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SECTION 2: Private Placement Memorandum

Hospice care delivery process Typically, a family member serves as the primary caregiver and, when appropriate, helps make decisions for the terminally ill individual. Members of Mother’s Touch staff make regular visits to assess the patient and provide additional care or other services. Mother’s Touch staff must be on-call 24 hours a day, seven days a week. The Mother’s Touch team plans to develop a care plan that meets each patient’s individual needs for pain management and symptom control. This interdisciplinary team, usually consists of the patient’s personal physician, a hospice physician or medical director, nurses, hospice aides, social workers, bereavement counselors, clergy or other spiritual counselors, trained volunteers, and speech, physical, and occupational therapists, if needed. All of these services are mandatory Medicare requirements (Conditions of Participation). Mother’s Touch plans to develop an experienced team in Denver. Marketing the Plan Denver is targeted as our first market entry for these reasons: 1. Denver is large and growing. Age 65+ 2015 population is expected to grow from 244,730 to 419,121 by 2030. The Denver CBSA reported 317,707 Medicare Beneficiaries in 2013. 2. Hospice utilization in Denver is 52% which is below estimated max 70% potential utilization. 3. Denver hospice care competition is fragmented with no overly dominate provider in the market except for The Denver Hospice. There were 24 providers in 2013 with the largest share of market held by The Denver Hospice at over 28% of Admits. Denver Hospice and Gentiva/Harden have a large asset base. In spite of their large base, however, these two are not highly profitable and in fact Denver Hospice showed a net loss in 2013 primarily because of “Fund raising compensation” and overall compensation expense at over 65%. 4. Industry data indicate there is an opportunity for a high quality and efficient hospice care service to capture a profitable share of the Denver market. 5. The Denver economy is strong and growing. “From 2010 to 2015 the region’s economy should add approximately 20,000 new jobs, averaging 2.5% annual growth.” (Source: State Demography One of the key factors in the success of Mother’s Touch will be the comprehensive marketing strategy and roll out to be accomplished over the extended length of time during the Medicare certification process.

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