Deaconess Enterprises

SHARING OUR STRENGTH Deaconess Associations Inc. 2005 Annual Report D E AC O N E S S A S S O C I AT I O N S I N C . B OA R D M E M B E R S Deaconess Associations 2005 Board of Directors Chairman Ex-Officio Members Pres./Medical Staff Steven Wunder, MD Past Pres./Medical Staff Deaconess Long Term Care Inc. 2005 Board of Directors Chairman Deaconess Foundation 2005 Board of Directors Chairman E. Anthony Woods Vice Chairman Mark Snyder, MD Vice Chairman Jeffery Stambough, MD Pres. Elect/Medical Staff E. Anthony Woods President & CEO Lee W. Scroggins President & CEO (Ex-Officio) Kay French Secretary Emmett O’Neal, MD Richard C. Gandersman COO Kathleen Gibboney Treasurer Richard C. Gandersman Secretary/Treasurer 2005 Medical Staff Officers President Kenneth Raupach Secretary/Treasurer/CFO Anthony Roderick Members James L. Pahls Assistant Secretary Carla Brooks Members Steven Wunder, MD President Elect Jacqueline Wiesman Members Emmett O’Neal, MD Secretary/Treasurer 2 William Bahl Donald Bell Samuel H. Pruett Emeritus Members A.J. McPhie Rodger V. Reed Thomas R. Schiff Cornelia H. Asbury George Raymond Drew Dan Meyer Stanton H. Vollman Ex Officio Members James Hawkins, MD Past President Jeffery Stambough, MD Deaconess Enterprises Inc./HomeCare Inc. 2005 Board of Directors Chairman George Raymond Drew Arthur Ehrnschwender 2005 Auxiliary Board Officers President Richard C. Gandersman Emmett O’Neal E. Anthony Woods Steven Wunder, MD William Bahl COO Deaconess Hospital 2005 Board of Directors Chairman Jo Ann Dooley Vice President † Richard C. Gandersman Treasurer/CFO Lee.W. Scroggins President & CEO Florence Copley Past President Larry D. Rayburn Members Richard C. Gandersman COO Jan Frank Apro Secretary David A. Ferrell Secretary Cecilia Monahan Treasurer Rodger V. Reed E. Anthony Woods William H. Zimmer, III Thomas R. Schiff Members Nancy Bush Members Kay French J. Alan Lips John J. Schiff, Jr. E. Anthony Woods Ruth Avril Thelma Huetten Hope Kresser Charlotte Sess Elsie Weich † Deceased TO OUR COMMUNITIES As we look back on DAI’s performance in 2005, a recurring force permeates our achievements: We Share Our Strength. We believe that’s a powerful calling and an even more powerful obligation — both of which can be traced to our organization’s strong beginnings. Since our doors opened at 533 East Liberty Street in Cincinnati almost 120 years ago, the tradition of sharing our strength has been nurtured and executed through the years. The faces of those who serve and have been served have changed, but the sources of our strength and our reason for being remain constant. In reading through the succeeding pages of this Annual Report, you will discover that our strength radiates through a variety of operating vehicles. Deaconess HomeCare (DHC) has been instrumental in satisfying infusion therapy and nursing care demands for adults and children in home settings in the Midwest, South and Southwest. DHC holds a “top ten” position among other privately-held home care market providers in the nation — and is a solid competitor against the public company arena as well. Through multiple facilities, Deaconess Long Term Care not only accommodates long-term skilled nursing, assisted living and independent residential needs in a number of midwest and southern communities, but is also called upon to satisfy the shorter-term rehabilitation goals of patients who ultimately are capable of returning to their private homes. As a single entity, Deaconess Hospital focuses on the acute care needs of the Greater Cincinnati community for both inpatient and outpatient services. Having been recognized nationally for clinical excellence for the fourth consecutive year demonstrates why the Hospital can confidently broadcast its message: “Expert Care from Caring Experts.” So what are the primary sources of our strength? It starts with our people. Healthcare is hands-on and personal. Technology is important, but our primary strength stems from a fusion of talent, expertise and commitment offered by our physicians and front line and behind-the-scenes employees. Add our dedicated board members and loyal benefactors of the Deaconess Foundation, and you have a united group of people with a united purpose — people who rise to the challenge even under the most difficult circumstances, as you will find through our team’s response to Hurricane Katrina. Our strength is also inherent in the quality of DAI’s services. We choose not to compromise when it comes to the well-being of our patients and residents — and we welcome opportunities to improve. Finally, our strength lies in our financial stability. Prudent financial management and strategy have produced a very healthy balance sheet for DAI … a prerequisite to our ability to attend to the health of others. As you visit DAI through our 2005 Annual Report, thank you for giving us a moment to share our story … and more importantly, for the opportunity to share our strength! Sincerely, 3 E. Anthony Woods Chairman Richard C. Gandersman President & CEO SHARING OUR STRENGTH In a year troubled by natural disasters which began with a tsunami and continued with a succession of hurricanes, Deaconess Associations searched for ways to reach out to both patients and employees. The DAI companies rallied to support each other when Hurricane Katrina battered Deaconess HomeCare sites along the southern coast. Despite turbulence that called for emergency measures, the year was a time of renewal and growth through this sharing of our strengths. Deaconess Hospital At the close of 2004, community, public, physician and employee focus groups had determined the 2005 positioning for Deaconess Hospital. The theme of “Expert Care from Caring Experts” 4 The Deaconess Joint Replacement Center continued to set records, serving almost 750 patients in 2005. The ranks of the distinguished group of Deaconess orthopedic surgeons was further strengthened with emerged with a multimedia campaign promoting major service lines: orthopedics, bariatrics, geropsychiatry and the Emergency Department. Caring Experts also became the foundation of the customer service training in 2005, planned and implemented by a team of enthusiastic employee ambassadors. additional surgeons from Wellington Orthopaedics. Two of the Cincinnati SportsMedicine surgeons were again named “Best Doctors in America” in a survey conducted by Harvard Medical School. While the joint replacement surgeons used the new BrainLab equipment for computer assisted orthopedic surgery, the UROSKOP Access System by Siemens Medical was purchased to provide more versatile patient access, reducing OR time by up to 30 percent. In contrast to the complexity of the new technology, a simple coil of silicone with a small, round port was introduced into patient care when the Deaconess Surgical Weight Loss Center welcomed lap band patients. The new laparoscopic procedure requires less than one hour in the OR and is reversible. The laparoscopic gastric bypass provides another popular option offered by the center in the fight against obesity. Renovations to public areas and the nursing units of Deaconess Hospital brought rave reviews from employees, patients and physicians in 2005. The surgical suites required a carefully-staged treatment, achieved with minimal schedule disruption. The relocation of Central Registration to the Main Lobby gave the hospital front entrance new vitality. The vibrancy of the lobby was further enhanced with the arrival of Lori’s Gift Shop, a national specialty shop with a presence in more than 200 hospitals nationwide. As the year drew to a close, media touted the good news that Deaconess Hospital had once again ranked among the top 5 percent of hospitals nationwide for clinical excellence. In the lap band weight loss procedure, a simple coil of silicone is inflated through a port, making the stomach smaller. Deaconess HomeCare Deaconess HomeCare’s adult and pediatric divisions underwent a unifying name change in 2005. For several years Deaconess Homecare had continually expanded its geographic presence, often providing services under the original name of the acquired company. MCH Services served medically fragile children from sites in several states. Some of the adult and pediatric markets overlap, but not in all states. In 2005, adult services moved into sectors previously served only by the pediatric division, beginning with the northern Ohio markets in Cleveland and Columbus. As the services were integrated, both divisions took the name of Deaconess HomeCare, and a new logo was designed to encompass both the adult and pediatric divisions. Along with its new name, DHC continued to roll out innovative products and services. The Anodyne Therapy System uses infrared energy to increase blood flow in patients with reduced sensation. The therapy can provide pain relief, as well as restoring feeling, mobility and balance. In the new Low Vision Therapy System, occupational therapists make the home environment safer through the use of “high marks,” tactile guides for adults dealing with macular degeneration, glaucoma, cataracts and diabetic neuropathy. Another system that helps ensure adults’ safety in their homes, the Health Buddy monitors health status through a system that plugs However, the lives of DHC employees and patients were disrupted in late August when Hurricane Katrina unleashed its fury on the southern coast. Especially hard-hit were areas served by what was then known as South Mississippi Home Health and Hospice (SMHH). SMHH had offices in Pascagoula, Biloxi and Gulfport, cities hardest hit by the hurricane. Infusion Partners’ office in Gulfport and the pharmacy in New Orleans were affected as well. Communications faltered with loss of power. Infusion Partners quickly pulled staff up to the Cincinnati office and medications were compounded and dispensed from that area. SMHH suffered a similar disruption of services as patients and employees were left homeless in the wake of the storm. A significant number of patients fled the besieged area, their jobs and homes lost. into a phone line. The patient supplies basic information daily, to be carefully reviewed by nurses and physicians through a secure website. The new system quickly gained popularity with physicians because of its accuracy and tremendous convenience for both staff and patient. In 2005, Infusion Partners (IP), a division of Deaconess HomeCare, saw growth of seventeen percent over its 2004 performance. During 2005 IP also successfully integrated operations of the PharmaThera acquisitions of 2004, which brought five locations on board, two in markets previously without an IP presence. Infusion Partners continues to expand its client base by serving nationally recognized clients such as St. Jude Children’s Research Hospital in Memphis, Tennessee. Many of the companies which now comprise Deaconess HomeCare bring rich histories. Elk Valley Home Health celebrated 30 years of service last October. Elk Valley Home Health was founded as a single office operation in Fayetteville, Tennessee. Over the years it expanded from its original service areas of six counties to the 49 counties it served in 2005 through eight locations. Elk Valley Health Services, the private duty nursing division, achieved substantial growth in 2005, positioning itself as one of the largest private duty providers in Tennessee. 5 (above) This South Mississippi HomeCare and Hospice (now known as Deaconess HomeCare) patient was awaiting rescue from his home, located six blocks from the Gulf of Mexico. (left) A South Mississippi HomeCare and Hospice nurse continues to care for patients, even though she is displaced from her home due to damage from Hurricane Katrina. Deaconess Associations quickly sent out a call to all of the companies and a succession of trucks with relief supplies made their way to Hattiesburg, Mississippi, which became a distribution point. The Deaconess Foundation set up a Katrina Relief Fund to accept donations. The Deaconess Foundation Board voted to extend $30,000 in relief to the 24 families whose homes were destroyed or rendered inhabitable by the storm. Rebuilding efforts are expected to continue for some time. In the wake of Hurricane Katrina, the number of patients served in the southern areas decreased along with the reduction in population. As patients vacated the stricken areas, hospitals struggled to reopen. At the end of the year, census for Deaconess HomeCare was 95 percent of what it had been at the end of August. In time, Infusion Partners reinstated service to the Gulf Coast of Mississippi and New Orleans but suffered from the same population loss experienced by the home care division. In spite of this, Infusion Partners closed the year ahead of projected revenue. Deaconess Foundation Healthcare continues to rely on generous donors to meet the needs of patient care. While the Foundation grappled with the financial needs created by Hurricane Katrina, the annual golf outing was held in early September. The event raised more than $130,000 for the Deaconess Foundation. One hundred eightysix golfers took to the links to support the charity event, which Deaconess Long Term Care Just as products continued to diversify in the home care arena, diversification was also key to the efforts of Deaconess Long Term Care in 2005. As hospital stays shorten in acute care, rehabilitation continues to transition to the long term care setting. This trend could be seen in the increased Medicare census in Deaconess Long Term Care facilities in 2005. Rehabilitation or sub acute care, which once took place in the acute care setting, is now often provided in a long term care setting on a short term basis. “Rehab to Home” is the goal of therapy patients who came to the DLTC facilities in increased numbers in 2005. Efficient patient care was streamlined in DLTC when system upgrades integrated clinical and accounting functions into one platform, bring greater ease of patient and financial information entry to staff, who now could consult one source for readily accessible patient data. Staffing in all healthcare sectors continues to be a concern nationwide. With concentrated efforts on the side of Human Resources and the management team, DLTC succeeded in reducing employee turnover by nine percent in 2005. 6 Throughout the events that shaped 2005, Deaconess Associations continued on an innovative path, sharing its strength where needed and discovering new partners to share our journey. The reach of the corporation may be broad and everchanging, but its mission remains clearly defined: “Compassionate People, Responsive Healthcare, Excellent Service.” That mission is often a clarion call, one we feel privileged to answer. (above) The Huntington Bank Hole-In-One went to Greg Sullivan (second from right) of Fifth Third Bank. Greg won $1,000 in cash. His shot also merited a matching $1,000 for the Deaconess Foundation. was chaired by Dr. William Drew. The John J. and Thomas R. Schiff & Co. served as the Titanium Sponsor, with DAI as the Platinum Sponsor. Smith & Nephew Orthopedics was the Diamond Sponsor. Gold Sponsors included Fifth Third Bank, JPMorgan Chase, National City Bank, Omnicare/Home Care Pharmacy, Wellington Orthopaedics & Sportsmedicine. RehabCare and US Bank were Silver Sponsors. A silent auction provided another means to raise funds and have fun. Deaconess has long been the beneficiary of loyal supporters who remember Deaconess with personal gifts in their wills. Reverend Helfrich had been a member of the Deaconess Hospital Board for nearly 35 years, and his wife Jean filled many volunteer positions. To memorialize their commitment to Deaconess, the couple’s daughter Jan Brandt established an endowment for educational assistance for Deaconess employees. Education was also the focus of a gift of $20,000 from Marie Wilkerson, Deaconess School of Nursing 1933. Mrs. Winnie Barrows, whose husband had been a surgeon at Deaconess for many years, donated $25,000 over the next five years to purchase a sound system for the hospital surgical suites. Also a Board Member, Kay French pledged $100,000 to help underinsured and noninsured patients of the Deaconess Surgical Weight Loss Center have access to the care needed. I N C O M E S TAT E M E N T A N D S TAT I S T I C S Core Business Division Revenues Acute Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $63.9 million Long Term Care . . . . . . . . . . . . . . . . . . . . . . . . . . . $85 million Home Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $135.9 million Foundation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1.9 million Total Net Revenue . . . . . . . . . . . . . . . . . . . . . . . $287.8 million The Heimlich Institute At the start of 2005, Dr. Henry Heimlich, President of the Heimlich Institute and member of Deaconess Associations, received well-deserved accolades. In January the Cincinnati Business Courier honored Dr. Heimlich with a Lifetime Achievement Award. The award noted Dr. Heimlich’s many contributions to the medical field, including the Heimlich Chest Drain Valve and MicroTrach, as well as the Heimlich Maneuver, which saves thousands of lives worldwide each year. Dr. Heimlich was also honored at the Indiana Statehouse in February for his years of medical service and was invited to watch as House Bill 11452 was presented, requiring colleges and universities to certify undergraduate applicants for an initial teaching certification in CPR and the Heimlich Maneuver. In another development, the Physicians Committee for Responsible Medicine (PCRM), a Washington -based group that promotes preventive medicine and alternatives to animal research, has created the Henry J. Heimlich Award for Innovative Medicine. Expenses Salaries and Benefits . . . . . . . . . . . . . . . . . . . . . $156.7 million Supplies and Services . . . . . . . . . . . . . . . . . . . . . . . $96 million Depreciation and Interest . . . . . . . . . . . . . . . . . . $13.5 million Other Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . $21.2 million Total Operating Expenses . . . . . . . . . . . . . . . . . $287.4 million Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . $.37 million Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $20.2 million Uncompensated Care . . . . . . . . . . . . . . . . . . . . . . . $7.8 million Acute Care Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 516 Licensed Beds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 226 2005 Admissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,622 Emergency Visits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,111 Affiliated Physicians . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 535 7 Long Term Care Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,406 Licensed Beds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,935 Home Care Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,264 Pediatric Hours of Service . . . . . . . . . . . . . . . . . . . . 1.2 million Admissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,323 Average Daily Patients on Service . . . . . . . . . . . . . . . . . . 7,393 Prescriptions Dispensed . . . . . . . . . . . . . . . . . . . . . . . . 140,169 D E AC O N E S S A S S O C I AT I O N S I N C . Deaconess Associations Cincinnati, Ohio Mississippi Infusion Partners Inc., Jackson and Gulfport, Mississippi Deaconess HomeCare Inc., Hattiesburg, Mississippi (17 offices) Ohio Specialty Supply Partners, Fayetteville, Tennessee Texas Deaconess Specialty Care Center, Kansas City, Missouri Edgewood Manor Nursing Home, Raytown, Missouri Georgian Gardens, Potosi, Missouri Golden Years Health Center, Harrisonville, Missouri Marshfield Care Center, Marshfield, Missouri Marshfield Place, Marshfield, Missouri Monett Health Care Center, Monett, Missouri Park Place Care Center, Raytown, Missouri Senior Estates, Kansas City, Missouri White Ridge Health Center, Lee’s Summit, Missouri Ohio Deaconess Foundation Cincinnati, Ohio Deaconess Hospital Cincinnati, Ohio Deaconess HomeCare Inc., Corpus Christi, Harlingen, Houston and McAllen, Texas Infusion Partners Inc., Dallas, Texas The Heimlich Institute Cincinnati, Ohio Deaconess HomeCare Inc., Cincinnati, Ohio Deaconess Home Health Care, Cincinnati, Ohio Infusion Partners Inc., Akron, Cincinnati and Toledo, Ohio Deaconess HomeCare Inc., Beachwood, Cincinnati, Columbus, Dayton and Toledo, Ohio Pennsylvania Deaconess Long Term Care Florida Deaconess HomeCare Alabama Delaney Creek Lodge, Brandon, Florida Nature Coast Lodge, Lecanto, Florida Kansas Infusion Partners Inc., Birmingham, Alabama 8 Georgia Infusion Partners, Savannah, Georgia Illinois Ottawa Retirement Community, Ottawa, Kansas Missouri Deaconess HomeCare Inc., Chicago, Illinois Indiana Deaconess HomeCare of Northeast Pennsylvania Infusion Partners Inc., Pittsburgh, Pennsylvania Deaconess HomeCare Inc., Pittsburgh, Pennsylvania Tennessee ABC Health Center, Harrisonville, Missouri Ava Place, Ava, Missouri Barry County Care Center, Cassville, Missouri Belleview Valley Nursing Home, Belleview, Missouri Big Spring Care Center, Humansville, Missouri Camden Health Center, Harrisonville, Missouri Cedar Valley Health Center, Raytown, Missouri Country Aire Retirement Estates, Lewistown, Missouri Dallas County Care Center, Buffalo, Missouri Continental Manor Nursing and Rehabilitation Center, Blanchester, Ohio Cottingham Retirement Community, Cincinnati, Ohio Mason Health Care Center, Mason, Ohio Scarlet Oaks Retirement Community, Cincinnati, Ohio Infusion Partners Inc., Aurora, Indiana Deaconess HomeCare Inc., Chesterton, Fort Wayne and Indianapolis, Indiana Louisiana Deaconess HomeCare Inc., Fayetteville, Tennessee Infusion Partners Inc., Jackson, Knoxville, Memphis and Nashville, Tennessee Elk Valley Health Services Inc., Jackson, Knoxville, Memphis and Nashville, Tennessee Deaconess HomeCare Inc., Fayetteville, Tennessee (8 offices) Infusion Partners Inc., New Orleans, Louisiana Deaconess HomeCare Inc., Baton Rouge, Hammond, and Slidell, Louisiana Michigan Infusion Partners Inc., Detroit, Michigan D E AC O N E S S A S S O C I AT I O N S L O C AT I O N S 2 0 0 5 Michigan Indiana Illinois Missouri Kansas Tennessee 9 Pennsylvania Ohio Texas Mississippi Louisiana Alabama Georgia Florida CORPORATE VALUES At Deaconess we hold these values as central to our success. Spiritual Values We embrace and promote spiritual values of our Christian heritage to guide ethical decision-making and to promote wholeness in our staff and those we serve. Customer Service We value an uncompromising dedication to understanding and satisfying our customers. Valued Employees We recognize and reward the contributions of our employees, and believe that qualified, committed and caring professionals are our most valuable asset. 10 Continuous Improvement We embrace and continually seek ways to provide quality, cost-effective health services that meet or exceed our customers’ expectations. Public Accountability We are responsive to the needs of our community and are committed to promoting and providing appropriate community-centered services to improve the health status of the people we serve. Respect We value an atmosphere of trust and fairness, and hold the highest regard for the worth and rights of others. Teamwork We value team accomplishments through collaborative efforts and support the physicians and other professionals who share the responsibility for the care given. Financial Strength We practice prudent business planning and cost-management strategies to ensure financial viability and responsible growth. 11 Mission Statement Deaconess Associations 311 Straight Street Cincinnati, Ohio 45219 Phone: 513-559-2100 Fax: 513-475-5251 www.DeaconessAssociations.com