Audits Section Burbank Financial Audits Branch Audits and Investigations Department of Health Care Services

REPORT ON THE RATE SETTING AUDIT SOUTH PASADENA CONVALESCENT HOSPITAL SOUTH PASADENA, CALIFORNIA NATIONAL PROVIDER IDENTIFIER: 16997864 FISCAL PERIOD ENDED DECEMBER 31, 211 Audits Section Burbank Financial Audits Branch Audits and Investigations Department of Health Care Services Section Chief: Daniel J. Giardinelli Audit Supervisor: Gertrude Lake Auditors: Alison Dowling and Diane Wu

State of California Health and Human Services Agency Department of Health Care Services TOBY DOUGLAS DIRECTOR EDMUND G. BROWN JR. GOVERNOR July 22, 213 Adminis trator South Pasadena Convalescent Hospital 94 Mission Street South Pasadena, CA 913 SOUTH PASADENA CONVALESCENT HOSPITAL NATIONAL PROVIDER IDENTIFIER (NPI) 16997864 FISCAL PERIOD ENDED DECEMBER 31, 211 We have examined the facility's Integrated Disclosure and Medi-Cal Cost Report for the above-referenced fiscal period. We also examined the facility's use of and Records of Noncovered Services deducted from patient share of cost. Our examination was made under the authority of Section 1417 of the Welfare and Institutions Code and was limited to a review of the cost report and accompanying financial statements, Medi-Cal payment data reports, prior fiscal period's Medi-Cal program audit report, and Medicare audit report for the current fiscal period, if applicable and available. In our opinion, the data presented in the accompanying Summary of Audited Facility Cost per Patient Day represents a proper determination of the allowable costs, patient days, and use of share of cost for the above fiscal period in accordance with Medi-Cal reimbursement principles. This audit report includes the: 1. Summary of Audited Facility Cost per Patient Day and supporting schedules 2. Audit adjust ments that include a summary of the total due the State in the amount of $36,93, which resulted from Medi-Cal overpayments The audit settlement will be incorporated into a Statement(s) of Account Status, which may reflect tentative retroactive adjustment determinations, payments from the provider, and other financial transactions initiated by the Department. The Statement(s) of Account Status will be forwarded to the provider by the State s fiscal intermediary. Instructions regarding payment will be included with the Statement(s) of Account Status. Financial Audits/Burbank/A & I, MS 211, 145 North San Fernando Boulevard, Room 23, Burbank, CA 9154 Telephone (818) 295-262 FAX: (818) 563-3324 Internet Address: www.dhcs.ca.gov

Administrator Page 2 Future Medi-Cal long-term care prospective rates may be affected by this examination. The extent to which the rates change will be determined by the Department's Fee-For- Service Rates Development Division. Notwithstanding this audit report, overpayments to the provider are subject to recovery pursuant to Section 51458.1, Article 6 of Division 3, Title 22, California Code of Regulations. If you disagree with the decision of the Department, you may appeal by writing to: Chief Department of Health Care Services Office of Administrative Hearings and Appeals 129 J Street, Suite 2 Sacramento, CA 95814 (916) 322-563 The written notice of disagreement must be received by the Department within 6 calendar days from the day you receive this letter. A copy of this notice should be sent to: United States Postal Service (USPS) Assistant Chief Counsel Department of Health Care Services Office of Legal Services MS 1 PO Box 997413 Sacramento, CA 95899 Courier (UPS, FedEx, etc.) Assistant Chief Counsel Department of Health Care Services Office of Legal Services MS 1 151 Capitol Avenue, Suite 71.51 Sacramento, CA 95814 (916) 44-77 The procedures that govern an appeal are contained in Welfare and Institutions Code, Section 14171, and California Code of Regulations, Title 22, Section 5116, et seq. If you have questions regarding this report, you may call the Audits Section Burbank at (818) 295-262. Original Signed By Daniel J. Giardinelli, Chief Audits Section Burbank Financial Audits Branch Certified

STATE OF CALIFORNIA SCHEDULE 1 SUMMARY OF AUDITED FACILITY COSTS / COST PER PATIENT DAY Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility No.: 16997864 2619738 Line No. PROGRAM DESCRIPTION AUDITED COST PER AS REPORTED AS AUDITED PATIENT DAY SKILLED NURSING CARE 1 Cost of Direct Care - Labor (Sch. 2, Ln. 15) $ N/A $ 3,845,193 $ 71.7 2 Cost of Indirect Care - Labor (Sch. 3, Ln. 15) $ N/A $ 921,696 $ 17.19 3 Cost of Direct and Indirect Nonlabor - Other (Sch. 4, Ln. 15) $ N/A $ 1,469,673 $ 27.4 4 Cost of Capital Related (Sch. 5, Ln. 15) $ N/A $ 727,914 $ 13.57 5 Property Taxes (Sch. 5, Ln. 15) $ N/A $ 37,13 $.69 6 CDPH Licensing Fees (Sch. 6, Ln. 15) $ N/A $ 28,154 $.52 7 Professional Liability Insurance (Sch. 6, Ln. 15) $ N/A $ 17,584 $ 2.1 8 Caregiver Training (Sch. 6, Ln. 15) $ N/A $ $. 9 Quality Assurance Fees (Sch. 6, Ln. 15) $ N/A $ 561,97 $ 1.48 1 Cost of Administration (Sch. 6, Ln. 15) $ N/A $ 864,772 $ 16.13 11 Cost of Routine Service/Audited Total Costs $ 8,847,661 $ 8,564,22 $ 159.69 12 Total Patient Days (Adj ) 53,628 53,628 13 Cost Per Patient Day (Cost Divided by Days) $ 164.98 $ 159.69 14 Overpayments (Adjs 14-16) $ $ 36,93 15 Medi-Cal Days (Adj 13) 34,141 33,862 16 Medi-Cal Managed Care Days (Adj ) INTERMEDIATE CARE 17 Cost of Routine Service (Sch. 2, 3, 4, 5, 6) $ $ 18 Total Patient Days (Adj ) 19 Cost Per Patient Day (Cost Divided by Days) $. $. 2 Overpayments (Adj ) $ $ MENTALLY DISORDERED CARE 21 Cost of Routine Service (Sch. 2, 3, 4, 5, 6) $ $ 22 Total Patient Days (Adj ) 23 Cost Per Patient Day (Cost Divided by Days) $. $. 24 Overpayments (Adj ) $ $ DEVELOPMENTALLY DISABLED CARE 25 Cost of Routine Service (Sch. 2, 3, 4, 5, 6) $ $ 26 Total Patient Days (Adj ) 27 Cost Per Patient Day (Cost Divided by Days) $. $. 28 Overpayments (Adj ) $ $ SUBACUTE CARE 29 Cost of Direct Care - Labor (Subacute Care Sch. 1, Ln. 25) $ N/A $ $. 3 Cost of Indirect Care - Labor (Subacute Care Sch. 1, Ln. 26) $ N/A $ $. 31 Cost of Direct and Indirect Nonlabor - Other (Subacute Care Sch. 1, Ln. 27) $ N/A $ $. 32 Cost of Capital Related (Subacute Care Sch. 1, Ln. 28) $ N/A $ $. 33 Property Taxes (Subacute Care Sch. 1, Ln. 29) $ N/A $ $. 34 CDPH Licensing Fees (Subacute Care Sch. 1, Ln. 3) $ N/A $ $. 35 Professional Liability Insurance (Subacute Care Sch. 1, Ln. 31) $ N/A $ $. 36 Quality Assurance Fees (Subacute Care Sch. 1, Ln. 32) $ N/A $ $. 37 Caregiver Training (Subacute Care Sch. 1, Ln. 33) $ N/A $ $. 38 Cost of Administration (Subacute Care Sch.1, Ln. 34) $ N/A $ $. 39 Total Cost of Subacute Service (Subacute Care Sch. 1, Ln. 35) $ $ $. 4 Total Patient Days (Subacute Care Sch. 1, Ln. 36) 41 Cost Per Patient Day (Cost Divided by Days) $. $. 42 Amount Due Provider (State) (Subacute Care Sch. 1, Ln. 4) $ $

STATE OF CALIFORNIA SCHEDULE 1 SUMMARY OF AUDITED FACILITY COSTS / COST PER PATIENT DAY Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility No.: 16997864 2619738 Line No. PROGRAM DESCRIPTION AUDITED COST PER AS REPORTED AS AUDITED PATIENT DAY SUBACUTE CARE - PEDIATRIC 43 Cost of Routine Service (Subacute Care - Pediatric, Sch. 1, Ln 3) $ $ 44 Cost of Ancillary Service (Subacute Care - Pediatric, Sch. 1, Ln. 1 + Ln. 2) $ $ 45 Total Cost of Subacute Care - Pediatric Service (Ln. 43 + Ln. 44) $ $ 46 Total Patient Days (Subacute Care - Pediatric, Sch. 1, Ln. 5) 47 Cost Per Patient Day (Cost Divided by Days) $. $. 48 Amount Due Provider (State) (Subacute Care - Pediatric, Sch. 1, Ln. 9) $ $ TRANSITIONAL INPATIENT CARE 49 Cost of Routine Service (Sch. 2, 3, 4, 5, 6) $ $ 5 Total Patient Days (Adj ) 51 Cost Per Patient Day (Cost Divided by Days) $. $. 52 Overpayments (Adj ) $ $ HOSPICE INPATIENT CARE 53 Cost of Routine Service (Sch. 2, 3, 4, 5, 6) $ $ 54 Total Patient Days (Adj ) 55 Cost Per Patient Day (Cost Divided by Days) $. $. 56 Overpayments (Adj ) $ $ OTHER ROUTINE SERVICES 57 Cost of Routine Service (Sch. 2, 3, 4, 5, 6) $ $ 58 Total Patient Days (Adj ) 59 Cost Per Patient Day (Cost Divided by Days) $. $. 6 Overpayments (Adj ) $ $

STATE OF CALIFORNIA SCHEDULE 2 ALLOCATION OF GENERAL SERVICES DIRECT CARE LABOR Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility No.: 16997864 2619738 Line No. DESCRIPTION Net Exp For Cost Alloc (From Sch 8) Soc Srvs 155 Activities 16 Total GENERAL SERVICES 5 Plant Operations and Maintenance 1 Housekeeping 6 Laundry and Linen 65 Dietary 155 Social Services $ 153,56 $ 153,56 16 Activities 13,782 $ 13,782 165 Administration 166 Medical Records 17 Inservice Education - Nursing ANCILLARY SERVICES 75 Patient Supplies 77 Specialized Support Surfaces N/A 8 Physical Therapy 87,79 87,79 81 Respiratory Therapy 82 Occupational Therapy 644,761 644,761 83 Speech Pathology 12,565 12,565 85 Pharmacy 9 Laboratory 95 Home Health Services 1 Other Ancillary Services 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 3,561,355 153,56 13,782 3,845,193 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 145 Other Nonreimbursable TOTAL $ 5,31,39 $ 153,56 $ 13,782 $ 5,31,39 (To Schedule 1)

STATE OF CALIFORNIA SCHEDULE 3 ALLOCATION OF GENERAL SERVICES INDIRECT CARE LABOR Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 Line No. DESCRIPTION Net Exp For Cost Alloc (From Sch 8) Plant Ops 5 Hskpng 1 Laundry 6 Dietary 65 Soc Srvs 155 Activities 16 Inserv. Ed 17 Accumulated Costs Admin 165 Medical Records 166 Total GENERAL SERVICES 5 Plant Operations and Maintenance $ 113,46 $ 113,46 1 Housekeeping 161,681 8,891 $ 17,572 6 Laundry and Linen 124,171 $ 124,171 65 Dietary 316,748 12,341 2,141 $ 349,231 155 Social Services N/A 778 1,27 $ 2,48 16 Activities N/A 1,56 1,723 $ 2,779 165 Administration N/A 5,473 8,933 $ 14,46 $ 14,46 166 Medical Records 167,751 1,395 2,276 171,422 $ 171,422 17 Inservice Education - Nursing 96,64 445 725 $ 97,774 ANCILLARY SERVICES 75 Patient Supplies 833 1,36 2,194 78 931 $ 3,23 77 Specialized Support Surfaces 8 Physical Therapy 3,46 5,559 8,965 1,428 16,993 27,387 81 Respiratory Therapy 82 Occupational Therapy 1,56 12,562 13,618 83 Speech Pathology 21 245 265 85 Pharmacy 967 1,578 2,545 579 6,884 1,8 9 Laboratory 57 682 739 95 Home Health Services 1 Other Ancillary Services 64 764 828 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 76,954 125,591 124,171 349,231 2,48 2,779 97,774 778,548 11,97 132,51 921,696 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 867 1,415 2,282 26 31 2,618 145 Other Nonreimbursable TOTAL $ 98,361 $ 113,46 $ 17,572 $ 124,171 $ 349,231 $ 2,48 $ 2,779 $ 97,774 $ 794,533 $ 14,46 $ 171,422 $ 98,361 (To Schedule 1)

STATE OF CALIFORNIA SCHEDULE 4 ALLOCATION OF GENERAL SERVICES OTHER - NONLABOR Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 Line No. DESCRIPTION Net Exp For Cost Alloc (From Sch 8) Plant Ops 5 Hskpng 1 Laundry 6 Dietary 65 Soc Srvs 155 Activities 16 Inserv. Ed 17 Accumulated Costs Admin 165 Medical Records 166 Total GENERAL SERVICES 5 Plant Operations and Maintenance $ 495,952 $ 495,952 1 Housekeeping 4,268 38,881 $ 79,149 6 Laundry and Linen 2,479 $ 2,479 65 Dietary 367,58 53,972 9,346 $ 43,826 155 Social Services 14,4 3,42 589 $ 18,391 16 Activities 19,759 4,617 8 $ 25,176 165 Administration N/A 23,936 4,145 $ 28,81 $ 28,81 166 Medical Records 15,529 6,99 1,56 22,685 $ 22,685 17 Inservice Education - Nursing 1,944 337 $ 2,281 ANCILLARY SERVICES 75 Patient Supplies 34,79 3,645 631 38,985 152 123 $ 39,261 77 Specialized Support Surfaces 8 Physical Therapy 11,62 14,896 2,58 28,538 2,784 2,249 33,57 81 Respiratory Therapy 82 Occupational Therapy 2,58 1,662 3,72 83 Speech Pathology 4 32 72 85 Pharmacy 338,28 4,228 732 343,169 1,128 911 345,27 9 Laboratory 34,983 34,983 112 9 35,185 95 Home Health Services 1 Other Ancillary Services 39,191 39,191 125 11 39,417 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 538,598 336,54 58,277 2,479 43,826 18,391 25,176 2,281 1,43,567 21,632 17,475 1,469,673 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 2,355 3,791 656 6,82 51 41 6,894 145 Other Nonreimbursable TOTAL $ 1,973,1 $ 495,952 $ 79,149 $ 2,479 $ 43,826 $ 18,391 $ 25,176 $ 2,281 $ 1,922,235 $ 28,81 $ 22,685 $ 1,973,1 (To Schedule 1)

STATE OF CALIFORNIA SCHEDULE 5 ALLOCATION OF CAPITAL COSTS Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility Number: 16997864 2619738 Line No. DESCRIPTION Net Exp For Cost Alloc (From Sch 8) Ratio Capital Various Plant Ops 5 Hskpng 1 Laundry 6 Dietary 65 Soc Srvs 155 Activities 16 GENERAL SERVICES Capital Related (excluding lines 4 & 45) $ 785,48 95% Property Tax (line 4) 4,63 5% $ 825,471 5 Plant Operations and Maintenance 1,454 $ 1,454 1 Housekeeping 64,6 114 $ 64,714 6 Laundry and Linen $ - 65 Dietary 89,673 158 7,642 $ 97,473 155 Social Services 5,653 1 482 $ 6,144 16 Activities 7,671 14 654 $ 8,339 165 Administration 39,77 7 3,389 166 Medical Records 1,134 18 864 17 Inservice Education - Nursing 3,23 6 275 ANCILLARY SERVICES 75 Patient Supplies 6,56 11 516 77 Specialized Support Surfaces 8 Physical Therapy 24,75 44 2,19 81 Respiratory Therapy 82 Occupational Therapy 83 Speech Pathology 85 Pharmacy 7,25 12 599 9 Laboratory 95 Home Health Services 1 Other Ancillary Services 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 559,156 986 47,649 97,473 6,144 8,339 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 6,299 11 537 145 Other Nonreimbursable TOTAL $ 825,471 1% $ 825,471 $ 1,454 $ 64,714 $ - $ 97,473 $ 6,144 $ 8,339 (To Schedule 1)

STATE OF CALIFORNIA SCHEDULE 5 ALLOCATION OF CAPITAL COSTS Provider Name: SOUTH PASADENA CONVALESCENT HOSPITAL Provider NPI: 16997864 Fiscal Period: JANUARY 1, 211 THROUGH DECEMBER 31, 211 OSHPD Facility Number: 2619738 Line No. DESCRIPTION Net Exp For Cost Alloc (From Sch 8) Ratio Inserv. Ed 17 Accumulated Costs Admin 165 Medical Records 166 Total Capital Related 95% Of Total Property Tax 5% Of Total GENERAL SERVICES Capital Related (excluding lines 4 & 45) $ 785,48 95% Property Tax (line 4) 4,63 5% 5 Plant Operations and Maintenance 1 Housekeeping 6 Laundry and Linen 65 Dietary 155 Social Services 16 Activities 165 Administration $ 43,229 $ 43,229 166 Medical Records 11,16 $ 11,16 17 Inservice Education - Nursing $ 3,511 ANCILLARY SERVICES 75 Patient Supplies 6,583 235 6 $ 6,878 $ 6,544 $ 334 77 Specialized Support Surfaces 8 Physical Therapy 26,93 4,285 1,92 32,28 3,713 1,567 81 Respiratory Therapy 82 Occupational Therapy 3,168 87 3,975 3,782 193 83 Speech Pathology 62 16 77 74 4 85 Pharmacy 7,636 1,736 442 9,815 9,339 476 9 Laboratory 172 44 216 25 1 95 Home Health Services 1 Other Ancillary Services 193 49 242 23 12 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 3,511 723,258 33,3 8,486 765,44 727,914 37,13 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 6,846 78 2 6,945 6,68 337 145 Other Nonreimbursable TOTAL $ 825,471 1% $ 3,511 $ 771,227 $ 43,229 $ 11,16 $ 825,471 $ 785,48 $ 4,63 (To Schedule 1)

STATE OF CALIFORNIA SCHEDULE 6 ALLOCATION OF ADMINISTRATION AND OTHER DIRECT PASS-THROUGH COSTS Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 Line No. DESCRIPTION Net Exp For Cost Alloc (From Sch 8) Ratio Accum Costs (From Sch 2) Accum Costs (From Sch 3) Accum Costs (From Sch 4) Accum Costs (From Sch 5) Total Accum Costs Allocated Admin. Costs Admin. 55% of Total DPH Licensing Fees 2% of Total Professional Liability Ins. 7% of Total Quality Assur. Fees 36% of Total Caregiver Training % of Total GENERAL SERVICES 45 Property Insurance $ 29,217 55 Interest - Other 165 Administration (Salaries & Wages, Fringe Benefits, 1,93,387 Agency Staff and Other - Nonlabor) Total Costs Allocable as Administration 1,122,64 55% 167 CDPH Licensing Fees 36,548 2% 168 Professional Liability Insurance 139,66 7% 169 Quality Assurance Fees 729,44 36% 174 Caregiver Training % Total 2,28,252 1% $ 2,28,252 ANCILLARY SERVICES 75 Patient Supplies $ - $ 2,194 $ 38,985 $ 6,583 $ 47,762 11,1 $ 6,94 $ 198 $ 758 $ 3,96 $ - 77 Specialized Support Surfaces 8 Physical Therapy 87,79 8,965 28,538 26,93 872,196 21,65 111,286 3,623 13,845 72,311 81 Respiratory Therapy 82 Occupational Therapy 644,761 644,761 148,635 82,267 2,678 1,235 53,455 83 Speech Pathology 12,565 12,565 2,897 1,63 52 199 1,42 85 Pharmacy 2,545 343,169 7,636 353,35 81,457 45,85 1,468 5,69 29,295 9 Laboratory 34,983 34,983 8,65 4,464 145 555 2,9 95 Home Health Services 1 Other Ancillary Services 39,191 39,191 9,35 5,1 163 622 3,249 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 3,845,193 778,548 1,43,567 723,258 6,777,566 1,562,416 864,772 28,154 17,584 561,97 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 2,282 6,82 6,846 15,93 3,672 2,33 66 253 1,321 145 Other Nonreimbursable SUBTOTAL $ 2,28,252 $ 5,31,39 $ 794,533 $ 1,922,235 $ 771,227 $ 8,798,34 $ 2,28,252 Total Administrative Costs $ 2,28,252 Unit Cost Multiplier.2352761 Accumulated Administration Costs (Sch 2 thru 5) $ 185,828 $ 5,766 $ 54,244 $ 29,838 $ 1,122,64 $ 36,548 $ 139,66 $ 729,44 $ - TOTAL FACILITY COSTS $ 11,117,394 (To Schedule 1)

STATE OF CALIFORNIA SCHEDULE 7 STATISTICS FOR COST ALLOCATION Provider Name: SOUTH PASADENA CONVALESCENT HOSPITAL Provider NPI: 16997864 OSHPD Facility Number: 2619738 Fiscal Period: JANUARY 1, 211 THROUGH DECEMBER 31, 211 Line No. DESCRIPTION Capital (SQ FT) VARIOUS (Adj ) Plant Ops (SQ FT) 5 Hskpng (SQ FT) 1 Laundry (LBS) 6 Dietary (MEALS) 65 Soc Srvs (DIRECT EXP) 155 Activities (DIRECT EXP) 16 Inserv. Ed (DIRECT EXP) 17 (Adj ) (Adj ) (Adj ) (Adj ) (Adj ) (Adj ) (Adj ) Admin. (TOTAL ACCUM COST) Med Records (TOTAL (ACCUM COST) GENERAL SERVICES 5 Plant Operations and Maintenance 36 1 Housekeeping 1,6 1,6 6 Laundry and Linen 65 Dietary 2,221 2,221 2,221 155 Social Services 14 14 14 16 Activities 19 19 19 165 Administration 985 985 985 166 Medical Records 251 251 251 17 Inservice Education - Nursing 8 8 8 ANCILLARY SERVICES 75 Patient Supplies 15 15 15 47,762 47,762 77 Specialized Support Surfaces 8 Physical Therapy 613 613 613 872,196 872,196 81 Respiratory Therapy 82 Occupational Therapy 644,761 644,761 83 Speech Pathology 12,565 12,565 85 Pharmacy 174 174 174 353,35 353,35 9 Laboratory 34,983 34,983 95 Home Health Services 1 Other Ancillary Services 39,191 39,191 11 Subacute Care Ancillary Services 12 Subacute Care - Pediatric Ancillary Services ROUTINE SERVICES 15 Skilled Nursing Care 13,849 13,849 13,849 522,52 156,756 4,99,953 4,99,953 4,99,953 6,777,566 6,777,566 11 Intermediate Care 115 Mentally Disordered Care 12 Developmentally Disabled Care 125 Subacute Care 126 Subacute Care - Pediatric 128 Transitional Inpatient Care 13 Hospice Inpatient Care 135 Other Routine Services NONREIMBURSABLE 139 Residential Care 14 Beauty and Barber 156 156 156 15,93 15,93 145 Other Nonreimbursable TOTAL STATISTICS 2,445 2,49 18,89 522,52 156,756 4,99,953 4,99,953 4,99,953 8,798,34 8,798,34 TOTAL DIRECT SALARIES COSTS - SCH. 2 $ 153,56 $ 13,782 UNIT COST MULTIPLIER (DIRECT SALARIES).3733116.31898414 TOTAL INDIRECT SALARIES COSTS - SCH. 3 $ 113,46 $ 17,572 $ 124,171 $ 349,231 $ 2,48 $ 2,779 $ 97,774 $ 14,46 $ 171,422 UNIT COST MULTIPLIER (INDIRECT SALARIES) 5.55666618 9.6861959.23763875 2.22786215.49941.67777.238476.163735.1948352 TOTAL INDIRECT OTHER COSTS - SCH. 4 $ 495,952 $ 79,149 $ 2,479 $ 43,826 $ 18,391 $ 25,176 $ 2,281 $ 28,81 $ 22,685 UNIT COST MULTIPLIER (INDIRECT OTHER) 24.365167 4.28497.3919276 2.74838479.448571.61447.55627.319165.25783 TOTAL CAPITAL COSTS - SCH. 5 $ 825,471 $ 1,454 $ 64,714 $ - $ 97,473 $ 6,144 $ 8,339 $ 3,511 $ 43,229 $ 11,16 UNIT COST MULTIPLIER (CAPITAL COSTS) 4.3752176.7121894 3.446147..6218141.14986.23381.85634.49133.12522

STATE OF CALIFORNIA SCHEDULE 8 SUMMARY OF AUDITED PROGRAM EXPENSES Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility Number: 16997864 2619738 Line No. Natural Class ACCOUNT TITLE ACCOUNT NUMBER AS REPORTED AUDIT ADJUSTMENTS 8A-1 AS AUDITED 5 Plant Operations and Maintenance 5.1-.19 Salaries and Wages 62 $ 89,43 $ $ 89,43 5.2-.39 Fringe Benefits 62 24,3 24,3 5.79 Agency Staff 62 5.4-.99 Other - Nonlabor 62 495,952 495,952 5 Plant Operations and Maintenance - Total 62 $ 69,358 $ $ 69,358 1 Housekeeping 1.1-.19 Salaries and Wages 63 $ $ $ 1.2-.39 Fringe Benefits 63 1.79 Agency Staff 63 21,44 (39,723) 161,681 1.4-.99 Other - Nonlabor 63 961 39,37 4,268 1 Housekeeping - Total 63 $ 22,365 $ (416) $ 21,949 15 Depreciation: Buildings and Improvements 711-712 $ 1,8 $ $ 1,8 2 Depreciation: Leasehold Improvements 713 13,293 13,293 25 Depreciation: Equipment 714 8,167 8,167 3 Depreciation and Amortization - Other 715-716 2,564 2,564 35 Leases and Rentals 72 741,584 741,584 4 Property Taxes 73 69,76 (29,697) 4,63 45 Property Insurance 74 29,217 29,217 5 Interest - Property, Plant, and Equipment 75 55 Interest - Other 76 $ $ $ 57 Subtotal 5-55 $ 1,666,891 $ (896) $ 1,665,995 (Sch 5) (Sch 5) (Sch 5) (Sch 5) (Sch 5) (Sch 5) (Sch 6) (Sch 5) (Sch 6) 6 Laundry and Linen 6.1-.19 Salaries and Wages 64 $ $ $ 6.2-.39 Fringe Benefits 64 6.79 Agency Staff 64 134,299 (1,128) 124,171 6.4-.99 Other - Nonlabor 64 1,658 9,821 2,479 6 Laundry and Linen - Total 64 $ 144,957 $ (37) $ 144,65 65 Dietary 65.1-.19 Salaries and Wages 65 $ 252,555 $ $ 252,555 65.2-.39 Fringe Benefits 65 64,193 64,193 65.79 Agency Staff 65 65.4-.99 Other - Nonlabor 65 367,58 367,58 65 Dietary - Total 65 $ 684,256 $ $ 684,256 7 Provision for Bad Debts 77 $ $ Ancillary Services 75 Patient Supplies 75.1-.19 Salaries and Wages 81 $ $ $ 75.2-.39 Fringe Benefits 81 75.79 Agency Staff 81 75.4-.99 Other - Nonlabor 81 34,79 34,79 75 Patient Supplies - Total 81 $ 34,79 $ $ 34,79 77 Specialized Support Surfaces 77.1-.19 Salaries and Wages 815 $ $ $ 77.2-.39 Fringe Benefits 815 77.79 Agency Staff 815 77.4-.99 Other - Nonlabor 815 77 Specialized Support Surfaces - Total 815 $ $ $ N/A N/A N/A

STATE OF CALIFORNIA SCHEDULE 8 SUMMARY OF AUDITED PROGRAM EXPENSES Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility Number: 16997864 2619738 Line No. Natural Class ACCOUNT TITLE ACCOUNT NUMBER AS REPORTED AUDIT ADJUSTMENTS 8A-1 AS AUDITED 8 Physical Therapy 8.1-.19 Salaries and Wages 82 $ $ $ 8.2-.39 Fringe Benefits 82 8.79 Agency Staff 82 87,79 87,79 8.4-.99 Other - Nonlabor 82 11,62 11,62 8 Physical Therapy - Total 82 $ 818,852 $ $ 818,852 81 Respiratory Therapy 81.1-.19 Salaries and Wages 822 $ $ $ 81.2-.39 Fringe Benefits 822 81.79 Agency Staff 822 81.4-.99 Other - Nonlabor 822 81 Respiratory Therapy - Total 822 $ $ $ 82 Occupational Therapy 82.1-.19 Salaries and Wages 825 $ $ $ 82.2-.39 Fringe Benefits 825 82.79 Agency Staff 825 644,761 644,761 82.4-.99 Other - Nonlabor 825 82 Occupational Therapy - Total 825 $ 644,761 $ $ 644,761 83 Speech Pathology 83.1-.19 Salaries and Wages 828 $ $ $ 83.2-.39 Fringe Benefits 828 83.79 Agency Staff 828 12,565 12,565 83.4-.99 Other - Nonlabor 828 83 Speech Pathology - Total 828 $ 12,565 $ $ 12,565 85 Pharmacy 85.1-.19 Salaries and Wages 83 $ $ $ 85.2-.39 Fringe Benefits 83 85.79 Agency Staff 83 85.4-.99 Other - Nonlabor 83 338,28 338,28 85 Pharmacy - Total 83 $ 338,28 $ $ 338,28 9 Laboratory 9.1-.19 Salaries and Wages 84 $ $ $ 9.2-.39 Fringe Benefits 84 9.79 Agency Staff 84 9.4-.99 Other - Nonlabor 84 34,983 34,983 9 Laboratory - Total 84 $ 34,983 $ $ 34,983 95 Home Health Services 95.1-.19 Salaries and Wages 88 $ $ $ 95.2-.39 Fringe Benefits 88 95.79 Agency Staff 88 95.4-.99 Other - Nonlabor 88 95 Home Health Services - Total 88 $ $ $ 1 Other Ancillary Services 1.1-.19 Salaries and Wages 89 $ $ $ 1.2-.39 Fringe Benefits 89 1.79 Agency Staff 89 1.4-.99 Other - Nonlabor 89 39,191 39,191 1 Other Ancillary Services - Total 89 $ 39,191 $ $ 39,191

STATE OF CALIFORNIA SCHEDULE 8 SUMMARY OF AUDITED PROGRAM EXPENSES Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility Number: 16997864 2619738 Line No. 11 11 11 11 11 11 Natural Class ACCOUNT TITLE Subacute Care Ancillary Services.1-.19 Salaries and Wages.2-.39 Fringe Benefits.79 Agency Staff.4-.99 Other - Nonlabor Subacute Care Ancillary Services - Total ACCOUNT NUMBER AS REPORTED AUDIT ADJUSTMENTS 8A-1 81-89 $ $ $ 81-89 81-89 81-89 81-89 $ $ $ AS AUDITED 12 12 12 12 12 12 Subacute Care - Pediatric Ancillary Services.1-.19 Salaries and Wages.2-.39 Fringe Benefits.79 Agency Staff.4-.99 Other - Nonlabor Subacute Care - Pediatric Ancillary Services - Total 81-89 $ $ $ 81-89 81-89 81-89 81-89 $ $ $ 14 Subtotal 75-12 $ 1,923,269 $ $ 1,923,269 15 15 15 15 15 15 Routine Services Skilled Nursing Care.1-.19 Salaries and Wages.2-.39 Fringe Benefits.49 Agency Staff.4-.99 Other - Nonlabor Skilled Nursing Care - Total 611 $ 2,899,792 $ $ 611 663,621 (2,58) 611 611 536,54 2,58 611 $ 4,99,953 $ $ 2,899,792 661,563 538,598 4,99,953 11 11 11 11 11 11 Intermediate Care.1-.19 Salaries and Wages.2-.39 Fringe Benefits.49 Agency Staff.4-.99 Other - Nonlabor Intermediate Care - Total 612 $ $ $ 612 612 612 612 $ $ $ 115 115 115 115 115 115 Mentally Disordered Care.1-.19 Salaries and Wages.2-.39 Fringe Benefits.49 Agency Staff.4-.99 Other - Nonlabor Mentally Disordered Care - Total 613 $ $ $ 613 613 613 613 $ $ $ 12 12 12 12 12 12 Developmentally Disabled Care.1-.19 Salaries and Wages.2-.39 Fringe Benefits.49 Agency Staff.4-.99 Other - Nonlabor Developmentally Disabled Care - Total 614 $ $ $ 614 614 614 614 $ $ $ 125 125 125 125 125 125 Subacute Care.1-.19 Salaries and Wages.2-.39 Fringe Benefits.49 Agency Staff.4-.99 Other - Nonlabor Subacute Care - Total 615 $ $ $ 615 615 615 615 $ $ $ 126 126 126 126 126 126 Subacute Care - Pediatric.1-.19 Salaries and Wages.2-.39 Fringe Benefits.49 Agency Staff.4-.99 Other - Nonlabor Subacute Care - Pediatric - Total 616 $ $ $ 616 616 616 616 $ $ $

STATE OF CALIFORNIA SCHEDULE 8 SUMMARY OF AUDITED PROGRAM EXPENSES Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility Number: 16997864 2619738 Line No. Natural Class ACCOUNT TITLE ACCOUNT NUMBER AS REPORTED AUDIT ADJUSTMENTS 8A-1 AS AUDITED 128 Transitional Inpatient Care 128.1-.19 Salaries and Wages 617 $ $ $ 128.2-.39 Fringe Benefits 617 128.49 Agency Staff 617 128.4-.99 Other - Nonlabor 617 128 Transitional Inpatient Care - Total 617 $ $ $ 13 Hospice Inpatient Care 13.1-.19 Salaries and Wages 618 $ $ $ 13.2-.39 Fringe Benefits 618 13.49 Agency Staff 618 13.4-.99 Other - Nonlabor 618 13 Hospice Inpatient Care - Total 618 $ $ $ 135 Other Routine Services 135.1-.19 Salaries and Wages 619 $ $ $ 135.2-.39 Fringe Benefits 619 135.49 Agency Staff 619 135.4-.99 Other - Nonlabor 619 135 Other Routine Services - Total 619 $ $ $ Other Nonreimbursable 139 Residential Care 139.1-.19 Salaries and Wages 91 $ $ $ 139.2-.39 Fringe Benefits 91 139.49 Agency Staff 91 139.4-.99 Other - Nonlabor 91 139 Residential Care - Total 91 $ $ $ 14 Beauty and Barber 14.1-.19 Salaries and Wages 89 $ $ $ 14.2-.39 Fringe Benefits 89 14.49 Agency Staff 89 14.4-.99 Other - Nonlabor 89 2,355 2,355 14 Beauty and Barber - Total 89 $ 2,355 $ $ 2,355 145 Other Nonreimbursable 145.1-.19 Salaries and Wages 91 $ $ $ 145.2-.39 Fringe Benefits 91 145.49 Agency Staff 91 145.4-.99 Other - Nonlabor 91 145 Other Nonreimbursable - Total 91 $ $ $ 146 Subtotal 15-145 $ 4,12,38 $ $ 4,12,38 155 Social Services 155.1-.19 Salaries and Wages 66 $ 121,916 $ $ 121,916 155.2-.39 Fringe Benefits 66 31,14 31,14 155.49 Agency Staff 66 155.4-.99 Other - Nonlabor 66 14,4 14,4 155 Social Services - Total 66 $ 167,456 $ $ 167,456

STATE OF CALIFORNIA SCHEDULE 8 SUMMARY OF AUDITED PROGRAM EXPENSES Provider Name: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL JANUARY 1, 211 THROUGH DECEMBER 31, 211 Provider NPI: OSHPD Facility Number: 16997864 2619738 Line No. Natural Class ACCOUNT TITLE ACCOUNT NUMBER AS REPORTED AUDIT ADJUSTMENTS 8A-1 AS AUDITED 16 Activities 16.1-.19 Salaries and Wages 67 $ 13,655 $ $ 13,655 16.2-.39 Fringe Benefits 67 27,127 27,127 16.49 Agency Staff 67 16.4-.99 Other - Nonlabor 67 19,759 19,759 16 Activities - Total 67 $ 15,541 $ $ 15,541 165 Administration 165.1-.19 Salaries and Wages 69 $ 587,867 $ (124,33) $ 463,564 165.2-.39 Fringe Benefits 69 194,574 (72,37) 122,537 165.49 Agency Staff 69 165.4-.99 Other - Nonlabor 69 643,713 (136,427) 57,286 165 Administration - Total 69 $ 1,426,154 $ (332,767) $ 1,93,387 (Sch 6) (Sch 6) (Sch 6) (Sch 6) 166 Medical Records 166.1-.19 Salaries and Wages 69 $ 138,886 $ $ 138,886 166.2-.39 Fringe Benefits 69 28,865 28,865 166.49 Agency Staff 69 166.4-.99 Other - Nonlabor 69 15,529 15,529 166 Medical Records - Total 69 $ 183,28 $ $ 183,28 167 CDPH Licensing Fees 69 $ 36,548 $ $ 36,548 168 Professional Liability Insurance 69 $ 165,774 $ (26,114) $ 139,66 169 Quality Assurance Fees 69 $ 729,44 $ $ 729,44 17 Inservice Education - Nursing 17.1-.19 Salaries and Wages 68 $ 76,551 $ $ 76,551 17.2-.39 Fringe Benefits 68 2,53 2,53 17.49 Agency Staff 68 17.4-.99 Other - Nonlabor 68 17 Inservice Education - Nursing - Total 68 $ 96,64 $ $ 96,64 (Sch 6) (Sch 6) (Sch 6) 174 Caregiver Training 174.1-.19 Salaries and Wages 69 $ $ $ 174.2-.39 Fringe Benefits 69 174.49 Agency Staff 69 174.4-.99 Other - Nonlabor 69 174 Caregiver Training - Total 69 $ $ $ (Sch 6) (Sch 6) (Sch 6) (Sch 6) Subtotal 155-174 $ 2,955,797 $ (358,881) $ 2,596,916 2 Total $ 11,477,478 $ (36,84) $ 11,117,394 21.24 Total Facility Group Health Insurance 69 $ 164,953 For informational purposes only, this amount is included in various cost centers above..

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 1 Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 TOTAL ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub (Pages 1 & 2) 2 3 4 5 6 7 8 9 No. No. 5 1 Plant Operations and Maintenance - Salaries and Wages 5 2 Plant Operations and Maintenance - Fringe Benefits 5 3 Plant Operations and Maintenance - Agency Staff 5 4 Plant Operations and Maintenance - Other - Nonlabor 1 1 Housekeeping - Salaries and Wages 1 2 Housekeeping - Fringe Benefits 1 3 Housekeeping - Agency Staff (39,723) (39,37) (416) 1 4 Housekeeping - Other - Nonlabor 39,37 39,37 15 4 Depreciation: Buildings and Improvements 2 4 Depreciation: Leasehold Improvements 25 4 Depreciation: Equipment 3 4 Depreciation and Amortization - Other 35 4 Leases and Rentals 4 4 Property Taxes (29,697) (29,217) (48) 45 4 Property Insurance 29,217 29,217 5 4 Interest - Property, Plant, and Equipment 55 4 Interest - Other 6 1 Laundry and Linen - Salaries and Wages 6 2 Laundry and Linen - Fringe Benefits 6 3 Laundry and Linen - Agency Staff (1,128) (9,821) (37) 6 4 Laundry and Linen - Other - Nonlabor 9,821 9,821 65 1 Dietary - Salaries and Wages 65 2 Dietary - Fringe Benefits 65 3 Dietary - Agency Staff 65 4 Dietary - Other - Nonlabor 7 4 Provision for Bad Debts 75 1 Patient Supplies - Salaries and Wages 75 2 Patient Supplies - Fringe Benefits 75 3 Patient Supplies - Agency Staff 75 4 Patient Supplies - Other - Nonlabor 77 1 Specialized Support Surfaces - Salaries and Wages 77 2 Specialized Support Surfaces - Fringe Benefits 77 3 Specialized Support Surfaces - Agency Staff 77 4 Specialized Support Surfaces - Other - Nonlabor 8 1 Physical Therapy - Salaries and Wages 8 2 Physical Therapy - Fringe Benefits 8 3 Physical Therapy - Agency Staff 8 4 Physical Therapy - Other - Nonlabor 81 1 Respiratory Therapy - Salaries and Wages 81 2 Respiratory Therapy - Fringe Benefits 81 3 Respiratory Therapy - Agency Staff 81 4 Respiratory Therapy - Other - Nonlabor 82 1 Occupational Therapy - Salaries and Wages 82 2 Occupational Therapy - Fringe Benefits 82 3 Occupational Therapy - Agency Staff 82 4 Occupational Therapy - Other - Nonlabor 83 1 Speech Pathology - Salaries and Wages 83 2 Speech Pathology - Fringe Benefits 83 3 Speech Pathology - Agency Staff

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 1 Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 TOTAL ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub (Pages 1 & 2) 2 3 4 5 6 7 8 9 No. No. 83 4 Speech Pathology - Other - Nonlabor 85 1 Pharmacy - Salaries and Wages 85 2 Pharmacy - Fringe Benefits 85 3 Pharmacy - Agency Staff 85 4 Pharmacy - Other - Nonlabor 9 1 Laboratory - Salaries and Wages 9 2 Laboratory - Fringe Benefits 9 3 Laboratory - Agency Staff 9 4 Laboratory - Other - Nonlabor 95 1 Home Health Services - Salaries and Wages 95 2 Home Health Services - Fringe Benefits 95 3 Home Health Services - Agency Staff 95 4 Home Health Services - Other - Nonlabor 1 1 Other Ancillary Services - Salaries and Wages 1 2 Other Ancillary Services - Fringe Benefits 1 3 Other Ancillary Services - Agency Staff 1 4 Other Ancillary Services - Other - Nonlabor 11 1 Subacute Care Ancillary Services - Salaries and Wages 11 2 Subacute Care Ancillary Services - Fringe Benefits 11 3 Subacute Care Ancillary Services - Agency Staff 11 4 Subacute Care Ancillary Services - Other - Nonlabor 12 1 Subacute Pediatric Ancillary Services - Salaries and Wages 12 2 Subacute Pediatric Ancillary Services - Fringe Benefits 12 3 Subacute Pediatric Ancillary Services - Agency Staff 12 4 Subacute Pediatric Ancillary Services - Other - Nonlabor 15 1 Skilled Nursing Care - Salaries and Wages 15 2 Skilled Nursing Care - Fringe Benefits (2,58) (2,58) 15 3 Skilled Nursing Care - Agency Staff 15 4 Skilled Nursing Care - Other - Nonlabor 2,58 2,58 11 1 Intermediate Care - Salaries and Wages 11 2 Intermediate Care - Fringe Benefits 11 3 Intermediate Care - Agency Staff 11 4 Intermediate Care - Other - Nonlabor 115 1 Mentally Disordered Care - Salaries and Wages 115 2 Mentally Disordered Care - Fringe Benefits 115 3 Mentally Disordered Care - Agency Staff 115 4 Mentally Disordered Care - Other - Nonlabor 12 1 Developmentally Disabled Care - Salaries and Wages 12 2 Developmentally Disabled Care - Fringe Benefits 12 3 Developmentally Disabled Care - Agency Staff 12 4 Developmentally Disabled Care - Other - Nonlabor 125 1 Subacute Care - Salaries and Wages 125 2 Subacute Care - Fringe Benefits 125 3 Subacute Care - Agency Staff 125 4 Subacute Care - Other - Nonlabor 126 1 Subacute Care - Pediatric - Salaries and Wages 126 2 Subacute Care - Pediatric - Fringe Benefits 126 3 Subacute Care - Pediatric - Agency Staff 126 4 Subacute Care - Pediatric - Other - Nonlabor

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 1 Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 TOTAL ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub (Pages 1 & 2) 2 3 4 5 6 7 8 9 No. No. 128 1 Transitional Inpatient Care - Salaries and Wages 128 2 Transitional Inpatient Care - Fringe Benefits 128 3 Transitional Inpatient Care - Agency Staff 128 4 Transitional Inpatient Care - Other - Nonlabor 13 1 Hospice Inpatient Care - Salaries and Wages 13 2 Hospice Inpatient Care - Fringe Benefits 13 3 Hospice Inpatient Care - Agency Staff 13 4 Hospice Inpatient Care - Other - Nonlabor 135 1 Other Routine Services - Salaries and Wages 135 2 Other Routine Services - Fringe Benefits 135 3 Other Routine Services - Agency Staff 135 4 Other Routine Services - Other - Nonlabor 139 1 Residential Care - Salaries and Wages 139 2 Residential Care - Fringe Benefits 139 3 Residential Care - Agency Staff 139 4 Residential Care - Other - Nonlabor 14 1 Beauty and Barber - Salaries and Wages 14 2 Beauty and Barber - Fringe Benefits 14 3 Beauty and Barber - Agency Staff 14 4 Beauty and Barber - Other - Nonlabor 145 1 Other Nonreimbursable - Salaries and Wages 145 2 Other Nonreimbursable - Fringe Benefits 145 3 Other Nonreimbursable - Agency Staff 145 4 Other Nonreimbursable - Other - Nonlabor 155 1 Social Services - Salaries and Wages 155 2 Social Services - Fringe Benefits 155 3 Social Services - Agency Staff 155 4 Social Services - Other - Nonlabor 16 1 Activities - Salaries and Wages 16 2 Activities - Fringe Benefits 16 3 Activities - Agency Staff 16 4 Activities - Other - Nonlabor 165 1 Administration - Salaries and Wages (124,33) 165 2 Administration - Fringe Benefits (72,37) (39,179) 165 3 Administration - Agency Staff 165 4 Administration - Other - Nonlabor (136,427) 25,24 (72,729) 166 1 Medical Records - Salaries and Wages 166 2 Medical Records - Fringe Benefits 166 3 Medical Records - Agency Staff 166 4 Medical Records - Other - Nonlabor 167 4 CDPH Licensing Fees 168 4 Professional Liability Insurance (26,114) (25,24) (1,9) 169 4 Quality Assurance Fees 17 1 Inservice Education - Nursing - Salaries and Wages 17 2 Inservice Education - Nursing - Fringe Benefits 17 3 Inservice Education - Nursing - Agency Staff 17 4 Inservice Education - Nursing - Other - Nonlabor 174 1 Caregiver Training - Salaries and Wages 174 2 Caregiver Training - Fringe Benefits

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 1 Provider Name: Provider NPI: OSHPD Facility Number: Fiscal Period: SOUTH PASADENA CONVALESCENT HOSPITAL 16997864 2619738 JANUARY 1, 211 THROUGH DECEMBER 31, 211 TOTAL ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub (Pages 1 & 2) 2 3 4 5 6 7 8 9 No. No. 174 3 Caregiver Training - Agency Staff 174 4 Caregiver Training - Other - Nonlabor 2 Total ($36,84) (72,729) (39,179) (1,9) (48) (723) (To Sch 8)

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 2 Provider Name: SOUTH PASADENA CONVALESCENT HOSPITAL Provider NPI: 16997864 OSHPD Facility Number: 2619738 Fiscal Period: JANUARY 1, 211 THROUGH DECEMBER 31, 211 AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub 1 11 12 No. No. 5 1 Plant Operations and Maintenance - Salaries and Wages 5 2 Plant Operations and Maintenance - Fringe Benefits 5 3 Plant Operations and Maintenance - Agency Staff 5 4 Plant Operations and Maintenance - Other - Nonlabor 1 1 Housekeeping - Salaries and Wages 1 2 Housekeeping - Fringe Benefits 1 3 Housekeeping - Agency Staff 1 4 Housekeeping - Other - Nonlabor 15 4 Depreciation: Buildings and Improvements 2 4 Depreciation: Leasehold Improvements 25 4 Depreciation: Equipment 3 4 Depreciation and Amortization - Other 35 4 Leases and Rentals 4 4 Property Taxes 45 4 Property Insurance 5 4 Interest - Property, Plant, and Equipment 55 4 Interest - Other 6 1 Laundry and Linen - Salaries and Wages 6 2 Laundry and Linen - Fringe Benefits 6 3 Laundry and Linen - Agency Staff 6 4 Laundry and Linen - Other - Nonlabor 65 1 Dietary - Salaries and Wages 65 2 Dietary - Fringe Benefits 65 3 Dietary - Agency Staff 65 4 Dietary - Other - Nonlabor 7 4 Provision for Bad Debts 75 1 Patient Supplies - Salaries and Wages 75 2 Patient Supplies - Fringe Benefits 75 3 Patient Supplies - Agency Staff 75 4 Patient Supplies - Other - Nonlabor 77 1 Specialized Support Surfaces - Salaries and Wages 77 2 Specialized Support Surfaces - Fringe Benefits 77 3 Specialized Support Surfaces - Agency Staff 77 4 Specialized Support Surfaces - Other - Nonlabor 8 1 Physical Therapy - Salaries and Wages 8 2 Physical Therapy - Fringe Benefits 8 3 Physical Therapy - Agency Staff 8 4 Physical Therapy - Other - Nonlabor 81 1 Respiratory Therapy - Salaries and Wages 81 2 Respiratory Therapy - Fringe Benefits 81 3 Respiratory Therapy - Agency Staff 81 4 Respiratory Therapy - Other - Nonlabor 82 1 Occupational Therapy - Salaries and Wages 82 2 Occupational Therapy - Fringe Benefits 82 3 Occupational Therapy - Agency Staff 82 4 Occupational Therapy - Other - Nonlabor 83 1 Speech Pathology - Salaries and Wages 83 2 Speech Pathology - Fringe Benefits 83 3 Speech Pathology - Agency Staff

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 2 Provider Name: SOUTH PASADENA CONVALESCENT HOSPITAL Provider NPI: 16997864 OSHPD Facility Number: 2619738 Fiscal Period: JANUARY 1, 211 THROUGH DECEMBER 31, 211 AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub 1 11 12 No. No. 83 4 Speech Pathology - Other - Nonlabor 85 1 Pharmacy - Salaries and Wages 85 2 Pharmacy - Fringe Benefits 85 3 Pharmacy - Agency Staff 85 4 Pharmacy - Other - Nonlabor 9 1 Laboratory - Salaries and Wages 9 2 Laboratory - Fringe Benefits 9 3 Laboratory - Agency Staff 9 4 Laboratory - Other - Nonlabor 95 1 Home Health Services - Salaries and Wages 95 2 Home Health Services - Fringe Benefits 95 3 Home Health Services - Agency Staff 95 4 Home Health Services - Other - Nonlabor 1 1 Other Ancillary Services - Salaries and Wages 1 2 Other Ancillary Services - Fringe Benefits 1 3 Other Ancillary Services - Agency Staff 1 4 Other Ancillary Services - Other - Nonlabor 11 1 Subacute Care Ancillary Services - Salaries and Wages 11 2 Subacute Care Ancillary Services - Fringe Benefits 11 3 Subacute Care Ancillary Services - Agency Staff 11 4 Subacute Care Ancillary Services - Other - Nonlabor 12 1 Subacute Pediatric Ancillary Services - Salaries and Wages 12 2 Subacute Pediatric Ancillary Services - Fringe Benefits 12 3 Subacute Pediatric Ancillary Services - Agency Staff 12 4 Subacute Pediatric Ancillary Services - Other - Nonlabor 15 1 Skilled Nursing Care - Salaries and Wages 15 2 Skilled Nursing Care - Fringe Benefits 15 3 Skilled Nursing Care - Agency Staff 15 4 Skilled Nursing Care - Other - Nonlabor 11 1 Intermediate Care - Salaries and Wages 11 2 Intermediate Care - Fringe Benefits 11 3 Intermediate Care - Agency Staff 11 4 Intermediate Care - Other - Nonlabor 115 1 Mentally Disordered Care - Salaries and Wages 115 2 Mentally Disordered Care - Fringe Benefits 115 3 Mentally Disordered Care - Agency Staff 115 4 Mentally Disordered Care - Other - Nonlabor 12 1 Developmentally Disabled Care - Salaries and Wages 12 2 Developmentally Disabled Care - Fringe Benefits 12 3 Developmentally Disabled Care - Agency Staff 12 4 Developmentally Disabled Care - Other - Nonlabor 125 1 Subacute Care - Salaries and Wages 125 2 Subacute Care - Fringe Benefits 125 3 Subacute Care - Agency Staff 125 4 Subacute Care - Other - Nonlabor 126 1 Subacute Care - Pediatric - Salaries and Wages 126 2 Subacute Care - Pediatric - Fringe Benefits 126 3 Subacute Care - Pediatric - Agency Staff 126 4 Subacute Care - Pediatric - Other - Nonlabor

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 2 Provider Name: SOUTH PASADENA CONVALESCENT HOSPITAL Provider NPI: 16997864 OSHPD Facility Number: 2619738 Fiscal Period: JANUARY 1, 211 THROUGH DECEMBER 31, 211 AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ Line Sub 1 11 12 No. No. 128 1 Transitional Inpatient Care - Salaries and Wages 128 2 Transitional Inpatient Care - Fringe Benefits 128 3 Transitional Inpatient Care - Agency Staff 128 4 Transitional Inpatient Care - Other - Nonlabor 13 1 Hospice Inpatient Care - Salaries and Wages 13 2 Hospice Inpatient Care - Fringe Benefits 13 3 Hospice Inpatient Care - Agency Staff 13 4 Hospice Inpatient Care - Other - Nonlabor 135 1 Other Routine Services - Salaries and Wages 135 2 Other Routine Services - Fringe Benefits 135 3 Other Routine Services - Agency Staff 135 4 Other Routine Services - Other - Nonlabor 139 1 Residential Care - Salaries and Wages 139 2 Residential Care - Fringe Benefits 139 3 Residential Care - Agency Staff 139 4 Residential Care - Other - Nonlabor 14 1 Beauty and Barber - Salaries and Wages 14 2 Beauty and Barber - Fringe Benefits 14 3 Beauty and Barber - Agency Staff 14 4 Beauty and Barber - Other - Nonlabor 145 1 Other Nonreimbursable - Salaries and Wages 145 2 Other Nonreimbursable - Fringe Benefits 145 3 Other Nonreimbursable - Agency Staff 145 4 Other Nonreimbursable - Other - Nonlabor 155 1 Social Services - Salaries and Wages 155 2 Social Services - Fringe Benefits 155 3 Social Services - Agency Staff 155 4 Social Services - Other - Nonlabor 16 1 Activities - Salaries and Wages 16 2 Activities - Fringe Benefits 16 3 Activities - Agency Staff 16 4 Activities - Other - Nonlabor 165 1 Administration - Salaries and Wages (124,33) 165 2 Administration - Fringe Benefits (32,858) 165 3 Administration - Agency Staff 165 4 Administration - Other - Nonlabor (78,722) (1,) 166 1 Medical Records - Salaries and Wages 166 2 Medical Records - Fringe Benefits 166 3 Medical Records - Agency Staff 166 4 Medical Records - Other - Nonlabor 167 4 CDPH Licensing Fees 168 4 Professional Liability Insurance 169 4 Quality Assurance Fees 17 1 Inservice Education - Nursing - Salaries and Wages 17 2 Inservice Education - Nursing - Fringe Benefits 17 3 Inservice Education - Nursing - Agency Staff 17 4 Inservice Education - Nursing - Other - Nonlabor 174 1 Caregiver Training - Salaries and Wages 174 2 Caregiver Training - Fringe Benefits

STATE OF CALIFORNIA RECLASSIFICATIONS AND/OR ADJUSTMENTS TO REPORTED COSTS Schedule 8A-1 Page 2 Provider Name: SOUTH PASADENA CONVALESCENT HOSPITAL Provider NPI: 16997864 OSHPD Facility Number: 2619738 Fiscal Period: JANUARY 1, 211 THROUGH DECEMBER 31, 211 Line Sub No. No. 174 3 Caregiver Training - Agency Staff 174 4 Caregiver Training - Other - Nonlabor AUDIT ADJ 1 AUDIT ADJ 11 AUDIT ADJ 12 AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ AUDIT ADJ 2 (78,722) (157,161) (1,) Total

State of California Department of Health Care Services Provider Name SOUTH PASADENA CONVALESCENT HOSPITAL Report References Cost Report Audit Report MC53 Adj. Page or No. Exhibit Line Col. Sch. Line Sub No Fiscal Period JANUARY 1, 211 THROUGH DECEMBER 31, 211 Explanation of Audit Adjustments MEMORANDUM ADJUSTMENT Provider NPI Adjustments 16997864 16 As Reported Increase (Decrease) As Adjusted 1 Not Reported 8 21 N/A Total Facility Group Health Insurance To include total group health insurance costs for informational purpose 42 CFR 413.2 and 413.24 CMS Pub. 15-1, Sections 23 and 234 $ $164,953 $164,953 Page 1

State of California Department of Health Care Services Provider Name SOUTH PASADENA CONVALESCENT HOSPITAL Report References Cost Report Audit Report MC53 Adj. Page or No. Exhibit Line Col. Sch. Line Sub No Fiscal Period JANUARY 1, 211 THROUGH DECEMBER 31, 211 Explanation of Audit Adjustments RECLASSIFICATIONS OF REPORTED COSTS Provider NPI Adjustments 16997864 16 As Reported Increase (Decrease) As Adjusted 2 1.5 4 4 8A-1 4 4 1.5 15 2 8A-1 15 2 1.5 45 4 8A-1 45 4 1.5 15 4 8A-1 15 4 Property Taxes Skilled Nursing Care - Fringe Benefits Property Insurance Skilled Nursing Care - Other - Nonlabor To reclassify the reported expenses for proper cost determination. 42 CFR 413.2 and 413.24 CMS Pub. 15-1, Sections 23 and 234 $69,76 663,621 536,54 ($29,217) (2,58) 29,217 2,58 $4,543 661,563 29,217 538,598 3 1.5 168 4 8A-1 168 4 1.5 165 4 8A-1 165 4 Administration - Professional Liability Insurance Administration - Other - Nonlabor To reclassify finance fees, taxes and other fees associated with liability insurance to the administration cost center. 42 CFR 413.24 / CMS Pub. 15-1, Section 2162 CCR, Title 22, Sections 52(b) and 5251 $165,774 643,713 ($25,24) 25,24 $14,75 668,737 4 1.5 1 3 8A-1 1 3 1.5 6 3 8A-1 6 3 1.5 1 4 8A-1 1 4 1.5 6 4 8A-1 6 4 Housekeeping - Agency Staff Laundry and Linen - Agency Staff Housekeeping - Other - Nonlabor Laundry and Linen - Other - Nonlabor To reclassify the non labor portion of the contract labor expense for proper cost determination. 42 CFR 413.2 and 413.24 / CMS Pub. 15-1, Sections 23 and 234 CCR, Title 22, Section 5252(c)(1) $21,44 134,299 961 1,658 ($39,37) (9,821) 39,37 9,821 $162,97 124,478 4,268 2,479 Balance carried forward from prior/to subsequent adjustments Page 2