MOUNT SINAI MEDICAL CENTER. MSMC Medical Center & Foundation

Transcription

1 MOUNT SINAI MEDICAL CENTER MSMC Medical Center & Foundation Investor Call 3rd Quarter 2015 December 17, 2015

2 Overview CEO Report Mission Master Facility Planning Budget Update Hospital Financial Update Volume Update Financial Results Financial Analysis Foundation Financial Update Financial Results Revenue Cycle Update EPIC EMR Update 2016 Budget Medical Center Foundation Capital 2

3 Mission To provide high quality health care to our diverse community enhanced through teaching, research, charity care and financial responsibility. 3

4 Facility Planning Replacement Surgery Tower and Emergency Department Project 12 New Modern Operating Rooms 154 Private Rooms Will allow for 100% Private Rooms for patients Replacement Emergency Department Expanded from current 16,700SF to 45,850SF Replacement Emergency Department will include a new 10,000SF Clinical Decision Unit New 750 space Parking Garage 4

5 Facility Planning Employee Parking Garage - Broke ground May 2015 Approximately 750 spaces for Employee use only Mobilization of the area started April 24, 2015 Construction expected to be completed June

6 Facility Planning SURGERY TOWER PROJECT SCHEDULE Estimated Date July 2015 September 2015 February 2016 May 2016 June 2016 May 2018 August 2018 November 2019 Action Ground breaking of Parking Garage Complete Design of Tower / Emergency Department Complete Enabling Projects Completion of Permitting / Begin Tower Construction Complete Parking Garage Complete Tower & Emergency Department Construction Occupy Tower & Emergency Department Completion of Phased Renovations - (Pharmacy, Lab, Dietary) 6 6

7 MSMC Benchmarks Significant Financial Accomplishments Stable Financial Performance Profitable for 11 of the last 12 years EBDITA: $63.3 million projected in 2015 Fitch Upgrade July 2015 BBB+ (Investment Grade, Stable Outlook) Moody s Upgrade July 2014 Baa1 (Investment Grade, Stable Outlook) Cash to Debt ratio: 89% in 2015 Cash Days on Hand : days in 2015 Long-Term Debt : $328.1 million in 2015 The Medical Center s Foundation has raised an average $14.8 million annually since

8 Medical Center 2016 Budget Summary 2015 Projection Summary and 2016 Budget Summary 1.0% Inpatient Admissions increase in 2016 as compared to 2015 Governmental revenue rate will continue to be challenged due to the ACA and Population Health Commercial revenue growth of 2% - 3% expected Expenses, volume adjusted, are expected to grow at 3.0% 2014 Audited 2015 Projected 2016 Budget Admissions 22,613 22,513 22,739 Revenues $529,226,245 $543,276,846 $559,759,242 Expenses 508,255, ,384, ,970,673 Net Income $20,971,014 $21,892,430 $17,788, FYE 2014 Financial Results exclude Loss on Extinguishment of Debt 8

9 Foundation 2016 Budget Summary Mount Sinai Medical Center Foundation Budgeted Pledges, Cash Gifts and Other Bequests of $22.7 million as compared to $17.3 million projected in 2015 Budgeted Operating Expenses expected to increase nominally by approximately 2% Net Assets are expected to continue to grow, given consistent Pledge Revenue production and Operating Expense control % Actual Projected Budget Variance Pledges, Cash Gifts & Other Bequests $ 22,612 $ 17,303 $ 22,747 31% Interest, Dividends & Gains/(Losses) on Investments* 1,738 2,350 $ % Total Revenues $ 24,350 $ 19,653 $ 23,684 21% Operating Expenses 5,763 4,306 4,371 2% Revenues over Expenses $ 16,849 $ 12,997 $ 18,376 41% Transfers to the Medical Center $ 678 $ 568 $ % Net Assets $ 138,872 $ 151,095 $ 169,471 12% * Note Financial Results excludes unrealized gains/(losses) on investments 9

10 Financial Update YTD 3 rd Quarter

11 2015 Financial Success Factors Achieved YTD September 2015 Profit Unaudited Net Income of $17,403,000 Financial results include Malpractice return on Premium credit of $3,938,000 Budgeted Net Income of $15,951,000 and Prior Year Actual Net Income of $14,274,000 Foundation Net assets increased by $10,442,000 as compared to the prior year Foundation s Net Assets were $147,096,000 at the end of YTD September 2015 as compared to $136,654,000 at the end of YTD September 2014 Key Volume Indicators Acute Inpatient Admissions were up 1.3% as compared to the prior year or 14,657 vs 14,470 Total Surgeries were up 3.8% as compared to the prior year or 9,615 vs 9,263 Outpatient Surgeries were up 6.9% as compared to the prior year or 5,341 vs 4,998 Strong Cardiology volume as compared to the prior year Cardiac Catheterization procedures were up 11.7% as compared to the prior year or 2,523 vs 2,259 Angioplasty procedures were up 17.5% as compared to the prior year or 1,007 vs. 857 Volume growth through the Emergency Department Total Emergency Department visits increased 5.9% or 3,036 visits as compared to the prior year or 54,396 vs 51,360 Emergency Department Inpatient admits were up 3.2% as compared to the prior year or 9,472 vs 9,178 11

12 Volume Update YTD Sep 2015 YTD Sep 2014 #Variance % Variance IP Rehab (4) (0.5%) Psychiatric 1,532 1,803 (271) (15.0%) Acute 14,657 14, % Total Admissions 16,963 17,051 (88) (0.5%) Observation Admits 4,195 4, % Deliveries 2,019 2,078 (59) (2.8%) MSMC Emergency Dept Visits 40,612 38,811 1, % FSED Emergency Dept Visits 13,784 12,549 1, % Total Emergency Dept Visits 54,396 51,360 3, % Inpatient Surgeries 4,274 4, % Ambulatory Surgeries 5,341 4, % Total Surgeries 9,615 9, % Open Hearts Surgeries (10) (1.5%) Cardiac Catheterizations 2,523 2, % Cardiac Angioplasties 1, % 12

13 Medical Center Profit & Loss Statement (Amounts in 000 s) YTD Sep 2015 Actual YTD Sep 2014 Budget YTD Sep 2014 Actual (1) Budget Variance Prior Year Variance Net Revenue $404,424 $407,370 $393,654 ($2,946) $10,770 Expenses Personnel Cost $198,249 $197,555 $190,266 $694 $7,983 Supply Expense 84,081 80,241 77,807 3,840 6,274 Admin & General 52,846 56,112 54,818 (3,266) (1,972) Insurance 16,865 23,120 23,220 (6,255) (6,355) Depreciation 20,777 19,950 20, Interest 10,086 10,031 8, ,704 Other Operating 4,117 4,410 4,164 (293) (47) Total Operating Exp $387,021 $391,419 $379,380 ($4,398) $7,641 Net Income $17,403 $15,951 $14,274 $1,452 $3,129 EBDITA $48,266 $45,932 $43,379 $2,334 $4, Year to Date 2014 Financial Results exclude Loss on Extinguishment of Debt of $4,500,000 13

14 Cash Position Cash Position Calculation per Bond Covenant In the period YTD September 2015, total Unrestricted Cash has grown by $26.7M or 13.9 days as compared to the same period in the prior year Medical Center Unrestricted Cash / Investments in Bank MSMC Foundation Days Available 09/30/15 $271,687,000 $43,578, Available 09/30/14 $249,270,000 $39,304, Available 12/31/14 $269,049,000 $42,694, Available 12/31/13 $246,256,000 $35,363, Available 12/31/12 $195,401,000 $25,380, Available 12/31/08 $71,623,000 $17,028,

15 Foundation YTD 2015 Financial Update 15

16 Financial Summary Mount Sinai Medical Center Foundation Through the 3 rd Quarter of 2015, the Foundation has raised approximately $13 million The Foundation experienced a decrease in operational expenses of (13%) as compared to the prior year primarily driven by a decrease in the provision for bad debt expense The Foundation s Net Assets grew from $136.7M in the 3rd quarter of 2014 to $147.1M in the 3rd quarter of 2015, or 8% YTD 2015 YTD 2014 PY Actual Actual Variance Pledges, Cash Gifts & Other Bequests $ 12,977 $ 18,132-28% Interest, Dividends & Gains (Losses) on Investments* 2, % Total Revenues $ 15,098 $ 18,307-18% Operating Expenses 3,229 3,706-13% Revenues Over Expenses $ 11,869 $ 14,601-19% Transfers to Medical Center $ 426 $ % Net Assets $ 147,096 $ 136,654 8% Cash & Investments: Unrestricted $ 43,578 $ 39,304 11% Restricted 32,348 30,601 6% Total Cash & Investments $ 75,926 $ 69,905 9% * Note Financial Results excludes unrealized gains/(losses) on investments 16

17 Revenue Cycle Update 17

18 Epic Revenue Cycle Epic Revenue Cycle Implementation Timing Month Project Go Live - May 1, 2016 Scope Registration / Scheduling Hospital Billing and Claims HIM Coding Revenue Cycle Analytics Resources Approximately 20 Full Time Employees 100% dedicated to implementation Approximately 10 Employees partially dedicated to implementation (0.3 FTE each) Budget Mount Sinai already owns the Epic Revenue Cycle Software Spend in $9.5M Cost of Implementation - $16.9M 18

19 2016 Medical Center Budget 19

20 Revenue Cycle Challenges Challenges to Revenue ICD10 Conversion occurred on October 1, ICD10 conversion cost were approximately $2.5M The permanent Revenue impact is unknown at this time ICD10 conversion is expected to significantly increase the number of claim denials. Denials are expected to occur in late November. A successful conversion will minimize this impact Lower Income Pool A potential reduction in Lower Income Pool funding was not built into the 2016 Budget Medicare Lower rates due to ACA and quality initiatives Program FYE 2015 FYE 2016 Variance Medicare $114,606,900 $113,567,300 ($1,039,600) ICD10 Conversion Denial Estimate ($2,500,000) Potential Lower Income Pool Funding ($9,445,509) Total Potential Net Revenue Reductions ($12,985,109) 20

21 Trended Financial Performance & Budget - (000 s) Financial Performance B16-P15 B16- P P 2015 B 2016 $ Var % Var Net Revenue $519,651 $529,226 $543,276 $559,759 $16, % SWB $242,419 $258,671 $267,186 $280,287 $13, % Supplies 100, , , ,151 3, % A&G 68,349 71,560 70,755 72,524 1, % Insurance 23,414 30,403 23,424 24,595 1, % Other Expenses 5,562 5,585 5,489 5, % Total Operating Exp $440,240 $470,783 $479,897 $499,239 $19, % EBDITA $79,411 $58,443 $63,380 $60,521 ($2,859) -4.5% Depreciation 26,630 26,049 27,703 28, % Interest 11,103 11,423 13,785 14, % Net Income $41,678 $20,971 $21,892 $17,789 ($4,104) -18.7% 1. FYE 2014 Financial Results exclude Loss on Extinguishment of Debt of $4,500,000 21

22 Budget Volume Indicators FYE 2014 P 2015 B 2016 P 2015 A 2014 % Variance B 2016 P 2015 % Variance B 2016 P 2015 # Variance IP Rehab 1,045 1,028 1, % 0.5% +5 Psychiatric 2,315 2,034 2,085-12% 2.5% +51 Acute 19,253 19,464 19, % 0.8% +157 Total Admissions 22,613 22,513 22, % +1.0% +226 Deliveries 2,822 2,741 2, % 3.0% +84 IP Surgery Cases 5,506 5,676 5, % 0.7% +37 OP Surgery Cases 6,651 6,854 6, % 1.0% +69 Open Heart Surgeries % 5.0% +43 Cardiac Caths 3,038 3,350 3, % 2.5% +84 MSMC ED Visits 52,057 54,933 57, % 4.0% +2,208 Aventura ED Visits 17,090 18,308 19, % 4.0% +732 Total ED Visits 69,147 73,241 76, % 4.0% +2,941 22

23 2016 Capital Budget 23

24 Routine Capital Budget Departments 2016 Capital Budget Information Technology $ 8,384,420 Cardiovascular Services $ 4,133,722 Imaging $ 3,678,330 Construction $ 3,134,500 Plant Engineering $ 2,506,423 Surgical Services $ 786,884 Nursing Services $ 637,450 Security/Safety/Transport $ 295,400 Other $ 405,300 Total Capital Budget Less FEMA Funding $ 23,962,429 Routine budget does not include special projects such as the Surgery Tower and Network Development projects 24

25 Mount Sinai Medical Center Disclosure Statement Forward-Looking Information: Certain Cautionary Statements The statements contained in this report that are not historical facts are "forward-looking statements" (as such term is defined in the Private Securities Litigation Reform Act of 1995), which may be identified by the use of forward-looking terminology such as: "estimates," "projects," "anticipates," "expects," "intends," "believes," "plans," "forecasts" or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements. We wish to caution the reader that forward-looking statements, including, without limitation, statements regarding expected cost reductions, anticipated or expected results of the implementation of our cost-reduction initiatives, the development of service lines, anticipated revenues or capital expenditures, projected profits or losses, and other statements contained in this report regarding matters that are not historical facts, are only estimates or predictions. No assurance can be given that future results will be achieved. Actual events or results may differ materially as a result of risks facing us or of actual results differing from the assumptions underlying such statements. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our estimates change. 25

26 Healthcare Excellence Ethical Behavior Accountability Respect & Caring Teamwork Service Before Self 26