0211 UIHCPresentation

University of Iowa Health Care
Presentation to
The Board of Regents, State of Iowa
February 2-3, 2011
1
Agenda
 Opening Remarks (Robillard)

 Operational and Financial Performance (Kates and Fisher)
 Renewing Our Clinical Facilities – The New University of
Iowa Children’s Hospital and Other Major Facility Priorities
(Robillard, Kates et al.)
2
Opening Remarks
Jean Robillard, MD
Vice President for Medical Affairs
3
Operating and Financial Performance Update
Ken Kates, Chief Executive Officer

UI Hospitals & Clinics
Ken Fisher, Associate Vice President for Finance

and Chief Financial Officer
4
Volume Indicators
July 2010 through November 2010
%
% Variance Variance
Prior Variance Variance to Prior to Prior
Operating Review (YTD) Actual Budget Year to Budget to Budget Year Year
Discharges 12,607 12,442 12,441 165 1.3% 166 1.3%
Patient Days 83,828 78,487 76,859 5,341 6.8% 6,969 9.1%
Length of Stay 6.51 6.25 6.05 0.26 4.2% 0.46 7.6%
Average Daily Census 547.90 512.98 502.35 34.92 6.8% 45.55 9.1%
Surgeries – Inpatient 4,770 4,738 4,668 32 0.7% 102 2.2%
Surgeries – Outpatient 6,389 5,780 5,765 609 10.5% 624 10.8%
Emergency Treatment Center 23,950 21,927 22,442 2,023 9.2% 1,508 6.7%
Visits
Outpatient Clinic Visits 332,924 331,622 320,942 1,302 0.4% 11,982 3.7%
Case Mix 1.7893 1.7780 1.7807 0.0113 0.6% 0.0086 0.5%

Medicare Case Mix 1.9909 2.0271 1.9916 (0.0362) -1.8% (0.0007) 0.0%
Greater than Greater than

Neutral
2.5% Favorable 2.5% Unfavorable
5
Discharges by Type
% Variance %
Prior Variance Variance to to Prior Variance to
Operating Review (YTD) Actual Budget Year to Budget Budget Year Prior Year
Adult Medical 4,296 4,269 4,139 27 0.6% 157 3.8%
Adult Surgical 5,725 5,612 5,606 113 2.0% 119 2.1%
Adult Psych 664 698 714 (34) -4.9% (50) -7.0%
Subtotal – Adult 10,685 10,579 10,459 106 1.0% 226 2.2%
Pediatric Medical 1,276 1,256 1,370 20 1.6% (94) -6.9%
Pediatric Surgical 88 73 67 15 20.6% 21 31.3%
Pediatric Critical Care 329 356 346 (27) -7.6% (17) -4.9%
Pediatric Psych 229 178 199 51 28.7% 30 15.1%
Subtotal – Pediatrics w/o 1,922 1,863 1,982 59 3.2% (60) -3.0%

newborn
Newborn 595 575 563 20 3.5% 32 5.7%
TOTAL w/o Newborn 12,607 12,442 12,441 165 1.3% 166 1.3%
Greater than Neutral Greater than

2.5% Favorable 2.5% Unfavorable 6
Discharge Days by Type
% Variance %
Prior Variance to Variance to to Prior Variance to
Operating Review (YTD) Actual Budget Year Budget Budget Year Prior Year
Adult Medical 25,330 23,790 23,167 1,540 6.5% 2,163 9.3%
Adult Surgical 29,805 28,747 27,931 1,058 3.7% 1,874 6.7%
Adult Psych 7,957 8,163 8,139 (206) -2.5% (182) -2.2%
Subtotal – Adult 63,092 60,700 59,237 2,392 3.9% 3,855 6.5%
Pediatric Medical 7,263 6,582 6,183 681 10.4% 1,080 17.5%
Pediatric Surgical 571 646 573 (75) -11.6% (2) -0.4%
Pediatric Critical Care 9,423 8,414 7,961 1,009 12.0% 1,462 18.4%
Pediatric Psych 1,708 1,474 1,339 234 15.9% 369 27.6%
Subtotal – Pediatrics w/o 18,965 17,116 16,056 1,849 10.8% 2,909 18.1%
newborn
Newborn 1,311 1,293 1,262 18 1.4% 49 3.9%
TOTAL w/o Newborn 82,057 77,816 75,293 4,241 5.5% 6,764 9.0%

2.5% Favorable 2.5% Unfavorable 7
Average Length of Stay by Type
% Variance %
Adult Medical 5.90 5.57 5.60 0.33 5.9% 0.30 5.4%
Adult Surgical 5.21 5.12 4.98 0.09 1.8% 0.23 4.6%
Adult Psych 11.98 11.69 11.40 0.29 2.5% 0.58 5.1%
Subtotal – Adult 5.90 5.74 5.66 0.16 2.8% 0.24 4.2%
Pediatric Medical 5.69 5.24 4.51 0.45 8.6% 1.18 26.2%
Pediatric Surgical 6.49 8.84 8.55 (2.35) -26.6% (2.06) -24.1%
Pediatric Critical Care 28.64 23.63 23.01 5.01 21.2% 5.63 24.5%
Pediatric Psych 7.46 8.30 6.73 (0.84) -10.1% 0.73 10.9%
Subtotal – Pediatrics w/o 9.87 9.19 8.10 0.68 7.4% 1.77 21.9%
newborn
Newborn 2.20 2.25 2.24 (0.05) -2.2% (0.04) -1.8%
TOTAL w/o Newborn 6.51 6.25 6.05 0.26 4.2% 0.46 7.6%

8
Outpatient Surgeries – by Clinical Department
% Variance %
Cardiothoracic 33 29 32 4 13.8% 1 3.1%
Dentistry 231 234 270 (3) -1.3% (39) -14.4%
Dermatology 21 24 26 (3) -12.5% (5) -19.2%
General Surgery 1,063 888 848 175 19.7% 215 25.4%
Gynecology 314 315 302 (1) -0.3% 12 4.0%
Internal Medicine 2 3 5 (1) -33.3% (3) -60.0%
Neurosurgery 227 188 179 39 20.7% 48 26.8%
Ophthalmology 1,385 1,292 1,329 93 7.2% 56 4.2%
Orthopedics 1,544 1,413 1,412 131 9.3% 132 9.4%
Otolaryngology 951 881 869 70 8.0% 82 9.4%
Pediatrics - 1 2 (1) -100.0% (2) -100.0%
Radiology – Interventional 9 18 24 (9) -50.0% (15) -62.5%
Urology w/ Procedure Ste. 609 494 467 115 23.3% 142 30.4%
Total 6,389 5,780 5,765 609 10.5% 624 10.8%

9
Inpatient Surgeries – by Clinical Department
% Variance %
Cardiothoracic 472 519 499 (47) -9.1% (27) -5.4%
Dentistry 55 55 51 - 0.0% 4 7.8%
General Surgery 1,330 1,202 1,083 128 10.7% 247 22.8%
Gynecology 321 349 369 (28) -8.0% (48) -13.0%
Neurosurgery 687 708 723 (21) -3.0% (36) -5.0%
Ophthalmology 66 54 40 12 22.2% 26 65.0%
Orthopedics 1,219 1,164 1,207 55 4.7% 12 1.0%
Otolaryngology 308 297 287 11 3.7% 21 7.3%
Pediatrics - - - - 0.0% - 0.0%
Radiology – Interventional 41 94 128 (53) -56.4% (87) -68.0%
Urology w/ Procedure Ste. 271 296 281 (25) -8.5% (10) -3.6%
Total 4,770 4,738 4,668 32 0.7% 102 2.2%

10
Emergency Treatment Center
% %
Prior Variance to Variance to Variance to Variance to
Operating Review (YTD) Actual Budget Year Budget Budget Prior Year Prior Year
ETC Visits 23,950 21,927 22,442 2,023 9.2% 1,508 6.7%
ETC Admits 6,207 5,634 5,546 573 10.2% 661 11.9%
Conversion Factor 25.9% 25.7% 24.7% 0.8% 4.9%
ETC Admits / Total Admits 49.4% 45.4% 44.9% 8.8% 10.0%

11
Clinic Visits by Clinical Department
% %
Prior Variance to Variance to Variance to Variance to
Operating Review (YTD) Actual Budget Year Budget Budget Prior Year Prior Year
Anesthesia 6,506 7,089 6,784 (583) -8.2% (278) -4.1%
CDD 9,323 3,249 3,089 6,074 187.0% 6,234 201.8%
Clinical Research 4,963 4,932 5,716 31 0.6% (753) -13.2%
Dermatology 10,502 11,087 10,686 (585) -5.3% (184) -1.7%
ETC 23,950 22,817 22,442 1,133 5.0% 1,508 6.7%
Employee Health Clinic 7,302 6,451 6,196 851 13.2% 1,106 17.9%
Family Care Center 37,909 41,527 41,375 (3,618) -8.7% (3,466) -8.4%
General Surgery 9,931 10,264 12,065 (333) -3.2% (2,134) -17.7%
Heart and Vascular 15,583 14,602 - 981 6.7% 15,583 100.0%
Hospital Dentistry 5,333 5,351 5,187 (18) -0.3% 146 2.8%
Internal Medicine 43,736 42,694 50,465 1,042 2.4% (6,729) -13.3%
Neurology 7,050 7,894 7,632 (844) -10.7% (582) -7.6%
Neurosurgery 3,845 4,007 4,076 (162) -4.0% (231) -5.7%
Obstetrics/Gynecology 30,863 32,986 31,951 (2,123) -6.4% (1,088) -3.4%
Ophthalmology 27,635 28,073 28,318 (438) -1.6% (683) -2.4%
Orthopedics 25,253 24,827 23,860 426 1.7% 1,393 5.8%
Otolaryngology 11,406 12,240 11,602 (834) -6.8% (196) -1.7%
Pediatrics 18,422 17,632 16,901 790 4.5% 1,521 9.0%
Primary Care Clinic North 9,266 8,065 7,151 1,201 14.9% 2,115 29.6%
Psychiatry 17,410 18,434 17,491 (1,024) -5.6% (81) -0.5%
Thoracic – Cardio Surgery 16 - 1,197 16 100.0% (1,181) -98.7%
Urology 6,454 7,139 6,542 (685) -9.6% (88) -1.4%
Other 266 262 216 4 -1.5% 50 23.2%
Total 332,924 331,622 320,942 1,302 0.4% 11,982 3.7%
Greater than 2.5% Favorable Neutral Greater than 2.5% Unfavorable
12
Case Mix Index
2.3 Medicare Acute
2.2
2.1
1.9
1.8
1.7
1.6
1.5
Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10
13
UIHC Comparative Financial Results
Fiscal Year-to-Date November 2010
% %
Variance to Variance to Variance to Variance to
NET REVENUES: Actual Budget Prior Year Budget Budget Prior Year Prior Year
Patient Revenue $413,853 $404,739 $375,737 $9,114 2.3% $38,116 10.1%
Other Operating Revenue 20,114 20,223 19,170 (109) -0.5% 944 4.9%
Total Revenue $433,967 $424,962 $394,907 $9,005 2.1% $39,060 9.9%
EXPENSES:
Salaries and Wages $202,782 $209,397 $195,226 ($6,615) -3.2% $7,556 3.9%
General Expenses 171,778 172,754 156,926 (976) -0.6% 14,852 9.5%
Operating Expense before Capital $374,560 $382,151 $352,152 ($7,591) -2.0% $22,408 6.4%
Cash Flow Operating Margin $59,407 $42,811 $42,755 $16,596 38.8% $16,652 39.0%
Capital - Depreciation and Amortization 28,515 30,448 30,828 (1,933) -6.4% (2,313) -7.5%
Total Operating Expense $403,075 $412,599 $382,980 ($9,524) -2.3% $20,095 5.3%
Operating Income $30,892 $12,363 $11,927 $18,529 149.9% $18,965 159.0%
Operating Margin % 7.1% 2.9% 3.0% 4.2% 4.1%
Gain (Loss) on Investments 15,982 6,789 22,048 9,193 135.4% (6,066) -27.5%
Other Non-Operating (3,158) (2,587) (2,114) (571) -22.1% (1,044) -49.4%

Net Income $43,716 $16,565 $31,861 $27,151 163.9% $11,855 37.2%
Net Margin % 9.8% 3.9% 7.7% 5.9% 2.1%
14
UIHC Comparative Financial Results
November 2010
% %
Variance to Variance to Variance to Variance to
NET REVENUES: Actual Budget Prior Year Budget Budget Prior Year Prior Year
Patient Revenue $82,205 $78,542 $75,700 $3,663 4.7% $6,505 8.6%
Other Operating Revenue 3,895 4,045 3,603 (150) -3.7% 292 8.1%
Total Revenue $86,100 $82,587 $79,303 $3,513 4.3% $6,797 8.6%
EXPENSES:
Salaries and Wages $41,453 $41,121 $38,682 $332 0.8% $2,771 7.2%
General Expenses 35,491 33,453 30,013 2,038 6.1% 5,478 18.3%
Operating Expense before Capital $76,944 $74,574 $68,695 $2,370 3.2% $8,249 12.0%
Cash Flow Operating Margin $9,156 $8,013 $10,608 $1,143 14.3% ($1,452) -13.7%
Capital - Depreciation and Amortization 5,697 6,089 6,146 (392) -6.4% (449) -7.3%
Total Operating Expense $82,641 $80,663 $74,841 $1,978 2.5% $7,800 10.4%
Operating Income $3,459 $1,924 $4,462 $1,535 79.8% ($1,003) -22.5%
Operating Margin % 4.0% 2.3% 5.6% 1.7% -1.6%
Gain (Loss) on Investments (2,865) 1,324 5,391 (4,189) -316.4% (8,256) -153.1%
Other Non-Operating (653) (517) (371) (136) -26.3% (282) -76.0%
Net Income ($59) $2,731 $9,482 ($2,790) -102.2% ($9,541) -100.6%
Net Margin % -0.1% 3.3% 11.2% -3.4% -11.3%
15
Comparative Accounts Receivable
November 30, 2010
June 30, 2009 June 30, 2010 November 30, 2010

Net Accounts $121,515,935 $117,737,680 $137,650,085
Receivable
Net Days in AR 49 47 49
80
Days of Revenue in Net A/R
70
60
58
54 53
54 55 52
MEDIAN (46) Moody’s Aa2 48
Rating
47 52 54 49 49 49 49
50 53 51 47 47 47
50 49 49 49
48 47 47 47 47 46
46
40
Jun- Jul- Aug- Se p- Oct- Nov- De c- Jan- Fe b- Mar- Apr - M ay- Jun- Jul- Aug- Se p- Oct- Nov- De c- Jan- Fe b- Mar - Apr - M ay- Jun- Jul- Aug- Se p- Oct- Nov-
08 08 08 08 08 08 08 09 09 09 09 09 09 09 09 09 09 09 09 10 10 10 10 10 10 10 10 10 10 10
$12,500,000
$10,000,000 Bad Debts

$7,500,000
$5,000,000$3,181,620 $3,496,488 $3,850,582 $3,328,958

$2,578,202 $2,908,162 $2,851,252 $2,259,237 $2,660,296
$2,245,055 $2,075,476 $2,688,849 $2,451,250
$1,493,531
$2,500,000 $1,144,108
$2,494,645 $3,066,487 $2,834,253
$2,800,705
$2,553,263
$2,034,035
$1,997,589
$1,781,443 $1,668,432
$0 $1,371,279 $876,447 $751,244
$968,779
$969,671
-$187,321
-$2,500,000
-$5,000,000
J un- J ul - A ug- S e p- Oc t - N ov - Dec- J an- Fe b- Mar- A pr - May- J un- J ul - Au g - S e p- Oc t - N ov - Dec- J a n- Fe b- Mar- A pr - May- J un- J ul - A ug- S e p- Oc t - N ov -
08 08 08 08 08 08 08 09 09 09 09 09 09 09 09 09 09 09 09 10 10 10 10 10 10 10 10 10 10 10
16
Renewing Our Clinical Facilities
The New University of Iowa Children’s Hospital

and
Other Major Facility Priorities
17
Major Facility Renewal/Expansion Needs
 Review Major Facility Renewal/Expansion Needs

– New Children’s Hospital
– Other Key Projects
 Review Proposed Project Sequencing and Estimated

Costs and Funding Mechanisms
 Request Approval of Project Description, Budget and

Schematic Design for Children’s Hospital
18
Board of Regent Approvals:
To Begin Facilities Planning Process
Regents Approve UI Health Care Request to Proceed with UIHC Strategic Facilities Master Plan Implementation
March 11, 2008
In 2008, the Board of Regents, State of Iowa approved the University of Iowa Health Care's request to proceed with
project planning for:
• New children's hospital – estimated 600,000 square feet
• New critical care tower, related renovations—including conversion of all inpatient rooms to private rooms –
• Improved access, parking, and traffic flow – planning will begin immediately
The strategic master facilities plan will meet health care needs of 21st century patients and families by:
• Accommodating projected growth in the number of patients, surgeries, diagnostic and therapeutic procedures,
and imaging and laboratory analyses
• Developing single patient rooms that meet the need for privacy, infection control, increased technology, and
space for families to participate in healing
• Building operating suites with more sophisticated electrical, mechanical and information systems
• Meeting increased space requirements for teaching and clinical research
The Board asked that UI Health Care leaders ensure that planning include special attention to improving patient and
family experiences, including access to the main campus, parking, and possibly taking some portion of the ambulatory
care services off the main campus.
19
Strategic Plan
20
Background – Need for New/Upgraded Facilities
• Patient service volumes, both inpatient and outpatient, are growing in all areas and UIHC
is serving an increasingly complex patient population
• Emerging technological advances require more floor space, greater height and more
sophisticated electrical, mechanical and information technology systems
• Consumer expectations are continuing to rise as are requirements for safety, infection control,
patient privacy and family centered care – contemporary private patient rooms
• Intermingled with adult services, facilities for children are currently located in Carver, Colloton,
Pappajohn and Pomerantz Family Pavilions and need to be consolidated into a Children’s
Hospital that is designed to meet the specific needs of pediatric patients
• Corollary requirements for teaching and clinical research space are continuing to expand
• Buildings built in the 1970s and early 1980s have reached or will soon reach 30-35 years of age
and need to be modernized with contemporary codes and expectations
• Roadways to UIHC are currently crowded with large numbers of patients, visitors and staff
coming to the Hospital and need to be decongested by development of an off-site clinic facility
21
Background – Need for New/Upgraded Facilities
• Engaged Kurt Salmon Associates (KSA) and TRG Healthcare LLC, national consulting firms,
to assist with projecting future volumes and developing facility options
• Consultants worked with UIHC planning staff, clinical department heads and faculty, other
medical leaders, UIHC, CCOM and UI Facilities and Operations administrators and many
other staff to complete assessments in three areas:
• Strategic assessment - translated the future vision into work load projections and facility
requirements
• Operational assessment - evaluated the functionality of clinical space in comparison to

contemporary standards
• Physical assessment - evaluated the physical condition of current facilities and the
capacity and constraints related to future development
• Information from the assessments and other factors led to the conclusion that UIHC’s future
facility needs could best be met by initially developing a children’s hospital, renovating
existing patient care units and adding future patient towers
22
Strategic Plan – Balanced Priorities
 Children’s Hospital Consolidation

Patient/Family Experience; Provision of the Best Medical
Care; Recruitment; Image/Identity/Market Expansion
 Adjacent Pediatric and Adult Interventional Platform
Patient/Family Experience; Recruit Best Surgeons; Cost
Management; Operational Efficiency; Margin Contribution
 Critical Care Bed Upgrades/Expansion
Safety/Quality; Patient/Family Experience; Margin
Contribution
 Private Patient Rooms
Safety/Quality; Privacy; Patient/Family Experience;
Operational Efficiency; Market Competitiveness
23
Key Findings: Functionality of Clinical and Other Space
Contemporary Academic Medical Center

Existing at UIHC
Standards
Majority of patient rooms are semi-private Large, all private patient rooms
Rooms are small – private rooms average 184 nsf; semi-private Private rooms are 275 nsf – 325 nsf
rooms average 225 nsf
Operating rooms are not uniformly sized and small (400 nsf – Large, efficiently configured surgical suite; operating rooms a
527 nsf); many are small resulting in fragmented flow minimum of 600 nsf; clear and coherent flow
Interventional services (surgery, angiography, catheterization, Interventional platform with co-located procedure and related
endoscopy) are dispersed; multiple anesthetizing locations support space
Ambulatory services are in many locations -- difficult way Ambulatory services, integrated, accessible, often in a single
finding. A large patient/family dissatisfier facility
Access from parking not often direct – difficult way finding; Proximate parking, easy way finding
A large patient/family dissatisfier
Faculty offices dispersed throughout medical center Dedicated physician office locations, not co-mingled in clinical
– co-mingled in clinical areas areas
On-stage (public) and off-stage (service) functions intermingled On-stage and off-stage functions separate
Inpatient areas lack amenities Numerous patient and family amenities
Privacy lacking in waiting, reception, prep/recovery areas HIPAA sensitive privacy in all patient areas
24
Contemporary Private Rooms Required
More than half (58%) of our adult medical/surgical floor beds are semi-private. These semi-
private rooms are too crowded to comfortably house patients, equipment, and families, and
are not optimal for infection control and managing patient privacy. This is a tremendous
dissatisfier for patients, families and staff.
25
Contemporary Private Rooms Required
Sharing hospital rooms may raise infection

rates: Canadian study
By Tom Spears , Ottawa Citizen January 7, 2010
OTTAWA — Each person who shares your hospital room raises your chance of catching a life-threatening infection by
at least 10 percent, new Canadian research shows.
"A private room is more costly to build in a hospital. However, if it saves on infections . . . then clearly it's worth the
expense," said Dr. Dick Zoutman, an infectious disease specialist at Queen's, in Kingston, Ont. "So we decided to look
at whether the number of roommates you have in hospital correlated with the risk of getting the Big Three superbugs.“
He studied records of 17,200 patients admitted to Kingston General Hospital over six months. "What we found
surprised me because of the strength of the relationship" between infection risk and number of roommates. "Your risk of
infection with one of those three superbugs went up 10 percent per roommate for each of the three infections." (In some
cases, it was slightly above 10 per cent. Patients exposed to six roommates during their stay had a risk 77 to 90 percent
higher than those in private rooms.) That means a double room is worse than a single, and a ward of four beds is worse
again. As well, a person who changes roommates has more risk than a person who has one roommate through his or
her hospital stay.
"I'm saying that the best possible decision is that we build our hospitals with private rooms."
Source: http://www.montrealgazette.com/health/Sharing+hospital+rooms+raise+infection+rates+Canadian+study/2415796/story.html
26
Contemporary Private Patient Rooms A Must:
Improved Infection Control, Privacy, Family Centered Care
28
27
Major Facility Projects
to Renew and Upgrade our Clinical Facilities
• Iowa River Landing/Off-site Replacement Facilities (underway)

• Cancer Center (underway)
• ICU expansion - Cardiovascular ICU
• Mechanical upgrades (Colloton, Carver and Pappajohn)
• Ambulatory and Main Operating Rooms - additional ORs/ pre-op
and post operative support space
• New Bed Tower #1 - Children's Hospital
• Complete renovations of existing adult inpatient units
• Adult hospital - Conversion to private rooms
• Orthopaedics - Clinical and research facilities
• Kitchen/Dining Room
• Backfill projects post Iowa River Landing
• Proton beam
• Preparatory projects for Bed Tower #2 (CDD, Parking, Utilities)
• New Bed Tower #2
28
Major Facility Projects - Projected Timing
Group 1 Group 2 Group 3

Planning now Planning now – next year Planning in 2-3 years
Implementation in 1-3 yrs Implementation in 2-4 yrs Implementation in 4-5 yrs
2011 - 2013 2013 - 2016 2016 - 2020
Iowa River Landing Children’s Hospital Tower including Bed Tower #2
(in process) Operating Rooms
Offsite Replacement Facilities Surgical Platform - Upgraded Pre and Orthopaedics - Clinical and Research
Post Facilities
Cancer Center Phase I - Conversion to Private Rooms Phase 2 - Conversion to Private Rooms
(in process)
Colloton Pavilion Iowa River Landing Backfill Carver /Pappajohn Pavilion
Mechanical Upgrade Mechanical Upgrade
Cardiovascular Intensive Care Unit Complete Renovations

Colloton Patient Units
Proton Beam Therapy Carver /Pappajohn Pavilion
Mechanical Upgrade
Ambulatory Surgery - Preparatory Projects for Bed Tower #2 -

Additional ORs CDD, Parking, Utilities, Roads
Main Operating Room -

Additional ORs
Kitchen/Dining Room Upgrades
29
Major Projects Approved for Planning:
Estimated Costs
Funded From Routine Annual Capital Budget (millions) (millions)
Group 1 Cardiovascular Intensive Care Unit/Heart and Vascular Center Pre/Post Procedure Facility $ 15
Colloton Pavilion mechanical upgrade $ 9
Proton Beam $ 25-40
Kitchen/Dining Room Upgrades $ 13
Total $ 77
Group 2 Conversion to Private Rooms - phase #1 ($6M per floor) $ 18

Preparatory projects for Bed Tower #2 (CDD relocation, new parking garage, utilities and roads) $ 89
Complete renovations of Colloton inpatient units $ 63
Carver or Pappajohn Pavilion mechanical upgrade $ 9
Total $ 179
Group 3 Conversion to private rooms - phase #2 ($6M per floor) $ 18

Carver or Pappajohn Pavilion mechanical upgrade $ 9
Total $ 27
Total $ 283
Funded Outside Routine Annual Capital Budget (millions) (millions)
Group 2 Children's Hospital Tower $ 271
Total $ 271
30
New Projects:
Estimated Costs
Funded From Routine Annual Capital Budget (millions) (millions)
Group 1 Offsite facility replacements $ 22

Ambulatory Surgery - Additional Operating Rooms $ 18
Main Operating Rooms - Additional Operating Rooms $ 20
Total $ 60
Group 2 Surgical Platform upgrades - Pre op and Post op $ 24

Iowa River Landing - backfill to main campus freed up space $ 20
Total $ 44
Group 3 Orthopaedics - clinical and research facilities $ 45

Total $ 45
Total $ 149
Funded Outside Routine Annual Capital Budget (millions) (millions)
Group 3 Bed Tower #2 $ 400
Total $ 400
31
The Need for a New Facility
32
UI Children’s Hospital Has Unique Challenges
 Children require different health care that focuses on their unique

needs, involves their parents from start to finish and is provided in
places designed to be kid-sized and child friendly
 We must create the sizing, shape, color, organization and “feel”

that lessen the anxiety and stress for children and their families
during hospitalization
 Inpatient and specialty services for children must be provided in

patient-centered areas
 We must meet the expected standard for academic medical

center children’s hospitals to aid in the recruitment of first class
“pediatric trained” clinicians, residents/fellows, researchers and
nurses
 Children’s services are currently spread over multiple pavilions

and multiple floors
33
UI Children’s Hospital Has Unique Challenges:
Services Dispersed Throughout Campus
Existing Pediatric Facilities on Campus
This diagram shows the existing locations of

pediatric care areas on the UI Health Sciences
campus that will be impacted by this project and
located in the future UI Children’s Hospital and the
future Center for Disabilities and Development.
34
New University of Iowa Children’s Hospital:
Creating a System of Care for Iowa’s Children
The overarching vision of the University of Iowa Children’s

Hospital project is to create a system of care for Iowa’s
children. This will be accomplished through the creation of
a pediatric health “Center of Excellence” that embraces the
principles of an Iowa specific children’s system of care.
This vision will be realized through the construction of a
new state-of-the-art children’s hospital and the incorporation
of sophisticated health information technology.
35
Creating a System of Care for Iowa’s Children
The new University of Iowa Children’s Hospital will:
 Provide a place for direct and virtual provision of innovative

pediatric care in a child friendly, family-centered environment
 Assure quality service and outcomes for Iowa’s children
 Expand the existing and initiate new on-site and outreach

tertiary-level services for children to meet the state’s current
and anticipated needs
 Foster outstanding research and educational programs that

meet the needs for the state’s pediatric health care
professionals
36
Project Absolutes
 Children and families first:

The design and philosophy of the building will reflect the principles of patient
and family-centered care where children and families come first
 Foster academic achievement:

The building will support the teaching mission and facilitate academic
achievement and medical excellence
 Maintainable, friendly and secure:

The building will be durable, easy to clean, welcoming and secure
 Architecturally and functionally integrated/environmentally sustainable:

The building will fit into the context of campus architecture, have good
functional relationships to related parts of the Medical Center, and be
designed to be environmentally sustainable
 Grow pride and image:

The building will engender pride and positively affect the image of the
University of Iowa
37
New Children’s Hospital Planning: Progress-to-Date
Architectural Selection Process Completed (2008)

 Heery International (Iowa City office) selected as Architect of
Record
 Stanley Beaman & Sears (Atlanta, GA) selected as
Children’s Hospital Architect
Construction Manager Selection Completed (2008)

 Gilbane Building Co. (Chicago, Il) selected as Construction
Manager
38
New Children’s Hospital Planning: Site Plan
39
New Children’s Hospital Planning: Site Plan
Carver Pavilion
Colloton Pavilion
40
Renderings
Southwest Street Level View
41
Renderings
North Street Level View
42
Renderings
Southeast Aerial View
43
Renderings
West Aerial View
44
Building Program Highlights
 General Building Statistics

– 427,850 gross square feet (371,600 gross square feet in new
construction, 56,250 gross square feet in renovated space)
– 100 feet wide by 300 feet long plus renovated space in JPP
– Eleven stories
 Medical Surgical Inpatient Units

– Three 28 bed medical/surgical units, incorporating rooms for
various clinical support for specific populations - total 84 beds
– Compares to 65 beds currently
 Neonatal Intensive Care Unit (NICU)

– Total of 83 beds (55 in existing facility)
 Pediatric Intensive Care Unit (PICU)

– Total of 28 beds
 Pediatric Operating Suites

– Eight operating rooms
45
Building Program Highlights (continued)
 Radiology
– General radiography, fluoroscopy and ultrasound
– Expansion space for future CT and MRI
 Child Life
– Central Child Life facility/decentralized playrooms
– Classroom
– Outdoor space for possible “healing garden”
 Family Support/Amenities
– Parent sleep rooms
– Meditation space
– Family resource center
– Family kitchen
– Laundry facilities
 Educational
– Resident training program facilities
– Conference rooms on every patient floor
46
Children’s Beds
Bed Capacity when the new Children's Hospital is open will

increase by 19% consistent with projected need.
Remain in Present
Beds Today New Hospital Hospital Future Total
Medical/Surgical 66 84 0 84
Pediatric Intensive Care 20 28 0 28
Neonatal Intensive Care 78 28 55 83
Total 164 140 55 195
47
New Children’s Hospital Planning: Stacking Diagram
Stacking Diagram
The stacking diagram is a cross section of the

future UI Children’s Hospital showing the services
on each floor and how it will connect to existing
facilities
48
New Children’s Hospital – Level 1
49
1 INPATIENT ROOMS 4 WAITING/FAMILY SUPPORT 7 DIAGNOSTIC/TREATMENT
2 EXAM ROOMS 5 BUILDING SUPPORT 8 CONFERENCE/EDUCATION
3 OFFICES 6 CLINICAL SUPPORT 9 PATIENT HOLDING/RECOVERY
50
51

52
53
New Children’s Hospital – Levels 6, 7 and 8

54
NICU Transitional Bed Space Comparison
The new NICU bed spaces will provide more privacy and allow for more
control over the environment – sound, light and climate. A private
shower/toilet and family space will be available in each room.
Current Intermediate NICU Spaces New NICU Spaces
200 square feet per 295 square feet per bed

bed space 55 square feet Toilet Room per bed
(Preliminary Layout)
55
Medical/Surgical Patient Room Comparison
The new patient rooms will have ample space for the patient, family and
clinical staff. The shower/toilet room will be accessible for patients.
Current Medical/Surgical Space New Medical/Surgical Space
178 square feet per bed 295 square feet per bed
43 square feet Toilet Room per bed 55 square feet Toilet Room per bed
There are 12 double rooms at 150 square feet
per bed with shared toilet 56
PICU Patient Room Comparison
The new PICU patient rooms will be private and have ample space for
the patient, family and clinical staff. A private patient shower/toilet will
be available in each room.
Current PICU Room New PICU Room
218 square feet per bed 295 square feet per bed
Swivel Toilet Included In Room 55 square feet Toilet Room per bed
57
New Children’s Hospital – Lower Level 1
58
59
60
New Children’s Hospital Designed to Integrate
into Future Patient Towers
Tower #4
Parking
Ramp #3
Tower #3
Service/Staff Elevators – Circulation
Visitors/Patients Elevators – Circulation
Tower #2
KINNICK
STADIUM New
Children's
Hospital
61
New Children’s Hospital –
Project Budget with Source of Funds
Construction $181,945,533
Professional Fees $23,334,975
Project Contingencies $18,889,564
Planning and Supervision $8,056,345
Equipment $38,524,000
Total $270,750,417
This project’s source of funds will be:

• University Hospital’s Building Usage Funds – G/P# 68010532
• UIHC Revenue Bonds
• Hospital Gift Funds
62
New Children’s Hospital – Benchmark Costs
Year
Construction Cost Comparison Size S.F. S.F. Cost**
Completed
OSF/Children’s Hospital, Peoria, IL 457,300 $638 2010
University of Michigan – Mott Children’s and Women’s Hospital 1,100,000 $509 2011
University of Chicago Comer Children’s Hospital, Chicago, IL 243,400 $478 2004
Phoenix Children’s Hospital 759,000 $416 2012
University of Alabama – Birmingham Children’s Hospital 770,000 $406 2011
Joe DiMaggio Children’s Hospital, Hollywood, FL 200,000 $394 2011
University of Iowa Children’s Hospital (Projected) 371,000 $392 2014
Children’s Healthcare of Atlanta, Egleston Campus 392,112 $330 2006
Children’s Healthcare of Atlanta, Scottish Rite Campus 243,655 $319 2006
** S.F. costs have been adjusted for location and completion date of project
63
New Children’s Hospital – Project Timeline(*)
Children’s Hospital Task 2011 2012 2013 2014 2015 2016
Design
Construction
Renovation
Enabling Projects Task 2011 2012 2013 2014 2015 2016

West Campus
Design Transportation Center
Design Utility Tunnel
Design Ramp #2
West Campus
Construction Transportation Center
Construction Utility Tunnel
Construction Ramp #2
(*) calendar year

64
Multi-Year Projection: Summary of Key Assumptions
Projection Current
Admissions Growth % (Average) 2.7% 1.5%
Visits Growth % (Average) 2.7% 9.1%
Operating Expense Annual Increase % (Average) 4.6% 4.0%
Length of Stay by 2018 5.60 6.46
Case Mix Index by 2018 1.87 1.79
Days Cash on Hand by 2018 210.0 249.1
65
Multi-Year Projection: Summary Income Statement
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
Admissions 53,131 54,970 57,213 58,939 60,268 61,892 64,116 66,625

Patient Days 193,590 188,103 183,231 182,784 185,414 190,014 197,144 204,578
Average daily census 530 515 502 501 508 521 540 560
Average length of stay 6.3 6.0 5.8 5.6 5.6 5.6 5.6 5.6
Admissions growth 1.0% 3.5% 4.1% 3.0% 2.3% 2.7% 3.6% 3.9%
Patient day growth 4.1% -2.8% -2.6% -0.2% 1.4% 2.5% 3.8% 3.8%
(In M illions)
Net Revenues $ 1,024 $ 1,068 $ 1,117 $ 1,158 $ 1,202 $ 1,244 $ 1,298 $ 1,359
Operating Expenses $ 894 $ 927 $ 963 $ 1,007 $ 1,056 $ 1,108 $ 1,158 $ 1,215
EBITDA* $ 130 $ 141 $ 154 $ 152 $ 146 $ 136 $ 139 $ 145
Depreciation $ 72 $ 72 $ 76 $ 80 $ 81 $ 98 $ 103 $ 109
Non-operating (interest activity) $ 23 $ 23 $ 71 $ 23 $ 24 $ 67 $ 16 $ 9
Net Income $ 82 $ 92 $ 149 $ 95 $ 89 $ 105 $ 52 $ 45
* Earnings before interest, depreciation, and amortization
66
Multi-Year Projection: Cash Sources and Uses Summary
(In Millions) FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Total
Operating Income $59 $69 $77 $71 $64 $38 $37 $36 $451
Depreciation $72 $72 $76 $80 $81 $97 $103 $109 $690
Interest earnings (net of interest expen
(net of interest expense) 23 23 21 23 24 17 16 9 156
Fundraising ‐ ‐ 50 ‐ ‐ 50 ‐ ‐ 100
Children's Hospital Grant ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐
Proceeds from new bond issue 25 25 100 50 ‐ ‐ 200 ‐ 400
Sources of Cash $120 $120 $247 $153 $105 $164 $319 $118 $1,346
Principal repayment $4 $5 $6 $11 $13 $13 $13 $14 $79

Regular capital spending 69 112 129 96 89 90 94 97 776
Children's Hospital 80 100 100 280
Critical Care Tower 50 150 150 350
Iowa River Landing Ambulatory Clinic 1 25 47 73
Operating Room renovation 25 23 2 50
Uses of Cash $74 $167 $285 $209 $202 $153 $257 $261 $1,608
Net (inclusive of Operating Income) $105 $22 $39 $15 ($33) $49 $99 ($107) $189
67
Multi-Year Projection: Key Financial Ratios
Debt to Capitalization
(lower values are better)
UI Health Care 10.4% 11.0% 15.5% 16.7% 15.3% 13.9% 21.1% 20.2%
Moody's AA (2009) 32.1% 32.1% 32.1% 32.1% 32.1% 32.1% 32.1% 32.1%
Moody's A (2009) 38.1% 38.1% 38.1% 38.1% 38.1% 38.1% 38.1% 38.1%
Moody's Baa (2009) 50.6% 50.6% 50.6% 50.6% 50.6% 50.6% 50.6% 50.6%
Debt Service Coverage

(higher values are better)
UI Health Care 17.14 12.36 11.33 6.76 6.31 7.94 5.59 4.65
Moody's AA (2009) 6.00 6.00 6.00 6.00 6.00 6.00 6.00 6.00
Moody's A (2009) 4.30 4.30 4.30 4.30 4.30 4.30 4.30 4.30
Moody's Baa (2009) 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80
68
Risks in Multi-Year Projection:
Sensitivity to Key Assumptions
Assumption Change Annual Operating Income Impact

Annual Operating Income Impact
Labor Rates up 1% ($4.9 M)
Length of Stay 6.0 to 5.9 $3.9 M
Inpatient Volume 2% to 3% $2.6 M
Case Mix Index 1.75 to 1.80 $14.0 M
Payor Reimbursement up 1% $9.0 M
69
Alternative Scenario: Risks of Not Proceeding
70
Children’s Hospital:
Growing Focus for Philanthropy
 Philanthropic plan for University of Iowa Children’s

Hospital/University of Iowa Department of Pediatrics
 Under the direction of University of Iowa Foundation, as

part of its campaign on behalf of UI Hospitals and
Clinics/Carver College of Medicine
71
 Capital Fundraising Goal:

 $50,000,000 to be raised for new UI Children’s
Hospital tower
 Naming opportunities are available
 Donors representing tens of millions of dollars in

commitments are eager to formalize their pledges once
permission to build has been secured
72
 Programmatic Fundraising Goal:

 $50,000,000 to be raised for programs to support
the work of UI Children’s Hospital
 Examples: faculty chairs and professorships;
research funds; nursing specialty education
 Patient and family programs such as Child Life
and Chaplaincy Services
 Progress-to-date: $32,000,000
 New $10,000,000 commitment for programs to be
announced in May
73
Conclusion
 Success requires growth and market differentiation

 We have strong demand for our programs and a
strong brand
 We need to continue to build clinical faculty and
programs to assure the success of clinical,
education and research strategies
 At the same time, continue to aggressively manage
costs against benchmarks
 Risks of projects can be well managed and are
substantially less than the risks of not proceeding
74

0211 UIHCPresentation

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University of Iowa Health Care

 Opening Remarks (Robillard)

Ken Kates, Chief Executive Officer

Ken Fisher, Associate Vice President for Finance

Patient Days 83,828 78,487 76,859 5,341 6.8% 6,969 9.1%

Length of Stay 6.51 6.25 6.05 0.26 4.2% 0.46 7.6%

Surgeries – Inpatient 4,770 4,738 4,668 32 0.7% 102 2.2%

Surgeries – Outpatient 6,389 5,780 5,765 609 10.5% 624 10.8%

Case Mix 1.7893 1.7780 1.7807 0.0113 0.6% 0.0086 0.5%

Greater than Greater than

Adult Surgical 5,725 5,612 5,606 113 2.0% 119 2.1%

Adult Psych 664 698 714 (34) -4.9% (50) -7.0%

Subtotal – Adult 10,685 10,579 10,459 106 1.0% 226 2.2%

Pediatric Medical 1,276 1,256 1,370 20 1.6% (94) -6.9%

Pediatric Surgical 88 73 67 15 20.6% 21 31.3%

Pediatric Psych 229 178 199 51 28.7% 30 15.1%

Subtotal – Pediatrics w/o 1,922 1,863 1,982 59 3.2% (60) -3.0%

Newborn 595 575 563 20 3.5% 32 5.7%

Greater than Neutral Greater than

Adult Medical 25,330 23,790 23,167 1,540 6.5% 2,163 9.3%

Adult Surgical 29,805 28,747 27,931 1,058 3.7% 1,874 6.7%

Adult Psych 7,957 8,163 8,139 (206) -2.5% (182) -2.2%

Subtotal – Adult 63,092 60,700 59,237 2,392 3.9% 3,855 6.5%

Pediatric Medical 7,263 6,582 6,183 681 10.4% 1,080 17.5%

Pediatric Surgical 571 646 573 (75) -11.6% (2) -0.4%

Pediatric Psych 1,708 1,474 1,339 234 15.9% 369 27.6%

Newborn 1,311 1,293 1,262 18 1.4% 49 3.9%

Greater than Neutral Greater than

Adult Medical 5.90 5.57 5.60 0.33 5.9% 0.30 5.4%

Adult Surgical 5.21 5.12 4.98 0.09 1.8% 0.23 4.6%

Adult Psych 11.98 11.69 11.40 0.29 2.5% 0.58 5.1%

Subtotal – Adult 5.90 5.74 5.66 0.16 2.8% 0.24 4.2%

Pediatric Medical 5.69 5.24 4.51 0.45 8.6% 1.18 26.2%

Pediatric Surgical 6.49 8.84 8.55 (2.35) -26.6% (2.06) -24.1%

Pediatric Psych 7.46 8.30 6.73 (0.84) -10.1% 0.73 10.9%

Newborn 2.20 2.25 2.24 (0.05) -2.2% (0.04) -1.8%

Greater than Neutral Greater than

Greater than Neutral Greater than

Greater than Neutral Greater than

ETC Visits 23,950 21,927 22,442 2,023 9.2% 1,508 6.7%

ETC Admits 6,207 5,634 5,546 573 10.2% 661 11.9%

Conversion Factor 25.9% 25.7% 24.7% 0.8% 4.9%

ETC Admits / Total Admits 49.4% 45.4% 44.9% 8.8% 10.0%

Greater than Neutral Greater than

2.3 Medicare Acute

General Expenses 171,778 172,754 156,926 (976) -0.6% 14,852 9.5%

Operating Income $30,892 $12,363 $11,927 $18,529 149.9% $18,965 159.0%

Operating Margin % 7.1% 2.9% 3.0% 4.2% 4.1%

Other Non-Operating (3,158) (2,587) (2,114) (571) -22.1% (1,044) -49.4%

General Expenses 35,491 33,453 30,013 2,038 6.1% 5,478 18.3%

Operating Income $3,459 $1,924 $4,462 $1,535 79.8% ($1,003) -22.5%

Operating Margin % 4.0% 2.3% 5.6% 1.7% -1.6%

June 30, 2009 June 30, 2010 November 30, 2010

$10,000,000 Bad Debts

$5,000,000$3,181,620 $3,496,488 $3,850,582 $3,328,958

The New University of Iowa Children’s Hospital

 Review Major Facility Renewal/Expansion Needs

 Review Proposed Project Sequencing and Estimated

 Request Approval of Project Description, Budget and

• New children's hospital – estimated 600,000 square feet

• Meeting increased space requirements for teaching and clinical research

• Operational assessment - evaluated the functionality of clinical space in comparison to