Sharon D. Lund Foundation NICU_SBU Proposal DJCW Children's Hospital of Orange County Portfolio

September 6, 2014

Robert L. Wilson
Board of Director
Sharon D. Lund Foundation
25129 The Old Road
Stevenson Ranch, CA 91381

Dear Robert,

First and foremost, we wish to thank you for all that the Lund Foundation has done to
support CHOC Children‘s. The Sharon D. Lund Foundation continues to serve as one of
our strongest philanthropic partners and trusted friends.

We can think of no greater acknowledgment of our partnership than to respectfully share
with you an emerging philanthropic request for our Neonatal Intensive Care Unit (NICU)
and Small Baby Unit (SBU).

CHOC Children‘s is sensitive to the fact that the below request represents a significant
philanthropic gift, but the need for support for our patients and families is too important not
to share with those who are closest to us. As you recognized first hand last week, we‘ve
reached a critical juncture in our need to expand the NICU and SBU.

We thank you in advance for your consideration and hope you will join us in our efforts to
support the NICU and SBU.

Sincerely,

Donna J. Wick

Donna J. Wick
Major Gifts Officer
Neonatal Intensive Care Unit & Small Baby Unit

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ABOUT CHOC:
Throughout our 50-year history, CHOC Children‘s Hospital has relied on a partnership with
our adjacent hospital, St. Joseph‘s for access to surgical, laboratory, imaging, and emergency
services for its patients. In 2013, the time was right for CHOC Children‘s to improve the
family experience and broaden its scope and care for our young patients by bringing
comprehensive treatment under our own roof. This expansion resulted in our Bill Holmes
Tower, which opened in spring of 2013.

Despite all the excitement leading up to a baby's arrival, pregnancy and birth are fraught with
some level of worry and concern too. It‘s all the more important to be surrounded by
professionals who can help. CHOC‘s NICU is a Level IV facility, our reputation has been
well regarded and as a result couples facing high-risk pregnancies often come from
surrounding communities and beyond to have their babies delivered here.

Neonatology is a division of pediatrics that specializes in the care of newborns who are too
premature or too sick to go to the main nursery. Through our partnerships with area
hospitals and beyond, the neonatology staff is often made aware of prenatal complications in
advance and able to meet with parents for a perinatal consultation to plan for a baby's birth.
In other instances, the neonatology team is called in emergently when an obstetrician
encounters an unexpected complication. A significant percentage of our patients are
admitted to the NICU as a result of problems from prematurity, others come to us with a
variety of existing health problems, ranging from congenital heart defects to intestinal
obstructions, respiratory issues and jaundice.

CHOC Children‘s Neonatal Intensive Care Unit
(NICU:

As a member of the Neonatal Centers of
Excellence Network, CHOC‘s Neonatal Intensive
Care Unit (NICU) provides families with the
highest-quality neonatal and mother-baby services.
Our 54-bed NICU, located on the second floor, is
the only Level IV unit in the region, offering
multidisciplinary tertiary and quaternary care for
the sickest of newborns, infants and children.

CHOC is the only Orange County hospital offering extracorporeal membrane oxygenation
(ECMO) and one of only 72 ECMO programs in the country.

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An additional 13 beds are located in the new level II CHOC NICU at St. Joseph Hospital.
The neonatology division is also involved in various research efforts, and is part of the
California Prenatal Quality Care Collaborative (CPQCC).

Most babies admitted to the NICU are premature (born before 37 weeks of pregnancy),
have low birth weight or have a medical condition that requires special care.

CHOC‘s NICU boasts a staff of 24 physicians, which is a significant number considering the
extra three years of training pediatricians must undergo to become neonatologists. Our
physicians are not only the area‘s foremost leaders in neonatology, they actively engaged in
research targeted to premature babies so that we may apply that knowledge to our daily work
in the hospital.

In addition to the physicians, the unit also has a team of certified neonatal nurse
practitioners (registered nurses with advanced degrees in neonatal care), many of whom have
been with the department for several years. The neonatology team also works closely with
CHOC's extensive staff of pediatric subspecialists, including surgeons, urologists,
orthopedists, gastroenterologists, infectious disease specialists, endocrinologists, and
cardiologists.

Recently, CHOC‘s NICU was named one of the nation‘s ―top 20‖ by the 2014-2015 U.S.
News & World Report. The ranking showcases the team‘s unwavering commitment to the
highest standards of patient care and safety. Dr. Vijay Dhar, Medical Director of the
NICU attributes the division‘s high performance to the specialized service lines, including
the Small Baby Unit, Surgical NICU, and the Cardiac NICU program.

Small Baby Unit (SBU):
In March 2010, CHOC Children‘s opened a special unit within the CHOC NICU that
focuses on caring for the unique needs of the smallest and sickest newborns. The Small
Baby Unit (SBU) offers even more specialized care for babies born before 28 weeks
gestation or weighing less than 1,000 grams.

The SBU is a quieter, more ―womb-like‖
unit staffed by dedicated neonatologists,
NICU nurses, respiratory therapists,
lactation consultants and other healthcare
professionals specially trained to care for
these tiny babies. The environment is also
designed to provide as little stimulation as
possible, incorporating natural or dimmed
lighting and noise.

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The goal of this very special unit within the NICU is to provide the highest quality care in
order to achieve optimal patient outcomes, reduce mortalities often associated with this
extremely high risk population and increase family satisfaction. Micro-preemies treated in
this area of the NICU have been born weighing less than 1000 grams.

Recently, dozens of representatives from neonatal intensive care units nationwide spent two
days at CHOC to learn how to replicate the SBU‘s remarkable facility in their own hospitals
as part of a conference held by the Vermont Oxford Network (VON). We were elated to
share our best practices in the field.

The Need:
Prior to the development of the Bill Holmes Tower, we were very aware that while the
Tower was essential in our efforts to expand the overall hospital, the added new
infrastructure would be unable to serve our expansion needs for the Neonatology Intensive
Care Unit, (NICU) and Small Baby Unit (SBU). Thus these very important units would
remain as is, but serve as CHOC‘s next and most pressing ensuing priority.

Serving CHOC‘s existing NICU patients with the greatest level of care remains the
cornerstone for all that we do and drive our every effort. We‘ve reached a critical juncture
in our ability to maintain the highest level of care for our patients and serve the community
that has come to rely on us. Older NICUs as in the case with CHOC were constructed with
open bays where bassinets are situated close together.

Premature babies often spend their first months of life in neonatal intensive care units
environments that, in recent years, have seen transformations across the country where
many hospitals are adding private rooms to NICUs in place of open wards. Such renovations
are due in large part to concerns that excessive stimulation from noise and lights – and not
medical conditions alone — may negatively impact a preemie‘s neurodevelopmental
outcome.

We are seeking philanthropic support to expand our NICU and Small Baby Unit to offer
private rooms to our most vulnerable patients and their families.

Since first introduced nearly 20 years ago, private room neonatal intensive care units
(NICUs), also known as single family rooms (SFRs) care, have gained traction as a major
development in hospital NICU construction. Unlike traditional units with bassinets placed in
an open-bay arrangement, private room units are spacious and comfortable for families and
have been credited with improved patient outcomes.

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SFR NICU typically consists of a series of private rooms each with approximately 160 net
square feet (NSF) with dedicated space for the bassinet, family, and caregivers within the
room.

Future Private Patient Room

The rooms are grouped in pods of approximately 12 rooms to facilitate staffing.

The overall size of the unit would [range from 400 departmental gross square feet (DGSF)
to 800 DGSF per bassinet depending on the scope of amenities. Benefits of the Single
Family Room for NICU are the new standard due to evidenced based research.

The most frequently cited benefits of Single Family Patient Room NICUs are the improved
environment for the infant and the family. Research shows that premature infants require
different lighting levels based on their developmental age and protection from high noise
levels. The private room setting allows the environment to be better tailored to the needs of
the infant. Infants in a private room unit have a higher average weight gain per day, fewer
days of requiring intravenous nutrition, and a reduced rate of hospital acquired infections.

The private room setting also provides the space and privacy for parents to be more
intimately involved in the care of the infant including breastfeeding and skin-to-skin contact
(Kangaroo care) both of which have been shown to have health benefits for the infant. A
recent study showed that increased parental involvement leads to better short- and long-term
outcomes for premature infants. The numerous benefits to patients include:

Healing Environment:
 Improved developmental care
 Improved parent involvement
 Reduce noise and better sleep leading to better healing
 Reduced anxiety and stress caused by overcrowded ‗bays‘

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 Reduced need for oxygen use which can cause chronic lung disease and retinopathy
(visions problems/blindness)

 Improved privacy which leads to better communication with doctors and nurses and
preparation for discharge

 Reduced length of stay
 Increased use of breast milk

Safety:
 Reduced possibility of cross-contamination of infections
 Reduced infection rates in very vulnerable/susceptible population
 Reduced medication errors
 Increased communication between family and healthcare team

Satisfaction:
 Space for parent/family involvement
 Reduced post-partum depression
 Increased family satisfaction related to privacy and more control
 Increased staff satisfaction related to more access to and interaction with
family/parents and less stressful environment
 Flexibility in operations, babies don‘t have to be moved around to accommodate
patients who require a private room due to disease infection

Cost:
 Reduced operating costs related to patient transfer due to acuity adaptable rooms
 Higher occupancy rates as a desirable environment – higher consumer draw

Future Needs and Growth:
The growing need to support our NICU and SBU is the highest priority for CHOC. The
hospital looks forward to our expanded 4th floor NICU developing over the next five (5)
years. Phase one includes:

 Thirty-six (36) private rooms
 Main lobby sitting area with exterior views,
 Family multipurpose room with computer and television
 Sibling Activity / Play Room and Consultation Room
 Private room designed to support healing environment for infant care
 Standardize room design – all room plans the same with dedicated staff zone, patient

zone and family zone within the room

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 Patient room size – 230 square feet with multiple lighting options, wood-like
cabinetry and flooring

 Family rooming-in facilities includes
sofa / sleeper; work desk

Phase two includes:
 Beside nursing concept with Care
Givers close to patient / family –
nursing alcoves between pair of rooms
with view windows for direct
observation and sliding glass doors for
optimum visualization and easy access
 Four team communication stations for
each 9 patient rooms
 Formula / milk bank storage and
processing

Future Nursing Alcove between pair of rooms

Despite the numerable positive outcomes for our families and costs savings, there is an
added measure of importance to expand our NICU and Small Baby Unit at this time.

CHOC adhere to the Office of Statewide Healthcare Planning and Development, (OSHPD)
initial application that was approved at the time we broke ground on the Bill Holmes Tower
construction. Under our initial application with OSHPD, all construction and expansion
must be completed within specific timeframe or CHOC will be required to reapply to
expand our NICU- a process that is both costly and time consuming.

The decision to expand CHOC‘s NICU was not made lightly. Our decision to move
forward at this time relies heavily on an ongoing, system wide basis takes into account
resource investments required to support existing programs and the significant ongoing
support that will be required to sustain our expanded NICU and SBU. This approach has
assured us that the decision to move forward with an expansion at this time is aligned with
our needs as an organization, but equally aligned with regional needs, and most importantly
serve our most vulnerable patients.

CHOC relies on community support to ensure the most technologically advanced,
compassionate care is provided to each and every child who needs us.

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We are requesting a philanthropic investment of $2,500,000.00 over the next two (2) fiscal
years.

Phase I 1,250,000.00
Phase II 1,250,000.00

In order to arrive at the above financial assumptions, careful consideration was given to the
needs of our community juxtaposed with your existing investments resulting in the
aforementioned conservative to moderate request.

As one of our strongest philanthropic champions, we believe that you remain the
preeminent partner to support CHOC‘s Neonatal Intensive Care Unit (NICU) and our Small
Baby Unit (SBU) expansion project.

The power to elevate CHOC‘s NICU and SBU remains where it has always been: in the
hearts and souls of our trusted partners. The impact that your investment will have on the
future of CHOC and the community will be immeasurable; we hope that you will take this
next step with us—together the power to shape the future for our must vulnerable has never
been greater.

We thank you for your time and consideration.

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