Date: 1/24/2005

Community Hospital in Top 5% Nationally for Clinical Excellence

Patients at HealthGrades Distinguished Hospitals for Clinical Excellence
Have 12-20% Better Survival Rates for Common Procedures and Diagnoses

January 24, 2005 — Community Hospital in Munster announced today that a new national study by HealthGrades places it among the top five percent in the U.S. for clinical quality performance. As a result, HealthGrades, the nation’s leading independent healthcare quality company, has recognized Community Hospital with the 2005 Distinguished Hospital Award for Clinical ExcellenceTM. Community Hospital is the only area medical facility to receive this latest distinction.

This is the second year in a row Community Hospital has been recognized as a Distinguished Hospital.
According to the HealthGrades study, Distinguished Hospitals for Clinical Excellence have markedly better mortality and complication rates, even though they tend to treat more and sicker patients. Nationally, a Medicare patient who underwent heart bypass surgery at a Distinguished Hospital for Clinical Excellence had a 15.3 percent better chance of surviving than a patient who received treatment at an average hospital. The improved survival rates at Distinguished Hospitals for Clinical Excellence were also 15.4 percent for stroke, 12.62 percent for heart attack (in hospitals where angioplasty and stent treatments were available), and 19.55 percent for community acquired pneumonia.

In addition to this award for overall quality, Community Hospital was recognized for achieving the best outcomes in the nation for orthopedic and vascular surgery. With the addition of the HealthGrades Specialty Excellence Awards, HealthGrades now provides consumers and the health care community with three ways to identify hospitals with the highest quality, as measured by actual patient outcomes. At the procedure level — from hip replacement to bypass surgery to births — HealthGrades provides star ratings indicating quality for 28 procedures and diagnoses for virtually all of the nation’s 5,000 hospitals. At the hospital level, HealthGrades issues Distinguished Hospital Awards™ to hospitals with the best overall quality. The HealthGrades Specialty Excellence Awards, HealthGrades is identifying hospitals with the best outcomes in terms of specialty care.

“These awards identify elite hospitals that lead the nation in specialty care,” said Dr. Samantha Collier, HealthGrades Vice President of Medical Affairs. “They set the benchmark, and these awards provide a new way for individuals to identify the hospitals in their area with the highest quality in a particular specialty — a valuable tool for anyone seeking care.”

“Our rankings and distinction from HealthGrades are a great source of pride for the Community Healthcare System,” said Donald S. Powers, president of the Community Healthcare System comprised of Community Hospital, St. Catherine Hospital in East Chicago and St. Mary Medical Center in Hobart. “This independent study not only underscores our commitment to the highest quality care, it validates that we deliver patient outcomes that are indeed among the best in the nation.”

The HealthGrades study identifies the highest-quality hospitals in the nation in terms of clinical excellence by analyzing federal Medicare patient data for 28 common medical procedures and diagnoses, from hip replacement to bypass surgery. Community Hospital is one of only 229 hospitals in the country to qualify for the recognition in the study, which is officially titled the HealthGrades 2005 Study of Distinguished Hospitals for Clinical Excellence.

In its 2005 study, HealthGrades independently and objectively analyzed Medicare patient records from fiscal years 2001-03, for 28 medical procedures and diagnoses. To qualify for the list, hospitals were required to meet minimum thresholds in terms of patient volumes, quality ratings and the range of services provides (see attached methodology paper for details). Hospitals with risk-adjusted mortality and complication rates that scored in the top five percent or better nationally — which demonstrates superior overall clinical performance — were then recognized as Distinguished Hospitals for Clinical Excellence.

“Our focus has always been to bring the best healthcare to our community, which has led us to attract some of the best doctors and professionals in their fields,” said John Gorski, senior vice president of hospital operations for the Community Healthcare System. “Good outcomes are dependent on a whole team of healthcare professionals who not only adopt, but advance the best practices in medicine today.”

To further the process of quality improvement, Community Hospital’s clinical staff and physicians will be working directly with HealthGrades over the next year to identify areas for further quality improvement. The goal of this quality assessment and improvement initiative with HealthGrades is to build on our achievements at Community Hospital and well as throughout our healthcare system, Gorski said.

“At Community Hospital and the Community Healthcare System, we believe a hospital should be excellent at everything it does and that’s why we continuously measure our quality against national benchmarks,” Gorski said. “While it’s rewarding to earn recognition by tough critics, our real motivation is to find out where we need to improve and how to become even better - our community deserves nothing less.”

About HealthGrades
Health Grades, Inc. (OTCBB: HGRD) is the leading independent healthcare quality company, providing ratings, information and advisory services to healthcare providers, employers, health plans and insurance companies. Through its Web site, HealthGrades provides more than one million consumers each month with access to information about healthcare providers and practitioners. HealthGrades works directly with healthcare providers to help assess, improve and promote their quality, and it provides liability insurers, employers and payers with critical information about healthcare quality.