Download Report

VOLUNTARY EVENT DISCLOSURE COVER SHEET
This cover sheet and accompanying “voluntary event disclosure” will be sent to the MSRB, pursuant to the Disclosure
Dissemination Agent Agreement dated as of January 7, 2013 between the Issuer and DAC.
Issuer’s and/or Other Obligated Person’s Name: NYU Hospitals Center ("NYUHC")
Nine-Digit CUSIP Number(s) of the bonds to which this notice relates:
Dormitory Authority of the State of New York NYU Hospitals Center Revenue Bonds, Series 2011A, $130,930,000, Dated:
January 25, 2011: 6499057S9, 6499057T7, 6499057U4, 6499057V2, 6499057W0, 6499057X8, 6499057Y6,
6499057Z3, 6499058A7, 6499058B5, 6499058C3, 6499058D1, 6499058E9, 6499058F6, 6499058G4, 6499058H2,
6499058J8, 6499058K5, 6499058L3
Dormitory Authority of the State of New York NYU Hospitals Center Revenue Bonds, Series 2007B, $94,150,000, Dated:
December 5, 2007: 649903WR8, 649903WS6
Dormitory Authority of the State of New York NYU Hospitals Center Revenue Bonds, Series 2007A, $165,300,000, Dated:
February 6, 2007: 649903CU3, 649903CV1, 649903CW9, 649903CX7, 649903CY5, 649903CZ2, 649903DA6
Dormitory Authority of the State of New York, NYU Hospitals Center Revenue Bonds, Series 2006A, $94,590,000, Dated:
October 4, 2006: 64983QY37, 64983QY45, 64983QY52, 64983QY60, 64983QY78, 64983QY86
NYU Hospitals Center Revenue Bonds, $52,200,000, Series 2000D (Auction Rate Securities), Dated: April 15, 2000:
64983WV37
NYU Hospitals Center Taxable Bonds, $250,000,000, Series 2012A, Dated July 31, 2012: 62952EAA5
1
Number of pages attached: 26
Description of Voluntary Event Disclosure (Check One):
4.
"amendment to continuing disclosure undertaking;"
"change in obligated person;"
"notice to investors pursuant to bond documents;"
"certain communications from the Internal Revenue Service;"
5.
"secondary market purchases;"
.
2.
3.
.
7.
8.
9.
10.
11.X
"bid for auction rate or other securities;"
"capital or other financing plan;"
"litigationlenforcement action;"
"change of tender agent, remarketing agent, or other on-going party;"
"derivative or other similar transaction;" and
" other event-based disclosures."
I hereby represent that I am autJ[horized by the issuer or iÿts2agent to distribute this information publicly:
Signature: ,,ÿÿÿ/,ÿÿ .ÿÿ_ _
/
Name: Michael T. Bu/rke
_
Title: Senior Vice President and Vice Dean, Chief Financial
Officer
Date: January 7, 2013
Digital Assurance Certification, L.L.C.
390 N. Orange Avenue
Suite 1750
Orlando, FL 32801
407-515-1100
U Langone
MEDICAL CEN11:II
This document is dated as of January 7, 2013
SPECIAL NOTE CONCERNING FORWARD-LOOKING STATEMENTS. Certain of the discussions included in the
following document may include certain “forward-looking statements” which involve known and unknown risks and
uncertainties inherent in the operation of healthcare facilities. Actual actions or results may differ materially from those
discussed below. Specific factors that might cause such differences include competition from other healthcare facilities
in the service area of NYU Hospitals Center facilities, federal and state regulation of healthcare providers, and
reimbursement policies of the state and federal governments and managed care organizations. In particular, statements
preceded by, followed by or that include the words “believes,” “estimates,” “expects,” “anticipates,” “plans,” “intends,”
“scheduled” or other similar expressions are or may constitute forward-looking statements.
J.P. Morgan Healthcare Conference Presentation
January 7, 2013
Concerning
NYU Hospitals Center
The information in this report
has been provided by
NYU Hospitals Center
3
NYU Hospitals Center
Michael T. Burke, Senior Vice President
and Vice Dean, Chief Financial Officer
J.P. Morgan Healthcare Conference
Monday, January 7, 2013
Table of Contents
•
Section 1: Organizational Initiatives
•
Section 2: Financial Performance
•
Section 3: Superstorm Sandy
•
Section 4: Future Strategic Focus
Presentation Title Goes Here
2
NYU Hospitals Center (“NYUHC”) At A Glance


NYUHC is a 1,069 licensed bed tertiary care teaching hospital located in midtown Manhattan
NYUHC is the principal teaching hospital of the New York University School of Medicine (“NYUSM”)


Currently a network of more than 1,050 physicians and 85 medical practices
Recognized Leader in Quality
 Ranked #11 in the nation on U.S. News & World Report’s
“Best Hospitals Honor Roll” with 13 nationally ranked
specialties (2012-2013)

 Ranked #2 by U.S. News & World Report in New York
State
Clinical transformation has driven operational
improvements
Successive Rating Increases
(2008-Present) (2)
2008
2009
2010
2011
2012
Ba2
Baa2
Baa1
Baa1
A3
BB
BB+
BBB/BBB+
BBB+
A-
BBB-
BBB-
BBB/BBB+
A-
A-
 Expanded ambulatory facilities
 Large growth in outpatient revenue
 Additional physician recruitment in tandem with NYUSM

 Significant investment in information technology
Improved balance sheet and financial performance built on strategic focus and discipline
 Net patient service revenue increased 42% to $1.83 billion in 2012 from $1.29 billion in 2009
 As of August 31, 2012, Operating margin was 12.3%(1)
 Days cash on hand improved to 135 days ($564.9 million of cash & marketable securities) as of August 31, 2012
 As of December 31, 2012, NYUHC’s liquidity level is approximately $785.9 million (inclusive of cash & marketable
securities); and in addition NYUHC has $260.0 million in undrawn lines of credit
(1) Operating margin excludes mission payments to NYUSM.
(2) Refer to slide 21 for rating agency updates related to Superstorm Sandy.
3
NYU Hospitals Center – Corporate Organization
NYUHC is the acute care delivery component of NYU Langone Medical Center (“NYULMC”). NYUHC and
NYU School of Medicine together form one of the nation’s premier centers for excellence in clinical care,
biomedical research and medical education. NYUHC and the NYU School of Medicine are led by a
common management team and governance structure.
New York University
NYU Langone Medical Center
School of Medicine
(including Faculty Group
Practice)
NYU Hospitals
Center
Key:
Member of the Obligated Group
Sole member
Unincorporated division of New
York University
CCC550
Note: Neither New York University nor its School of Medicine are obligated with respect to the NYUHC’s Bonds. No assets or revenues
of New York University or its School of Medicine are pledged to secure or available to pay debt service with respect to the NYUHC’s
Bonds. CCC550, NYU Hospitals Center’s wholly owned captive insurance company, is also not obligated with respect to the NYUHC’s
Bonds and no assets or revenues of CCC550 are pledged to secure or available to pay debt service with respect to the NYUHC’s Bonds.
4
NYU Hospitals Center’s Facilities
Tisch Center for
Women’s Health
1491 3rd Avenue
Ambulatory
Care Center
240 East 38th Street
Ambulatory
Surgery Center
333 East 38th Street
Clinical Cancer
Center
160 East 34th Street
Center for
Musculoskeletal Care
333 East 38th Street
Hospital for Joint
Diseases
301 East 17th Street
Rusk Institute
550 First Avenue
Tisch Hospital/HCC
550 First Avenue
Source: Microsoft MapPoint
5
Section 1:
Organizational Initiatives
Presentation Title Goes Here
6
NYUHC’s Strategic Goals
NYU Langone Medical Center – a world-class, patient-centered, integrated academic medical
center, pursuing excellence while fulfilling our tri-partite mission in patient care, research and
education.
NYU Hospitals Center – providing excellent quality care and patient experience, by talented
people
 Quality – NYUHC is a leader in the national movement focused on quality and patient safety; our
continuing achievements in quality are broadly recognized by organizations such as: University
HealthSystem Consortium, US News and World Reports, the Leapfrog Group, and Thomson
Reuters;
 Patient Experience – focused on transforming the patient experience, both inpatient and outpatient,
through such initiatives as the creation of a Patient Experience Office, the 7-Day Hospital initiative
and our expanded ambulatory and outpatients, to make our specialized care available to patients
whenever and wherever needed
 People – with a distinguished Medical Staff, 116 of whom were recently named “Best Doctors” by
New York magazine, we are committed to attracting and recruiting the best physicians and
practices, including over 371 new recruits in the last 5 years; in conjunction with the NYU School of
Medicine, these physicians are conducting groundbreaking research
Campus Transformation – NYUHC is in the process of a Campus Transformation, a multiyear, multi-phase plan to construct and renovate 2.3 million square feet of facilities for state-ofthe-art patient care, research and education.
7
Recognized Leader in Quality of Care
NYUHC is a Top 50 Cardiovascular
Hospitals 2012 Award winner. Only
hospital in New York State with distinction
Ranked #11 in the nation on the “Best
Hospitals Honor Roll” with 13 nationally
ranked specialties
Achieved a 5 star rating; the only hospital
in New York State to achieve this top ten
ranking
Ranked #2 in New York State and the
New York Metro area
Received the Gold Seal of Approval in
2010 for excellence in quality and patient
safety
Awarded an “A” Hospital Safety
ScoreSM in June 2012 for excellence in
patient safety; one of only two hospitals in
NYC
Recipient of 10 HealthGrades Quality
awards from 2009 to 2012
Magnet Status designation for excellence
in nursing in 2005 and 2009
8
NYUHC’s Strategic Investments
 Ambulatory Care - NYUHC is competing in the metro NY healthcare market by continuing to invest in
the development of its ambulatory care network, including:
 Completed Projects
 Center for Musculoskeletal Care – 333 East 38th Street
 Opened in March 2012
 Specializing in orthopaedics, rheumatology, rehabilitation and musculoskeletal radiology
 Ambulatory Care Center - 240 East 38th Street
 Opened in April 2012
 Specializing in outpatient adult and pediatric rehab
 34th Street Cancer Center
 Opened in 2006 with recent expansion of services
 Specializing in radiation oncology, diagnostic radiology, breast cancer, breast surgery
 Under construction - expansion of existing Emergency Department
 Working to support NYUSM’s expansion of the Faculty Group Practice Model
 currently a network of more than 1,050 physicians
 85 medical practices
 a geographical presence in Manhattan and the outer boroughs of New York City (ie. Brooklyn,
Queens and Long Island)
9
NYUHC’s Strategic Investments (continued)
 Technology – NYUHC’s investment in EPIC enables a patient centered vision by 2014
 Patient access to health records electronically
 Mobile apps for health updates and Emergency Department waiting times
 Further improves highly ranked patient workflow, satisfaction and safety scores
 Continue to improve our revenue cycle performance
 Standardized “best practice” protocols
 Posting of metrics and benchmarks
 Successful Physician Recruitment Across Key Specialties - Physician recruitment is targeted on specific
clinical programs with increasing demand for patient care services in the future and key primary care referral
groups
 371 net increase in physicians to the active/courtesy staff from 2007-2012
 New recruitments focused on the following specialties:
 Cardiothoracic surgeons
 Pediatric cardiothoracic surgeons
 Neurosurgeons
 Gastroenterologist oncologists
 Neuro-oncologists
 Hematology oncologists
10
Philanthropic Success to Support Continued NYULMC Growth (1)
Total Support FY 2008 - 2013 YTD
Cumulative Philanthropy Raised: $1.21 billion
New Commitments
and Outright Gifts
$600
$500
Cash
$508
$400
$300
$200
$180
$199
$194
$169
$100
$205
$203
$155
$124
$137
$78
$38
$2008
2009
2010
2011
(1) Includes combined gifts to NYUHC and NYUSM.
2012
2013
11
Section 2:
Financial Performance
Presentation Title Goes Here
12
Financial Performance Highlights (Pre-Superstorm Sandy)
Profitability has improved liquidity levels and balance
sheet
•$785.9mm in cash as of December 31, 2012
•$400mm in working capital lines
Improved Operations: achieved by higher case mix
acuity/higher margin services and increased ambulatory
volume; CCC550 equity return totaling $31.2 million in FY
2012
Increased Volume: Driven by increased outpatient and
ambulatory services and aggressive physician recruitment
Revenue Cycle Initiatives: Improvements in clinical
documentation, coding, charge capture as well as successful
managed care strategies
Expense Management: Target expense savings in areas
such as medical/surgical, labs, distribution, corporate
services; NYUHC has realized expense savings totaling
$14.3 million
Increased Patient Flow and Efficiencies: Lean/Six SIGMA
and improved productivity
Working Capital Discipline: Investment policy is to provide
liquidity for operating and capital expenditures. The balance
of working capital is maintained in a capital program reserve
fund which is targeted to be at least 2x the amount of any
working capital draws
FY 2011(1)
FY 2012(1,2)
Operating Revenue
($MM)
$1,712
$1,965
Operating Income ($MM)
$177.6
$242.1
Operating Margin
10.4%
12.3%
EBIDA Margin
15.2%
17.3%
DCOH (days)
108
135
Cash to Debt
62%
61%
Debt to Capitalization
55%
59%
MADS Coverage
4.98
4.35
(1) NYUHC’s fiscal year end audited reporting period is August 31.
(2) Includes Series 2012A Taxable Bonds $250MM.
13
Inpatient and Outpatient Trends
Total Inpatient Discharges
37,813
2,556
4,750
Outpatient Visits
36,478
36,973
37,503
37,585
2,724
2,787
2,806
2,939
4,492
4,381
4,612
284,558
261,835
240,770
216,789
5,086
201,877
25,643
23,306
27,635
30,507
FY 2008
29,262
FY 2009
Med/Surg
29,805
FY 2010
Maternity
30,085
37,940
28,009
33,892
31,195
29,320
29,560
FY 2011
FY 2012
Rehab
32,286
29,659
150,936
161,826
FY 2008
FY 2009
Cancer Center
181,566
FY 2010
ER
198,284
FY 2011
214,332
FY 2012
Amb Surg
14
Operating Performance (4)
Total Revenue (1)
Operating Margin (1,3)
$000
EBIDA (1,2,3)
%
$000
1,964,755
339,410 17.3%
12.3
11.9
1,711,892
10.4
1,561,265
1,369,088
267,386 17.1%
260,516 15.2%
FY 2010
FY 2011
7.8
1,175,994
171,869 12.6%
81,001 6.9%
1.2
FY 2008
FY 2009
FY 2010
FY 2011
FY 2012
FY 2008
FY 2009
FY 2010
FY 2011
FY 2012
FY 2008
FY 2009
(1) Equals total operating revenue in audited financial statements less investment income and realized
gains (losses) on investments and unrestricted contributions.
(2) Equals operating margin indicator plus depreciation and interest less investment income and
unrestricted contributions.
(3) Operating margin and EBIDA excludes mission payments to NYUSM.
(4) NYUHC’s fiscal year end audited reporting period is August 31.
FY 2012
15
Liquidity Ratios (3)
Cash on Hand (1)
Cash to Debt (2)
Days
Liquidity Level:
%
135
• Total liquidity/capacity is
approximately $1.0 billion
(inclusive of cash, marketable
securities and undrawn lines of
credit)
87
118
108
62
81
85
61
54
42
• Current liquidity as of 12/31/12:
$785.9MM vs. $564.9MM at FY
2012
• NYUHC maintains $400MM in
commercial lines of credit
• Undrawn capacity of $260MM
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
(1) Based on MTI methodology.
(2) Cash to Debt for FY 2012 includes Series 2012A $250MM taxable bonds.
(3) NYUHC’s fiscal year end audited reporting period is August 31.
16
Leverage Indicators (2)
Debt to Capitalization (1)
MADS Coverage(1)
%
x
Outstanding Debt:
73
5.82
65
57
4.98
59
55
4.35
3.97
•Total $903.2MM
• $753MM rated debt
• Fixed ~ 94%
• Variable ~ 6%
• $150MM capital
leases/lines of credit
•No derivatives
2.46
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
(1) FY 2012 includes Series 2012A $250MM taxable bonds.
(2) NYUHC’s fiscal year end audited reporting period is August 31.
17
Section 3:
Superstorm Sandy
Presentation Title Goes Here
18
Note: Above from NYULMC advertisement in January 6, 2013 NY Times
Superstorm Sandy
 October 29, 2012 - Superstorm Sandy struck New York City
causing widespread damage to properties throughout the
region, including lower Manhattan. All NYUHC facilities with
the exception of Hospital for Joint Diseases (“HJD”) were
closed.
 As of November 16, 2012 – NYUHC re-opened several
facilities including the Clinical Cancer Center on East 34th
Street, the Ambulatory Care Center and Ambulatory Surgery
Centers on East 38th Street and the Center for
Musculoskeletal Care.
 December 17, 2012 – various outpatient procedural and
surgical services (ie. cardiac catherization) re-opened in the
Schwartz Health Care Center (“HCC”) adjacent to Tisch
Hospital.
 December 27, 2012 – a phased re-opening of Tisch Hospital
began
Services including ambulatory and inpatient surgery,
electrophysiology, radiology, neurosurgery, post-anesthesia
care units, medical and surgical ICU’s and select ancillary
services became operational.
The services, re-opening through December 27, 2012,
accounted for approximately two-thirds of NYUHC’s patient
care capacity in FY 2012.
Press conference on December 27, 2012, to announce
re-opening of Tisch Hospital with Mr. Ken Langone,
Senator Charles Schumer and NYULMC Dean and
CEO Robert Grossman
19
Superstorm Sandy (continued)
•Emergency Department
 NYUHC was in the initial stage of a major construction and expansion project related to emergency
department services. As a result of Sandy, it is not possible to open or immediately relocate the
emergency department.
 An urgent care center, staffed by emergency department clinicians, is being established to handle
walk-in and other urgent care cases.
January 2013 – phased re-opening of Tisch Hospital is scheduled to continue throughout month of
January.
 Services such as an urgent care center, epilepsy, internal medicine, labor and delivery, neurology,
pediatrics and pediatrics ICU are expected to become operational.
The services described above are planned to ramp up to a fully operational state between January 2013
and March 2013 and together with already opened facilities are expected to comprise 98% of NYUHC’s
patient care capacity (based on FY 2012 results).
20
Superstorm Sandy (continued)
• Business Interruption & Insurance Coverage
 NYUHC has business interruption, water, property casualty and other insurance coverage with respect to the
incurred losses in effect at the time of the storm.
 Discussions with insurance carriers are ongoing as is our investigation into the causes and measurement of our
losses. Management expects to receive substantial recoveries; however, the amount of recovery cannot be
determined at this time and remains subject to investigation, measurement, negotiation, and settlement. A $20 million
advance was received in November 2012 followed by an additional $20 million payment in December 2012.
 Management has submitted three applications for assistance to the Federal Emergency Management Association
(“FEMA”) for an initial total amount of approximately $200 million, of which $149.7 million has been funded by FEMA.
Management will apply for additional FEMA funding for reconstruction and mitigation as rebuilding plans and costs
become known.
 Management expects FEMA to provide funding of at least 75% of allowable claims not covered by insurance.
Funding percentage may increase pending certain variables at the federal level.
 Rating Agency Communications
 Management has communicated frequently with Moody’s, Standard & Poor’s and Fitch since Superstorm Sandy and
during the re-opening of NYUHC’s inpatient and outpatient facilities.
 Moody’s had placed the NYUHC A3 rating under review for possible downgrade on November 20, 2012.
 At this time, Standard & Poor’s (A-) and Fitch (A-) maintain stable outlooks for NYUHC’s ratings.
 Management will continue proactive communication with the rating agencies with the planned re-opening of NYUHC
facilities.
21
NYU Hospitals Center Timeline of Events Post Superstorm Sandy
Oct. 29: Hurricane Sandy Strikes
NY Metro Area
Nov. 26: Schwartz Care Center
(HCC) re-opens for physician
office operations*
 Tisch evacuated
Dec. 17: HCC re-opens for
procedural and surgical
services
Jan – March 2013: NYUHC
inpatient and outpatient
facilities planned to be fully
operational
 HJD remains open
Nov. 30: NYUHC publishes
FY2012 annual disclosure on
DAC/EMMA
Oct. 31: Center for
Musculoskeletal Care re-opens
October
November
Nov. 16: NYUHC publishes
voluntary disclosure filing on
DAC/EMMA related to Sandy
Nov. 16: Skirball Building
(NYUSM) re-opens*
Nov. 5: 34th Street Cancer
Center re-opens
Nov. 5-9: Ambulatory Care
Center and Ambulatory Surgery
Centers re-open
January
December
Dec. 14: NYUHC publishes
FY2012 audit report on
DAC/EMMA
Dec. 2: EPIC inpatient clinical
systems go-live at HJD campus
(as previously scheduled); EPIC to
be deployed as sites re-open (1)
Dec. 27: Tisch Hospital
begins phased re-opening
* Not on NYUHC credit
(1) EPIC inpatient clinical systems “go-live” simultaneously with re-opening of HCC & Tisch Hospital beginning on December 17th and through January
2013.
22
Section 4:
Future Strategic Focus
Presentation Title Goes Here
23
NYUHC- An Academic Medical Center of the Future
 The new NYUHC campus will promote and enhance the integration of patient care,
education and research, and meet community needs.
 Construction of a new 800,000 square foot, 20-story
clinical pavilion on the First Avenue Campus
(expected construction 2013-2017)
 Financed through debt, philanthropy and equity
 NYUHC plans to participate with the University on
construction of two facilities:
 Energy Building
–Construction began in Summer 2012
 Science Building dedicated to research
–Construction is expected to begin in 2013
 As a result of Superstorm Sandy, a reassessment
of the design for these projects is underway to
ensure the appropriate risk mitigation
considerations are in place.
24
* Includes NYUSM facilities
Building Design and Layout (*)
Emergency Department
Kimmel Pavilion
The Envisioned Campus
2525
Energy Building
Science Building
Conclusion
 NYULMC is a world-class, patient-centered, highly integrated medical center, with close ties to NYU
 Proven management team with a multi-year track record of increased volume and profitability levels
 Significant track record of revenue growth
 Continued strong operating performance characterized by double-digit margins over the last 3
years
 Substantial improvement in balance sheet measures over the last 5 years
 Focused on long-term strategy and best positioning the Medical Center for the future of healthcare
 Strong physician recruitment efforts
 Solid execution of ambulatory care strategy
 NYUHC’s immediate focus is restoring our inpatient facilities post Superstorm Sandy; we
believe sufficient resources are in place to achieve this goal
 NYUHC is committed to keeping the investor community updated on its progress
 NYUHC and Board of Trustees focused on short-term recovery and long-term strategic goals
26