{rr^WV'Y *~j Darrell Early From: Sent: To: Cc: Subject: Alan Germany Friday, August 04, 2017 1:20 PM Skylar Crane Timothy Ong; Mark El-Hinn RE: Celtic Commercial Finance- HFMA (Equipment List) Attaching nts: imageOOLgif; image002.png; image003.png; image004.png; image005.png Skylar: Last O ctober TRMC converted to th e C em er Inform ation System . On th e in p atien t side, w e had Siem ens MS4 previously and NextGen on th e o u tp a tie n t side. After th e conversion, th e re w as a 4 m onth gap until claims sta rte d being released again. W e had engaged an experienced project m anager to o v ersee th e en tire project, as well as an experienced R evenue Cycle project m anager. I had even brought on a GO a y e a r or so prior to th e conversion w ho had m ost recently w orked a t C em er and previously a t Siem ens. W ith all o f th a t said, I did n o t folio n C erner's advice to have a working capital line in place at th e tim e o f th e conversion. Our cash collections from p a tie n t accounting have declined 24% post-conversion as com pared to pre-conversion. That e q u a te s to a cum ulative to ta l o f $9M M . Adding on to p o f th a t, we incurred a b o u t $9.4 MM in conversion costs (in :iuding $3.3 MM fo r th e actual C em er license). As a sep; irate m atte r, in O ctober 2014, th e G eneral Obligation bond proceeds w ere ex h au sted which has caused riie to have to fund th e continuing patien t Tow er construction o u t of hospital op eratio n s. That has to ta le d a b o u t $8 MM cum ulative as o f th is point. We do n o t plan to use th e funds for acquisitions or fu tu re sites. The anticipated new funding will go to w ard s replenishing cash reserves d u e to th e $26.4 MM expenditures outlined above. W e also m ay use a portion of th e proceeds to retire th e existing rev en u e bonds, which currently to ta l $13.6 MM. Let m e know if you would like fu rth er explanation or rationale. Thanks, Alan From: Skylar Crane [SCrane@ Celticfinance.com ] Sent: Friday, August 04, 2017 10:41 AM To: Alan G erm any Cc: Timothy Ong; M ark El-Hinn Subject: E ; Celtic Commercial Finance- HFMA (Equipm ent List) Alan, Thanks a^ain fo r your tim e yesterday going through th e detaiis/tim ing. Per your last convo with Mark, our guys w an ted it in your ow n w ords why you are going th ro u g h this reim b u rsem en t/fu n d in g process now. We understand you sp e n t a lot on th e recen t EHR/other projects, but it helps us to u n d e rsta n d th e m otivation for raising cash. For exam ple, are going to use it for acquisitions, fu tu re sites, etc.? Thanks in advance for your explanation. l