COMMUNITY HEALTH NETWORK, INC. & AFFILIATED ENTITIES Continuing Disclosure Information As of and for the Nine Months Ended September 30, 2015 and 2014

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1 COMMUNITY HEALTH NETWORK, INC. & AFFILIATED ENTITIES Cntinuing Disclsure Infrmatin As f and fr the Nine Mnths Ended September 30, 2015 and 2014 A-1

2 Cmmunity Health Netwrk, Inc., an Indiana nn-prfit crpratin and its nn-prfit and fr-prfit affiliates (cllectively the Netwrk ) cmprises a full-service integrated health delivery system in central Indiana. The Netwrk is a central Indiana health system cnsisting f eight acute care and/r specialty hspitals, seven immediate care centers, ver 500 primary care and specialty emplyed physicians, frty ambulatry care centers, nine freestanding surgery centers, seven utpatient imaging centers, tw ambulatry endscpy centers, fur nursing hmes and assisted living facilities. The principal perating subsidiaries cnsist f the fllwing: Cmmunity Health Netwrk, Inc. -(Credit Grup member) Indiana Heart Hspital, LLC d/b/a Cmmunity Heart and Vascular Hspital- (Credit Grup member) Visinary Enterprises, Inc. -(Credit Grup member) Cmmunity Hward Reginal Health, Inc.- (Credit Grup member) Cmmunity Hspital f Andersn and Madisn Cunty, Inc.- (Credit Grup member) Indiana Ostepathic Hspital, Inc. and Affiliates d/b/a Cmmunity Westview Hspital Cmmunity Physicians f Indiana, Inc. d/b/a Cmmunity Physicians Netwrk Cmmunity Health Netwrk Fundatin, Inc. Cmmunity Hme Health Services, Inc. Effective September 18, 2014, the Netwrk acquired a htel business and related assets. On December 23, 2014, the Netwrk ceased peratins f the htel. Effective Octber 1, 2014, the Indiana Heart Hspital, LLC ( TIHH ) was merged int Cmmunity Health Netwrk, Inc. ( CHNw ). Thus, TIHH s financial results are cmbined with CHNw s financial results beginning Octber 1, Effective December 19, 2014, the Netwrk ceased peratins f Midwest Racquetball, Inc. a whlly wned subsidiary f Cmmunity Hward Reginal Health, Inc. Midwest Racquetball, Inc. was legally disslved December 22, Histrical Financial Infrmatin The unaudited cnslidated financial statements include all adjustments, cnsisting f nrmal recurring and ther accruals, which the management f the Netwrk cnsiders necessary fr a fair presentatin f financial psitin and results f peratins and changes in net assets fr these perids. Operating results fr the nine mnths ended September 30, 2015 are nt necessarily indicative f the results that may be expected fr the entire year ending December 31, The audited cnslidated financial statements at December 31, 2014 and 2013 are psted n the Digital Assurance Certificatin, L.C.C. ( DAC ) website at The Netwrk currently participates in the DAC disclsure system. A-2

3 Cmmunity Health Netwrk, Inc. and Affiliates Summary Financial Infrmatin Cnslidated Balance Sheets September 30, December 31, September 30, (unaudited) (audited) (unaudited) Assets Current assets Cash and cash equivalents $ $ $ Restricted cash Patient accunts receivable, net Other current assets Ttal current assets Assets limited as t use Bard designated funds Funds held by trustee, net f current prtin Reinsurance trust assets Prperty, plant and equipment, net Capitalized sftware csts, net Deferred financing csts, net Due t uncnslidated affiliates and related parties 3.3 (1.0) 1.3 Other assets Ttal assets $ 2,269.0 $ 2,170.4 $ 2,146.2 Liabilities and Net Assets Current liabilities Current prtin f lng-term debt $ 22.3 $ 22.4 $ 21.9 Shrt-term brrwings Other current liabilities Ttal current liabilities Accrued pensin benefit cst (160.0) (14.3) (16.5) Other liabilities Pensin underfunded liability- lng-term Lng-term debt, net f current prtin Ttal liabilities 1, , Net assets Unrestricted 1, , ,145.4 Temprarily restricted Permanently restricted Ttal net assets befre nn-cntrlling interest 1, , ,157.2 Nn-cntrlling interest Ttal net assets 1, , ,172.9 Ttal liabilities and net assets $ 2,269.0 $ 2,170.4 $ 2,146.2 A-3

4 Cmmunity Health Netwrk, Inc. and Affiliates Unaudited Summary Financial Infrmatin Cnslidated Statements f Operatins and Changes in Net Assets Nine Mnths Ended September 30, ($ in millins) Change in Unrestricted Net Assets Ttal unrestricted revenues and gains $1,512.7 $1,433.0 Operating expenses Salaries, benefits and pensin Other expenses Depreciatin and amrtizatin Interest Ttal perating expenses 1, ,300.2 Incme frm peratins Investment (lss) incme- realized/unrealized (45.3) 22.4 Other, net (.7) - Excess f revenues ver expenses befre federal incme taxes Prvisin fr incme taxes Excess f revenues ver expenses Less: Excess f revenues ver expenses attributable t nncntrlling interest (13.3) (11.8) Excess f revenues ver expenses attributable t Netwrk Change in nn-cntrlling interest 4.4 (2.5) Other changes (.2).9 Increase in unrestricted net assets Change in Temprarily Restricted Net Assets Decrease in temprarily restricted net assets (.6).2 Change in Permanently Restricted Net Assets Increase in permanently restricted net assets.4 - Increase in net assets Net assets, beginning f perid 1, ,041.4 Net assets, end f perid $1,110.0 $ 1,172.9 A-4

5 Management Discussin f Histrical Financial Perfrmance Nine Mnths Ended September 30, 2015 The Netwrk s perating margin fr the nine mnths ended September 30, 2015 was an perating margin f 8.6% r $130.4 millin as cmpared t a planned perating margin f 5.7% r $84.2 millin and a prir year margin f 9.3% r $132.8 millin. The Netwrk s YTD 2015 perating margin was impacted by the fllwing as cmpared t prir year: Inpatient Inpatient admissins increased 2.3%. All Netwrk inpatient facilities experienced an increase in inpatient admissins except fr the Netwrk s West hspital which experienced a decrease primarily due t the clsures f its psych and rehab business in 2014 and the Netwrk s Kkm hspital; Inpatient surgeries increased by 2.3%. All Netwrk facilities experienced an increase in inpatient surgeries except fr the Netwrk s East hspital which experienced a decrease; Births increased 1.5%. All Netwrk facilities experienced an increase in births except fr the Netwrk s Kkm hspital. Outpatient Emergency rm visits increased 7.7%. All Netwrk facilities experienced an increase; Emplyed physician wrvus increased 8.3%; Imaging scans increased 6.4%. All Netwrk facilities experienced an increase except fr the Netwrk s West and Kkm hspitals; Outpatient surgeries increased 1.4%. All utpatient facilities experienced an increase in surgeries except fr the Netwrk s East and Kkm regins. Uncmpensated Care, Payr Mix and Case Mix Index Uncmpensated care as a percentage f ttal patient revenue was 3.2% fr the nine mnths ended September 30, 2015 as cmpared t 4.4% fr the nine mnths ended September 30, 2014 and a budgeted percentage f 4.6%. The Netwrk s Case Mix Index imprved frm 1.49 as September 30, 2014 t 1.50 at September 30, Cmparing YTD 2015 t YTD 2014, the Netwrk experienced a favrable shift in self-pay payr mix and ther cmmercial. The Netwrk s payer mix is as fllws: Payer Mix September 30, 2015 September 30, 2014 Medicare 43.5% 43.5% Medicaid 16.3% 14.7% WellPint 18.2% 19.4% Self-pay 3.8% 5.4% Other cmmercial 18.2% 17.0% The imprvement in payr is driven by mre patients becming cvered by insurance prducts including the Anthem Exchange prducts as well as HIP 2.0. The Netwrk s revenue deductins including bad debts as a percentage f ttal patient revenue increased frm 64.4% fr the nine mnths ended September 30, 2014 t 66.1% fr the nine mnths ended September 30, A-5

6 The Netwrk s ttal margin fr the nine mnths ended September 30, 2015 was 4.3% as cmpared t a prir year ttal margin f 9.3%. The Netwrk s ttal margin was negatively impacted by lsses recgnized n the Netwrk s bard designated funds. The Netwrk recgnized unrealized lsses f $46.9 millin ffset $1.9 millin f dividends and interest n its bard designated funds fr the nine mnths ended September 30, The Netwrk marks t market its investments n a mnthly basis. The net days in accunts receivable was 49 days fr the Netwrk at September 30, 2015 as cmpared t 45 days at September 30, The Netwrk s days cash n hand was 169 days at September 30, 2015 as cmpared t 175 days at September 30, The decline in days cash n hand is primarily driven by the recgnitin f the unrealized lsses n investments. On April 13, 2015, the Netwrk Bard f Directrs apprved management s request t terminate it defined benefit pensin plan effective June 30, On April 14, 2015, the Netwrk drew dwn $150.0 millin n a bridge line f credit. On April 15, 2015, the $150.0 millin was used t prefund the Netwrk s defined benefit retirement plan. On June 30, 2015, the Netwrk terminated the plan. Prceeds f the plan will nt be distributed t participants until the Netwrk receives a favrable determinatin letter frm the Internal Revenue Service. The Netwrk anticipates receiving such a letter during In June 2015, the Netwrk issued $202.0 millin f taxable bnds t repay the $150.0 millin bridge line f credit referenced abve as well t pay the csts f varius cnstructin and renvatins prjects. In July 2015, the Netwrk paid $20.4 millin as a settlement fr a billing matter with the federal gvernment. A-6