NORTHWESTERN MEMORIAL HOSPITAL AUDITED FINANCIAL STATEMENTS AND ANNUAL REPORT CERTIFICATION Pursuant to Section 3 of the Disclosure Dissemination Agreement dated as of March 1, 2009, between Northwestern Memorial Hospital ("NMH") and Digital Assurance Certification, L.L.C., as exclusive Disclosure Dissemination Agent (the "Disclosure Dissemination Agent" or "DAC") with reference to the Illinois Finance Authority Revenue Bonds, Series 2009 and all other NMH bonds, the undersigned does hereby certify that attached hereto is the Audited Financials Statements and Annual Report containing an update to the information provided in Appendix A to the Official Statement under the captions "HISTORICAL UTILIZATION OF SERVICES," "SUMMARY OF FINANCIAL RESULTS Debt Service Coverage;" " Capitalization;" and " Sources of Revenue" for the fiscal year ended August 31, 2012 as required under the Disclosure Dissemination Agreement. All capitalized terms used, but not defined herein, shall have the meaning set forth in the Disclosure Dissemination Agreement. This 29 th day of November, 2012. Northwestern Memorial Hospital By: /s/ Peter J. McCanna Executive Vice President, Administration and Chief Financial Officer
Historical Utilization of Services Utilization Statistics Inpatient Admissions 55,743 Equivalent Admissions* 104,287 Average Length of Stay 4.5 Patient Days 252,165 Average Occupancy** 78.9% Deliveries 14,035 Emergency Room Visits: Inpatient*** 23,711 Outpatient 111,954 Total 135,665 Outpatient Registrations - (Excluding Emergency Room) 725,034 Surgeries: Inpatient 14,951 Outpatient 25,570 Total 40,521 Beds Beds, Licensed - Total 1,011 Beds, Staffed - Total**** 929 * Inpatient admissions adjusted to reflect outpatient activity. ** Calculated based on Patient Days (as shown in this chart) plus outpatient observation days divided by staffed beds. *** Emergency room visits resulting in inpatient admissions. **** Staffed beds include all adult inpatient and observation (unlicensed) beds available for patient care. NICU bassinets are not included in the staffed bed calculation.
Summary of Financial Results - Maximum Annual Debt Service Coverage ($ thousands) Excess of revenue over expenses $ 110,306 Unrealized gains (57,597) Change in fair value of interest rate swaps 30,533 Depreciation and amortization 132,834 Interest on funded indebtedness** 40,271 Income available for debt service* $ 256,347 Divided by Maximum Annual Debt Service Requirement* $ 56,433 Maximum Annual Debt Service Coverage Ratio 4.5 * The method of calculating the debt service coverage ratio for NMH is prescribed by Article 1 and Sections 411 and 413 of the Amended and Restated Master Trust Indenture between NMH and J.P. Morgan Trust Company, National Association, dated as of May 1, 2004, as amended and supplemented by each Supplemental Master Trust Indenture thereto through and including the Sixteenth Supplemental Master Trust Indenture dated as of July 1, 2012 (the Master Indenture ). ** Interest on Funded Indebtedness is net of $2,452 of paid interest that has been capitalized and included as an asset on the balance sheet in accordance with U.S. generally accepted accounting principles. Interest on funded indebtedness also includes $10,570 for net swap settlements that is included in other operating expense in the statement of operations and changes in net assets in accordance with U.S. generally accepted accounting principles.
Summary of Financial Results - Capitalization As of August 31, 2012 ($ thousands) Long-term indebtedness (excluding current portion) $ 806,155 Unrestricted net assets 2,232,102 Total Capitalization $ 3,038,257 Long-term indebtedness as a percentage of total capitalization 26.5%
Northwestern Memorial Hospital Obligated Group Summary of Financial Results - Sources of Revenue Net Patient Service Revenue By Payor Type Medicare 23.5% Medicaid 6.0% Other Third-Party Payors and Patients 3.0% Managed care 67.5% Total 100.0%