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Agenda 01/29/2008 Item #16F 4 Agenda Item No. 16F4 January 29. 2008 Page 1 of 22 EXECUTIVE SUMMARY Recommendation to approve a Certiticate of Public Convenience and Necessity for NCH Healthcarc System for non-emergency ambulance service and approve a budget amendment recognizing and appropriating the $250 anuual renewal fee. OBJECTIVE: Board of County Commissioners approval of a Certificate of Public Convenience and Necessity for NCB Bealthcare System, authorization for the Chainnan to execute the same and approval of a Budget Amendment to recognize and appropriate the $250 annual renewal fee. CONSIDERA TIONS: NeH Bealtheare Systems Clm-ently operates non-emergency ambulance transport under a Certificate of Public Convenience and Necessity. Collier County Ordinance No. 2004-12 requires that NCB Healthcare Systems annually renew its original Celtificate of Public Convenience and Necessitv and pay a $250 flOe. FUl1her, the renewal certificate may be approved routinely by the Board or County Commissioners upon advice oi.the Administrator. FISCAL IMPACT: $250 to he recognized and appropriated by Budget Amendment to Emergency Management Fund OOI-1442JO Illr FY08. GROWTH MANAGEMENT IMPACT: There is no Growth Management Impact associated with this action. RECOMMENDA nON: That the Board of County Commissioners: 1. Approve the Certificate of Public Convenience and Necessity for the NCB Bealthcare System. 2. Authorize the Chairman to execute the same. 3. Approve a Budget Amendment to recognize and appropriate the $250 annual renewal fee. PREPARED BY: Department Christine Chase, Sr. Administrative Assistant, Emergency Management ..~ Page 1 of 1 Agenda Item No. 16F4 January 29, 2008 Page 2 of 22 COLLIER COUNTY BOARD OF COUNTY COMMISSIONERS Item Number: Item Summary: 16F4 Recommendation to approve a Certificate of Public Convenience and Necessity for NCH Heattllcare System for non-emergency ambulance service and approve a budget amendment. recognizing and appropriating the $250 annual renewal fee. Meeting Date: 1/29/2008900:00 AM Prepared By Christine Chase Senk)r AdministrBHve Assistant Date- Gounty Manager's Office i::mergency Managernnnt ii8i200U 3:02:03 PM Approved By Don ::. Summers Bureau of Emergency 3e~".ices Di,r,'ctor Date t:Ol)'nty ManagE'~'s Office Bun:<;'\u of [me-rgem:v Services 'liOf200H 4:2:l ~~1M ;\,pproved By OMS C{}()'.cHnatcr OMB Coordinatnr Date County Manager's OffiCI:, <:Jf1k,~ (~f Managernent & EJudget 1116/2001:"1 9:29 AM Approved By Michael Smykowski hfianagernE.'nt & Budget Director Date County Manager's Office Office of Management & Budget 1122120084:11 PM Approved By James V. Mudd County Manager Date Board of County Commissioners County Manager's Office 1122120085:09 PM file ://C:\AgendaT est\Export\99-January%2029, %202008\ 16. %20CONSENT%20A GENDA \... 1/23/2008 Naples Campus 350 Seventh Stree!N. Naples. Florida 34102 (239) 436,5000 NCH Agenda Item No. 16F4 January 29, 2008 Page 3 of 22 North Collier Campus 11190 Healthpark Boulevard Naples,. Florida 34110 (239) 513,7000 c,'~, ~!!,~~.."- ............... Healthcare System Decernber28,2007 ;j JAN - 2 2008 Dan Summers, Director Bureau of Emergency Services Collier County, Florida _ ," , .",,'.' i,n';:.t,,,".~"'LT Ell,........,..' '_I\," \ ,....'"":.!~.J.-\,-,..."I...i'" .\'it::il,'..Ji..' V. <," Subject: Renewal of Certificate of Public Convenience and Necessity for NCH Healthcare System, Ambulance Services. Mr. Summers, Persuant to Collier County Ordinance 2004-12, please accept the following updated information for the renewal of the required certificate for 2008. 1. NCH Ambulance Services is operated by NCH Healthcare Systems, 350 7th Street North, Naples, Florida, 34101. 2' NCH Ambulance Services provides the NCH Healthcare System with interfacility, and out of county ambulance transports. 3, NCH Ambulance Services operates with up to 3, and no less than 1, State Licensed ALS Ambulances, for 24 hours a day, and 7 days a week. 4- NCH Ambulance Services is located at 2157 Pine Ridge Road, Naples, Florida. S- Schedule of attachments: A, NCH Certificate of Liability Insurance. B, Florida Advanced Life Support License. C, List of permitted ALS Ambulances D' Medical Director Documents. E, Schedule of rates. F, List of officers, and trustees of the NCH Healthcare System. G, Check for $250.00 renewal fee. Thank you for your attention to this matter. Please call me if you need any additional information, or if I can answer questions about this renewal. Sincerely, David Mennini, Director NCH Ambulance Services 239,513-7080 office www.NCHmd.org r Agenda Item No. 16F4 January 29, 2008 Page 4 of 22 Attachment A Agenda Item No. 16F4 January 29, 2008 ACORD '" CERTIFICATE OF LIABILITY INSURANCE Page 1 of 3 10/0';/2007 THIS CERTIFICATE is ISSUED AS A MATTER OF iNFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR AL Tl'R THE COVERAGE AFFORDED BY THE POLICIES BELOW. 877-945-7378 PRODUCER Willis North America, Inc. 26 Century Blvd. P. O. Box 305191 Naehvil18. TN 372305191 INSURED NeH Healthcare Systems, Attn: Daryl Kilpatrick PO Box 413029 Naples, FL 34101 Inc. , INSURERS AFFORDING COVERAGE NAIC# --i'NSU~E~'~!_h. C~~.~:~_~r ~~k !i;_~ I~~-~~~:CG C~P~~Z____"_';~-6-~~"2';i- INSURERS: Steadfast Insurance Co. ! 26387-001 -- ----- - --- --~..._---~ ; !NSl!~ER c: Zu~_~ ~IU ic _an _In.,~ur&n~..!.._ c:o~P..!~.L . ~~ 3 5 - 2 9~ INSURER D: INSURER E: __+ u_ COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TOTHE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOlWlTHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REOUCED BY PAID CLAIMS. -.-------- t~SR lTR TYPEOF1NSURANCE I GENER.A.L UABlLITY POUCY NUMBER ....~~ i"glifit, -----iiNf-- UMITS : : COMMERCIAL GENERAL LIABILITY r---+-----c r....--- i ! : CLAIMS MADE j! OCCUR I I - - I ' . i EACH OCCURRENCE : DAMAGE TO RENTED' ! PB!;'MI~I;_~tEa OCGUr'-m~J : MEO EXP (Any one persOf1) 1----...-.----.-------...-- IpERSoN~~ADVINJURY I ~+ IA I I I GENERAL AGGREGATE ------.-- --]$ , , , " --1 _._-~ i 1,000,000 i . ..ul I .~ GEN'l AGGREGATE LIMIT APPLIES PER ,---1 POLICY 1- - j~T : LOC ; AUTOMOBILE UABIU1Y P8108241A934COF007 10/1/2007 .......---I.....U- 10/1/2008 I C:OMBINED SINGLE LlMll ; (Ea>lccictenl) 1 PRODUCTS. COMP/OP ~('~ I $ I I ., ~ ANY AUlD ALL OWNED AUTOS BOD~l Y INJURY (Per person) -., _ _ j SCHEDULED AUTOS , __K_~ HIRED AUTOS : X j NON.OWNED AUTOS II ,--, -.-- , , GARAGE UABIUTY BODilY INJURv (Peraccidenll PROPERTY DAMAGE : (Peraccidenlj AUTO ONLY. EAACCIDENT --- --- , B EXCESSlUMBREUA U~LITY _i OCCUR G2 CLAIMS MADE :HPC2B0706511 110/1/2007 10/1/200B EACH OCCURRENCE , ., ---~_.__._-- ANY AUTO OTHER THAN AUTO ONLY: !l.C?~~GATE DEDUCTIBLE X RETENTION $3 000 00 ! ~i:'~~~T1ONAND i ANY PROPRIETOR/PARTNERlEXECUTIVE OFF1CERlMEMBER EXQUDEO? ~~C~~R~~s4oNS below C1THER Excess workers Compensation IEWS3878463 I E.L. EACH ACCIDENT ~_._ EL DISEASE EA EMPLOYEE $ E.l. DISEASE - POLICY LIMIT $ C I DESCRIPTION OF 0PfRA TlONSlLOCA TlONS/IIEHtcLESlEXCLUSlONS ADDED BY ENDORSEMENTlSPECIAl PROVISIONS SEE ATTACHED FOR PROFESSIONAL LIABILITY: s~,ooo.ooo. Each Accident $1,000,000. Each E~ploy../Di.8a6. Limit. are in Excess 0 500 000. CERTIFICATE HOLDER CANCELLATION ACORD 25 (2001/08) Coll:2130096 SHOULD ANY OF THE ABOVE DESCRIBED POUClES BE CANCELLED BEFORE THE EXPlRAllON DATE THEREOF, THE ISSUING INSURER WILL EM)EAVOR TO MAIL ~ DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHAL.L IMPOSE NO OBUGAT1ON OR UABIUlY OF ANY KIND UPON THE INSURER, ITS AGENTS OR REPRESENTAT1VES. AUTHORIZED REPRESENTATIVE ,~ Agency of Healthcare Admin. 2727 Mahan Drive, Room 213 Tallahassee, PL 32308 @ACORDCORPORATION 1888 i\genda Item No. 16F4 January 29.2008 - ~ WJllts CERTIFICATE OF LIABILITY INSURANCE Page 2 o.f 3 I ~ROOUCER 877-945,7378 DATE 10/03/2007 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. T LINSURERS AFFORDING COVERAGE i NAIC# ----- ---~--- -------------,_..---- , r_1N~RERA Tb~~.!l~k Fir!-~.!...~e. Company _125615~OOl IN_~ ~tee.dfast~ura.!lceS~~_ ___ ___;_~6387_~~ , r:::::~ Zuuch ^:.nc:~In.ura~e-.-_comp.nx __ -1165"= Willi~ North America, Inc. 26 Century Blvd. P. O. Box 305191 Nashville, TN 372305191 INSURED NeB Healthcare Systems, Attn: Daryl Kilpatrick PO Box 413029 Naples, FL 34101 Inc. , DESCRlPllON OF OPERAnONS/LOCAl1ONSNEHlCL.ESlEXCLUstONS ADDED BY ENDORSEMENT/SPECIAl PRCMSlONS PROFESSIONAL LIABILITY COVERAGE - RETRO DATE: 7/1/78 CARRIER: STEADFAST INSURANCE COMPANY POLICY NUMBER: HPC280706511 EFFECTIVE: 10/01/2007 TO 10/01/2008 $25,000,000 LIMIT OVER SIR $3.000,000 Umbrella liability is excess of Hospital Professional Liability with a Self-Insured retention of $3,000,000 per claim, and General Liability with a Self-Insured retention of $1,000,000 per occurrence/$3,OOO,OOO Aggregate. C0.11,2130096 Tp1,689723 Cert:9634203 Agenda Item No. 16F4 January 29.2008 ? Page 3 of 3 IMPORTANT If the certificate holder is an ADDITIONAL INSURED. the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). If SUBROGATION IS WAIVED. subject to the terms and conditions of the policy. certain policies may require an endorsement. A statement on this certificate does not canfer rights to the certificate holder in lieu of such endorsement(s). DISCLAIMER The Certificate of Insurance on the reverse side of this form does not constitute a contract between the issuing insurer(s), authorized representative or producer, and the certificate holder, nor does it affirmatively or negatively amend, extend or alter the r.overage afforded by the policies listed thereon. ACORD 25 (2001/08) Coll:2130096 Tpl:689723 Cert:9634203 Agenda Item No. 16F4 January 29, 2008 Page 8 of 22 Attachment B ; q ,.._~~"",_,,,,,,,,,.',,,,,,,c._~,,,,,",,,,_,.,",".--....._...~___.,,.,_.~,..,,,....._~,,"""_"~__~__~"""""'-""'~".....'"-,"._..."",."".",_,.~..c~__....,,,..~_.~~_~,_.__.____, ..___..._._ .._.' r_;?~.I~-';:-'::::_~~~_ifuk~~i__i:~~~..I:;~.~_~_~~_~~~:_',,~ '7o::l;N. ~~~~" . ';1;Tj 001." ZNI.ID" )::C~.'_ $~ft ,- " .{g~t,'-,: _ ,I... G3 '~.", en ~:; ,~ ,'" i. i';' ~" i: 5T ~j;; ,~'i.: \H .Lt,. 'Ewi t~~~ rni ; ~ ,., ~ t i;' j ~,~r; i~~ , <;e'; ii!i,,', ~ ~- ~{ '''"li:' i~~" :!t, ~~:~. t ~~fJ! ,h, ~:~~ :( \~,;;)! '.'.~'...'. llf ~." '. ~t, ;~~: 1,(." i:;:ii'~ '~"( ~g~' ~ -~ ~~; ~. f-~ tf) f~~; .~,,, '..~"....:. ~ -., lei'l ill .f ~l,~~ flil;~ :~~ \.~tf;- l:;-!lr,. I nf~l_ ~5h~ i~b .~"'. frfti~ , I'" " ~wT :,/~'; vn~ #", ;~ ,.*'....:M':~r~'--'-.~~''''~;~i!"tf,i.'ffi'~~'~l'-~:=~""""""~T!~~~~...,..,~...Rr~ fv, m -.~:~-~---. .' .' 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'l' '" '" <;; !6 U -s ~ ~ 1 Agenda Item No. 16F4 January 29.2008 Page 12 of 22 Attachment D Agenda Item No. 16F4 January 29.2008 Page 13 of 22 TOBER, ROBERT BOYD MD NAPLES COMMUNITY HOSPITAL 350 7TH ST N NAPLES FL 33940 - 0000 1..11.../1.1./...1,.111...11...11.,.11...11......111 , CONTROL.L!D SUBSTANCE REGlSTRATlON CERTIFJCATE OEA REGISTRATION THIS REGISlRATfON "'. UNITED STATES DEPAR'JMENT OF JUSTICE NUMBER EXPIRES pAn) . DRUG ENFORCBfENT ADMINISTRATION I A T8302438 11-30-2008 PAID I . WASHINGTON, D.C. 20537 , SCHEDUlES BUSINESS ACTMTY ISSUE DATE , 12,2N, PRACTITIONER 11,09-2005/ , , 3,3N,4,5 , , TOBER, ROBERT BOYD MD , Sedions 304 Bnd 1008 (21 U .S.C. 824 and 958) of the Controlled NAPLES COMMUNITY HOSPITAL , SubstlncesAc:t of 1970. as amended. proyfde that the Attorney , General may revoIte or suspend 8 registration to manufacture. 350 7TH ST N , diSll1bl1l8, dispense, import or export a cnntrolled substance. , NAPLES FL 33940-??oo , THIS CERTIFICATE IS NOT TRANSFERABLE ON CHANGE OF , OWNERSHIP, CONTROl, LOCATION, OR BUSINESS ACTMTY , AND rr IS. NOT VALID AFTER THE EXPIRATJON OA rE. ' --------------------------------------. CONTROLLED SUBSTANCE REGISTRATION CERTIFICATE UNITED STATES DEPARTMENT OF JUSTICE DRUG ENFORCEMENT ADMINISTRATION WASHINGTON, D.C. 20537 ;- , OEA REGISTRATION NUMBER IAT8302438 SCHEDULES BUSINESS ACTIVITY 12'2N, PRACTITIONER 3,3N,4,5 TOBER, ROBERT BOYD MD NAPLES COMMUNITY HOSPITAL 350 7TH ST N THIS REGISTRATlQH EXPIRES "'. PAn) 11-30-2008 PAID ISSue. DATE 11-09-2005 NAPLES FL 33940- 0000 Sections 304 and 1008 (21 U.S.C. 824 and 958) of the Controlled Substances Ad of lB70, as amended, proykje that the Attorney General may revoke or suspend a registration to manufacture, distribute, dispense. bnport or export a controlled substance. II THIS (";FRTlFIr.ATF I!=:; NnTT~AN~I=F~ARI ~ ON (""l.llt.ll..lnC "lI:::~\AIt...~t:lC"I_"n ,......~~...... '........A........... ....- -- .-.. ---- .-- DATE 111()112007 LICENSE NO. ME 30891 CONTROL NO. 227645 ~nd (,0 J.' CD en (Y) r'--'. 0,) No. 16F4 a Y 49,2008 e 140122 AC#? 7 ,3 99 G 4 STATE OF FLORIDA . . ... DEPARTMENT OF HEAL TH . ... .. DIVISION OF MEDICAL QUALITY ASSURANCE The MEDICAL DOCTOR named below has met all requirements of the laws and rules of the state of Florida. Expiration Date: JANUARY 31, 2010 ROBERT BOYD TOBER ATTN: NCH WOUND HEALING CENTER 6400 DAVIS BLVD. SUITE 104 NAPLES,FL 34112 iii '-' L ~ (/) z;; ~ ~ m ~ i:ffi.. ::J 0:1 J:ct ::i ..." ;10 w;;;l ~-,~~ ",Ow O.I-:!: ii-ffiu. 1I.. :;!o Oi=Z ~ ~~. ~ &~ "' DO d "'- oEo :: ~ o .a~ "'~'"' ~u.~ .-'" -!l ~~ a:: a:e!~ ~ 01i Gl""':l 0 t;~" c- 3~1, ~ < ~.2! m ~-=''g 0 fil.o: 8 ~ "'1il'~ w e;!!'~ m ~:l!E$ ~ (l..//i/._C?->t- Charlie Crist GOVERNOR 11 ~ v';APh#)i ~ Ana M, Via monte Ros, M,D., M.PH. STATE SURGEON GENERAL DISPLAY IF REQUIRED BY LAW EXPIRATION DATE: JANUARY 31, 2010 Your lkf'1l5C number is ME 30MB!. pl1:ww \I~e it in aJl l:orresp()ll(knfC with .HIU!' hOlmlicotlndJ. IlJ;u:h licenser i:'l solely rnlpon~ib1c for mltifying lhe dcpanmclll in \\'Iiling (; ihc li('nl~'~e's c\un:nl n\flilin:;: u(liln~"s lUll! pnWIh-e JOfHtjon Ildd n~~ll. U1!l: this sc{:tion ItJ report. IlfHnl: Ilnd lor prnflifc I\JUltioll llddn;~l:l nml/or mailing arJdress (~llIUlR~s. If ,'m1 Illl"!: rlllt received your r1'nt'wlIlllotice 90 day., prior to 1he expiHltion dHle ~hllWll on this lkcn:;(~, pleflt':ir cB111R50) '188-05'15. I: r;haof>cs n''1uirt' legal dOf.Uf]lenlJllion ll!lowing the IHII1l~ t:h;mg('. Pleull/' make sun' thal II l)hotoc\lpy 01 one of Illc folluwillg fwcol1lpII,nics this form: Sl nlnrl'illg(' lic{'nst~, It ",,'oref' dt,,:rec or u r.mlrtonlc-r. A drlver'sUeense or social security card 18 Jlot condde..ed legal dOCWDentatton. Mcdkul Quolil}' J\ssurnnl:f~ offers you lhl~ r:OJ1Velllro('(' of sever/ll onlin(' !>r:rvircs_ These servkcllo give }'OU 111!~ {lbilily 1.0 rt~l1ew )'()\./f licenl'l<", llptlllle your mailing Ilmt pnldkc l{)(~lllj()ll ndtln:5ses nnt! updal.e J{)\Ir prnlilc iJ\~nrmll1.ion. 1. Golo ..wIUu:althsource,com 1. Click on U(:cIHa~c/Provid('r 3. Click on Prm:litioncr Login 4. Sd<,cl .\'UlH pf(lfc~si(Jn 5. Enlt:r IJu' IICC\IlI11ll1) nnd p~s.6word ht~rc (Account 10 tlnd Po.word are cau leDlltlvel Al:counl 1\): toberrob Pas!;word: c2G-lc:cEI" Wilen '0' is IowereoSl: 18tter 'O'.} 6. Click on Login To rr:quest H duplicutr. Iit.:cnse, submit this f(lrm nnd ~\ chet;k or m()lH.~Y urdc:r, pa.l'llble In Ihe DEPARTMENT OF HEALTH, in the RmQunt of $25DO. Now tlmt ~'()U hflve 'yl)ur li,l~n,"c, 1Tt1l1c1~ sure you ket'p il. Go tl) www.dob..tatcII.lQ/mqa/avold.btml to find out mon~. MAIL TO: DEPARTMENT OF HEALTH DIVISION OF MEDICAL QUALITY ASSURANCE LICENSURE SERVICES P,O. BOX 6320 TALLAHASSEE, FLORIDA 32314,6320 ::J NAME CHANGE (ATTACH LEGAL DOCUMENTATION) FROM: LAST -----FiRSr--- MIDDLE o PRACTICE LOCATION ADDRESS CHANGE (This address will be printed on your license and postad on the InterneL) ZIP .cJTY - STATE U MAILING ADDRESS CHANGE (This address will be used when mailing your license and for all other correspondence from the Department.) TO: LAST DH 2103,5198 FIRST - MIDDLE- -cn-y STATE ZIP - Agenda Item No. 16F4 January 29, 2008 Page 15 of 22 Attachment E Agenda Item No. 16F4 January 29, 2008 Page 16 of 22 Naples Campus 350 Seventh StreetN. Naples. Florida 34102 (239) 436"5000 NCH North Collier Campus 11190 Healtnpark Boulevard Naples, Florida 34110 (239) 513-7000 ;~~,~:!~~rr~1il':~"- --........ Healthcare System To: Collier County Board of Commissioners From: NCH Healthcare System, Ambulance Services Date: December 28, 2007 Subject: Schedule of rates for Ambulance transport for 2008, 280020-9 NCH BLS- AO-429- $525.00 280030-8 NCH AlS2- AO-433- $630.00 280040-7 NCH ALS1- AO-426- $550.00 280050-6 NCH AlSl- AO-427- $577.50 280070-4 NCH BlSl- AO-428- $540.75 www.NCHmd.org Agenda Item No. 16F4 January 29. 2008 Page 17 of 22 Attachment F - Offi cers & Trustees ~ NCH ..- ...........--.... - Agenda Item No.l~ 1 of 4 January 29, 2008 Home I Cont.ct u. l~llQEl;ti.lttofSl.n in ... Naples, FL Fair .730 Se.rell NCKmd.org: I. Search I . :advanced search About Us News & Events Careers @ NCH Patients & Visitors Services Home . About Us ~ Officers & Trustees ~UiCk Links .. Print this Page \.t .i"~,\ J. '" ;' '~;'!I! .' . ......... Related Pages: ~ Bienvenfdo ~ Willkommen Our Mission & Vision , History Awards & Recognition The NCH Healthcare System Foundation , Volunteers Annual Reports , 990 IRS Tax Forms Helpful Info: Maps of NCH Telephone Numbers Find a Doctor QUick Links: Select: NCH Downtown Naples Hospital 350 7th Street North Naples FL 34102 (239)436'5000 NCH North Naples Hospital 11190 Health Park Blvd. Naples FL 34110 (239)552'7000 Officers . Trustees The NCH Healthcare System , NCH Healthcare System , NCH Naples Hospital Inc. NCH Marco Healthcare Center , Ambulatory Surgical Care, Inc. Community Home Care, Inc. Gulf Coast Linen Services, Inc. , Health Resources Corporation BOARD OF TRUSTEES 2007-2008 NCH HEALTHCARE SYSTEM, INC. NCH NAPLES HOSPITAL, INC. CORPORATE OFFICERS .& Carl E. Westman Chairman Stephen L. Schwartz 1st Vice Chairman Joseph Perkovich 2nd Vice Chairman Edwin Stedem Secretary/Treasurer BOARD OF TRUSTEES 1----1 I I L I I II William Allyn Jay H. Baker William E. Blndley Susan L. Dalton I II.,.,.". ." :i~W" " ',", .. Paul Dernbach, M.D. Alberto M. de la Rivaherrera, M.D. laVerne C. Franklin Linda Flewelling 12/13/2007 http://www .nchmd.orgidefault.aspx?id=487 &amp;link=navrnenu - Officers & Trustees Agenda Item No.Pifi!e\2 of 4 January 29, 2008 Pa e 19 of 22 ~".. \. .....,,-;r, i : :"'e": . ., ... . Thomas J. Gazdic Daniel Gill Ellin Goetz Kay Gow f'I...'.....,:.... 'Ii ", ,:;, .~ I II Francis E. Harrington, M.D. Kim Ciccarelli Kantor Arnold Lerner Scott Lutgert I I II Paul J. Marinelli Gern Moll John M. Morrison Wayne Mullican Rabbi Joseph Perkovich Scot C. Schultz, Stephen L. James H. Perman 2nd Vice Chairman M.D. Schwartz 1st Vice Chairman & I I Edwin Stedem Secretary ITreasurer Norman Thomson, M.D. Carl E. Westman Chairman STAFF OFFICERS I I I I Allen S. Weiss, MD President & CEO Carrie Capps Chief Nursing & Clinical Officer Kevin D. Cooper General Counsell Gail Dolan COO, North Naples Hospital Campus http://www.nchmd.orgldefault.aspx?id=487&amp;link=navmenu ] 2/ 13/2007 - Officers & Trustees I Phillip Dutcher COO, Downtown Naples Hospital Campus Vicki Haie CFO /Assistant Treasurer I' ,~ ; ',,"' Susan Wolff Chief information Officer Return to Top NCH MARCO HEAL THCARE CENTER Corporate Officers John l. Patterson, Chairman Thomas Stolee, M.D., 1st Vice Chairman Paul Kurtzman, 2nd Vice Chairman AI Diaz, 3rd Vice Chairman Melody Kappauf, Secretary Richard Adams, Treasurer Trustees Richard Adams, Treasurer Elizabeth Bozzo (Bonnie) AI Diaz, 3rd Vice Chairman David Fenelon Kevin Fitzgerald Judy Gewirtz Lawrence J. Hocking Melody Kappauf, Secretary James B. Kauffman, Jr. Paul Kurtzman, 2nd Vice Chairman Mary Ann Kline Margaret L. Lanoix Robert A. Marks Allen W. Merriam, III Joh n l. Patterson, Chairman Yvette Saco Sal A. Saldano Thomas Stolee, M.D., 1st Vice Chairman Socrates Tseckares Brooks C.B. Wood http://www.nchmd.org/default.aspx?id=487&amp;link=navmenu Chief of Staff Beth Martin Assistant Secretary Agenda Item No.~lfifei 3 of 4 January 29.2008 Page 20 of 22 I Brian Settle Chief Human Resources Officer 12/13/2007 - Officers & Trustees Staff Officers Kevin D. Cooper, General Counsel/Chief of Staff Gail Dolan, COO-North Naples Hospital Campus Phil Dutcher, COO-Downtown Hospital Campus Vicki Hale, Chief Financial Officer Brian Settle, Chief Human Resources Officer Carrie Skifton, Chief Nursing & Clinical Officer Pamela D. Wagner, Assistant Secretary Allen S. Weiss, M.D., President & CEO Susan Wolff, Cheif Information Officer Agenda ItemNo.P8if64 of 4 Januarv 29. 2TlUs Page 21 of 22 Return to Top HEALTH RESOURCES CORPORATION AMBULATORY SURGICAL CARE, INC. COMMUNITY HOME CARE, INC. COMMUNITY IMAGING, INC. GULF COAST LINEN SERVICE, INC. Corporate Officers: Carl t. Westman; Chairman Stephen L. Schwartz, 1 st \lice (':harrma0 Joseph Perkovich. _.)no" Vice (:11airman ;:::dwin Ste(jem, C:;ern""tar\.//Fr-easurer Directors: Daniel Baer Jay Baker William Bindley Richard Bodman Paul Dernbach, M.D Linda Flewelling Thomas Gazdic Daniel Gill Arnold Lerner John Morrison Joseph l. Perkovich, 2nd Vice Chairman Stephen L. Schwartz, 1st Vice Chairman Edwin Stedem, Secretary(Treasurer Carl E. Westman, Chairman Staff Officers Kevin D. Cooper, General Counsel/Chief of Staff Gail Dolan, COO'North Napies Hospital Campus Phil Dutcher, COO-Downtown Hospital Campus Vicki Hale, Chief Financlai Officer Beth Martin, Assistant Secretary Brian Settle, Chief Human Resources Officer Carrie Skifton, Chief Nursing & Clinical Officer Allen S. Weiss, M.D., President & CEO Susan Wolff, Chief Information Officer Return to Top I ,....L_ OUR VISION IS TO ..Ii THI!. F'NI!.ST '''TEGRATGO HeAl.THeAllU! SYsTEM IH..T"'S;:UN}TI1IiJ,IS.T;"'TES.:~ Home I About Us I News & Events I Find a Job I Patients & Visitors I Services I HelpfUl Links Access Healthline I Site Map I Privacy Notice I Website Privacy I Disclaimer I Contact Us :92007 NCH HEAlTHCARE SYSTEM http://www.nclund.org/default.aspx?id~487 &amp;Jink=navmenu 12/13/2007 c.._,_"""_,,,.,,,,,,,,,,,,_~.. Agenda Item No. 16F4 January 29, 2008 Page 22 of 22 Attachment G 10 Fct l-aq~<xv<6 Additional Back-up For Agenda item #16.F.4 Bee date 1/29/08 \0FL/- h7~ -og Transition. Expansion. Commitment. 2006 Annual Report NCH <:.- Healthcare ---- System That question has served as a guiding principle for NCH Healthcare System (NCH) since its beginning more than 50 years ago. In any industry, the most sound definition of leadership is comprised of several vital elements: demonstrating quality in What are the qualities of good leadership? quantifiable, measurable ways; embracing the challenge of change and advancing technology; exhibiting sound financial practices; and determining and responding to the needs of the people served. During Fiscal Year 2006 (FY2006), NCH showed its commitment to remaining a leader in the healthcare field. \(pF'i l-d61-0 g 10Ft I-~-O~ NCH HGlhttc.ve --.. S~tem September 30th, 2006, the end of Fiscal Year 2006 (FY2006), coincided with the advent of significant change at the NCH Healthcare System. Just two days before, I, as Ch.irman, had the privilege of commencing the monthly meeting of NCH Department Heads with the announcement that, only twelve hours earlier, the Board of Trustees had unanimously appointed Dr. Allen Weiss: the new President and CEO of the system. The response of the attendees was electriJying, with everra"e standing and applauding Dr. Weiss and the decision of the Board of Trustees. Coincidently with the announcement of our new CEO, the NCH famtlywas celebrating the 50th Anniversary of a healthcare organization that had started humbly as Naples Community Hospital and then evolved over those years into the complex sophisticated institution now kn()1\,.'n as the NeE Healthcare System. For most of its history, NCH had operated under the leadership of two admirable CEOs: William Crone, who was President and CEO for 34 years, and Edward Morton, who jot oed NCH in 1972 and served as CEO for six years. During the final six months of FY2006, the Succession Planning Cotllmittee, under the leadership of Trustee]ohn Morrison and with the guidance and assistance of an international search firm Heidrick & Struggles, had considered the credentials of more than a dozen CEO candifates. During the search, the committee narrowed it down to oniy a handful ()f highly qualified candidates, including Dr. Weiss, who had served as President of our system since the retirement of William Crone in 2000. As the committee interviewed the final contenders, each committee member had differing vlews about how the various candidates could affect NCH's future. All of the riml outside candidates were extraordinarily qualified, each currently serving as CEO of an excellent healthr.care system, and no one doubted the abilities of any of them to lead NCH. But as the committee's deli~crations entered the final phase, the seiection criteria shifted to the question of who among the candidates was best qualified and positioned to seize the moment and carry NCH to the next level While each candidate had admirers and advocates, only Dr. Weiss, the physician and leader we all knew and respected, had the absolute confidence of enough members of theoCommittee to tip the scale in his favor. The final vote of the Succession Planning Committee was cast, and the committee's report was presented to the Board of Trustees, who unanimously approved Dr. Weiss a5 the new President and CEO. With that major task completed, the board and management team focu:sed on the exciting developments and challenges confronting NCH in the weeks and months ahead. Already on everyone's calendars were the planned ribbon cuttings for the Garden of Hope and Cour.ge; the Briggs Wellness Center; the Baker Patient Tower; and the von Arx Diabetes Center of Excellence: and Nutrition Health. Our new CEO:s agenda, meanwhile, focused on the important goal of improvi ng the relationship between the NCH Medical Staff and the new leadership of the NCH Healthcare System Addressing the Department of Surgery days later, Dr, Weiss pledged, "I am and will remain in maximum ti~ening mode." As the Board of Trustees commenced Fiscal Year 2007, it saluted the many accomplishments of former CEOs William Crone and Edward Morton. And with great expectatiollS, -me Board placed the mantle of authority on the shoulders of Dr. Allen Weiss and pledged its full support im his administration. Carl E. Westman, Cll3.irman, the Board of Trustees, NCH Hea/thcarc System With the refinement of computer-driven Information Technology (IT), quality has become more verifiable and quantifiable in the healthcare industry. NCH has fully embraced this idea by steadily moving toward becoming a totally integrated, "paperless" system. Demonstrating quality Medication administration is always a major concern in a complex hospital setting. A report issued by the Institute of Medicine in July 2006 concluded that 1.5 million patients are harmed by medication errors in the U.S. each year and thousands are killed. NCH took steps during FY2006 to reduce these kinds of errors using IT technology. The NCH North Naples Hospital Campus instituted bar code verification of the medicine, patient (through use of a wrist band) and nurse. The laptop computer the nurse brings to the patient's bedside not only completes the "paperwork" but also assures the right medicine is given to the right patient at the right time. This same process is being implemented at the NCH Downtown Naples Hospital Campus currently. This technology is tremendously important in avoiding the medication errors that have plagued health care in the past. These kinds of advances, combined with other specific quality initiatives, are bringing NCH into the national spotlight. For the second consecutive year NCH was ranked in the top 5% nationally for overall clinical quality by HealthGrades, an independent ranking agency that evaluates Medicare data from more than 5,000 hospitals nationwide. 1 (p Ftt I-OCt -D~ I (p F4- l-CJ61-0~ Naturally, everyone hopes to stay well and not need hospitalization. But when a hospital stay is required, quality, measured objectively, should be the single most important consideration in choosing the hospital. Independent quality rating agencies have matured during the past few years as the health care industry has embraced the digital age. The NCH Healthcare System has been recognized over the past four years by winning more than 12 quality awards: Commitment HealthGrades award for clinical excellence (top 5% hosPital) 2005 J 2006 HealthGraJes award for safety 2006 . Heal,hGraJes award for cardiology 2004, 2005, 2006 HealthGraJes award for neurology 2006 . HealthGraJes award for pulmonary 2006 HealthGraJes award for women's health 2006 . Solucient 100 Top Hospitals, cardiology 2006 Solucient 100 Top Hospita~: Performance Improvement LeaJers Premier Award for Quality for Acute Myocardial Infarction 2006 A patient in a top 5% overall clinical quality hospital has a 69% decreased chance of dying in the hospital when compared to a bottom 5% hospital. Pressure sores which occur in more than 7% of .'.J . -.; ,.- .. ~ Li!J J!iil patients nationally have been lowered to 1. 7% at NCH this past year, through computer identification of high risk patients and excellent nursing care. Cardiac arrests for non-intensive-care patients at NCH have been lowered more than 50% by having teams in place to rescue patients on the regular medical units when symptoms initially present. Top 5% in the nation for overall clinical excellence goes to NCH for the second year in a row. The close of FY2006 brought new leadership to NCH, as long-time and valued CEO Edward Morton retired and NCH President Allen Weiss, M.D. accepted CEO duties as well as his own. Such a transition can be disruptive, but, fortunately for NCH, the two leaders shared a common commitment to making NCH the best it can be. Tbe. challenge of-change With that commitment firmly in mind, NCH continues collaborating with its 530+ physician partners to achieve the goal of being the best demonstrated quality in the region and also being the most operationally efficient. At NCH Downtown Naples Hospital Campus, the number of operating rooms was expanded from nine to twelve with the new Shick Cardiac Center and the Allyn operating rooms. At NCH North Naples Hospital Campus, operating rooms increased from three to four. NCH l~ F-L!- h3.q-O ~ anesthesiologists and surgeons have created new ways of working together to better serve their patients by scheduling smartly, improving safety, and increasing efficiency. This past January was the busiest month in the operating rooms ever at N CH with more operations completed during the day rather than spilling over to the evening or night. The continued focus on high quality inpatient care also demands that NCH respond to the region's growth. As a result, NCH increased the capacity throughout the total system from 539 beds to 681 beds. The completion of the Jay and Patty Baker Patient Tower at NCH North Naples Hospital Campus and renovations at NCH Downtown Naples Hospital Campus now allows NCH to offer private rooms to approximately two-thirds of its patients, greatly increasing patient satisfaction and quality of care. Capacity is also important as NCH addresses the region's growth, which creates stress ,. 'iJ _. :~,',/::,s~;''':7''",~'',~''?r!fF,'. ~ on emergency rooms. Work is now commencing on a redesign of the emergency department at NCH North Naples Hospital Campus, as part of the continuing expansion there. When complete, the facility will include a specific emergency area for pediatric patients-a recognition of the increasing number of families in the region. I(oF If !-~--O~ "The von Arx family has been actively supporting the NCH Healthcare System for over 15 years. Sharon's life was saved by a diligent emergency room staff in the early 1990s. Dolph served as Chairman of the hosPital and NCH Healthcare System for 11 years. The family support for the von Arx Diabetes Center of Excellence is based on an acute need for education and control of the disease that is endemic in Collier County. Our emotional support for the Diabetes Center is based on our direct experience with the disease. Sharon's father was diabetic for 30 years. He died of complications related to this disease. Type II diabetes can be controlled. Genetics, diet and lifestyle are the key elements in determining who is at risk of develoPing the disease, We firmly believe that education and a healthy lifestyle program will reduce the impact of this insidious disease on our Collier residents." - Dolph & Sharon von ATX 10F* I-~ -o~ HBefore John's mother started Naples Community HosPital, with several other families in town, you had to go up a two-lane road to Fort Myers. People then wanted the best health facility for Collier County that we could have. John then served as Chairman of the hosPital for many years. \X1e believe its in one's own self interest to support NCH. You're going to need it someday. But we also believe in taking care of yourself and doing what you can do to keep healthy. John is in his 90s and still goes to the wellness center every week. We're hoPing people will see (the Briggs Health Pavilion) as a benefit to the whole community. \X1e're growing and we think healthcare needs to keep up with that growth. " - Dr. John & Mary Jane Briggs Dr. John N. Briggs Health Pavilion & Wellness Center "We like to say that we lay our eggs where we nest. We live here and think it's so important to give back to where we are. And, really, what's more important than healthcare? Jay had had an emergency gallbladder operation at NCH, and they made us feel well cared for. The tower was something that was needed, given the growth in the community. So we decided to support it. We look at it that so many of us have been so fortunate. To us, that entails an obligation to give back, particularly to those things that are in line with your interests. We think they have a wonderful team at NCH, and we have the utmost faith in them." - Jay & Patty Baker [(0 F t{- l- 0t9 ~o~ Jay & Patty Baker Patient Tower \0 ~i \-oet-o~ Financial Results ($ in Millions) 2001 $11.0 $50 $40 $30 $20 $10 2002 $8.1 2003 $14.8 2004 $15.1 2005 $45.4 2006 $35.5 -$ 2 ~ Income from Operations _ Loss from Operations E Unrestricted Donations Our Patients BIRTHS 119,808 4370 HI met Richard D'Amico six years ago, and my involvement with the Garden came naturally. He shared the history for creating a garden in memory of his friend, Jan Emfield. While Jan was battling breast cancer, she had a vision of a healing garden for hosPital patients that Richard promised to build. Jan understood its benefits and, while she lost her battle with cancer, Richard kept that promise. ,'.. <'>'1t~~ t' Cancer has affected all of us. My .. husband is a 16 year lung cancer survivor. While he was undergoing . chemo and radiation therapy, it was my job to be proactive and positive. I would regularly walk along the Potomac River. I'd cry a little, pray a little and reflect in the serene beauty of nature. Through my experience, I could relate to the need for a healing place such as the Garden of Hope and Courage. Thanks to generous donations made by many, Jan's vision is now a beautiful sanctuary on the NCH campus. Consisting of a children's garden, pavilion for gatherings and a pathway that encircles the lake, its purpose is to insPire and encourage. I hope you will take a walk; I know it will be a beautiful and sPiritual walk." -Sue Dalton \0 FY- \~dZ1-0 8 Garden of Hope & Courage Consolidated Balance Sheets September 30, 2006 and 2005 ($ in Thousands) Assets Cash and investments Accounts receivable, net Assets limited to use Property, plant, and equipment, net Other Total assets Liabilities and net assets Accounts payable and accrued expenses Long-term debt Other liabilities Total liabilities Net assets Total liabilities and net assets Consolidated Statement of Operations Years Ended September 30, 2006 and 2005 ($ in Thousands) Unrestricted revenues Patient revenue Nonoperating revenue Other revenue Total revenues Expenses Compensation and benefits Supplies and other expenses Depreciation and interest Purchased services Total expenses Exce~s revenue over expenses Sale of Grand Central Station Donations Increase in unrestricted net assets $62,504 $49,560 42,172 34,060 9,677 23,424 $234,353 :jiWI,044 Medical Staff 275,973 249,491 2001 2002 2003 200' 2005 2006 $510,326 $4)6,'>3') ~ 537 I 2006 2005 2006 2005 $85,608 64,550 31,604 259,286 69,278 $510,326 $84,891 51,540 8,246 210,856 71,002 $456,535 $400,981 $380,950 5,585 20,130 16,550 426,696 397,500 216,615 196,148 138,892 124,384 29,387 27,260 23,430 21,378 408,324 369,170 18,372 28,330 10,500 17,134 6,533 $35,506 $45,363 ICQF4 1~O:=i -0 ~ Roll of Donors Annual Giving. We gratefully acknowledge the following individuals, foundations & corporations that helped support the NCH Healthcare System on an annual basis between January 1, 2006 & December 31, 2006 NCH Healthcare Foundation extends its appreciation to the many supporters who contributed to the NCH Healthcare System during 2006. These friends are perpetuating a tradition of philanthropic giving that has facilitated essential progress in the delivery of healthcare for our community. Their contributions are vital to ensure that NCH provides innovative & gracious clinical care; acquires state-of-the art equipment, technologies & treatments; & attracts the best physicians & staff. These gifts are acknowledged in the Sharon & Dolph von Arx Donor Recognition Galleries located in the main lobbies of both NCH hospitals. "Deceased \(Q Fi \-a1 ~O~ Chainnan's Circle ($5,000 or more) Individual & Family Fourulalion Donon Anonymous (7) Mr. & Mrs. Larry J. Abels Don & lean Ackerman Mr. & Mrs.]ohn N. Allen Mr. & Mrs. William F. Allyn Mr. William G. Allyn * Mr. & Mrs. Lee R. Anderson, Sr. Mr. Lowell W. Andreas Mr. & Mrs. Leo Armatis Mr. & Mrs.]ohn L. Ashby Mr. & Mrs. William W. Bain, Jr. Mr. & Mrs.]ay H. Baker Mr. Alton G. Bale, Jr. F. Roben & Mona Ball, Jr. Barbara & Ronald Da\-js BaL~er Mr. & Mrs.]. T. Battenberg, III Mr. * & Mrs. Richard L Battram Mr. & Mrs. Richard A. Bearse Frank & Marilyn Beddor Mr. & Mrs. Frank Bendheim Mr. & Mrs. Robert J. Bennett Mrs. Keith S. Benson Mr. & Mrs. Phillip Beuth Mr. & Mrs. William E. Bindley The Blair Foundation Mr. & Mrs. John T. Blakely Mr. & Mrs. Richard S. Bodman Mr. & Mrs. Donald R. Borgeson Mr. & Mrs. Stefan Bothe Dr. & Mrs. Peter R. Boyd Mr. & Mrs. Daniel F. Breeden Mr. & Mrs. John M. Brennan Dr. & Mrs. John N. Briggs Frederick F. Buechel, Sr., M.D. & Frederick F. Buechel, Jr., M.D. Mr. & Mrs. Gerard L. Cafesjian Virginia & Robert W. Carlson, Jr. Gerald & Sally Ann Carrier Mr. & Mrs. Robert L. Carsello Mr. & Mrs. Richard J. Censits Robert & Carol Chambers Robert & Suzanne Chute Mr. & Mrs. John C. Clark Mr. & Mrs. Robert A. Clifford Mr. & Mrs. Brian Cobb Mr. & Mrs. Uoyd H. Coffin, Jr. Harvey D. & Janet G. Cohen Miles & Parker Collier Mr. & Mrs. Dale R. Corney Mr. & Mrs. Tllomas A. Cooper Mr. & Mrs. Ralph). Cox Mr. & Mrs. Andrew B. Craig, III Dr. & Mrs. Blane N. Crandall Mr. & Mrs. Thomas C. Curtis, Jr William & Susan Dalton Jerry & Vernon Davidson & Family Mr. & Mrs. Charles J. DeGrange Mr. & Mrs. Edward L Delahanty Mr. & Mrs. Cbarles W. Denny Mr. & Mrs. Richard H. DeVoe Mr. Joseph E. D'Jamoos Mr. & Mrs. John F. Donahue Me & Mrs. Gary D. Downey Duluth-Superior Area Community Foundation Bob & Connie Eaton Mr. & Mrs. Stuart Egerton, [J Mr. & Mrs. Herbert E. Ehlers Mr. & Mrs. David J. Esha Christina & Doug Esson Mr. & Mrs. Arthur L. Fagan Mr. & Mrs. David C. Farrell Mr. & Mrs. John F. Farrell, Jr. Mr. & Mrs. Gerald F Fitzgerald Russell & Patricia Fleischma Mr. & Mrs. James E. Fligg Mr. & Mrs. Terrance R. Flynn Kathryn R. Foley Trust Susan Regenstein Frank & Barry Frank Eugene & Mary Frey Fritz & Kathy Friday John & Mary Anne Gamba Chuck & Arlene Garrity Mr. & Mrs. Richard I. Giertsen Mrs. Jan M. Goldsmith Mr. & Mrs. Donald W. Goodwin Perry A. Gotsis, M.D. Mr. & Mrs. Robert T Gow Mr. & Mrs. Thomas C. Graham Harry Grandis & Nancy Grandis White Pierson M. & Florence B. Grieve Mr. & Mrs. Sidney Grossman Dr. & Mrs. James J- Guerra The Tim & Torn Gullibon Foundation Mr. & Mrs. Don ]. Gunther Mr. & Mrs. John R. Hall Mrs. Mildred G. Hall" Mr. & Mrs. Jonathan C. I Iamill Mr. & Mn. Richud M. Hamlin John & Ann Harris Mr. & Mrs. E. J. Hartmann Barry & Carol Hastings Frances Pew Hayes Family Foundation Mrs. Normall A. Herrell Mr. & Mrs Robert G. Hershenhorn Mr. & Mrs_ Leo]. Hertzog, Jr. Mr. & Mrs. Paul F. Hills Mr. & Mrs. Earl G. Hodges Mr. & Mrs. John W. Holley Mr. & Mrs. David R. Hubers Mr. & Mrs. Glenn Illig Mr. & Mrs. Verne G. lstock Marjorie Jewell Trust & John Jewell Trusts John & Barbara Jordan In Memory of Bernice Orkin Kaye Mr. & Mrs. George R. Kempton Mr. & Mrs. Maurice D. Kent Mrs. Shirley [ten Kern Mr. & Mrs. John H. Kolmer, Jr. Mr. & Mts. William]. Kopp Mr. & Mrs. George R. Kraus Mr. & Mrs. John Kuhne Mr. & Mrs. Arthur H. Kurtz Dr. Stephen & Rebecca Kwedar Mr. & Mrs. Robert Lanigan Mrs. Doris S. Lanphier~ Ralph & Dorothy Larsen Mr. & Mrs. Ned C. Lautenhach Mr. Michael laVerdiere Raymond W. Leclerc Mr. & Mrs. Paul E. Lego Maureen & Arnold Lerner Sue & David Lipman Dr. & Mrs. Morris]. Lipnik Dr. & Mrs. John S. Little Mrs. Ellen wring Mrs. G. Donald Lwe Mr. & Mrs. Raymond L. Lutgen Mt. & Mrs. Roben J. MacDonald Mrs. Leslie S. Magin Mr. & Mrs. Edward H. Malone Mr. & Mrs. Paul J. Marinelli James Harper Marsha!! The Manin Foundation, Inc. Mr. Richard Maslow The Masterson Foundation, Inc. Ms. Carol Ann May & Mr. James M. Saindon Herb & Judi McCord Mr. & Mrs. Samuel A. McCullough Mr. & Mrs. TI'omas P. McDonagh, Jr. Malcolm & Sonia McDonald Mr. & Mrs. Richard E. McGinnis Mr. & Mrs. James W. McKee, Jr. Mr. & Mrs. Alvin E. McQuinn Dr. & Mrs. Leon P. Mead Mr. & Mrs.]. William Meek, III Dr. & Mrs. Roben]. Meli Mr. & Mrs. C. John Miller Jan M. E\'tleigh & Richard W. Miller Richard & Clair Mohn Brenda & Ronald Morey Mr. & Mrs. Frank]. Morgan Mr. & Mrs. John J. Morgan, Jr. John M. & Susan Morrison Mr. & Mrs. Dennis Morrissette Mr. & Mrs. Edward A. Morton Mr. & Mrs. William B. Ogden, III Alexandra Hayes, Griffin Olness, Linden Olness & Fletcher Olness Dr. & Mrs. Leslie C. Norino Mr. & Mrs. Patrick]. O'Meara Dwight D. Opperman Mr. & Mrs. William B. Ogden, IV Thomas A. & Evelyn Owens Dr. & Mrs.' Chris Papadopoulos Mr. & Mrs. John F. Pavlish Mr. & Mrs. Bernard S. Peck Audrey & Al Petersen Mr. & Mrs.james S. Peterson Mr. & Mrs. Raymond F. Pettit Mr. & Mrs. F. Fred Pezeshkan Dr. & Mrs. R.1ymond W. Phillips Mr. & Mrs.' Charles W. Pingree Mr. & Mrs. R!lben P. Poisson Henry & Laura Prange Mr. & Mrs. Lawrence R. Pugh Mr_ & Mrs. D,mald Redlinger Mr. & Mrs. James Reid Mr. & Mrs. Scott B. Relf Mr. & Mrs. Howard T. Rosen Janet O. Ross~ The Savitz Family Foundation Mr. & Mrs. James C. Schacker Mr. & Mrs. Gerald R. Schmidt Mr. & Mrs. James M. Schoonmaker, II Mr. & Mrs. Richard M. Schulze Dr. Rosann Schwartz & Mr. Richard Schwam Mr. & Mrs. Samuel Schwartz Mr. & Mrs. Srephen L. Schwanz Stephen L Schwam, Pres. Btookdale Foundation MI. & Mrs. Stanley A. Seneker Mr. & Mrs. Michael F. Shanahan, Sr. Mr_ & Mrs. Robert D. Sherman Mr. & Mrs. William W. Slocum MI. & Mrs. David Byron Smith Mr. & Mrs. Walter C. Spengler Robert & Carolyn Springborn Lynne & Howard Stacker Julia M. Stagg Mr. & Mrs. Stanley Star Mrs. Robert L. Stocking Mr. & Mrs. Jay R. Stonesifer Bert Axelrad, Chairman, Harry Sudakoff Foundation Mr. Mark Sudduth Mr. & Mrs. Leland N. Sunder Mr. & Mrs. Kermit S. Sutton Mr. & Mrs. Edward T. Swan The Telford Foundation John & Patti Thornton Mr. & Mrs. Thomas Tisbo Mr. & Mrs. Robert H. Transou The Honorable & Mrs. William W. Treat Mr. & Mrs. Byron W. Trerice, Jr. Mrs. Betty Lou Tucker Mr. & Mrs. Tucker Tyler Mr. & Mrs. William F. Vernon, Jr. Mr. & Mrs. Joseph P. Viviano Patty & Dick Vogel Mr. & Mrs. Dolph W. von Arx lwFtf \-dt1~D~ Mr. & Mrs. George P. Wagner, Jr. Mr. & Mts. C. C. Waldbillig Mr. & Mrs. Hicks B. Waldron Mr_ & Mrs. TIlornas M. Wamser MI. & Mrs. David Wang Mr. & Mrs. John C. Wasmer, Jr. Mr. & Mrs. Paul H. Way Drs. Allen & Marla Weiss Mrs. Ted J. Welch Mr. & Mrs. Carl E. Westman Mr. & Mrs. Rodney L Woods Karl & Joanne Wyss MI. & Mrs. Gary L. Yates Mrs. Judy Ziegler Chairman',Cirrl" Corporate & Foundation DOTWTS Anonymous Agostino's Furniture & Design Antaramian Development Group, LLC Automated Shading, Inc. Bank of America Bank of Florida Barron Collier Companies Cerner Corporation Cohen & Grigsby, P.c. Collier Anesthesia, P.A. Comcast Community Foundation of Collier County Congress Jewelers Crowther Roofing DeVoe Automotive Dunwody, White & Landon, PA Dyehouse Comeriato Architect Embarq Emergency Physicians of Naples, LLC Florida Gulf Coast University Foundation G.E. Foundation Gtant, Fridkin, Pearson, Athan & Crown, PA HealthSouth Island Country Club Kelley, Stiffler & Thomas Kent Technologies Kraft Construction Co., Inc. The Lutgen Companies McKesson Corporation Mellon Private Wealth Management Merck Company Foundation Morgan Keegan & Company, Inc. Naples Pathology A~ociates Naples Radiologists, PA TIle Earl Monall Celebrity Golf Classic National Healing Corporation NCHAuxiliary North Collier Hospital Auxiliary Northern Trust Bank of Florida Private Capital Management Pulte Homes & DiVosta Homes R.J. Reynolds Tobacco Company Foundation RegenrCruiseLines Saks Fifth Avenue Salvatori & Wood Sodexho Healthcare Services Sr. Jude Medical Stock Development The English-Speaking Union.Naples Branch Meredith Corporation "nle Wachm'ia Foundation Tiffany & Company Unilever United States Foundation, Inc. Wacho,'ia Bank Wasmer, Schroeder & Company, Inc. Wicker, Smith, O'Hara, McCoy, Graham & Ford, P.A. Willis North America, Inc. t I J .<<1, . ~Decea~ed Annnal Patrons ($1,000 or more) Indi\!idual & Family Foundation Donors Anonymous (11) Mr. & Mrs. Lew E Allyn Mr. Roberr E. Anders Mrs. C. Allen Applegate Dr. & Mrs. Matthew James Baker Mr. & Mrs. Richard J. Baker The Honorable & Mrs. William E. Bartlett Mr. & Mrs. Tom H. Barrett Mr. & Mrs.~ Alan L Berckmann Mr. & Mrs. Donald C. Berkey Ms. Terri Boyd Boyd Family Wilma & Bill Boyd Harold & Marita Brayman Miriam C. Bwoke Paula & Fred Brothers Mr. Russell A. Budd & Mrs. Katie Pa..~chal1 NallL)' & Doug Campbell Patsy D. Carter Dr. J. D. Labs & Dr. Pamela L. Caslowitz Ms. Sheri Chase Art & Bev Cherry Mr. & Mrs. Carleton A. Cleveland, Jr. Mr. & Mrs. Edward B. Collum Mr. & Mrs. Frank S. Comeriato Mr. & Mrs. Ke\in Cooper Mr. David L Corder Trafton M. & Maude W, Crandall Foundation A Mrs. Cynthia C. Crocker, R.N. Mr. & Mrs. Robert A. Crown Mr. & Mrs. Walter D. Dance Dr. & Mrs. Michael T. Dent Dr. & Mrs. Paul D. Dernhach Connie & Mike Dillon Mr. & Mrs. Theodore Dimitriou Mr. & Mrs. Burt N. Dorsett Mr. & Mrs.~ James P. Dupey Mr. William H. Earls Mr. & Mrs. Carl E. Eklof Mr. & Mrs. Thomas Elwood Mr. & Mrs. Richard H. Erickson Mr. & Mrs. Peter]. Evano..ich Mr. & Mrs. Robert S. Evans Mr. & Mrs. Rohert M. Feerick Mt. & Mrs. Jerry Felicelli Mr. & Mrs. David L Fenelon Mr: & Mrs. Sru~rt L. Feuer Eurick & Linda Flewelling Mr. & Mrs. Stephen Flood Mr. & Mrs. Alan C. Freeman Palma & Jerry Fuson Ms. Mimi Gabr Dr. & Mrs. Merit F. Gadallah Jim & Lydia Galton Ms. Judirh Gardetto Mr. & Mrs. Charles M. Gately Mr. & Mrs. Jay G. Gates Tom & Jan Garoic Mr. & Mrs. Arthur W. Gilbart Mr. & Mrs. Daniel E. Gill Ms. Eileen M. Golden Goodman_Klein. Pinckney Family Foundation Mr. Mark S. Goodman Mn. William A. Gossett Richard & Rissa Grossman Mr. & Mrs. William Hagen Mr. & Mrs. Harry A Hammerly Ms. Diana J. Harrison Mr. & Mrs. Richard G. Hartigan, Jr. Mrs. Paul J. Henegan Mt. & Mrs. Donald R. Hibbert Mr. Andrew Hill & Dr. Susan M. Liberski Mr. & Mrs. A John Holton \(oFL{- l- aq -o~ Ms. Mary A. Holtt The Homan Foundation Mt. ~ & Mrs. Gerald]. Hoselton Mr. & Mrs. Howard M. Hujsa Dr. & Mrs. Keith P. Hussey Bill & Marge Hyland Mr. & Mrs. Columbus o. Donnell Iselin The Javitch Foundation James & Andrea ]ohannsell Mr. & Mrs. Robert C. Jones Dr. & Mrs. Colin L. Kanar ]an & Kim Kantor Mrs. Walter A. Keane Mrs. Polly Keller Dr. & Mrs. Sean Kelley Mr. & Mrs. Edwin F. Kerr Mr. Frederick B. Kieckhefer Mr. & Mrs. Joseph F. Kindlon William A. & Barbara A. Klauber Dr. & Mrs. Hermes O. Koop Mr. & Mrs. Walrer G. Korntheuer Elaine & Samuel Kreiger Mr. & Mrs. John A. Krol Zelda Kronfeld Mr. & Mrs. T. ]. Kukk Dt. & Mrs. William P. Lascheid Mr. & Mrs. PaulJ. Lav.-rcnce Mr. & Mrs. Harvey S. Le\'en~on Annette Rae & Samuel M. Levine Mr. & Mrs. Stephen R. Levitan Mr. & Mrs. Jay C. Levitt Dr. & Mrs. John P. Lewis Mr. & Mrs. Charles A. Lister Dr. & Mrs. Bernard Lublin Scott & Simone Lutgert Mt. & Mrs. John W. Lyon Mr. & Mrs. Michael J. LYOllS Mr. & Mrs. William MacClarence Linda Halverstadt MacDuffie Mr. & Mrs. James R. Malone Dr. & Mrs. James S. Manzanares Mr. & Mrs. Robert C. Marconi Mr. Matthew Mathias Mr. & Mrs. William C. Merritt Norma D. Meyer Mrs. Lloyd I. Miller Kimberley Speer Miller Mr. Paul Mongerson Mr. & Mrs. Richard W. Moulton Mr. & Mrs. Kenneth J. Muraski Mr. & Mrs. Robert F. Naples Mr. & Mrs. Jerry F. Nichols Mrs. Richard E. Novak Mr. & Mrs. D. Eugene Nugent Mr. Hugh J. O'Hare Mr. & Mrs. William J. O'Meara Mr. & Mrs. 11lomas F. O'Reilly Mr. & Mrs.~ Robert C. Ortner Dr. & Mrs. William C. Pallas Mrs. Lester E. Pankonin Mr. PaulL. Parshall Dr. & Mrs. Torrence P. B. Payne Mr. Joseph 1. Perkovich Mt. & Mrs. William Pike Mrs. Virginia C. Quirk Mr. & Mrs. W. Jay Rasmussen Mt. & Mr~. Larry Ray Ms. Patricia Read Mr. & Mrs. John Recco Mr. & Mrs. Larry E. Rich Mr. & Mrs. George T. Richardson Mr. R. A Roberts Roy & Pearl Rogers Foundarion Mr. & Mr~. Francis G. Ronnenberg Mr. & Mrs. Charles L. Rue, Jr. Mr. & Mrs. Tom Rush Dr. & Mrs. John J. Ryan Thomas & Cynthia Rynalslci Mr. & Mrs. Joseph $. Sample Mr.~ & Mrs. CharlesJ. Sanders, Jr. Donald & Eleanor Sang Mr. Ou Scarponi~ Mr. & Mrs. Edward A. Schefer Mr. & Mrs, David Sciacqua Mr. & Mrs. Brian c.o. Settle Mr. John T. & Dr. Debra Shepard Mr. & Mrs. Harvey Shreve Mr. & Mrs. Elliott Singer Ms. Carrie Shfton Capt. & Mrs. Allan P. Slaff Mr. & Mrs. Robert N. Small Mr. & Mrs. Donald Smith Dr. & Mrs. David E. Smock Mr. & Mrs. John F. Sorey, III Dr. & Mrs. David M. Spellberg Mr. & Mrs. John M. Stafford Mr. & Mrs. Edgar Starns Mr. & Mrs. Edwin]. Stedem Mr. & Mrs. Joseph T. Steuer Mrs. NeL,on R. Stewart Dr. & Mrs. Joseph F Sullivan Mr. Dan E. Summers Tasker/Elwell Family Mr. & Mrs. George S. Trees, Jr. Mr. & Mrs. Sonny Van Arsdale Mr. & Mrs. Dean G. VanNest Jim & Debbi Wallace Mr. & Mrs. James A. Warnken Mr. & Mrs. Robert K. Weinfurtner Mr. & Mrs. Felipe Weingartt Nancy Grandis White Mr. & Mrs. Motdechai Wider Sallie & Kevin Williams Ms. Matianne Wisner Alice & Larry Wolf Dr. & Mrs. Brian D. Wolff Susan B. Wolff Dr. & Mrs. Edward Woliver Mr. & Mrs. Charles A. Womack, Jr. Mrs. Henry C. Wood Mr_ & Mrs. Gordon R. Worley Annnal Patrons Corporate & Foundation Donors Anonymous A. Gail Boorman & Associates, P.A. A. Vernon Allen Builder, Ine. AmeriCare Home Health Services, lnc, AMN Healthcare Anchor Health Centers Arrhrex, Inc. AveMariaUni\'ersity Bank of America BCC Financial Management Services, Inc. Bond, Schoeneck & King, P.A. Border Bancshares, Inc. Mr. & Mrs. R. Scott Cameron Ciccarelli Advisory Services, Inc. Coastal Beverage Ltd. Collier Neurologic Specialists, L.L.c. Colonial Bank Comaica Bank & Trust Community Bank of Naples Community Health Panners-Naples PHO Community Home Care CSI Financial Services Culture Connection, Ine. Cummings & Lockwood, LLC Demandata Systems, LLC Dr. Johnny's Supreme Auto OSI Laboratories Estero Chamber of Commerce Eye Consultants of Bonita Springs Fifth 1l1ird Bank, South Rorida Gates McVey Builders Gibraltar Private Bank & Trust Gulf Coast Cardiothoracic Surgeons Gulfshore Homes, Ine. Gulfsrream Homes Hole Montes, Inc. Hotel Plaza Athenee, New York HSBC - North America Integrated Therapeutics Corporation John R. Wood Realtors Johnson & Johmon Jonathan Bailey Associates JPMorgan Private Bank Key Private Bank La Playa Beach & Golf Resort Liberty Bank Mandarin Oriental, Miami Marino Group Inc Marissa Collections MedQuist, Inc. Medtronlc Sohmor Danek Midwest Exchange Company, Ine. Mill Park Foundation, Ine. Mimi JoIie Maison, Ine. Naples Day Surgery Naples Engraving Naples Historical Society Jerry F. Nichols & Brown & Brown Benefits Norman Love Confections O'Donnell Landscapes, Ine. Option Care Pfizer Foundation Matching Gifts Program PFM: Advisors Porter, Wright, Morris, & Arthur, LLP PriceWaterhouseCoopers LLP Quai! Creek Country Club Quality Med Tran - Sarah Ann of SW Florida, Inc. Reflections - Alphamedia Productions Richards Company Robert of Philadelphia Robins, Kaplan, Miller & Ciresi, LLP South Beach Wine & Food Festival Southwest Direct Square 0 Foundation St. William Council of Catholic Women (CCW) State Farm Companies Foundation SunTrust Banks, Ine. The Goring Bed & Breakfast The Graham Group, Ine. The Thomas Riley Artisans' Guild Maria Procacci, Vineyards The Whitaker WelIness Center Williams TlB Bank TLC Engineering for Architecmre Total Communication Concept.< Group, Ine. Trinity Medical Services, [ne. United States Trusr Company, N.A. WiL,onMilIer,lne. YamronJewelers Zola Keller CumulariVf~ GivinP We sincerely appreciate the continuing & long-te-nn generosity of the follnwing individlUlls, families, foundations, & corporations. Vision:lries ($5,000,000 or more) Individual & Family Foundation Donors Anonymous Mr. & Mrs. Jay H. Baker Briggs Family Foundation Mr. & Mrs_ Raymond L Lutgert NCH Auxiliary Mrs. Helen E. S. Shick" l (0 Ftf \~ dq -08 Philanthrotlists ($1,000,000) In&vidlUll & Family Foundation Donors General Da\id H. Baker~ Mr. John H. Becker~ Mrs. Helen W. Bell Louise M. Benson ~ Estate of Mina D. Brmm ~ Dr* & Mrs! John E. Burch Harvey D. & Janet G. Cohen In Memory of D. Graham Copeland Mr. & Mrs. John F. Donahue Bob & Connie Eaton Mr. & Mrs. Vincent Foglia Mr. & Mrs. James L. French Mr. John E. Kohan Mrs. Florence T. Kress~ Mr. & Mrs. Robert Lanigan Mr. & Mrs._ Robert J. MacDonald Magnolia Balls NCH Hospital Balls Mr. & Mrs. William A. Read, Jr. Stephen L. Schwartz, Pres. Btookdale Foundation Bruce & Cynthia Sherman Mrs. Herbert J. Sugden The Telford FOUlldation Mr. & Mrs. Dolph W. von Arx The Whitaker Foundation Benefar.tors ($500.000) Individual & Family Foundation Donors Anonymous Mr.~ & Mrs. John P. Blair Miles & Parker Collier William & Susan Dalton Louise Powers Degen Trust Russell & Patricia Fleischman Mr. & Mrs. Terrance R. Flynn Mrs. Doris S, Lanphier" Mr. & Mrs. Robert Needham Dellora A. & Lester J. Norris Foundation Mr. & Mrs. F. Fred Pezesbkan Tasker/Elwell Family Mr. ~ & Mrs.' Charles P. Walker ~ ($250,000) Individual & Family Foundation Donors Anonymous Mr. & Mrs. William F. Allyn Robert & Suzanne Chute Dr. & Mrs. Allen W. Cowley, Sr. Mr. & Mrs. John Grado Mrs. Mary Anne Harrington" Alexandra Hayes, Griffjn Olness, Linden Olness & Fletcher 0lneS5 Frances Pew Hayes' Family Foundation Marjorie Jewell Trust & John Jewell Trusts Dr. & Mrs" Chris Papadopoulos Mr. & Mrs. ~ Lloyd Pettit Mr. & Mrs.~ Charles W. Pingree Mr.~ & Mrs.~ John E. Rhodes Mrs. Robert L. Stocking Mr. & Mrs. Kermit S. Sutton Mildred H. 1l10mas~ Ms. Catherine Wolfe & Mr. Jack Stanley l'mnm Corporate & Foundation Donors Bank of America Barron Collier Companies Narrow Estate North Collier Hospital Auxiliary *Deceased Imm<lm ($100,000) Individual & Family Foundation Donors Anonymous 0) Rurh Abramson * Mr. & Mrs. John N, Allen Mr. William G. Allyn~ Mr. & Mrs. John L. Ashby Bruce J. Bergman Mr. & Mrs. Richard S. Bodman Paulette M. Boiardi Mr. & Mrs. Daniel F. Breeden Mrs. Alice Brugler* Mr. & Mrs. Andrew B. Craig, III Mr. & Mrs. Richard H. DeVoe Lois DeYoung* Mr. & Mrs. Daniel C. Ferguson Mr. John F. Forsyth * Mr. Curtiss E. Frank* Fritz & Kathy Friday John & Mary Anne Gamba Mr.* & Mrs. George H. Gaynor William Gierisch Trust Mr.* & Mrs.* Edward R. Godfrey Harry Grandis & Nancy Grandis White Pierson M. & Rorence B. Grieve Mr. & Mrs. Sidney Grossman Mr. Charles A. Hamilton ~ Jack Harker* Barry&Ca.roIHastings Mr.* & Mrs. Marshall M. Holcombe Mr. Alfred l.W. LeBien* Maureen & Arnold Lerner Gordon Lozier* Scott & Simone Lutgert The Martin Foundation, Ine. Mr. Richard Maslow Mr. RobertW. Mcll\'ain,Jr.~ Mr. & Mrs. James W. McKee, Jr. Daniel F. McKnight Unitrusr John M. & Susan Morrison Chuck & Sue Mueller Dwight D. Opperman The Lutgert Family Mr. John M. Rachal JanetD. Ross' Mrs. Nettie Lou Samuels* Gene & Mary Sarazen Foundation, lne. Estate of Henry O. Schumacher Mr. ~ & Mrs. Miles B. Scofield Duane & Robin Stranahan Sidney A. Swensrud Foundation Mrs. Barbara Thoma., Edward F. & Marion Knight Foundation of rhe Toledo Community Foundation Mr. & Mrs. Joseph P. Viviano Mr. & Mrs. George P. Wagner, Jr. Mr. & Mrs. David Wang Mrs. Catherine M. Ward Mrs. Alvina P. Wendt fu!ndm Corporate & Foundation Donors Collier Anesthesia, PA Embarq Fifrh Third Bank, South Florida G.E. Foundation HealthSouth Island Countty Club Kraft Construction Co., lne. Marco Island Hospital Auxiliary Merck Company Foundation Sodexho Healthcare Services Stock Development filIllnL ($75,000) Indivit.lunl & Family Foundation Donm Anonymous (2) Mrs. Keith S. Benson Mr. Edwin H. Bower~ Mr. Henry C. Church, Jr.~ Susan Regenstein Frank & Barry Frank Fredricksen Foundation The Elizabeth E. Kennedy Fund Mr. & Mrs. Thomas P. McDonagh, Jr. Malcolm & Sonia McDonald Mr. & Mrs. Edward A. Morton Mr. & Mrs. Raymond F. Pettit Mr. & Mrs. Howard T. Rosen Lyle & Gloria Rosenzweig Bert Axelrad, Chairman, Harry Sudakoff Foundation Mr. & Mrs. Morrison Waud Mr. & Mr~. Da\-id K. Wibon Karl & Joanne Wys~ .I'atron> Corpora!e & Foundation Donon Carlson-Harris General Contractors, lne. DeVoe Automotive Naples Radiologists, PA Northern Trust Bank of Florida Saks Fifth Avenue The Wachovia Foundarion ~ ($50,000) lndilliduaJ & Family Foundation Donors Anonymous (2) Don & Jean Ackerman Mr. Lowell W. Andreas Mr. & Mrs. William E. Bindley Mr. Thomas E. Bolger Mr. Robert P. Brown, Jr. Mr." & Mrs.~ Joseph M. Carmosino Mr. & Mrs. Richard J. Censits Mr. & Mrs. Donald L Clark Mr. * & Mrs.' Norman H. Curtis Christina & Doug Esson Mr. & Mrs. Da\id C. Farrell Mr. Edward H_ Fish Eugene & Mary Frey Mr. Dewey Gargiulo Mr. & Mrs.~ Walter Glass Mr.~ & Mrs. William F. Grady Mr. & Mrs. Thomas C. Graham Mr.~ & Mrs.* Harold F. Grumhaus Mrs. Mildred G. Hall" Mrs. PauIJ. Henegan Mr. & Mrs. Paul F. Hills Mr. ~ & Mrs. Thomas B. Holzer Mr. & Mrs.~ Frank X. Homan, Sr. Mr. & Mrs. John A. Johnston Mr.* & Mrs. James J. Kerrigan, Jr. Mr. & Mrs. George R. Kraus Mr. & Mrs. Carl Lambein Ms. Carol Ann May & Mr. James M. Saindon Mr. Scott McFarland~ Dr. & Mrs. Michael Meftah Mr.' & Mrs: Joseph W_ Oliver Mrs. Yvonne Pabst' Mr. & Mrs. James Reid Ms. Adriannc B. Reilly Mr. & Mrs. Stephen L. Schwartz Mr_ & Mrs. Stanley A. Seneker Ms. JulietC. Sproul Joseph T. & Jamie G. Steuer EsrateofMarianTerrell* Mr. & Mrs. Tucker Tyler Drs. Allen & Marla Weiss I&F~ l-~ -0& WilliamB.West* Mrs. Sylvia WiUiam.~~ Me. & Mrs. Edward T. Yawney """""'" Corporate & Foundation Donors Bank of Rorida Crowther Roofing Dyehouse Comeriaro Architect The English.speaking Union.Naples Branch Naples Pathology Associates Pulte Homes & DiVosra Homes SCM Properties, LLC United States Trust Company, N.A. Wacho\'ia Bank Wasmer, Schroeder & Company, lne. Wicker, Smith, O'Hara, McCoy, Graham & Ford, PA Banvan Sodetv OUT legaq society recogniz.es individuah whose charitable gift planning amms a bright future for the NCH Healthcare Sysrem Anonymous (4) Mr. & Mrs. John L A;hby Mrs. Helen W. Bell Willeen L Benedum Mr. Robert T. Benson Mr.' & Mrs. John P. Blair Mr. & Mrs. Howard A. Bolton Karl H. * & Helga Brand Dr. & Mrs. John N. Briggs Mr.* & Mrs.* Richard E. Brown Oscar~ & Alexandra Clark-Dunn Mr.' & Mrs. John E. Dabbert Mr. & Mrs. Donald E. Farmer Mrs. Nancy Faye Mrs. Helen Frame Dr. & Mrs. Ralph Geller Mr. ~ & Mrs. ~ Joseph E. Godfrey Mrs. Paola Copeland Groverman F. L Gunther.Mohr Ms. Marjorie Harrison Mr. Andrew Hill & Dr. Susan M. Liberski William A. & Barbara A. Klauber Dr. & Mrs. Morris J. Lipnik LeslieS.Magin Dr. & Mrs. Douglas Gene McCree Mr.* & Mrs.* Fergus J. McDiarmid Tom & Gloria McDonagh Winifred Hinton McKenzie' Norma D. Meyer Mr. & Mrs. Ted Myers Daniel' & Barbara R. Newman Dr. Leslie C. Norins & Ann "Rainey" Norins Mrs. Antoinette Benson Porter* Mr.' & Mrs. George G. Raymond, Jr. M!. & Mrs. William A Read, Jr. Mr. & Mrs. Gerald R. Schmidt Mr.* & Mr~. Michael Sttamiello Tasker/Elwell Family Mr: & Mrs: Richard L Terrell Me. & Mrs. Tucker Tyler Dr. & Mrs. Donald P. Ullrich Mr. & Mrs. Dolph W. \'On Arx Mr. & Mrs. R. L. Walker Mrs. Alvina P. Wendt Mr. August Zolororofe~ ~ We are deeply grateful to the loyal contributors who steadfastly support the NCH Healtlu:are System with annual gifts for five Qr more consecutweyea1S. 25 Consecutive Years Individual & Family FOltndation Donors Mr. William G. Allyn~ Mrs. Keith S. Benson Mr.~ & Mrs. John P. Blair Mr. & Mrs. Walter D. Dance Mr. & Mrs. Richard H. DeVoe Oscar~ & Alexandra Clark-Dunn Mr. & Mrs. Arthur W. Gilbart Mr. & Mrs. James R. King NCH Auxiliary Mr. R. A. Roberts 20 Consecutive Years lruUtJidual & Family Foundation Donon Anonymous Mr. & Mrs" Charles W. Pingree Mr. & Mrs. Joseph S. Sample Mr. & Mrs. Joseph T. Steuer Tasker/Elwell Family 1 Ii Consecutive Years Individual & Family Foundation Dorwn Anonymous Mr. & Mrs.~ Alan L. Berckmann Mr. & Mrs. Edward B. Collum Mr. & Mrs: James P. Dupey Mr. ~ & Mrs. Stuart L. Feuer Mr. & Mrs. Charles J. Fields Mr. & Mrs. John M. Gregg Mr. & Mrs. Delong O. Kellogg Mrs. Doris S. Lanphier~ Dr. & Mrs. William P. Lascheid Dr. & Mrs. Robert S. McKnight Mr. & Mrs. James E. Mellinger Harold Narrow' Estate Dr. & Mrs. Torrence P. B. Payne Mrs. Virginia C Quirk Mr. & Mrs. William W. Slocum Mrs. Nelson R. Stewart Mr. & Mrs. Dolph W. van Arx Mrs. Henry C. Wood li.llia Corporate & Foundation Donors Cerner Corporation DeVoe Automorive 10 Consec:utive Years rndividual & Family Foundation Donors Mr. Lowell W. Andreas Mr. & Mrs. John L. A>hby Mr. Robert D. & Dr. Mary M. Cadieux Gerald & Sally Ann Carrier Mr. & Mrs. Richard J. Censits Russell & Patricia Fleischman Mr. & Mrs. Orville W. Forte, Jr. Mrs. Barbara L. Goodof Mrs. Shirley lten Kern Mr. & Mrs. Alfred E. Liebetrau Mr. & Mrs. William MacClarence Mr. & Mrs. James W. McKee, Jr. Mr. & Mrs. Edward A. Morton Mr. & Mrs. Charles L. Rue, Jr. Mrs. Robert L. Srocking Bert kelrad, Chairman, Harry Sudakoff Foundation Cot. & Mrs. Charles L. Sues Mr. & Mrs. Kermit S. Sutton Mr. & Mrs. James A. Warnken Sallie & Kevin Williams .lll..Yl= Corporate & Foundation Dorwrs Fifth Third Bank, South Aorida G. E. Foundation Kraft Construction Co., Inc. North Collier Hospital Auxiliary United States Trust Company, NA. USG Foundation, Ine. S Consecutive Years Inditridual & Family Foundation DOI1OTs Anonymous (3) Mr. & Mrs. William C AllL~on, IV Mr. & Mrs. Angelo R. Arena Mr. & Mrs. William E. Bindley Mr. & Mrs. Richard S. Bodman Karl H. * & Helga Brand Robert & Suzanne Chute Mr. & Mrs. John C. Clark Miles & Parker Collier Mr. & Mrs. Thomas A. Cooper Mrs. Cynthia C. Crocker, R.N. Mr. & Mrs. Jack D. Crutchfield William & Susan Dalton Mr. & Mrs. John J. Daly Gail & Kevin Dolan Mr. & Mrs. John F Donahue Mrs. Mary Louise Donkersgoed Mr. & Mrs. Robett J. Eaton Mr. & Mrs. Gordon l. Erikson Edrick & Linda Flewelling Mr. & Mrs. Terrance R. Flynn Mr. & Mrs. Gerard Gallian Mr. & Mrs. Jay G. Gates Perry A. GotsLs, M.D. Mr. & Mrs. Robert T. Gow Mr. & Mrs. Don J< Gunther Mr. & Mrs. Richard G. Hartigan, Jr. Ms. Martha B. Hedges & Mr. Judson J. Mohl Ms. Ann Hruby Mr. & Mrs. Da\id R. Huber~ John & Barbara Jordan Mr_ Richard N. Jowitt Mr. & Mrs. Robert P. Kepen Mr. & Mrs. John H. Kolmer, Jr. Dr. & Mrs. Hermes O. Koop Mr. & Mrs. Walter G. Korntheuer Dr. Stephen & Rebecca Kwedar Mr. & Mrs. John B. Lepore Dr. & Mrs. Morris J. Lipnik Mr. & Mrs. Charles A. Lister Mr. & Mrs. Ronald J. McGinty Dr. & Mrs. Robert J. Meli Norma D. Meyer Kevin & Susan Miller Alexandra Hayes, Griffin Olness, Linden Olness & Fletcher Olness Mr. & Mrs. Robert F. Naples Mr. & Mrs. Robert Needham Mr. & Mrs. William B. Ogden, 1II Mr. HenryL. Ohlef Mr. & Mrs. William J. O'Meara Dwight D. Opperman Mr. & Mrs" Robert C. Ortner Mr. & Mrs. F. Fred Pezeshkan MaryE. Plotz Mr. & Mrs. Larry Ray Ms. Patricia Read Mr. & Mrs. James Reid Thomas & Cynthia Rynalski Mr.* & Mrs. Charles J. Sanders, Jr. Mr. & Mrs. Vincent A. Sarni Mr. & Mrs. Stephen L. Schwam Mr. William M. Sebring, Jr. Mr. & Mrs. Brian CG. Settle Mr_ Frank & Dr. Susan Short Ms. Carrie Skifron Patricia A. Stratton Dr. & Mrs. Joseph F. Sullivan Mr. & Mrs. Petcr A. Thomas Mr. & Mrs. El\\in W. Thurlow Mr. & Mrs. Tucker Tyler Rosetta G. Valleau Mr. & Mrs. George P. Wagner, Jr. Mr. & Mrs. Edwin F. Walmer \~FY \~dq -O~ The Watkins Family Mr. & Mrs. Robert K Weinfurtner On. Allen & Marla Weiss Mr. & Mrs. George E. Willis Mr. & Mrs. Mark B. WiL~on Dr. & Mrs. Robert W. Wilson Susan B.Wolff i.Xow Corporate & Foundation Donors Anchor Health Centers Bank of Aorida Collier Anesthesia, P.A. Crowther Roofing Cummings & Lockwood, LLC Dyehouse Comeriato Architect Embarq Aorida Gulf Coast University Foundation Gesbay A>sociates, Architect HealthSouth IBM International Foundation Island Country Club La Playa Beach & Golf Club Lutgert Imunnce Marino Group Inc Meredith Corporation Naples Day Surgery Naples Pathology Associates Naples RadiolOgists, PA Northern Trust Bank of Florida Potter, Wright, Morris, & Arthur, LLP Preferred Travel of Naples, Ine. Price WaterhouseCoopers LLP Private Capital Management Quality Med Tran - Sarah Ann of SW Florida, rne. Sodexho Healthcare Senices Square D Foundation The Telford Foundation TIB Bank TLC Engineering for Architecture Total Communication Concept.~ Group, Inc. Unilever United States Foundation, Ine. Wacho\<ia Bank Wasmer, Schroeder & Company, Inc. Wicker, Smith, O'Hara, McCoy, Graham & Ford, P.A T~ NCH Healthcare Foundation has made every effort to acknowledge accurately our 2006 contributors. If you haw any questioru or comments aboutrhis listing; please conract the Foundntion Office at 239-436-4511. Thank you. Ai; the expansions and innovations demonstrate, this past year of transition has also been one of accomplishment, both of tangible and intangible goals. Massive building projects completed during FY2006 included not only the Baker Patient Tower, but also the Briggs Health Pavilion and Wellness Center, the Garden of Hope and Courage, and the von Arx Diabetes Center of Excellence and Nutrition Health. Each was a response to the needs of the growing community-and each relied on effective partnerships between NCH and the people it serves. Creating and sustaining partnerships are crucial to accomplishing the mission of the NCH Healthcare System-to promote, maintain and restore the health of the community it serves. Everyone who is recognized and honored in this annual report is a partner in this noble cause. \0 ftf \ - ~ -0 ~ Meeting needs Patients, physicians, volunteers, nurses and support people along with benefactors-all trying to make each other successful-have created the current high quality healthcare of which N CH is justly proud. But each person or group alone could not be as effective in caring for individual patients or the community. Working together with the common goal of demonstrated quality, the entire community can share in the satisfaction that the N CH Healthcare System has progressed to the top 5% nationally and will continue leading the community in the quest for exceptional healthcare. N CH has cared for this community for more than 51 years and plans to make the next 51 years even better. Thank you for your continuous and generous support as well as the opportunity to serve. J " ,*" I'. ,~<i ~ , , \ , -:"t:,:,~' I \CpFL{- l~crz1~O g 2006 Board of Trustees and Camorate Officers Carl E. Westman, Esq., Chairman Stephen L Schwartz, 1st VICe Chairman Richard Roland, M.D., 2nd Vice Chairman Richard]. Censits, Secretary(freasurer Edward A Morton, CEO Allen Weiss, M.D., President James A Warnken, Exec. VP./CFO & Asst. Treasurer Kevin Cooper, VP. & General Counsel Cynthia A Bennett, Asst. Secretary Elizabeth Allen Jay Baker William Bindle'll Richard Bodman Susan Dalton Paul Oernbach, M.D. Linda Flewelling laVerne C. Franklin EllinGoetz Thomas Grady Pierson Griew Fritz Harrington, M.D. Robert Lanigan Arnold Lerner Scott Lurgert Nelson Maldonado, M.D. Paul Marinelli GerriMoll John Morrison Joseph Perkovich Rabbi James Perman Edwin Stedem 2006 NeB Foundation Committee Terrace R. Flynn, Chairman Lois W. Lipnik William F. Allyn Matthew Mathias Harvey D. Cohen Carol Ann May Thomas L Cook, M.D. Malcolm S. McDonald Andrew B. Craig Edward A Monon Susan L Dalton Jane S. Ogden David L. Fenelon F. Fred Pezeshkan John D. Fumagalli James Reid Kay F. Gow Duane Stranahan, Jr. Kim Ciccarelli Kantor Joseph P. Viviano George R. Kraus Allen S. Weiss, M.D. Stephen A Kwedar, M.D. Carl Westman, Esq. Robert Lanigan Sallie L. Williams, Exec. Director Nancy C. Lascheid Planned Givin2' Subcommittee Kim Ciccareli Kantor, Chairman Robert D. W. Landon, II, Esq. Steve Benson Tucker Tyler Ronald B. Ciesla Carl E. Westman, Esq. Judy M. Coleman Edward E. Wollman, Esq William A Klauber, ex officio 2006 Mfdical Exec.llth'e Committee & Officers Hermes Koop, MD, President Corey Howard, MO, Medkine Debra McCormack, MD, VICe President Kevin Collins, MD, Obstetrics/Gynecology Jeffrey McCartney, MD, SecretaryJTreasurer H. David Greider, MD, Pathology Perry Gotsis, MD, Past President Debra Shepard, MO, Pediatrics Albert Alessi, DO, Chairman, NCH North Naples Hospital Jeffrey McCartney, Neurology Lee Anderson, MO, Anesthesiology James Boorstin, MO, Psychiatry Andrew Shuter~ DO, ER Director, NCH Naples Downtown HosPital Michael Theobald, MD, Radiology Carolyn Walters, MO, NeB North Naples Hospital Paul Dembach, MD, Surgery Daniel Kaplan, DO, Family Practice fJR/CEWA1i:RHOusE(aJPERS I \(aFti l ~oz:r -0 ~ , NCH Healthcare System, Inc. Consolidated Financial Statements and , Supplemental Schedule September 30, 2006 and 2005 l0 F-Lt l~<11-oq NCH Healthcare System, Inc. Index September 30, 2006 and 2005 Pagels) Report of Independent Certified Public Accountants ............................................................................. 1 Consolidated Financial Statements Consolidated Balance Sheets.................................................. ........................................2-3 Consolidaled Stalemenls of Operations .................................... ..........................................4 Consolidated Statemenls of Changes in Nel Assets.................................................................................... 5 Consolidated Slatements of Cash Flows ........... .......................................................................................... 6 Noles 10 Consolidated Financial Statements.... .....................................................................................7-22 Supplemental Schedule Report of Independent Certified Public Accountants on Accompanying Information.. ...................23 Schedule of Income from Operations before Charitable Contributions ...................................................... 24 lioFq l~ ~ -0 ~ ~CEWA1fRHOUSE[QJPERS I PricewaterhouseCoopers LLP 101 East Kennedy Boulevard Suite 1500 Tampa FL 33602.5147 Telephone (813) 229 0221 Facsimile (813) 229 3646 Report of Independent Certified Public Accountants To the Board of Trustees of NCH Healthcare System, Inc. In our opinion, the accompanying consolidaled balance sheets and the related consolidated statements of operalions, of changes in nel assets, and of cash flows present fairly, in all material respects, lhe financial position of NCH Healthcare System, Inc. (the "System") al September 30, 2006 and 2005, and the results of their operations and their cash flows for the years Ihen ended in conformity with accounling principles generally accepled in lhe Uniled States of America. These financial statements are lhe responsibility of lhe System's management. Our responsibility is 10 express an opinion on lhese financial stalements based on our audits. We conducted our audils of lhese statements in accordance wilh auditing slandards generally accepted in the United Slates of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether lhe financial slatements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting lhe amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financiai stalement presenlation. We believe that our audits provide a reasonable basis for our opinion. f~"l:lp December 15, 2006 NCH Healthcare System, Inc. Consolidated Balance Sheets September 30, 2006 and 2005 \ Co Flf- \-3t1~O~ Assets Current assets Cash and cash equivalenls Investments Due from patients and others, net of allowance for estimated uncollectibles of approximately $34,975,000 in 2006 and $25,281,000 in 2005 Assets limiled as to use Inventories Other current assets Total current assets Assets limited as to use Self-insurance fund Board-designated assels Assets held by truslee under bond indentures Less: assets limited as 10 use lhal are required for current liabilities Investments in partnerships Property and equipment, nel of accumulated depreciation Long-term inveslments Bond issue cosls Other assets Total assets 2006 2005 $ 28,852,852 $ 50,725,982 56,754,860 34,164,919 64,550,434 51,540,363 21,255,464 12,959,421 8,685,440 7,487,636 7,348,085 6,807,754 187,447,135 163,686,075 15,410,267 10,464,032 74,539 72,557 16,118,708 27,709,835 31,603,514 38,246,424 (21,255,464) (12,959,421 ) 10,348,050 25,287,003 5,744,152 5,151,557 259,286,263 210,856,142 8,444,956 8,039,211 2,446,998 2,614,944 36,608,208 40,900,493 $510,325,762 $ 456,535,425 2 The accompanying notes are an inlegral part of lhese consolidated financial statements. 10F<-t (- CJt1 -0'6 NCH Healthcare System, Inc. Consolidated Balance Sheets, continued September 30, 2006 and 2005 2006 2005 Liabilities and Net Assets Current liabilities Current portion of long-lerm debt and capilallease obligations $ 7,833,637 $ 4,904,674 Current portion of self-insurance liabilities 5,136,756 3,484,523 Accounls payable 27,022,289 16,582,714 Accrued expenses 32,495,698 29,888,829 Accrued interest 2,986,111 3,088,543 Estimated third-party payor setllements 6,291,952 5,625,505 Total currenlliabilities 81,766,443 63,574,788 Long-lerm debt and capilallease obligations, excluding current portion 134,338,477 129,155,727 Estimated self-insurance liabilities, excluding current portion 10,273,511 6,979,509 Other liabililies 7,974,386 7,334,645 T olalliabilities 234,352,817 207,044,669 Commitments and contingencies Net assets Unrestricted 247,389,092 211,883,429 Temporarily reslricted 18,602,352 28,156,379 Permanently restricted 9,981,501 9,450,948 Total nel assets 275,972,945 249,490,756 Tolalliabllitles and net assets $ 510,325,762 $ 456,535,425 The accompanying noles are an integral part of lhese consolidated financial statements. 3 NCH Healthcare System, Inc. Consolidated Statements of Operations Years Ended September 30, 2006 and 2005 \ (pF4- \ - a-zi -o~ Unrestricted revenues Nel patient service revenue Other revenue Total revenues Expenses Salaries and wages Employee benefits Supplies and other expenses Purchased services Depreciation and amortization Interest expense Provision for bad debts Total expenses Other nonoperating revenue Excess of revenues over expenses Change in nel unrealized gains on other lhan lrading securities Net assets released from restrictions Increase in unrestricted net assets 2006 2005 $ 454,194,902 $ 421,790,246 21,153,471 31,263,881 475,348,373 453,054,127 180,066,349 163,862,327 36,548,960 32,285,342 138,891,678 124,384,097 23,429,795 21,378,415 23,994,079 22,172,121 5,392,960 5,087,892 53,213,723 40,839,652 461,537,544 410,009,846 5,585,290 19,396,119 43,044,281 1,197,303 58,487 14,912,241 2,260,622 $ 35,505,663 $ 45,363,390 The accompanying notes are an integral part of these consolidated financial statemenls. 4 \(pF+ \~~ -o~ NCH Healthcare System, Inc. Consolidated Statements of Changes in Net Assets Years Ended September 30, 2006 and 2005 Temporarily Permanently Unrestricted Restricted Restricted rota' Net assets at September 30, 2004 $ 166,520,039 $ 14,879,438 $ 14,908,204 $ 196,307,681 Excess of revenues over expenses 43,044,281 43,044,281 Change in net unrealized gains (losses) on other than trading securities 58,487 (42,928) (427,907) (412,348) Restricted gifts and bequests 9,121,15S 9,121,155 Income from restricted investments 196,713 1,233,274 1,429,987 Net assets released from restrictions 2,260,622 4,002,001 (6,262,623) Change in net assets 45,363,390 13,276,941 (5,457,256) 53,183,075 Net assets at September 30, 2005 211,883,429 28,156,379 9,450,948 249,490,756 Excess of revenues over expenses 19,396,119 19,396,119 Change in net unrealized gains (losses) on other than trading securities 1,197,303 9,318 (922,156) 284,465 Restricted gifts and bequests 4,702,075 326,963 5,029,038 Income from restricted investments 482,931 1,289,636 1,772,567 Net assets released from restrictions 14,912,241 (14,748,351) (163,890) Change in net assets 35,50S,663 (9,554,027) 530,553 26,482,189 Net assets at September 30, 2006 $ 247,389,092 $ 18,602,352 $ 9,981,501 $ 275,972,945 The accompanying noles are an inlegral part of lhese consolidated financial statemenls. 5 NCH Healthcare System, Inc. Consolidated Statements of Cash Flows Years Ended September 30, 2006 and 2005 lroFY \-Qt1~og Cash flows from operating activities Change in net assets Adjustmenls to reconcile change in net assets to net cash provided by operating activities Restricted gifts and bequests Change in net unrealized (gains) losses on other than trading securities Income from restricted investments Deprecialion and amortization Provision for bad debls Loss (gain) on disposal of property and equlpmenl Changes in assets and liabilities Increase in due from patients and olhers Increase in inventories (Increase) decrease in olher current assets Increase (decrease) in accounls payable Increase in accrued expenses (Decrease) increase in accrued interest Increase In eslimaled self-insurance liabilities Increase in estimated lhird-party payor settlements Increase in other liabilities Nel cash provided by operating activities Cash flows from investing activities Purchases of property and equipment Proceeds from lhe sales of property and equipment (Purchases) proceeds of investments, net Decrease (increase) in other assets Decrease in assets limited as to use Increase in investment in partnerships Net cash used in investing activilies Cash flows from financing activities Proceeds from long-term borrowings Repaymenl of long-lerm debt and capital lease obligations Payment of bond issue costs Net cash provided by (used in) financing activities (Decrease) increase in cash and cash equivalents Cash and cash equivalents Beginning of year End of year Supplemental disclosure of cash flow information Cash paid during the year for interest Supplemental noncash disclosures Property and equipmenl included in accounts payable 2006 2005 $ 26,482,189 $ 53,183,075 (4,611,068) (6,828,597) (284,465) 412,348 (1,772,567) (1,429,987) 23,994,079 22,172,121 53,213,723 40,839,652 74,270 (10,485,116) (66,223,794) (41,045,369) (1,197,804) (995,351 ) (540,331) 535,305 2,271,060 (3,274,707) 2,606,869 4,310,583 (102,432) 596,172 4,946,235 262,177 666,447 375,082 639,741 3,022,553 40,162,152 61,649,941 (64,151,695) (34,638,929) 3,735,427 3,538,347 (16,307,844) 4,700,457 572,285 (2,867,274) 6,642,910 13,609,994 (592,595) (1,589,831) (70,101,512) (17,247,236) 15,000,000 (6,888,287) (20,643,384) (45,483) (8,245) 8,066,230 (20,651,629) (21,873,130) 23,751,076 50,725,982 26,974,906 $ 28,852,852 $ 50,725,982 $ 6,424,039 $ 5,702,836 $ 8,168,515 $ 2,692,441 The accompanying noles are an Inlegral part of these consolidaled financial statements. 6 Iw~Lf \- 2Z1-of NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 1. Summary of Significant Accounting Policies Organization The NCH Healthcare System, Inc. (the "System") was incorporated as a 501 (c)(3) not-for-profit parenl holding corporation in 1983 under a plan of reorganization to better serve the community's health care needs and to provide managemenl with greater flexibility in providing services. The Syslem mainlains the legal righl to select trustees of its not-for-profit subsidiaries for approval by the subsidiaries' respeclive corporate memberships and to elect all the directors of its proprietary subsidiaries. In addition, the System maintains the right 10 approve (1) the operating and oapilal budgets, (2) all amendments to lhe bylaws and articles of incorporation, and (3) all long-term debt obligations and requesls for certificates of need for all of the subsidiaries. The System owns 100% of the outstanding stock of ils proprietary enlerprise subsidiaries. The System's companies and the consolidated financial slalements consisl of the following enlilies: Naples Community Hospital, Inc. (lhe "Hospital"), a not-for-profit corporalion, operates two general acute care hospilals in Collier County, Florida, a blood donor center and various other outpatient centers iocated throughout the communily. Marco Island Hospital, Inc. d/b/a Marco Healthcare Center ("MIH"), a nol-for-profit corporalion, operates an urgent care cenler and medical office building on Marco Island, Florida. Community Home Services, Inc., a not-for-profit corporation, provides durable medical equipment and operates Lifeline emergency response services. Collier Health Care, Inc. (CHCI), a nol-for-profit corporation, owns and leases healthcare facilities in Naples and lmmokalee, Florida. CHCI also operates Children's Medical Services, a program serving chronically ill and special needs children under Tille V and the Florida KidCare Program lhrough Tille XXI. NCHMD, Inc. d/b/a S.W. Florida Hematology and Oncology Specialists, a nol-for-profit corporation, was incorporated on November 14, 2003 and provides services 10 patienls with cancer and blood disorders. Heallh Resources Corporation ("HRC"), a for-profit holding company which consists of lhe following proprielary subsidiaries: (i) Diagnostic Services, Inc. d/b/a DSI Laboratories provides various laboratory testing services primarily in Southwest Florida. (iI) Community Imaging, Inc. ("CII") was formed to operate as a partner in lhe operalion of diagnoslic imaging cenlers. CII's 50% partnership inleresl in Naples Diagnostic Imaging Center, Ltd. ("NDlC") is accounled for using lhe equity method of accounting. In conjunction with the issuance of long-lerm debt for the construction and equipping of NDIC facilities, the Syslem has provided an unconditional guarantee to pay 5'0% of the obligalions related to lhis debt should NDIC default. As of September 30, 2006 and 2005, lolallong-term debt oulslanding al NDIC was $5,492,050 and $3,785,545, respectively. (iil) Ambulatory Surgical Care Center, Inc. ("ASCC") owns a 15% inleresl in Naples Day Surgery ("NOS"), a non-affiliated limiled liability company which operales two ambulatory surgery centers in 7 10F+ l ~ dtj ~o <l NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 Collier County, Florida. (iv) Community Home Care, Inc. disconlinued operating its privale duty home health agency during fiscal year 2005, and concurrently purchased a 49% interest in Kokua Healing Arts, Inc., an established privale duty home heallh agency headquartered in Naples, Florida. (v) Counseling and Employee Assistance Program, Inc., acquired in September 2005, provides employee assistance services, such as individual and family counseling, to NCH affiliates and other local companies. The System also owns a 50% interesl in Bonila Community Heallh Center ("BCHC"), a not-for- profit organizalion. BCHC operates an urgent care center, an ambulatory surgical care cenler, a diagnoslic imaging center and an outpatient rehabililation center in Estero, Florida. Additionally, BCHC leases office space to physicians and olher health care providers. The inveslment in BCHC is accounled for using lhe equity method. In conjunclion with the issuance of long-term debl for lhe conslruction and equipping of the BCHC facility, lhe Syslem has provided an unconditional guaranlee to pay 50% of lhe obligations related 10 this debl should BCHC default. As of Seplember 30, 2006 and 2005, lotallong-term debt outstanding at BCHC was $27,625,566 and $28,125,390, respectively. The System also owns a 50% interesl in Naples Physician Hospilal Organization dlbla Community Heallh Partners ("CHP"), a not-for-profit taxable entily under the laws of the Slale of Florida. CHP contracts with various employers and other third-party payors for the provision of healthcare services by CHP members. The investment in CHP is accounted for using the equily method. Basis of Presentation These consolidated financial statemenls, which are presented on the accrual basis of accounting, have been prepared 10 focus on the Syslem as a whole and 10 presenl balances and lransactions according 10 the existence or absence of donor-imposed restrictions. This has been accomplished by classification of net assels and transactions into three classes of net assels - permanently restricted, temporarily restricted or unrestricted as follows: Permanently restricted net assets Net assets subject 10 donor-imposed slipulations thallhey be maintained permanently by the System. Generally, the donor of lhese assels permits lhe Syslem to use all or part of Ihe income earned on related investments for general or specific purposes. Temporarily restricted net assets Net assets subject 10 donor-imposed stipulations lhal will evenlually be met by actions of the System andlor the passage of time. Unrestricted net assets Nel assets generaled from operalions, unrestricted donations, and the satisfaclion or lapse of temporary restriclions. These are not subject to donor-imposed stipulations. Principles of Consolidation The consolidated financial statements include the accounls of lhe Syslem. All significanl intercompany amounls and transactions have been eliminated in consolidation. 8 \0FL\- \-JIq --og NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 Use of Estimates The preparalion of financial slatements in conformity with accounting principles generaily accepled in the United States of America requires management 10 make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial stalemenls and lhe reported revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include investmenls in highly liquid debt inslruments with original malurities of three months or less al date of purchase bul exclude amounts whose use is limited by self-insurance programs, board designalion or arrangements under trusl agreements. Investments and Investment Income Investments in equity securilies with readily delerminable fair values and ail investmenls in debt securities are measured at fair value in the consolidated balance sheels. Investment income or loss (including realized gains and losses on investments, interest and dividends) is included in the excess of revenues over expenses unless income or loss is restricted by donor or law. Unrealized gains and losses on investments are excluded from lhe excess of revenues over expenses unless lhe investmenls are trading securilies. Ail of the System's investments are classified as available for sale securilies. Inventories Inventories consist of operaling supplies and are staled at lhe lower of cost or market, on a first-in, first-oul basis. Assets Limited as to Use Assels limited as to use primarily include assets required by state insurance laws to fund claims in lhe Syslem's self-insurance programs, assets set aside by the Board of Trustees, and assets held by trustee under bond indenture agreements. Amounts required to meet current liabilities of the Syslem have been classified as current assets. Assets limiled as to use are carried on lhe consolidated balance sheets at fair value based upon quoted market prices. Donor Receivables Donalions to be received in lhe future that are held in irrevocable trusts are reported at nel present value. Pledges to make future donations are reported at net presenl value, nel of an ailowance for estimaled uncoileclible pledges. Donor receivables are classified as other assets in the consolidaled balance sheels. Gifts are reported as eilher temporarily or permanently reslricted if lhey are received wilh donor slipulalions that limit the use of lhe donated assets. When a stipulated lime restriction ends or purpose restriction is satisfied, temporarily restricted net assets are reclassified as unrestricted net assets and reported in the consolidated slatemenls of operations as net assets released from restriclions. Donor-restricted conlributions whose reslriclions are met within the same year as received are reported as unrestricted contributions in the acCompanying consolidated financial statements. 9 \ 0 F-tf l~OZ1 ~og NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 Property and Equipment Property and equipment are recorded al cost or if donaled, at fair market value at date of dona lion. Property and equipment donated for operalions are recorded as additions to unrestricted net assels. Major asset classifications and useful lives are generally in accordance wilh lhose recommended by lhe American Hospital Association. Deprecialion is provided over the eslimated useful life of each class of depreciable assets, which range from 3 to 40 years, and is computed on the straight-line method. Equipment under capilal iease obligalions is amortized on the slraighl- line method over lhe lease lerm or the estimated useful life of the equipment, whichever is shorter. Such amortization is included in depreciation and amortization expense in lhe consolidaled stalemenls of operations. Upon sale or retirement of depreciable assets, the related cost and accumulaled depreciation are removed and any resulting gain or loss is included in olher revenue. Bond Issue Costs Bond issue costs are amortized over lhe life of the related bonds using the slraight-line method, which approximates the effective interest method. Estimated Self-Insurance Liabilities The provision for estimated self-insured medical malpractice claims, workers' compensation claims and health and dental claims includes estimales of the ultimate costs for bolh reported claims and claims incurred but not reported. Heallh and dental claim provisions are included with accrued expenses. The provisions for medical malpractice claims and workers' compensation claims have been actuarially determined. Excess of Revenues Over Expenses The consolidated slatements of operations include excess of revenues over expenses. Changes in unreslricled net assets which are excluded from excess of revenues over expenses, consistent with induslry practice, include unrealized gains and losses on investments other than trading securities and assets released from donor restrictions in accordance with stipulalions of the gift. Net Patient Service Revenue The System has agreements with lhird-party payors that provide for payments to the Syslem al amounls differenl from its eslablished rates. Payment arrangemenls include prospectively determined rales on the basis of per discharge, per procedure, per capita (capitation), reimbursed cost, discounted charges, and per diem. Net palient service revenue is reported at the eslimated net realizable amounts from patients, third-party payors, and others for services rendered, including estimated relroaclive adjustments under reimbursement agreements with lhird-party payors. Retroactive adjuslments are accrued on an estimated basis in the period the related services are rendered and adjusted in future periods as final selllements are determined. Functional Expenses The System does not present expense information by functional classification because its resources and activities are primarily related to providing health care services. Further, since lhe Syslem receives substantially all of its resources from providing health care services in a manner similar 10 a business enlerprise, other indicators contained in these consolidated financial statemenls are considered important in evalualing how well management has discharged their stewardship responsibilities. 10 l(pF~ \~~'Or NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 Charity Care The System provides care wilhout charge or at amounls less than its established rates to patients who meet specific criteria under the State's charity care guidelines. Because the System does not pursue collection of accounls determined to qualify as charity care, these amounts are nol reported as revenue. Income Taxes The System and all of its not-far-profit subsidiaries are exempt from federal income taxes under Section 501 (c)(3) of the Internal Revenue Code (the "Code") and are exemptfrom federal income laxes on related income pursuanl to Seclion 501 (a) of lhe Code. The System and all of its not-for- profit subsidiaries do not have significant unrelated business income; however, such stalus is subject 10 final determination upon examination of the related income lax relurns by lhe appropriate laxing authorities. The Syslem's for-profit subsidiaries are subject to income tax. Accounting for Derivative Instruments The System uses derivative financial instrumenls for lhe purpose of managing lheir exposure to adverse flucluations in interesl rates. While lhese instrumenls are subjecl to fluctuations in value, such fluctuations are generally offset by lhe change in value of the underlying exposures being hedged. The Syslem does not enter into any derivalive financial inslruments for lrading purposes. The System records all of their derivative instruments in the consolidated balance sheets at fair value. Although lhese derivative instrumenls are used for risk managemenl purposes, the Syslem does not meet the crileria to qualify for hedge accounling and, therefore, lhe changes in fair value are recorded in lhe consolidaled stalements of operalions as interest expense. New Accounting Pronouncements Financial Accounting Slandards Board ("FASB") Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations (an interpretation of FASB Statement No. 143) ("FIN No. 47") was issued in March 2005. FIN No. 47 provides c1arificalion wilh respect to the timing of liability recognition for legal obligations associated with the retirement of tangible long-lived assets when the timing andlor melhod of settlement of lhe obligalion is conditional on a future event. This inlerpretation requires thai the fair value of a liability for a conditional asset reliremenl obligalion be recognized in lhe period in which it occurred if a reasonable estimale of fair value can be made. FIN No. 47 requires the initial applicalion of the inlerpretation to be recognized as a cumulalive effect of a change in an accounling principle. Specifically, FIN No, 47 requires the recognition, a cumulative effect, the cumulative accretion and accumulaled depreCiation for the period from lhe date the liability is incurred to the date of adoption of Ihis interpretalion. The liability incurred dale is presumed 10 be lhe date upon which the legal requirement 10 perform lhe asset retirement activity was enacled. The adoplion of FIN No. 47 did not have a malerial impact on the consolidaled financial statements at September 30, 2006. 11 \(pFL\- l- ~ ~o f NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 On November 10, 2005, the FASB issued FASB Staff Posilion ("FSP") FIN 45-3, Application of FASB Interpretation No. 45 to Minimum Revenue Guarantees Granted to a Business or Its Owners (FSP FIN 45-3). FSP FIN 45-3 clarified lhat FIN 45 is applicable to minimum revenue guarantees granled to a non-employee physician by a not-for-profit health care facliity thai has recruited lhe physician to move 10 lhe tacility's geographical area to establish a practice. This FSP applies 10 minimum revenue guarantees gran led to physicians regardless of whelher the physician's praclice qualifies as a business. FSP FIN 45-3 is effective tor new minimum revenue guarantees issued or modified on or after January 1, 2006. Earlier application of the provisions of this FSP is permitted. The guarantor's previous accounting for minimum revenue guarantees issued prior 10 the date of this FSP's inilial application shall not be revised or restated 10 reflect lhe effect of the recognilion and measurement provisions of Inlerprelalion 45. Upon adoption of FSP FIN 45-3, the System recognized physician income guarantees of approximately $787,000. The System also recognized a corresponding asset for the physician income guarantees that will be amortized over the guarantee period which is approximateiy 36 to 60 monlhs. Reclassifications Certain reclassifications have been made to the consolidated financial statemenls ot the prior period in order 10 conform 10 lhe currenl period presentation. These reclassifications had no effecl on excess of revenues over expenses, changes in net assets, or net assets. 2. Third-Party Payors The Syslem has agreements with third-party payors that provide for payment 10 the System at amounts different from its established rates. A summary of the basis of paymenls from the System's primary third-party payors follows: Medicare Most inpatient and outpatient services rendered to Medicare program beneficiaries are paid at prospectiveiy determined rales. These rates vary according to a patient c1assificalion system that is based on clinical, diagnoslic, and other factors. Psychialric services and some oulpalient services continue 10 be paid based upon a cost reimbursement melhodology. The System is reimbursed for cosl reimbursabie items at a tentalive interim rate with final setliemenl determined after submission of annual cosl reports by the System which are subsequently audiled by the Medicare fiscal inlermediary. The System's Medicare cost reports have been filed for all years through Seplember 30, 2005 and have been audited and final settlements determined by lhe Medicare intermediary for all years through September 30, 2004. Retroaclive adjustments for cost report setliements are accrued on an estimated basis in the period when the relaled services are rendered and adjusted in future periods when final setliements are determined. 12 \0f2L{ \ -Jt1-0 ~ NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 Medicaid Inpatient and outpatient services (except for laboratory and palhology services paid by fee schedule) rendered to Medicaid program beneficiaries are reimbursed under a cosl reimbursemenl methodology. Reimbursable cosl is delermined in accordance with the principles of reimbursement established by the Florida Title XIX Hospilal Reimbursement Plan, supplemenled by the Medicare Principles of Reimbursement. The interim rates are lentatively established for each hospital, subject 10 cost ceilings with exceptions. The Syslem is reimbursed at a lenlative interim rale with final seltlemenl determined after the inlermediary audit of the combined Medicare and Medicaid cosl report. Retroactive adjustmenls for interim rale changes anlicipated after the intermediary audil of the cost report are accrued on an estimated basis in the period when final settlements are delermined. The System's Medicaid interim rales are based on the Medicare/Medicaid cost report which has been audiled by the fiscal intermediary through September 30, 2002. Laws and regulations governing the Medicare and Medicaid Programs are complex and subjecl to inlerpretation. The System believes that il is in compliance with all applicable laws and regulations and is nol aware of any pending or threatened investigations involving allegations of polential wrongdoing. While no such regulalory inquiries have been made, compliance with such laws and regulations can be subjecl to future governmenlal review and inlerpretalion as well as significanl regulatory action including fines, penalties, and exclusion from the Medicare and Medicaid Programs. The Syslem's classification of patienls and the appropriateness of their care are subject to review by the fiscal intermediaries administering lhe Medicare and Medicaid programs. In June 2005, lhe System became aware lhat there was an irregulariIy in lhe process for billing two drugs in the pharmacy which resulled in overcharges to the Medicare program and other payers over a period of several years. The System self-reported this issue to lhe Office of the Inspector General ("DIG") and believes that adequate reserves have been made as of September 30, 2006 and 2005 to account for refunds thai will be made in addition 10 any penalties or fines that potentially could be assessed. Other The System has also enlered inlo payment arrangemenls with certain commercial insurance carriers, heallh maintenance organizations, and preferred provider organizations. The basis for payment to lhe System under these arrangements includes prospectively determined rates per discharge, per diem, per capita (capitation), discounts from established charges, and prospeclively delermined rates per procedure for oulpatient services. Some of lhese arrangements provide for review of paid claims for compliance with lhe lerms of the contract and resull in relroactive selllement with third parties. Retroaclive adjuslmenls for other third party claims are recorded in the period when final seltlemenl is determined. 13 NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 \0F4 \~ 2tr ~o~ 3. Net Patient Service Revenue Net patient service revenue was the following for the years ended September 30, 2006 and 2005: 2006 Gross patient service revenue Less: Medicare and Medicaid allowances Other discounts and allowances $1,138,443,974 (528,904,708) (155,344,364) (684,249,072) $ 454,194,902 Net patient service revenue 4. Uncompensated Care 2005 $ 1,065,375,140 (507,430,892) (136,154,002) (643,584,894) $ 421,790,246 Uncompensated care represents either charges foregone or charges in excess of payment received for services provided 10 patients who are nol covered under conlracls with third-party payors. The major components of uncompensated care are calegorized as charity, welfare, and bad debls. Charily care represenls services and supplies furnished at no charge to patients who have qualified under the income criteria promulgated by the State of Florida. Patients who would otherwise be deemed as charity care can sometimes qualify under Ihe Collier County Welfare Program. Paymenls under the County Welfare Program are limited by the amount appropriated by the County. However, payments received are based on 80% of Medicaid rates. During the year ending September 30,2006, lhe System began participating in lhe Trailblazers Seclion 1011 Federal Program which compensales heaithcare providers for emergency services rendered to undocumented illegal aliens who have no other means to pay lheir bills. Patienls are pre-screened to delermine if they meel criteria for the program which will only reimburse for inilial emergency and stabilization lrealment. Paymenls are received on a quarterly basis and the System is reimbursed a percentage of Medicare rates for inpatients and outpatients. The difference between the charges and what was received in lhe Trailblazers program was included in the welfare amount. Finaliy, bad debts represent charges deemed uncolleclible due 10 either (a) a patient's inability 10 qualify as charity, welfare, or Medicaid, yet clear financial indications exist that demonstrate an inability to pay, or (b) a palient's refusai to pay for services provided and the System's decision to cease further colleclion efforts. Uncompensated care for the years ended September 30, 2006 and 2005 was as follows: 2006 Charily care - charges foregone, based on eslablished rates Welfare - difference between established rates and reimbursement received Total charity care and welfare Bad debts - charges deemed uncollectible Tolal uncompensated care $ 46,079,414 6,254,321 52,333,735 53,213,723 $ 105,547,458 14 2005 $ 44,325,950 5,021,524 49,347,474 40,839,652 $ 90,187,126 \(pF'i \~dt1 ~of NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 5. Temporarily and Permanently Restricted Net Assets Temporarily restricled net assels are available for the following purposes at September 30, 2006 and 2005: 2006 2005 Health care services Building construction and purchase of equipment Indigent care and educalion $ 18,313,171 289,181 $ 18,602,352 $ 27,768,649 387,730 $ 28,156,379 Permanently restricted net assets al September 30, 2006 and 2005 are restricled to: 2006 2005 Inveslments to be held in perpetuily, the income from which is expendable to support health care services $ 9,981,501 $ 9,450,948 . 6. Due from Patients and Others Amounts due from patienls and others is nel of uncolleclible accounts for bad debts and contractual allowances under third-party payor arrangements. Medicare and Medicaid represenl approximately 36% and 37% of amounls due from patients and olhers as of Seplember 30, 2006 and 2005, respectively. The credit risk for other receivables is limited due to the large number of insurance and managed care companies and other payors thai provide payments for services. These receivables are reported net of an estimated allowance for uncolleclible accounts in the accompanying consolidated financial slatements. 15 \(cF+ \-6t1~O~ NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 7. Assets Limited as to Use and Investments The composition of assets limited as to use and investmenls are stated at fair value al September 30, 2006 and 2005, and are sel forth in the following lable: 2006 2005 Assets limited as to use Self-insurance fund Cash and cash equivalents U.S. governmenl and agency securities Corporate bonds Total assels limiled as 10 use $ 6,985,310 $ 6,779,919 2,954,845 1,021,206 5,470,112 2,662,907 15,410,267 10,464,032 74,539 72,557 16,044,273 27,699,380 74,435 10,455 16,118,708 27,709,835 $ 31,603,514 $ 38,246,424 2006 2005 $ 880,345 $ 306,117 22,219,938 9,568,985 36,502,876 26,983,185 76,368 139,790 5,520,289 5,206,053 65,199,816 42,204,130 (56,754,860) (34,164,919) $ 8,444,956 $ 8,039,211 Board designated fund Cash and cash equivalents Assets held by trustee under bond indenlures U.S. government and agency securities Interest receivable Investments Cash and cash equivalents U.S. governmenl and agency securities Corporate bonds Preferred stock Common stock Less: amount included in current assets Long-lerm investments Investment income and gains (losses) from unreslricted cash, assets limited as to use, and investments are comprised of the following for the years ended Seplember 30, 2006 and 2005: 2006 2005 Interest income and realized gains and losses on sale of investments Change in unrealized gains on olher than trading securities $ 5,038,917 $ 1,197,303 $ 1,446,367 $ 58,467 16 NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 \ipF1{ I <)Cj--og 8. Property and Equipment Property and equipmenl and accumulaled depreciation and amortization consist of the following at September 30, 2006 and 2005: 2006 Land Land improvements Buildings Fixed equipment Movable equipment Rental apartmenls Leasehold improvements Plant expansion in progress $ 15,741,117 3,970,629 208,568,550 41,369,638 163,178,812 857,813 6,682,006 72,022,549 512,391,114 (253,104,851 ) $ 259,286,263 Less: Accumulated depreciation and amortization 2005 $ 15,669,852 3,885,949 201,349,388 39,036,140 149,783,829 857,814 6,592,649 23,851,792 441,027,413 (230,171,271 ) $ 210,856,142 As of Seplember 30, 2006, lhe System had capital leases for equipmenllolaling $1,628,003 with reiated accumulated amortization of $1,152,453. As of September 30, 2005, lhe System had capitai leases for equipment Iota ling $1,628,003 wilh related accumulaled amortization of $990,746. Depreciation expense was approximaleiy $23,535,000 and $21,904,000 for lhe years ended September 30, 2006 and 2005, respectively. The plant expansion in progress al Seplember 30, 2006 inciuded the construclion costs of the North Naples Hospilai expansion, the NCH Briggs Health Pavilion and various other projecls, which management estimales will cost an additional $15,000,000 to compiete. il is expected that lhe majority of these projects will be completed by February 2007. The System closed on the sale of Grand Cenlral Slation Shopping Plaza on March 1, 2005, and concurrent wilh the closing, retired outstanding debt of approximalely $14,600,000 of the Series 1999 Bonds associated with this property. The Syslem was paid $4,000,000 in cash and received a $21,000,000 note receivabie, secured by the property, to be paid no laler than June 30, 2007. With a book value of approximately $14,000,000, lhe System recognized a gain on the sale of approximately $10,500,000 which is included in other revenue in lhe consolidaled slatemenls of operations in 2005. In April 2006, the System was paid $3,720,000 of the note receivable. The balance ?f $17,280,000 on lhe nole receivable was paid in November 2006. 17 NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 \ (p F- L\- h3Z1 ,of 9. Long-Term Debt and Capital Lease Obligations The System was obligated under long-lerm debl and capital lease obligations as follows at September 30, 2006 and 2005: City of Naples, Florida, Hospital Refunding Revenue Bonds, Series 1993 (payable by the Hospital under an agreement with the City of Naples), consisting of $7,475,QOO of term bonds due October 1, 2009, interest payable annually at 5.25%; $8,285,000 of term bonds due October 1, 2011, interest payable annually at 5.375%; $11,045,000 of term bonds due October 1, 2014, interest payable annually at 5.25%; $10,700,000 of term bonds due October 1, 2019, interest payable annually at 5.00%; and $6,765,000 of serial bonds due from October 1, 1994 to 2007, interest payable annually at rates of 2.70% to 5.10%. City of Naples, Florida, Hospital Revenue Bonds, Series 1996 (payable by the Hospital under an agreement with the City of Naples), consisting of $2,835,000 of serial bonds with varying interest rates (from 4.00% to 5.125%) maturing through October 1, 2008; $10,125,000 term bonds, interest payable annually at 5.5%, maturing October 1, 2016; and $20,585,000 term bonds interest payable annually at 5.5%, maturing October 1, 2026. Collier County Industrial Development Authority Healthcare Facilities Revenue Bonds, Series 2002 (payable by the System under an agreement with Collier County) consisting of $11,390,000 serial bonds with interest at rates ranging from 2.60% to 3.97% during the year ended September 30, 2006, maturing November 1, 2022. Collier County Industrial Development Authority Healthcare Facilities Revenue Bonds, (payable by the Hospital under an agreement with Collier County) consisting of $38,000,000 serial bonds with interest at 4.65% at September 30, 2006, maturing September 30,2019. Bank promissory note, variable interest at bank's prime rate minus 1.25%, monthly principal payments of $11 ,850 plus accrued interest, through November 2008, balloon of $3,089,850 due December 2008, collateralized by land, building, property and equipment. GE Capital Public Finance, Inc. (payable by the Hospital under an agreement with Collier County) consisting of $12,932,291 note with interest at 3.79% at September 30, 2006, maturing January 1, 2011. Present value of capital lease obligations Total long-term debt Less: Unamortized original issue discount Less: Current maturities 18 2006 2005 $ 44,270,000 $ 47,410,000 33.545,000 34,405,000 11,390,000 11,860,000 38.000,000 38.000,000 3.397.573 3.539.773 12,932,291 142,928 443,295 143,677.792 135,658,068 (1.505,678) (1,597,667) (7,833,637) (4,904.674) $ 134,338,477 $ 129,155,727 \LPFtt \-d't!-of NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 The agreemenls underlying the bond issues described above conlain covenants which provide for, among other lhings, the maintenance of certain ratios, conditions for addilional indebtedness and the transferability of funds. The System was in compliance with all covenants for the years ended September 30, 2006 and 2005. The bonds are collaleralized by all revenue, accounts receivable, contract rights and general intangibles of the System and by the money and securities held in the funds and accounts established under the applicable indentures. The Series 2004 Bonds are collateralized by a mortgage on the North Naples Campus. Payment of principal and interest on the Series 1993 and Series 1996 Bonds is guaranteed by municipal bond insurance. The Series 2002 and Series 2004 Bonds are backed by direct pay letters of credit with separale financial instilutions which expire on November 15, 2007 and Oclober 15, 2011, respectively.' The System entered Into a tax-exempt debl agreement 10 finance equipment acquisitions with a financial institution on December 27,2005 consisting of a $15,000,000 note with a fixed interest rate of 3.79%, maturing January 2011. The total amounl oulstanding al Seplember 30, 2006 was $12,932,291. The System ulilizes interesl rate swap agreements 10 manage interesl rate exposure. The interest rale differenlials to be paid or received under such interesl rate swaps are recognized over the life of the agreements as adjustments 10 interest expense. The principal objective of lhe agreements is 10 minimize the risks and/or costs associated wilh financing activities. The System has an inlerest rale swap agreement with a financial institution on outstanding debl of $11,390,000 at Seplember 30, 2006. Under the agreemenl, lhe System pays a fixed rate of 4.0% through November 1,2006. The fair value of the interest rate swap at September 30, 2006 of $9,492 is reflected in other liabilities in the accompanying consolidated balance sheets, and lhe income of $124,662 related to lhe change in fair value of the interest rate swap is recorded as a reduclion to inleresl expense for the year ended September 30,2006. The fair value of the interesl rate swap at Seplember 30, 2005 of $134,154 is reflecled in olher liabililies in the accompanying consolidaled balance sheets, and the income of $407, 131 reiated 10 lhe change in fair value of the interest rate swap is recorded as a reduclion to interest expense for the year ended Seplember 30, 2005. At September 30, 2006, the Syslem has an $8,000,000 line of credil with a financial institution. There were no draws during lhe years ended September 30,2006 and 2005. Borrowings under lhe line of credil bear interesl al L1BOR plus .55%. The line of credit expires on August 29, 2007. The approximate aggregate principal malurities and sinking fund requiremenls on long-term debt in each of lhe next five years and lhereafler are as follows: Years Ending September 30, 2007 2008 2009 2010 2011 Thereafter $ 7,690,709 8,030,949 11,356,412 8,617,145 6,524,649 101,315,000 $ 143,534,864 19 NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 \(oF~ r- d'tj-{) ~ The System leases equipment under noncancelable lease agreemenls which qualify as capilal lease obligations. Future minimum lease payments under lhese obligalions are as follows: Years Ending September 30, 2007 Total minimum lease payments Less: Amount representing inlerest Present value of minimum lease paymenls $ 146,305 146,305 (3,377) 142,928 $ 10. Self-Insured Claims The System's Board of Trustees elected to self-insure its professionalliabilily, workers' compensation, and employee health programs. For 2006 and 2005 professionalliabilily, the System had a $3,000,000 per claim self-insured relenlion. To pay claims in excess of the self-insured relention, the Syslem purchased an excess professionalliabilily policy (claims-made basis). Losses from asserted claims and from unasserted claims identified under the System's incident reporting system are accrued based on estimales lhat incorporate the System's pasl experience, as well as other considerations including the nature of each claim or incident and relevant trend faclors and incidents lhat may have occurred but that have not been identified under the incidenl reporting system. Total expenses under lhis program were $8,957,599 and $5,493,042 during the years ended September 30, 2006 and 2005, respectively, and are included in supplies and other expenses in lhe consolidated slalemenls of operalion. As of September 30,2006 and 2005, the Syslem had accrued $12,350,970 and $7,321,582, respectively, which, in the opinion of management, based on historical experience and currenl acluarial analyses, is sufficient to cover reported claims and claims incurred but not reported. The accrued professionalliabilily has been discounted at a rate of 5% in 2006 and 2005. The discount on the accrual professionalliabilily was approximalely $1 ,599,000 and $1,157,000 at September 30, 2006 and 2005, respectively. For 2006 and 2005 workers' compensation, the System had a per claim self-insured relention of $500,000 per claim self-insured relenlion. To pay claims in excess of its self-insured relenlion, the System purchased an excess Iiabilily policy (occurrence-basis). Total expenses under lhis program were $2,252,805 and $2,053,178 during the years ended Seplember 30,2006 and 2005, respectively and are included in supplies and olher expenses in the consolidaled statement of operalions. As of September 30, 2006 and 2005, the System had accrued $3,059,297 and $3,142,450, respectively, which, in the opinion of management, based on historical experience and currenl acluarial analyses, is sufficienllo cover reported claims and claims incurred but nol reported. The accrued workers' compensation reserve has been discounted at a rate of 5% in 2006 and 2005. The discounl on the accrued workers' compensation was approximalely $828,000 and $945,000 at September 30,2006 and 2005, respectively. For 2006 and 2005 employee heallh coverage, the System had a $275,000 per claim self-insured retenlion. The plan calls for a Iifelime maximum of $1 ,500,000 per covered life. As of September 30,2006 and 2005, the System had accrued $6,662,912 and $5,040,774, respectively, which, in the opinion of management based on historical experience, is sufficient to cover reported claims and claims incurred bul not reported. Due to lhe short-term nature of these claims, the reserve is included in accrued expenses and has nol been discounted. 20 \ CpFtt \~CM --og NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 The Syslem is involved in litigation arising from the ordinary course of business. In lhe opinion of management and counsel, these mailers will be resolved without a material adverse effect to the System's financial position, results of operations or cash fiows. 11. Defined Contribution Plan The Syslem has a 401 (k) plan (the "Plan") subjecl to the provisions of ERISA in which the System, al its discretion, contributes 2% of base compensalion for each participant. The Syslem makes an addilionai conlribution of 50% of employee contributions up to a maximum System contribution of 2% of base compensation. The System's contributions, net of forfeitures, for the years ended Seplember 30, 2006 and 2005 were approximately $5,930,000 and $5,360,000, respeclively. 12. Related Party Transactions Two members of the Board are employed as Senior Vice-Presidents at financial instilutions wilh which Ihe Syslem conducls business and another member of lhe Board is employed by a law firm which provides services to the System. One physician member of the Board served as an elected medical slaff department chair and was paid a stipend for serving in thai position. Anolher physician member of the Board served as a Medical Director for one of lhe departments of the Hospital and was paid a stipend for serving in that role. 13. Leases The System leases buildings and equipment under operating leases. Rent expense for the years ended September 30,2006 and 2005 approximated $5,471,000 and $4,578,000, respectively. The future minimum lease paymenls under operating leases at September 30, 2006 are approximalely as follows: Years Ending September 30, 2007 2008 2009 2010 2011 Thereafter $ 4,716,000 2,386,000 1,338,000 977,000 890,000 785,000 $ 11,092,000 14. Fair Value of Financial Instruments The following methods and assumptions were used by the System in estimating the fair value of its financial instruments: (a) Cash and cash equivalents: The carrying amount reported in the consolidated balance sheets for cash and cash equivalents approximates its fair value. (b) Invesfments: Fair values, which are the amounts reported in lhe consolidated balance sheels, are based on quoted market prices, if available, or estimated using quoted market prices for similar securities. 21 \ Cc> F L\- \~Jt1 ~O~ NCH Healthcare System, Inc. Notes to Consolidated Financial Statements September 30, 2006 and 2005 (c) Assets limited as to use: These assets consist primarily of cash and short-term investments and interest receivable. The carrying amounl reported in the consoiidaled balance sheets is fair value. (d) Accounts payable and accrued expenses: The carrying amount reported in lhe consolidaled balance sheets for accounls payable and accrued expenses approximales lheir fair value. (e) Long-term debt and capital lease obligations: The fair value of the long-lerm debt and capital lease obiigalions are eslimaled based on lhe quoted markel prices for the same or similar issues or on lhe current rates offered 10 the System for debt of the same remaining maturilies. The carrying amounts and fair values of the System's financial instrumenls at September 30, 2006 and 2005 are as follows: 2006 Carrying Amount Fair Value 2005 Carrying Amount Fair Value Cash and cash equivalenls $ 28,852,852 $ 28,852,852 $ 50,725,982 $ 50,725,982 Investments 65,199,816 65,199,816 42,204,130 42,204,130 Assets limited as to use 31,603,514 31,603,514 38,246,424 38,246,424 Accounts payable and accrued expenses 59,517,987 59,517,987 46,471,543 46,471,543 Long-term debt and capital lease obiigations 142,172,114 145,483,396 134,060,401 138,831,853 Interest rate swaps (included in other liabilities) 9,492 9,492 134,154 134,154 15. Concentrations of Credit Risk Financial instrumenls which potentially subject lhe Syslem to concenlrations of credil risk consist principally of cash and cash equivalents, investments, and assets limited as 10 use. The Syslem places ils cash and cash equivalents wilh what managemenl believes to be high credit quality financial inslitutions. Included in cash and cash equivalents are bank deposits, certificates of deposit and olher short-term investments in the amount of approximately $28,853,000 and $50,726,000 as of September 30,2006 and 2005, respectively. The Syslem's assets limited as 10 use and inveslments include U.S. government and agency securilies, corporale bonds, preferred stock and common stock which are subject 10 markel risk. The System limils the amount of credit exposure to anyone company or financial institution by diversifying its inveslments. The fair value of assets limited as to use and other investments is estimated based on quoted market prices for those or similar investmenls. 16. Other Nonoperating Revenue Other nonoperaling revenue consists of seltlemenls of various legal mailers during lhe year ended September 30, 2006. 22 \(0 f=ct h~ -t) f fJR!CEWAlj:RHOUSE(OOPERS I PricewaterhouseCoopers llP 101 East Kennedy Boulevard Suite 1500 Tampa FL 33602-5147 Telephone (813) 229 0221 Facsimile (813) 229 3646 Report of Independent Certified Public Accountants on Accompanying Information To lhe Board of Trustees of NCH Heallhcare Syslem, Inc. The report on our audils of the consolidated financial statemenls of NCH Healthcare System, Inc. as of September 30, 2006 and 2005 and for the years then ended appears on page 1 of lhis document. Those audits were conducted for lhe purpose of forming an opinion on the consolidated financial statemenls taken as a whole. The Schedule of Income from Operations before Charilable Contributions is presenled for purposes of additional analysis and is nol a required part of lhe basic financial statements. Such information has been subjected to lhe audiling procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relalion to the basic financial statements taken as a whole. f' ~:l)'P December 15, 2006 23 \CpFi \~(1q~of NCH Healthcare System, Inc. Schedule of Income from Operations Before Charitable Contributions Years Ended September 30, 2006 and 2005 2006 2005 Increase in unrestricted net assets $ 35,505,663 $ 45,363,390 Less: Net assets released from restrictions (14,912,241) (2,260,622) Other nonoperating revenue (5,585,290) Unreslricted charitable contributions (2,221,721 ) (4,272,709) Income from operalions before charilable conlributions $ 12,786,411 $ 38,830,059 24 Naples Campus 350 Seventh Street N. Naples, Florida 34102 (239) 436-5000 NCH \CoF-Y- V-CA~O~ North Collier C. 11190 H..lthpark Naples, Florida 34' (239) 513-7000 >'11?B.JftJF --.......... Healthcare System REFERENCES FOR THE NCH HEAL THCARE SYSTEM: CARL WESTMAN 1952 CRAYTON RD NAPLES, FL 34102 ALLEN WEISS 1221 GULF SHORE BLVD N NAPLES, FL 34102 GAIL DOLAN 535 RIDGE DR NAPLES, FL 34108 www.NCHmd.org , I