Joe Hymes, CEO Anesthesia Associates of Ann Arbor PRESS RELEASE March 26, 2018

Anesthesia Associates of Ann Arbor and Midwest Anesthesia Consultants have partnered with J.W. Childs Associates

Ann Arbor, March 26, 2018 – Anesthesia Associates of Ann Arbor and Midwest Anesthesia Consultants (collectively “A4”), the leading independent provider of anesthesia and pain management services in the Midwest, has partnered with J.W. Childs Associates (“J.W. Childs”), a leading Boston based middle-market private equity firm. As part of the transaction, J.W. Childs will provide growth equity capital to support A4’s continued expansion and A4 will combine with J.W. Childs’ existing portfolio company Siromed.

Founded in 1968 and headquartered in Ann Arbor, Michigan, A4 is the largest provider of anesthesia and pain management services in the State of Michigan. A4 attributes its ongoing growth and success to a keen focus on delivering top quality, cutting-edge health care to patients, while providing a high degree of engagement and customer service to its health system partners. With over 110 physician anesthesiologists, A4 currently provides services to 11 hospitals, six ambulatory surgery centers (ASCs) and four chronic pain management clinics.

J.W. Childs is a Boston-based private equity firm focused on investing in middle-market growth companies. Since inception in 1995, J.W. Childs has invested $3.6 billion of equity capital in more than 49 companies across the healthcare, consumer, and specialty retail/ecommerce industries. The firm’s success has been built on its industry focus and the extensive operating expertise of its partners.

Siromed currently is a provider of anesthesiology physician services to hospitals, ASCs and other healthcare facilities in South Florida. Siromed was founded in 2017 to pursue partnerships with a broad array of physician services practices throughout North America, especially those seeking capital to support the development of their practices while maintaining clinical autonomy.

“J.W. Childs and Siromed bring their expertise at managing practices on a large scale while keeping quality and compliance in the forefront of all they do. Their access to financial resources will provide us with the tools to continue to meet the demands of our hospital partners and patients now and into the future,” said Dr. Traci Coffman, President of A4.

Dr. Lewis Gold and Dr. Mitchell Eisenberg, former President and CEO of Sheridan Healthcare, respectively, who also serve on the Board of Directors of Siromed commented “We are very excited to have the A4 organization join the Siromed platform as we continue to develop a best in class physician practice management organization.”

Adam Suttin, Managing Partner of J.W. Childs commented “We were very impressed with A4’s clinical quality and leadership and look forward to assisting A4 in their next phase of growth. Our mission in founding Siromed was to allow leading groups like A4 to maintain clinical and operational autonomy while assisting them with the resources they need to grow.”

Houlihan Lokey and Sheppard Mullin advised A4 on the transaction. McDermott Will & Emery advised J.W. Childs and Siromed.

Compliance Begins With YOU

“Real integrity is doing the right thing, knowing that nobody’s going to know whether you did it or not.” -Oprah Winfrey”

Mahatma Gandhi said: “Be the change you want to see in the world.” Essentially it means you can make a difference, if you choose to. We are all responsible for results (good or bad) and we can influence the outcomes in matters of compliance within organizations. We will touch on how compliance begins with you, and why is it important.Compliance means fulfilling official requirements, doing the “right” thing, or taking action to correct what is wrong. Laws and regulations are put in place to protect people’s rights and to hold organizations and professionals responsible for operating in compliance with the requirements, to protect those who receive the organization’s services, and to protect the integrity of a program and the program funds.

Organizations often enter into Conditions for Participation (CoP) agreements with federal, state, and even private entities. When organizations are approved to participate, they are expected to carry out the services that the agreement requires. If the organization does not meet the requirements, they may have to return the program funds they received, often with penalties or fines for not carrying out the services as agreed.

Workforce members also enter into conditional agreements with their employer when they are hired. Those conditions may vary, depending on what type of services the organization provides. Most organizations maintain and communicate codes of conduct and policies and procedures, and they provide education to help their workforce comply with the requirements they must meet. When employees do not meet conditions of employment, it can quickly affect the organization’s compliance, and it could result in harm to those receiving services from the organization. It may also affect the employees’ future employment.

Many organizations have compliance programs to help their workforce comply. Compliance programs exist to identify risks and oversee corrective actions, but anyone can identify a compliance concern. Additionally, compliance programs are designed to keep employees aware of current requirements, to help them identify and know how to report compliance issues, and to provide a “confidential message line” for the workforce to report potential or actual concerns without fear of retaliation. Compliance begins with you, because of the difference your decisions can make. When an issue is identified by anyone, it is important that the organization is able to quickly respond and correct the issue to protect everyone’s interests. Noncompliance comes in many forms—some can be very serious, and we often hear about those in the media.

Compliance issues can range from financial issues (e.g., banking, investments, grants, or billing standards); to health care concerns (e.g., Infection control, quality, and professional practice standards); or environmental matters (e.g., Construction, oil and gas, or utilities) and more. When in doubt, ask. Talk with someone about your concerns, or use the confidential message system in your organization. Your choice to report or not report can make a big difference, and this is just one way that compliance begins with you.

CMS Quality Payment Program

On October 14, 2016, the Department of Health and Human Services (HHS) issued its final rule with comment period implementing the Quality Payment Program that is part of the Medicare Access and CHIP Re authorization Act of 2015 (MACRA).

The Quality Payment Program improves Medicare by helping you focus on care quality and the one thing that matters most — making patients healthier. The Quality Payment Program has two tracks you can choose from:

APMS-Advanced Alternative Payment ModelsANDMIPS – Merit-based Incentive Payment SystemsA4 falls under this track in the quality payment program

In MIPS, you earn a payment adjustment based on evidence-based and practice-specific quality data. Based on your performance in 2017, you will see a positive, neutral, or negative adjustment of up to 4% to your Medicare payments for covered professional services furnished in 2019. This adjustment percentage grows to a potential of 9% in 2022 and beyond.

There are 4 Performance Categories for MIPS:

• Quality – Replaces PQRS (Physician Quality Reporting System)

• Improvement Activities – New for 2017

• Advanced Care Information – Replaces the Medicare EHR incentive program (also known as Meaningful Use)

• Cost – Replaces Value Based Modifier-will start in 2018

A4 is currently reporting their MIPS Performance Categories for 2017 through the POM ACO * (Physician Organization of Michigan Accountable Care Organization) which is a Medicare Shared Savings Program. A4 has been participating in the POM ACO for a few years now and has been granted some shared savings in the past.

*Accountable care organizations (ACOs) are groups of doctors, hospitals and other health care providers who join together to coordinate care for patients. The purpose of an ACO is to reduce the cost of care by eliminating duplication of efforts and increasing the quality of services.

A4 Quality and Regulatory Update

What is a PCMH-N (Patient Centered Medical Home-Neighborhood) and how does it relate to A4?

• PCMH-N is a BCBSM program developed to strengthen the relationship between specialists and primary care physicians in the delivery and coordination of care, and to assist each provider in achieving higher levels of patient engagement and care coordination.

• This is an effective way of improving and achieving population health management. Being a part of aPCMH-N office means the healthcare team is committed to following the basic foundation for this program across our member population regardless of their insurance. Thus, improving the quality of care the patient receives while also lowering the cost of care for the patient. Specialists are then rewarded for their part in delivering effective and efficient care when receiving their Value Based Reimbursement Uplifts.

• There are 12 PCMH domains of function derived from The National Joint Care Principles of the Patient-Cen tered Medical Home. They are:

1. Coordination of Care

2. Extended Access

3. Individual Care Management

4. Linkage to Community Services

5. Patient-Provider Partnership

6. Patient Registry

7. Patient Web Portal

8. Performance Reporting

9. Preventative Services

10. Self-Management Support

11. Specialist Referral Process

12. Test Results Tracking