1. Covering The Bases Bernard Pettingill, Ph.D.

2. Economic Damages - Bases Life Expectancy / WLE Continuation of Care Plan Medical Inflation / Attendant Care Presentation Life Expectancy / WLE Continuation of Care Plan Medical Inflation / Attendant Care Presentation

3. New Technology Waste, Inefficiency & Fraud Medical R&D Aging Population New Technology Waste, Inefficiency & Fraud Medical R&D Aging Population Reasons for Cost Increases

4. Life Expectancy Census Data - 2000 Optimal Care - Based on L.E. Census Data - 2000 Optimal Care - Based on L.E.

5. Routine M.D. Visits Therapies ADLs Diagnostics Orthopedic Equipment Supplies Routine M.D. Visits Therapies ADLs Diagnostics Orthopedic Equipment Supplies Categories of Need Attendant CareAttendant Care

6. YEAR 2000 2001 2002 2003 2004 2005 YEAR 2000 2001 2002 2003 2004 2005 MEDICAL CARE 4.3% 4.8% 5.1% 4.5% 5.0% 4.3% MEDICAL CARE 4.3% 4.8% 5.1% 4.5% 5.0% 4.3% Year to Year Changes in Medical Care Costs

7. FROM YEAR TO YEAR # OF YEARS ALL MEDICAL CARE MEDICAL CARE SERVICES PROFESSIONAL SERVICES MEDICAL CARE COMMODI- TIES, PRESCRIP- TIONS AND DRUGS HOSPITAL ROOM AND RELATED SERVICES 1998 1999 2000 2001 2002 2003 2004 1998 1999 2000 2001 2002 2003 2004 2005 76543217654321 76543217654321 4.2% 4.3% 4.4% 4.3% 4.2% 4.3% 4.2% 4.3% 4.4% 4.3% 4.2% 4.3% 4.5% 4.7% 4.8% 4.9% 4.8% 4.5% 4.7% 4.8% 4.9% 4.8% 3.4% 3.5% 3.4% 3.5% 3.9% 3.8% 3.4% 3.5% 3.4% 3.5% 3.9% 3.8% 3.2% 3.0% 2.8% 2.5% 3.2% 3.0% 2.8% 2.5% 6.3% 6.6% 6.8% 6.1% 5.6% 5.3% 6.3% 6.6% 6.8% 6.1% 5.6% 5.3%

8. Sample Case White Female Age 2.0 Life Expectancy = 79.7 years 24 Hour Nursing Care (HOME) $30.50/Hour/LPN Discount Factor = 4.5%

9. Model 1: Growth Rate = 3.4% Present Value = $14.36m Model 2: Growth Rate = Discount rate Present Value = $21.08m Model 3: Growth Rate = 5.4% (25yr. Avg.) Present Value = $30.01m Models

10. Testimony - Economist Long Version / Short VersionLong Version / Short Version Question / AnswerQuestion / Answer Charts / ELMO / OverheadCharts / ELMO / Overhead

11. Recent Life Expectancy Tables Medical Vs General Inflation Sample - Goods / Services 1940, 50, 60, 70, 80, 90s Recent Life Expectancy Tables Medical Vs General Inflation Sample - Goods / Services 1940, 50, 60, 70, 80, 90s Trial Charts

12. $25.0 MILLION

13. $28.0 MILLION

14. $51.6 MILLION

15. CONSULTING ECONOMIST PHONE (561) 622-0330 CELL (561) 346-7828 FAX (561) 624-2854 TOLL FREE (800) 662-0330 CONSULTING ECONOMIST PHONE (561) 622-0330 CELL (561) 346-7828 FAX (561) 624-2854 TOLL FREE (800) 662-0330 BERNARD F. PETTINGILL, PH.D. #93 Sandbourne Lane P.G.A. NATIONAL PALM BEACH GARDENS, FL 33418 E-mail: biffpett@gate.net