2017-11-09T17:45:25-06:00 2016-12-31 ERNST & YOUNG US LLP 560 MISSION ST STE 1600 SAN FRANCISCO CA 94105 990 2016-01-01 990289310 SUTTER INSURANCE SERVICES CORPORATION % ANNIE WOO SUTT 9162866665 745 FORT STREET STE 1100 HONOLULU HI 96813 SUSAN BURCHIEL CFO 2017-10-26 true EVA NITTA P01286320 4158948000 2016 2022-09-23 18:48:47Z BONNIE GEORGE 745 FORT STREET 1100 HONOLULU HI 96813 65475296 false X WWW.SUTTERHEALTH.ORG X 1992 HI SEE SCHEDULE O 4 0 0 0 126392 -1730 0 0 55106161 56859741 -3044823 8489163 138215 126392 52199553 65475296 0 0 0 0 0 9375 0 0 0 61850596 61540078 61850596 61549453 -9651043 3925843 190351726 196160825 149627025 154957998 40724701 41202827 X SEE SCHEDULE O false false 60474445 0 56859741 SEE SCHEDULE O 60474445 true false false false false false false false false false false false false false true true true true false false false false false false false false false false false true false false false false false false false false false false false false false true true true false false true 268 0 true 0 true true false false false false false false false false false X 4 0 false false false false true true true true true false false true true true true true true true true false X ANNIE WOO 8085853592 745 FORT STREET SUITE 1100 HONOLULU HI 96813 FLORENCE DI BENEDETTO SECR SISCO, SVP GEN COUNCIL SH 1.0 40.0 X X 0 1085269 370038 PATRICK FRY CHAIR SISCO, PRES/CEO SH PT YR 1.0 40.0 X X 9375 13161450 279177 BONNIE GEORGE PRESIDENT/CEO SISCO 40.0 0.0 X X 0 433212 85665 SARAH KREVANS CHAIR SISCO, PRES/CEO SH 1.0 40.0 X X 0 2365948 1511150 JEFF SPRAGUE SVP & CFO SUTTER HEALTH 1.0 40.0 X 0 1149499 538199 SHELLY BOEHM CFO SUTTER INSURANCE SVCS CORP 10.0 30.0 X 0 386803 77358 9375 18582181 2861587 0 false true false SEDGWICK CLAIMS MANAGEMENT SVCS INC PO BOX 102514 ATLANTA GA 303682514 3RD PARTY ADMIN FEES 2148245 HANSON BRIDGETT MARCUS VLAHOS AND R 425 MARKET STREET 26TH FLOOR SAN FRANCISCO CA 94105 LEGAL SERVICES 1934069 LATHAM AND WATKINS LLP PO BOX 894271 LOA ANGELES CA 90017 LEGAL SERVICES 1541551 SHEUERMAN MARTINI TABARI ZENERE G 1033 WILLOW ST SAN JOSE CA 95125 LEGAL SERVICES 1386231 PORTER SCOTT APC 350 UNIVERSITY AVENUE SUITE 200 SACRAMENTO CA 95825 LEGAL SERVICES 1027482 28 0 PREMIUM REVENUE 524298 56859741 56859741 56859741 8489163 8489163 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 UBI MALPRACTICE/D&O INSURANCE 524298 126392 126392 126392 65475296 56859741 126392 8489163 0 0 0 0 9375 9375 0 0 0 0 0 0 19290 19290 23072 23072 0 0 317548 317548 0 0 108072 92867 15205 0 0 0 13826 13826 0 0 0 0 0 29251 29251 LOSS AND LOSS ADJUSTMENT 47164643 47164643 PURCHASED SERVICES 9571077 8939027 632050 INSURED INCENTIVE FEE 2659688 2659688 REINSURANCE 1491697 1491697 141914 103322 38592 61549453 60474445 1075008 0 0 0 226206 606249 0 0 0 0 0 0 0 0 0 0 0 0 397007 382388 0 0 187276553 192268234 0 0 0 0 0 0 2451960 2903954 190351726 196160825 374387 259569 0 0 0 0 0 0 0 0 0 0 0 0 0 0 149252638 154698429 149627025 154957998 X 40724701 41202827 0 0 0 0 40724701 41202827 190351726 196160825 X 3925843 -3447717 X false true X true false X X 25 ADOLESCENT TREATMENT CENTER INC 680088443 3 true 0 0 SUTTER BAY HOSPITALS 940562680 3 true 0 0 EAST BAY PERINATAL CENTER 510172285 3 true 0 0 EDEN MEDICAL CENTER 942948100 10 true 0 0 SUTTER CENTRAL VALLEY HOSPITALS 941080917 3 true 0 0 MILLS-PENINSULA HEALTH SERVICES 941156265 3 true 0 0 SUTTER BAY MEDICAL FOUNDATION 941156581 3 true 0 0 SUTTER WEST BAY MEDICAL FOUNDATION 942948131 3 true 0 0 SAMUEL MERRITT UNIVERSITY 942992642 2 true 0 0 SUTTER AUBURN FAITH HOSPITAL FOUNDATION 942594966 7 true 0 0 SUTTER COAST HOSPITAL 942988520 3 true 0 0 SUTTER EAST BAY HOSPITALS 941196176 3 true 0 0 SUTTER EAST BAY MEDICAL FOUNDATION 942690415 3 true 0 0 SUTTER GOULD MEDICAL FOUNDATION 941682256 3 true 0 0 SUTTER HEALTH PACIFIC 990298651 3 true 0 0 SUTTER VALLEY HOSPITALS 941156621 3 true 0 0 SUTTER MEDICAL CENTER FOUNDATION 942788906 7 true 0 0 SUTTER ROSEVILLE MEDICAL CENTER FOUNDATION 680040113 7 true 0 0 SUTTER SOLANO CHARITABLE FOUNDATION 942668262 7 true 0 0 SUTTER VISITING NURSES ASSOCIATION AND HOSPICE 946068843 10 true 0 0 BETTER HEALTH EAST BAY FOUNDATION 510160184 7 true 0 0 CALIFORNIA PACIFIC MEDICAL CENTER FOUNDATION 942728423 7 true 0 0 MILLS-PENINSULA HOSPITAL FOUNDATION 237288765 7 true 0 0 SUTTER DAVIS HOSPITAL FOUNDATION 680217870 7 true 0 0 SUTTER MEDICAL CENTER CASTRO VALLEY 770146047 3 true 0 0 25 true false false false false false false false false false false false false false false true true true X true true SCHEDULE A, PART I, LINE 11G THE PRINCIPAL ACTIVITY OF SISCO IS TO PROVIDE INSURANCE AND RISK MANAGEMENT SERVICES AND SERVING AS A REPOSITORY FOR FUNDS PAID IN BY SUTTER HEALTH AND ITS AFFILIATES FOR THE PURPOSE OF SELF-INSURING. SCHEDULE A, PART IV, SECTION D, LINE 3 This organization is an affiliate of Sutter Health, a 501(c)(3) tax-exempt support organization. Sutter Health is the sole member of SISCO with the right to elect and remove at least a majority of the board of directors, and the majority of SISCO's Board of Directors are officers of Sutter Health. In addition, Sutter Health is also the sole member or controls all of the organizations that SISCO supports. The Sutter Health Board of Directors retains certain "reserved powers" which require that certain decisions made by supported organization boards (including SISCO) must be approved by the Sutter Health Board of Directors before being effective. Because of this structure, supported organizations have a significant voice in the operations of SISCO. SCHEDULE A, PART IV, SECTION E, LINE 2A SISCO IS A RISK MANAGEMENT SUPPORT ORGANIZATION THAT ASSISTS SUTTER HEALTH, ITS PARENT, AND AFFILIATES OF SUTTER HEALTH (LISTED IN SCHEDULE A, PART VI) IN PROVIDING INSURANCE AND RISK MANAGEMENT SERVICES, AND SERVING AS A REPOSITORY FOR FUNDS PAID IN BY SUTTER HEALTH AND ITS AFFILIATES FOR THE PURPOSE OF SELF-INSURING. SCHEDULE A, PART IV, SECTION E, LINE 2B PROVIDING INSURANCE AND RISK MANAGEMENT SERVICES IS A NECESSARY PART OF THE ADMINISTRATIVE FUNCTION OF ANY ORGANIZATION, AND THIS IS ESPECIALLY TRUE IN HEALTH CARE. WITH A LARGE HEALTH CARE SYSTEM LIKE SUTTER HEALTH, INSURANCE COSTS ARE SUBSTANTIAL, BUT TO BETTER CONTAIN COSTS AND PROVIDE APPROPRIATE AND TIMELY RISK SERVICES, SUTTER HEALTH PROVIDES SELF-INSURING TO AFFILIATES THROUGH SISCO. SISCO CONTROLS RISK AND COSTS WHICH FREE UP ADDITIONAL FUNDS TO ASSIST THE COMMUNITIES WE SERVE. 0 INSURANCE LIABILITIES 143770222 PAYABLE TO RELATED PARTIES 10928207 154698429 X 63323665 63323665 317548 1834083 2151631 65475296 59397822 59397822 317548 1834083 2151631 61549453 SCHEDULE D, PART X, LINE 2 ASC 740 (FIN 48) FOOTNOTE FROM AUDIT: THIS ORGANIZATION WAS PART OF A CONSOLIDATED FINANCIAL SYSTEM AUDIT. THE ASC 740 AUDIT FOOTNOTE DISCLOSURE FOR THE SUTTER SYSTEM IS AS FOLLOWS: SUTTER HEALTH, THE LEGAL ENTITY, AND MANY AFFILIATES HAVE BEEN DETERMINED TO BE EXEMPT ORGANIZATIONS BY THE INTERNAL REVENUE SERVICE AND THE CALIFORNIA FRANCHISE TAX BOARD, AND GENERALLY, ARE NOT SUBJECT TO TAXES ON INCOME. CERTAIN ACTIVITIES OF SUTTER ARE SUBJECT TO INCOME TAXES; HOWEVER, SUCH ACTIVITIES ARE NOT SIGNIFICANT TO THE CONSOLIDATED FINANCIAL STATEMENTS. WITH RESPECT TO ITS TAXABLE ACTIVITIES, SUTTER RECORDS INCOME TAXES USING THE LIABILITY METHOD, UNDER WHICH DEFERRED TAX ASSETS AND LIABILITIES ARE DETERMINED BASED ON THE DIFFERENCES BETWEEN THE FINANCIAL ACCOUNTING AND TAX BASES OF ASSETS AND LIABILITIES. DEFERRED TAX ASSETS OR LIABILITIES AT THE END OF EACH PERIOD ARE DETERMINED USING THE CURRENTLY ENACTED TAX RATE EXPECTED TO APPLY TO TAXABLE INCOME IN THE PERIODS THAT THE DEFERRED TAX ASSET OR LIABILITY IS EXPECTED TO BE REALIZED OR SETTLED. SUTTER RECOGNIZES THE TAX BENEFIT FROM UNCERTAIN TAX POSITIONS ONLY IF IT IS MORE LIKELY THAN NOT THAT THE TAX POSITIONS WILL BE SUSTAINED ON EXAMINATION BY THE TAX AUTHORITIES, BASED ON THE TECHNICAL MERITS OF THE POSITION. THE TAX BENEFIT IS MEASURED BASED ON THE LARGEST BENEFIT THAT HAS A GREATER THAN 50% LIKELIHOOD OF BEING REALIZED UPON ULTIMATE SETTLEMENT. THE STATUTE OF LIMITATIONS FOR TAX YEARS 2013 THROUGH 2015 REMAIN OPEN IN U.S. TAX JURISDICTIONS IN WHICH SUTTER AND ITS AFFILIATES ARE SUBJECT TO TAXATION. SUTTER RECOGNIZES INTEREST AND PENALTIES RELATED TO INCOME TAX MATTERS IN OPERATING EXPENSES. AT DECEMBER 31, 2016 AND 2015, THERE WERE NO SUCH UNCERTAIN TAX POSITIONS. SCHEDULE D, PART XI, LINE 4B REINSURANCE RECOVERABLES $ 342,386 REINSURANCE ADD BACK $ 1,491,697 ---------- TOTAL $ 1,834,083 ========== SCHEDULE D, PART XII, LINE 4B REINSURANCE RECOVERABLES $ 342,386 REINSURANCE ADD BACK $ 1,491,697 ---------- TOTAL $ 1,834,083 ========== X true true X X X X false true false false false false false true false FLORENCE DI BENEDETTO SECR SISCO, SVP GEN COUNCIL SH 0 651722 0 360394 0 73153 0 351226 0 18812 0 1455307 0 129200 PATRICK FRY CHAIR SISCO, PRES/CEO SH PT YR 0 116532 0 2164509 9375 10880409 0 273326 0 5851 9375 13440627 0 11519311 BONNIE GEORGE PRESIDENT/CEO SISCO 0 301716 0 101650 0 29846 0 74226 0 11439 0 518877 0 47004 SARAH KREVANS CHAIR SISCO, PRES/CEO SH 0 1528303 0 647289 0 190356 0 1484076 0 27074 0 3877098 0 345896 JEFF SPRAGUE SVP & CFO SUTTER HEALTH 0 698248 0 337500 0 113751 0 509176 0 29023 0 1687698 0 104373 SHELLY BOEHM CFO SUTTER INSURANCE SVCS CORP 0 278995 0 95430 0 12378 0 64851 0 12507 0 464161 0 0 SCHEDULE J, PART I, LINE 1A TAX INDEMNIFICATION: STANDARD POLICY FOR ALL SUTTER HEALTH EMPLOYEES IS THAT NON-CASH GIFTS AND AWARDS ARE GROSSED-UP FOR TAX PURPOSES. THE AMOUNT OF THE GROSS-UP IS ADDED TO THE EMPLOYEES WAGES AND TAXED ACCORDINGLY. SCHEDULE J, PART I, LINE 3 SUPPLEMENTAL COMPENSATION INFORMATION: THE CEO OF THIS ORGANIZATION IS AN EMPLOYEE OF SUTTER HEALTH, A RELATED TAX-EXEMPT ORGANIZATION. THE COMPENSATION COMMITTEE OF THE SUTTER HEALTH BOARD OF DIRECTORS RETAINS ULTIMATE DISCRETIONARY AUTHORITY OVER ALL ELEMENTS OF COMPENSATION TO ASSURE THAT ORGANIZATIONAL PURPOSES ARE APPROPRIATELY BEING SERVED. THE COMPENSATION COMMITTEE USES CREDIBLE DATA SOURCES AND MAINTAINS AN OBJECTIVE "ARMS LENGTH" DECISION-MAKING PROCESS, ENSURING THE INTEGRITY OF SUTTERS EXECUTIVE PROGRAMS AND CONSISTENCY WITH THE ORGANIZATIONS OVERALL MISSION. SEE SCHEDULE O NARRATIVE FOR PART VI, LINE 15 FOR A FULL DESCRIPTION OF THE COMPENSATION APPROVAL PROCESS COMPLETED BY SUTTER HEALTH. SCHEDULE J, PART I, LINE 4B NONQUALIFIED RETIREMENT PLAN: THE PURPOSE OF THE NONQUALIFIED RETIREMENT PLAN IS TO PROVIDE SUTTER HEALTH EXECUTIVES WITH A COMPETITIVE RETIREMENT BENEFIT CONSISTENT WITH SUTTER HEALTHS OVERALL COMPENSATION PHILOSOPHY FOR ALL EMPLOYEES. CONTRIBUTIONS ARE DESIGNED TAKING INTO CONSIDERATION LOST RETIREMENT BENEFITS THAT WOULD OTHERWISE BE OBTAINED THROUGH THE QUALIFIED PENSION PLAN AND SOCIAL SECURITY BENEFITS. SUTTERS PLANS ARE DESIGNED CONSISTENT WITH COMPETITIVE INDUSTRY PRACTICES. THE RETIREMENT PLAN FOR SUTTER HEALTH EMPLOYEES IS A COMBINATION OF SOCIAL SECURITY, 403(B) EMPLOYER MATCH CONTRIBUTIONS AND QUALIFIED PENSION PLAN BENEFITS. SUTTER HEALTH EXECUTIVES ARE GENERALLY INELIGIBLE FOR EMPLOYER MATCH CONTRIBUTIONS. ADDITIONALLY, QUALIFIED PENSION PLAN AND SOCIAL SECURITY BENEFITS CAPS HAVE THE EFFECT OF SUBSTANTIALLY REDUCING RETIREMENT BENEFITS THAT ARE OTHERWISE PROVIDED TO ALL EMPLOYEES. THE EFFECT IS THAT EXECUTIVES OFTEN DO NOT RECEIVE THE SAME LEVEL OF RETIREMENT BENEFIT ON AN INCOME REPLACEMENT BASIS AS OTHER EMPLOYEES. TO ENSURE A COMPETITIVE RETIREMENT BENEFIT AND TO ADDRESS THE SHORTFALLS DESCRIBED ABOVE, SUTTER HEALTH MAKES AN ANNUAL CONTRIBUTION TO A NON-QUALIFIED 457(F) PLAN FOR ITS EXECUTIVES. THE FORMULA HAS TWO PARTS: (1) 4% TO 7% OF BASE SALARY (COMMENSURATE WITH MANAGEMENT LEVEL), PLUS (2) A CONTRIBUTION STARTING AT 5% (BASED UPON TENURE) FOR ELIGIBLE EARNINGS BEYOND THE IRS DEFINITION OF INCLUDIBLE COMPENSATION ("PENSION PAY CAP"). THE LATTER OF WHICH IS DESIGNED TO HELP RESTORE LOST PENSION BENEFITS FORFEITED UNDER THE QUALIFIED PENSION PLAN FOR EARNINGS OVER THE PENSION PAY CAP LIMIT. CONTRIBUTIONS ARE ALSO MADE FOR A SMALL GROUP OF SENIOR LEVEL EXECUTIVES WHOSE ESTIMATED RETIREMENT BENEFIT (SOCIAL SECURITY PLUS QUALIFIED PLAN BENEFITS PLUS 457(F)) FALLS BELOW 50% - 65% OF FINAL 4-YEAR AVERAGE BASE SALARY WHEN RETIRING AT AGE 65 WITH 22.5 YEARS OF SERVICE. TARGET BENEFIT LEVELS ARE DISCOUNTED FOR YEARS OF SERVICE LESS THAN 22.5 AT AGE 65. UNLIKE SUTTER HEALTHS QUALIFIED PENSION PLAN WHERE EMPLOYEE BENEFITS ARE GUARANTEED (I.E., A DEFINED BENEFIT), SUTTERS NON-QUALIFIED PLAN BENEFITS ARE NOT GUARANTEED BY SUTTER HEALTH. INVESTMENT RISK IS BORNE BY PARTICIPANTS AND BENEFITS ARE NOT PROTECTED SHOULD SUTTER HEALTH BECOME INSOLVENT. THE FOLLOWING INDIVIDUALS RECEIVED 457(F) NON-QUALIFIED PAYMENTS DURING THE YEAR: PATRICK FRY - $10,648,923 (*SEE NOTE BELOW) SHELLY BOEHM - $11,900 *PATRICK FRY 2016 COMPENSATION: IN 2016 PATRICK FRY RETIRED AS CEO OF SUTTER HEALTH AFTER A CAREER SPANNING OVER 30 YEARS WITH OUR SYSTEM AND RECEIVED A LUMP-SUM PAYOUT OF A RETIREMENT BENEFIT. SCHEDULE J, PART I, LINE 7 NON-FIXED PAYMENTS: SPOT AWARDS ARE INFREQUENTLY USED TO REWARD EMPLOYEES. THERE ARE NO SPECIFIC GUIDELINES FOR THE AMOUNT OF THE SPOT AWARD BUT THE AMOUNT TENDS TO NOT EXCEED 5% TO 10% OF GROSS ANNUAL SALARY. ANNUAL INCENTIVE PLAN (AIP) THE PURPOSE OF THE PLAN IS TO FOCUS EXECUTIVES ON SPECIFIC, SHORTER-TERM GOALS THAT ARE CRITICAL TO THE ACHIEVEMENT OF AFFILIATE, OPERATING UNIT AND SYSTEM-WIDE OBJECTIVES THAT DRIVE OVERALL ORGANIZATION PERFORMANCE. A PORTION OF THE PLAN AWARD IS DISCRETIONARY IN THAT THE SUPERVISOR MAY ADD UP TO 5% TO THE AWARD PROVIDED THE TOTAL AWARD (FORMULA PORTION PLUS DISCRETIONARY) DOES NOT EXCEED THE MAXIMUM ESTABLISHED FOR ANY GIVEN EXECUTIVE. LONG TERM PERFORMANCE PLANS SUTTER HEALTH ALSO EMPLOYS A LONG TERM PERFORMANCE PLAN WHICH IS DESIGNED TO FOCUS ON LONGER TERM STRATEGIC OBJECTIVES OF THE ORGANIZATION. SUTTERS LONG TERM PERFORMANCE PLAN APPROACH IS A COMBINATION OF BOTH LONGER TERM MEASURES OF ORGANIZATION SUCCESS AND KEY ORGANIZATION STRATEGIES WHICH REQUIRE THE COMBINED EFFORT OF ALL LEADERSHIP TO ACHIEVE SUCCESS. SUTTER USES A COMMON FATE APPROACH IN THAT ALL PLAN PARTICIPANTS ARE MEASURED AGAINST THE SAME, ORGANIZATION-WIDE CRITERIA VS. INDIVIDUAL EFFORTS. THIS FOSTERS A COMMON PURPOSE ACROSS LEADERSHIP AND A SHARED SENSE OF ACCOUNTABILITY FOR THE OVERALL SUCCESS OF SUTTER HEALTH. TO ENSURE THAT EXTRAORDINARY EFFORTS BY INDIVIDUALS CAN BE RECOGNIZED AND THAT ACTIONS OF LEADERSHIP ARE CONSISTENT WITH SUPPORTING SUTTER HEALTHS OVERALL MISSION, VISION, AND VALUES, SUTTERS LONG TERM PERFORMANCE PLAN APPROACH ALSO INCORPORATES A COMBINATION OF CEO AND SUTTER HEALTH COMPENSATION COMMITTEE DISCRETION. IN SOME CASES, THE SUTTER HEALTH COMPENSATION COMMITTEE HAS DELEGATED AUTHORITY TO THE PRESIDENT & CEO TO MODIFY INDIVIDUAL AWARDS WITHIN LIMITS THAT HAVE BEEN PRE-APPROVED BY THE SUTTER HEALTH COMPENSATION COMMITTEE. THIS INCLUDES BOTH THE REDUCTION AND INCREASE OF AWARD AMOUNTS. SUCH MODIFICATIONS GENERALLY DO NOT EXCEED +/- 20% AND ARE EMPLOYED JUDICIOUSLY. IN ALL CASES, THE COMPENSATION COMMITTEE OF THE BOARD DETERMINES ACHIEVEMENT OF ORGANIZATION GOALS AND MAKES FINAL AWARD DETERMINATION WHICH MAY RESULT IN A REDUCTION OF AWARD IF APPROPRIATE. ALL SENIOR EXECUTIVE AWARDS ARE REVIEWED FOR COMPENSATION REASONABLENESS AND APPROVED BY THE COMPENSATION COMMITTEE PRIOR TO PAYMENT. FORM 990 PART I, LINE 1 AND PART III, LINE 1 MISSION STATEMENT: SUTTER INSURANCE SERVICES INCORPORATION (SISCO) IS A RISK MANAGEMENT SUPPORTING ORGANIZATION THAT ASSISTS SUTTER HEALTH SYSTEM AND ITS AFFILIATES IN ACCOMPLISHING THEIR FINANCIAL, PATIENT CARE, AND BUSINESS GOALS AND OBJECTIVES THROUGH SOUND RISK FINANCING AND RISK MANAGEMENT PROGRAMS AND PRACTICES. FORM 990, PART III, LINE 4A EXEMPT PURPOSE ACHIEVEMENTS: THE PRINCIPAL ACTIVITY OF SUTTER INSURANCE SERVICES CORPORATION (SISCO) IS TO PROVIDE SUPPORT AND BENEFIT TO SUTTER HEALTH SYSTEM AND ITS AFFILIATES. SISCO DOES THIS BY PROVIDING INSURANCE AND RISK MANAGEMENT SERVICES AND SERVING AS A REPOSITORY FOR FUNDS PAID IN BY SUTTER HEALTH SYSTEM AND ITS AFFILIATES FOR THE PURPOSE OF SELF-INSURING. SISCO IS OPERATED AS AN INTEGRAL PART OF AND PERFORMS AN ESSENTIAL FUNCTION FOR SUTTER HEALTH SYSTEM AND ITS AFFILIATES. FORM 990, PART VI, LINES 6 & 7A DESCRIPTION OF CLASSES OF PERSONS AND THE NATURE OF THEIR RIGHTS: THIS CORPORATION IS AN AFFILIATE OF SUTTER HEALTH, A CALIFORNIA NONPROFIT PUBLIC BENEFIT CORPORATION. SUTTER HEALTH IS THE SOLE MEMBER WITH THE RIGHT TO ELECT AT LEAST A MAJORITY OF THE MEMBERS OF THE BOARD OF DIRECTORS. FORM 990, PART VI, LINE 7B DESCRIBE CLASSES OF PERSONS, DECISIONS REQUIRING APPROVAL & TYPE OF VOTING RIGHTS: SUTTER HEALTH AS THE SOLE MEMBER OF THE ORGANIZATION IS ENTITLED TO EXERCISE FULLY ALL RIGHTS AND PRIVILEGES OF MEMBERS OF NONPROFIT CORPORATIONS UNDER ALL APPLICABLE LAWS. THE MEMBER HAS THE RIGHTS AND POWERS TO APPOINT (AND REMOVE) MEMBERS OF THE CORPORATION'S BOARD OF DIRECTORS, SUBJECT TO THE PROVISIONS OF THE BYLAWS. IN ADDITION, THE MEMBER HAS THE RIGHT TO APPROVE THE FOLLOWING ACTIONS OF THE CORPORATION'S BOARD OF DIRECTORS: (1) MERGER, CONSOLIDATION OR DISSOLUTION OF THE CORPORATION; (2) AMENDMENT/RESTATEMENT OF THE ARTICLES OF INCORPORATION OR THESE BYLAWS; (3) APPROVAL OF OPERATING AND CAPITAL BUDGETS, HOWEVER, THE CORPORATION MAY DEVELOP BUDGETS WITHIN GUIDELINES AS SET BY THE SOLE MEMBER; (4) LONG-TERM OR MATERIAL AGREEMENTS; (5) APPOINTMENT OF AN INDEPENDENT AUDITOR AND THE HIRING OF CORPORATE COUNSEL EXCEPT IN CONFLICT SITUATIONS BETWEEN THE SOLE MEMBER AND THE CORPORATION; (6) THE CREATION OR ACQUISITION OF ANY SUBSIDIARY OR AFFILIATED ENTITY; (7) CONTRACTING WITH AN UNRELATED THIRD PARTY FOR ALL OR SUBSTANTIALLY ALL OF THE MANAGEMENT OF THE ASSETS OR OPERATIONS OF THE CORPORATION OR ANY SUBSIDIARY OR AFFILIATE THEREOF; (8) APPROVAL OF STRATEGIC PLANS OF THE CORPORATION; AND (9) A TRANSACTION BETWEEN THE CORPORATION AND A DIRECTOR OF THE CORPORATION. SOLE MEMBER REVIEW OF MAJOR ACTIVITIES. THE SOLE MEMBER MAY REVIEW MAJOR ACTIVITIES OF THE CORPORATION. "MAJOR ACTIVITIES" ARE MATTERS THAT THE SOLE MEMBER HAS DECLARED MAJOR, BY WRITTEN NOTICE TO THE CORPORATION THAT IDENTIFIES THE MATTER REQUIRING APPROVAL. NOTICES RECEIVED PURSUANT TO THIS SUBSECTION SHALL BE RECORDED IN THE CORPORATE RECORDS OF THE CORPORATION. FORM 990, PART VI, LINE 11B DESCRIBE THE PROCESS USED BY MANAGEMENT AND/OR GOVERNING BODY TO REVIEW THE FORM 990: SUTTER HEALTH HAS A CENTRALIZED TAX DEPARTMENT RESPONSIBLE FOR THE PREPARATION OF THE FORM 990. ANNUALLY THE TAX DEPARTMENT PROVIDES TRAINING AND EDUCATION TO AFFILIATE PERSONNEL WHO ASSIST THE TAX DEPARTMENT IN COLLECTING AND REVIEWING DATA TO BE REPORTED ON THE FORM 990. THE PREPARATION MATERIAL IS REVIEWED BY VARIOUS DEPARTMENTS INCLUDING TAX, FINANCE, LEGAL, AND HUMAN RESOURCES. A NATIONAL ACCOUNTING FIRM PREPARES AND/OR REVIEWS THE RETURN. A COMPLETED RETURN IS THEN REVIEWED BY THE TAX DEPARTMENT, THE AFFILIATE, AND THE CFO BEFORE THE RETURN IS FILED. FORM 990, PART VI, LINE 12 DESCRIPTION OF PROCESS TO MONITOR TRANSACTIONS FOR CONFLICTS OF INTEREST: EMPLOYEES ARE EDUCATED ON THE CONFLICT OF INTEREST POLICY AND THE NEED TO MAKE DISCLOSURE AS PART OF ANNUAL COMPLIANCE EDUCATION. IN ADDITION, ANNUALLY A DISCLOSURE STATEMENT IS COMPLETED BY ALL DIRECTORS AND OFFICERS THAT INCLUDES AN ACKNOWLEDGEMENT THAT THEY HAVE READ THE CONFLICT OF INTEREST POLICY. ON THIS STATEMENT THE INDIVIDUAL WILL LIST A WIDE RANGE OF INFORMATION WHICH INCLUDES BUSINESS RELATIONSHIPS, EMPLOYMENT RELATIONSHIPS, PROPERTY INTERESTS, AND THOSE OF RELATED PARTIES. THE CEO AND BOARD CHAIR WILL REVIEW THE STATEMENTS AND MONITOR SITUATIONS THAT MAY POSE A POTENTIAL CONFLICT OF INTEREST. THE CEO AND BOARD CHAIR MAY CONSULT WITH THE OFFICE OF THE GENERAL COUNSEL AS NECESSARY. IF THERE IS A POTENTIAL CONFLICT OF INTEREST RELATED TO A PARTICULAR TRANSACTION, THE INTERESTED INDIVIDUAL MUST DISCLOSE THE EXISTENCE AND NATURE OF THE RELATIONSHIP. THE BOARD CHAIR MAY APPOINT A DISINTERESTED PERSON OR COMMITTEE TO INVESTIGATE THE CONFLICT. UNTIL THE POTENTIAL CONFLICT IS RESOLVED, THE BOARD CHAIR MAY REQUEST THE INDIVIDUAL TO NOT PARTICIPATE DURING RELATED PRESENTATIONS AND DISCUSSIONS. IN ALL CIRCUMSTANCES INVOLVING AN ACTUAL CONFLICT, THE INTERESTED INDIVIDUAL SHALL REFRAIN FROM VOTING ON ANY MATTER RELATED TO THE TRANSACTION. FORM 990, PART VI, LINE 15 PROCESS FOR DETERMINING COMPENSATION: THE COMPENSATION COMMITTEE OF THE SUTTER HEALTH BOARD OF DIRECTORS RETAINS ULTIMATE DISCRETIONARY AUTHORITY OVER ALL ELEMENTS OF COMPENSATION TO ASSURE THAT ORGANIZATIONAL PURPOSES ARE APPROPRIATELY BEING SERVED. THE COMPENSATION COMMITTEE USES CREDIBLE DATA SOURCES AND MAINTAINS AN OBJECTIVE "ARMS LENGTH" DECISION-MAKING PROCESS, ENSURING THE INTEGRITY OF SUTTER'S EXECUTIVE PROGRAMS AND CONSISTENCY WITH THE ORGANIZATION'S OVERALL MISSION. IN ORDER TO ENSURE EXTERNAL COMPETITIVENESS, NATIONAL COMPENSATION DATA COMPARISONS ARE REVIEWED. COMPETITIVE ANALYSIS INCLUDES: (A) BASE SALARY, (B) TOTAL CASH (BASE SALARY + ANNUAL INCENTIVE), (C) TOTAL DIRECT CASH (BASE SALARY + ANNUAL INCENTIVE + LONG TERM INCENTIVE) AND (D) TOTAL REMUNERATION (BASE SALARY + ANNUAL INCENTIVE + BENEFITS AND LONG TERM INCENTIVE). THIS ANALYSIS INCLUDES NATIONAL COMPARISONS FOR ORGANIZATIONS SIMILAR IN SIZE, SCOPE AND COMPLEXITY AS SUTTER HEALTH. THIS METHOD IS MOST APPROPRIATE SINCE IT IS A NATIONAL MARKETPLACE IN WHICH SUTTER COMPETES FOR EXECUTIVE TALENT. Officers and Key Employees of this organization undergo an annual review by the Compensation Committee or a delegated sub-committee. Approval is recorded in the minutes. Executive compensation review was last completed in December 2016. FORM 990, PART VI, LINE 19 AVAILABILITY OF GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS TO THE GENERAL PUBLIC: THE SUTTER HEALTH SYSTEM POSTS ITS CURRENT AND PAST AUDITED FINANCIAL STATEMENTS AT SUTTERHEALTH.ORG. OTHER DOCUMENTS ARE ALSO LOCATED AT THIS WEBSITE INCLUDING THE ANNUAL REPORT, MISSION STATEMENT, HISTORY, AND LINKS TO AFFILIATE WEBSITES. THE GOVERNING DOCUMENTS ARE NOT AVAILABLE TO THE PUBLIC AT THIS TIME. FORM 990, PART XI, LINE 9 OTHER CHANGES TO FUND BALANCE: EQUITY TRANSFER (NET) $ (3,447,717) ADOLESCENT TREATMENT CENTERS INC C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 680088443 HEALTHCARE CA 501(C)(3) 3 SUTTER EBH true BETTER HEALTH EAST BAY FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 510160184 FUNDRAISING CA 501(C)(3) 7 SUTTER EBH true CALIFORNIA PACIFIC MEDICAL CTR FOUND C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942728423 FUNDRAISING CA 501(C)(3) 7 SUTTER BH true EAST BAY PERINATAL CENTER C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 510172285 HEALTHCARE CA 501(C)(3) 3 SUTTER EBH true EDEN MEDICAL CENTER C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942948100 HEALTHCARE CA 501(C)(3) 10 SUTTER HLTH true MEMORIAL HOSPITAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942290244 FUNDRAISING CA 501(C)(3) 12A - I SUTTER CVH true MILLS-PENINSULA HEALTH SERVICES C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 941156265 HOSPITAL CA 501(C)(3) 3 SUTTER BMF true MILLS-PENINSULA HOSPITAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 237288765 FUNDRAISING CA 501(C)(3) 7 SUTTER BH true SAMUEL MERRITT UNIVERSITY 450 30TH STREET STE 2840 OAKLAND CA 94609 942992642 UNIVERSITY CA 501(C)(3) 2 SUTTER EBH true SUTTER AUBURN FAITH HOSPITAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942594966 FUNDRAISING CA 501(C)(3) 7 SUTTER VH true SUTTER BAY HOSPITALS C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 940562680 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER BAY MEDICAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 941156581 HEALTHCARE CA 501(C)(3) 3 SUTTER HLTH true SUTTER CENTRAL VALLEY HOSPITALS C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 941080917 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER COAST HOSPITAL C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942988520 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER DAVIS HOSPITAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 680217870 FUNDRAISING CA 501(C)(3) 7 SUTTER VH true SUTTER EAST BAY HOSPITALS C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 941196176 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER EAST BAY MEDICAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942690415 HEALTHCARE CA 501(C)(3) 12B - II SUTTER HLTH true SUTTER GOULD MEDICAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 941682256 HEALTHCARE CA 501(C)(3) 3 SUTTER HLTH true SUTTER HEALTH 2200 RIVER PLAZA DRIVE SACRAMENTO CA 95833 942788907 SUPPORTING OR CA 501(C)(3) 12C III-FI NA false SUTTER HEALTH PACIFIC 91-2301 FT WEAVER RD EWA BEACH HI 96706 990298651 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER HEALTH PLAN C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 461183948 HEALTH PLAN CA 501(C)(4) N/A SUTTER HLTH true SUTTER MEDICAL CENTER FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942788906 FUNDRAISING CA 501(C)(3) 7 SUTTER VH true SUTTER MEDICAL CENTER CASTRO VALLEY C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 770146047 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER ROSEVILLE MEDICAL CTR FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 680040113 FUNDRAISING CA 501(C)(3) 7 SUTTER VH true SUTTER SOLANO CHARITABLE FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942668262 FUNDRAISING CA 501(C)(3) 7 SUTTER VH true SUTTER VALLEY HOSPITALS C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 941156621 HOSPITAL CA 501(C)(3) 3 SUTTER HLTH true SUTTER VALLEY MEDICAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 680273974 HEALTHCARE CA 501(C)(3) 12B - II SUTTER HLTH true SUTTER VISITING NURSE ASSOC AND HOSPICE C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 946068843 HEALTHCARE CA 501(C)(3) 10 SUTTER HLTH true SUTTER WEST BAY MEDICAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 942948131 HEALTHCARE CA 501(C)(3) 3 SUTTER HLTH true TRACY HOSPITAL FOUNDATION C/O SH TAX 2200 RIVER PLAZA DR SACRAMENTO CA 95833 680318845 FUNDRAISING CA 501(C)(3) 12A - I SUTTER CVH true MAGNETIC IMAGING AFFILIATES LLC 175 LENNON WALNUT CREEK CA 94598 942953833 PATIENT CARE CA NA SURGERY CENTER OF ALTA BATES SMC 3875 TELEGRAPH OAKLAND CA 94609 470946086 OUTPATIENT SURG CA NA ALTA CT SERVICES LP 175 LENNON WALNUT CREEK CA 94598 943083464 PATIENT CARE CA NA CALIFORNIA PACIFIC ADV IMAGING LLC PO BOX 6102 NOVATO CA 94598 562311840 MRI JOINT VENTURE DE NA SAN FRANCISCO ENDOSCOPY CENTER 2200 RIVER PLAZA DRIVE SACRAMENTO CA 95833 912160588 ENDOSCOPY JV CA NA PRESIDIO SURGERY CENTER LLC 1635 DIVISADERO SAN FRANCISCO CA 94115 320144060 AMBULATORY SURG CA NA SUTTER FAIRFIELD SURGERY CENTER LLC 2200 RIVER PLAZA DRIVE SACRAMENTO CA 95833 300233892 SURGERY CA NA TWIN CITIES SURGICAL HOSPITAL LLC 2200 RIVER PLAZA DRIVE SACRAMENTO CA 95833 352182617 SURGERY CA NA SUTTER AMADOR SURGERY CENTER LLC 2200 RIVER PLAZA DRIVE SACRAMENTO CA 95833 461398093 SURGERY CA NA ROSEVILLE ENDOSCOPY CENTER 2200 RIVER PLAZA DRIVE SACRAMENTO CA 95833 870710513 ENDOSCOPY JV CA NA STANISLAUS SURGICAL HOSPITAL LLC 1421 OAKDALE ROAD MODESTO CA 95355 911754157 SURGERY CA NA MEMORIAL MEDICAL BUILDING 1 1800 COFFEE RD 76 MODESTO CA 95355 770287288 OFFICE RENTAL CA NA MEMORIAL MEDICAL BUILDING 2 1800 COFFEE RD 76 MODESTO CA 95355 770287288 OFFICE RENTAL CA NA MAGNETIC IMAGING AFFILIATES LLC 2125 OAK GROVE ROAD WALNUT CREEK CA 94598 473696091 PATIENT CARE CA NA ASC OPERATORS - 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