acute care hospital, Geary Community Hospital, and there is a short stay surgical hospital, Manhattan Surgical Hospital, located in the primary service area. The following table compares admission statistics for VCHM, Geary Community Hospital and Manhattan Surgical Hospital on a calendar/fiscal year basis: Facility Statistics (1) Via Christi Hosptial Manhattan Admissions 5,563 5,432 5,143 4,879 3,733 Geary Community Hospital Admissions 1,786 1,885 1,783 1,654 1,422 Manhattan Surgical Hospital Admissions (1) Excludes Irwin Army Community Hospital Source: KHA Annual STAT Reports, [Remainder of this page intentionally left blank] 8
9 HISTORICAL UTILIZATION The following table provides information with respect to utilization and other significant statistics for VCHM for the fiscal years ended September 30, 2012 through June 30, 2015: (1) Available Beds Admissions Adult/Peds 4,879 3,733 4,839 4,646 Admissions Nursery 1, ,072 1,112 Patient Days Adult/Peds 16,149 12,431 16,778 15,866 Patient Days Nursery 2,300 1,754 2,374 2,273 Occupancy 39.75% 44.64% 39.63% 37.47% Average Length of Stay Outpatient Surgery 1,945 1,625 2,027 1,894 Total ER Registrations 24,029 17,665 23,130 23,748 Total OP Registrations 50,806 34,537 36,138 37,619 Mental Health Visits 8,194 5,567 5,408 6,961 Series Patients 21,945 16,694 20,516 21,660 Observation Visits 1, ,072 1,553 Physician Visits 10,065 3,933 3,933 7,184 Total OP Vis its 118,253 80,917 93, ,619 (1) Nine months ending June 2013 EMPLOYEES During the fiscal year ended June 30, 2015, VCHM employed approximately 500 employees who worked full time and an additional 230 employees who worked part time and on call schedules, for a total of 581 full time equivalent employees. This total includes 11 physicians and 152 full time registered nurses. Turnover at VCHM was 37.8% for the most recent fiscal year. VCHM completed a Medical Staff Development plan in September of VCHM works with the local Medical Staff to assist with recruitment to meet the community needs, such as assistance with recruitment expenses, income guarantee for the first year, relocation expenses. VCHM actively recruits nursing and other professional through a variety of sourcing strategies. In addition, VCHM has educational affiliations with area colleges and universities, offering clinical site, preceptor and internship programs for nurses, physical therapists, occupational therapists, social workers, dieticians and emergency medical technicians. VCHM partners with the Kansas Board of Regents to support nursing scholarships as well a working with the Kansas State University Foundation to support pre-health scholarships. 9
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