2017-11-13T11:10:25-06:00 2016-12-31 350921680 CROWE HORWATH LLP 9600 Brownsboro Road Suite 400 Louisville KY 402411122 990 2016-01-01 611028724 NORTON PROPERTIES INC NORT 5026298263 ACCOUNTING 224 E BROADWAY 5TH FLOOR LOUISVILLE KY 40202 MICHAEL W GOUGH TREASURER & CFO 2017-11-07 true Rachel Spurlock P00520729 5023263996 2016 2017-02-10 21:41:12Z RUSSELL F COX 4967 US HIGHWAY 42 SUITE 100 LOUISVILLE KY 40222 36611934 false X WWW.NORTONHEALTHCARE.COM X 1981 KY OWNS MEDICAL OFFICE BUILDING AND PARKING GARAGES. 23 22 48 5 0 0 0 34483539 36608241 1001 5004 2692 34488543 36611934 0 0 1118222 1097968 0 0 37812900 39498914 38931122 40596882 -4442579 -3984948 72398912 73528931 71145630 76260597 1253282 -2731666 NORTON PROPERTIES, INC. (PROPERTIES) HOLDS PROPERTIES THAT ARE USED TO SUPPORT THE CHARITABLE HEALTH CARE PURPOSES OF NORTON HEALTHCARE, INC. (NORTON), I.E. PRIMARILY OF NORTON HOSPITALS, INC. (HOSPITALS), COMMMUNITY MEDICAL ASSOCIATES, INC., AND NORTON. PROPERTIES OWNS MEDICAL OFFICE BUILDINGS THAT ARE LEASED BY PHYSICIANS ON THE MEDICAL STAFF OF HOSPITALS. IT ALSO LEASES OFFICE SPACE AND PARKING FACILITIES FOR THE CONVENIENCE OF NORTON EMPLOYEES, PHYSICIANS ON THE MEDICAL STAFF OF HOSPITALS, AND GUESTS. false false 40053232 36610933 BUILDING AND PARKING RENTAL- MAINTAIN OFFICE AND PARKING FACILITIES NEAR THE NORTON HEALTHCARE, INC. HOSPITALS AND COMMUNITY MEDICAL ASSOCIATES, INC. PRACTICE LOCATIONS FOR USE BY PHYSICIANS, PATIENTS, PATIENTS' FAMILIES AND GUESTS, AND HOSPITAL EMPLOYEES. 40053232 true false false false false false false true false false true false false false true false false 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 false false false true 96 0 true 48 true false false false false false false false false false false X 23 22 false false false false true true true true true false false true true true true true true true true false X Helena Schulz 5026298263 Accounting 224 E BROADWAY 5TH FL LOUISVILLE KY 402022025 Stephen A Williams CEO/Trustee 2.0 48.0 X X 0 2140771 85700 Donald H Robinson Chair 0.5 14.0 X 0 0 0 Gary L Stewart Vice Chair & Chair Elect 0.5 7.0 X 0 1600 0 Maria L Bouvette Trustee 0.5 3.0 X 0 1600 0 Brendan Canavan Trustee 0.5 3.0 X 0 1600 0 Sue Davis EdD RN Trustee 0.5 3.0 X 0 1600 0 Lee K Garlove Trustee 0.5 4.0 X 0 1600 0 Maria Gerwing Hampton Trustee 0.5 6.0 X 0 1600 0 Craig D Grant Trustee 0.5 3.0 X 0 1600 0 Louis Heuser Trustee (partial year) 0.5 3.0 X 0 0 0 Martha K Heyburn MD Trustee 0.5 5.0 X 0 1600 0 Richard R Ivey Trustee 0.5 3.0 X 0 1600 0 Ronald Lehocky MD Trustee 0.5 5.0 X 0 1600 0 Gail Lyttle Trustee 0.5 3.0 X 0 1600 0 Gregory E Mayes Trustee 0.5 7.0 X 0 1600 0 Maureen McGowan Trustee 0.5 3.0 X 0 0 0 Edie Nixon Trustee 0.5 6.0 X 0 1600 0 Barry Pennybaker Trustee 0.5 3.0 X 0 1600 0 Erwin Roberts Trustee 0.5 3.0 X 0 1600 0 G Hunt Rounsavall Jr Trustee 0.5 7.0 X 0 1600 0 Dr Rita Hudson Shourds Trustee 0.5 3.0 X 0 0 0 Rev William J Schultz Trustee 0.5 5.0 X 0 1600 0 James L Sublett MD Trustee 0.5 3.0 X 0 1600 0 Richard S Wolf MD Honorary Chair Emeritus 0.5 4.0 X 0 1600 0 Joseph J McGowan EdD Trustee (partial year) 0.5 3.0 X 0 0 0 Russell F Cox President 2.0 48.0 X 0 1332366 381368 Michael W Gough Sr VP CFO/Treasurer 2.0 48.0 X 0 1114894 317579 Robert B Azar Sys VP Chief Legal Officer/Secretary 2.0 48.0 X 0 680749 121650 Charles Mattingly Director of Properties 40.0 0 X 128962 0 25002 128962 5299180 931299 1 false true false Intec Building Services Inc 3812 Bardstown Rd LOUISVILLE KY 40218 Cleaning services 347950 Medical Center Stream & Chilled Water 1400 Story Ave Louisville KY 40206 Utility non-public 332612 Securitas Security Services P O Box 403412 Atlanta GA 303843412 Security services 215524 Ready Electric Company Inc 3300 Gilmore Industrial Blvd Louisville KY 40213 Electrical professional services 213600 Pine Tree Mechanical Co Inc 4304 Oak Hill Rd Bowling Green KY 42101 Construction 190593 9 0 RENTAL INCOME 531310 36250076 36250076 PARKING INCOME 812930 358165 358165 0 0 0 0 36608241 0 0 1001 0 1001 1001 1001 MISCELLANEOUS INCOME 531390 2692 2692 0 0 0 0 2692 36611934 36610933 0 1001 621286 402426 218860 118375 76675 41700 217124 168384 48740 141183 117427 23756 1089450 1046941 42509 0 107247 15688 91559 28142898 28142204 694 2104 2104 3184999 3184999 5373259 5373259 93380 93380 REPAIRS AND MAINTENANCE 1028325 1028325 ALLOCATED SUPPORT 389148 315210 73938 COURIER EXPENSES 12941 12941 75163 73269 1894 0 40596882 40053232 543650 0 0 0 0 1499586 1724394 128828781 57024244 70899326 71804537 0 0 0 0 72398912 73528931 1566799 494038 69578831 75766559 71145630 76260597 X 1253282 -2731666 0 1253282 -2731666 72398912 73528931 -3984948 0 X false true X true false X X 1 NORTON HOSPITALS INC 610703799 3 true 40053232 0 1 40053232 0 true false false false false false false false false false false false false false false true false 5768777 5768777 95264930 44232999 51031931 974837 827103 147734 13216935 11964142 1252793 13603302 0 13603302 71804537 CAPITALIZED LEASE AGREEMENT 43830066 PAYABLE TO AFFILIATE 26980367 ASSET RETIREMENT OBLIGATION 3906126 DEFERRED PURCHASE PRICE 1050000 75766559 false true false false false false false true false Stephen A Williams CEO/Trustee 0 1100643 0 648812 0 391317 0 58375 0 27325 0 2226472 0 156533 Russell F Cox President 0 775652 0 300166 0 256549 0 350179 0 31188 0 1713734 0 105296 Michael W Gough Sr VP CFO/Treasurer 0 637892 0 253405 0 223597 0 294872 0 22707 0 1432473 0 88892 Robert B Azar Sys VP Chief Legal Officer/Secretary 0 417886 0 167415 0 95448 0 109086 0 12564 0 802399 0 55868 Charles Mattingly Director of Properties 111314 0 8064 0 9584 0 16468 0 8534 0 153963 0 0 0 Schedule J, Part I, Line 3 Arrangement used to establish the top management official's compensation NORTON HEALTHCARE, INC. (NORTON) EIN 61-1028725 IS THE PARENT ORGANIZATION FOR NORTON PROPERTIES, INC. AND THEREFORE ESTABLISHES COMPENSATION FOR THE CEO, OFFICERS AND KEY EMPLOYEES THROUGH ENGAGING WITH THE EXECUTIVE COMMITTEE OF NORTON; AN INDEPENDENT COMPENSATION CONSULTANT; WRITTEN EMPLOYMENT AGREEMENTS; THIRD PARTY COMPENSATION SURVEYS AND APPROVAL BY THE EXECUTIVE COMMITTEE AND BOARD. SEE NARRATIVE IN SCHEDULE O, REFERENCING PART VI, LINE 15 WHICH FURTHER DESCRIBES THE PROCESS FOR DETERMINING COMPENSATION FOR THE ORGANIZATION. Schedule J, Part I, Line 4b Supplemental nonqualified retirement plan THE FOLLOWING INTERESTED PERSONS PARTICIPATED IN OR RECEIVED PAYMENT FROM SUPPLEMENTAL NONQUALIFIED RETIREMENT PLANS AS DESCRIBED IN IRC SECTION 457(F). THE INTERESTED PERSONS BELOW MAY HAVE PARTICIPATED IN ONE OR MORE OF THE FOLLOWING PLANS: THE EXECU-FLEX BENEFIT PLAN, THE EXECU-PLUS BENEFIT PLAN, DEFINED BENEFIT AND DEFINED CONTRIBUTION RESTORATION PLANS, AND THE PHYSICIAN DEFERRED PLAN. THE "PAY CREDIT" OUTLINED BELOW REPRESENTS A REASONABLE ESTIMATE OF THE ANNUAL INCREASE IN ACTUARIAL VALUE OF THE PLANS; AND THEREFORE, REPRESENTS THE ORGANIZATION'S CONTRIBUTION TO THE VALUE OF THE BENEFITS. NAME - PAY CREDIT Stephen A. Williams - $ 37,614 Russell F. Cox - 184,624 Michael W. Gough - 151,419 Robert Azar - 89,124 THE "PAYMENT RECEIVED" OUTLINED BELOW REPRESENTS CASH PAYMENTS THAT THE EMPLOYEE RECEIVED DURING 2016 AND CAN BE COMPRISED OF CURRENT AND OR PRIOR YEARS EMPLOYEE AND EMPLOYER CONTRIBUTIONS. NAME - PAYMENT RECEIVED Stephen A. Williams - $ 269,688 Russell F. Cox - 110,639 Michael W. Gough - 91,441 Robert Azar - 56,519 Schedule J, Part I, Line 7 Non-fixed payments In 2016, Norton Healthcare, Inc. (Norton) had in place a Variable Compensation Plan for Executives, eligibility under which extended to employees holding a full-time position as Senior Officer, Officer, System Director or other designated Director level position. Under the plan, a variable compensation pool amount is approved by the Board of Trustees. Each participant's performance is evaluated relative to the goals and objectives documented as part of the participant's plan; and an award is determined for the participant, based on achievement of the goals and objectives, subject to the funding of the variable compensation pool. At the end of each year, the Committee on Executive Compensation and Benefits determines an appropriate award for the Norton's President & Chief Executive Officer, and the President & Chief Executive Officer recommends appropriate awards for other senior executives to the Committee on Executive Compensation and Benefits for its review and approval. Form 990, Part V, Line 2a EMPLOYEES REPORTED ON FORM W-3 NORTON HEALTHCARE, INC. (NORTON) EIN 61-1028725 IS THE COMMON PAYING AGENT FOR NORTON PROPERTIES, INC. (PROPERTIES) AND THEREFORE, ALL APPLICABLE IRS TAX COMPLIANCE FILINGS ARE REPORTED BY NORTON ON BEHALF OF PROPERTIES. PROPERTIES HAS APPROXIMATELY 48 EMPLOYEES. Form 990, Part V, Line 1a VENDORS REPORTED ON FORM 1096 NORTON HEALTHCARE, INC. (NORTON) EIN 61-1028725 IS THE COMMON PAYING AGENT FOR NORTON PROPERTIES, INC. (PROPERTIES) AND THEREFORE, ALL VENDORS, INCLUDING INDEPENDENT CONTRACTORS, ARE PAID AND REPORTED BY NORTON ON BEHALF OF PROPERTIES FOR PURPOSES OF PART V, LINE 1. THE NUMBER OF 1099S REPORTED AND FILED FOR 2016 BY NORTON FOR PROPERTIES, WAS APPROXIMATELY 96. PROPERTIES HAS APPROXIMATELY 9 INDEPENDENT CONTRACTORS EXCEEDED $100,000 FOR 2016. Form 990, Part VI, Line 1a Delegate broad authority to a committee The Executive Committee shall possess and may exercise all the powers and authority of the Board of Trustees in the management and direction of the business and affairs of the Corporation. However, the Executive Committee does not possess the authority to do the following: a ) fill vacancies on the Board; b) change the membership of the Executive Committee; c) make decisions to merge, liquidate, or otherwise make decisions outside of the normal course of business; d) make final determinations of long-term policy; e) hire or fire the Chief Executive Officer; and f) amend the Articles of Incorporation or Bylaws. Form 990, Part VI, Line 6 Classes of members or stockholders NORTON HEALTHCARE, INC. EIN 61-1028725 IS THE SOLE MEMBER OF NORTON PROPERTIES, INC. Form 990, Part VI, Line 7a Members or stockholders electing members of governing body THE BOARD OF TRUSTEES OF NORTON HEALTHCARE, INC. APPOINTS THE TRUSTEES OF THE ORGANIZATION. Form 990, Part VI, Line 7b Decisions requiring approval by members or stockholders ACCORDING TO THE ARTICLES OF INCORPORATION OF THE ORGANIZATION, NORTON HEALTHCARE, INC. (NORTON), THE SOLE MEMBER, POSSESSES ALL OF THE RIGHTS GRANTED TO A MEMBER PURSUANT TO LAW, INCLUDING THE RIGHT TO ELECT TRUSTEES OR DIRECTORS AND APPROVE AMENDMENTS TO THE ARTICLES OF INCORPORATION OF THE ORGANIZATION. NORTON ALSO POSSESSES THE RIGHT TO REQUIRE THE ORGANIZATION TO (I) PROVIDE CONTRIBUTIONS OF FUNDS OF THE ORGANIZATION TO PAY ALL OR A PORTION OF THE PRINCIPAL OF, INTEREST ON, AND ALL OTHER PAYMENTS TO BECOME DUE AND OWING WITH RESPECT TO ANY AND ALL INDEBTEDNESS INCURRED BY NORTON, AND (II) PROVIDE SECURITY FOR SUCH INDEBTEDNESS. Form 990, Part VI, Line 11b Review of form 990 by governing body AT THE OCTOBER 5, 2017 NORTON HEALTHCARE, INC. (NORTON) FINANCE COMMITTEE MEETING AND AT THE OCTOBER 26, 2017 NORTON BOARD OF TRUSTEES MEETING, THE 990S WERE DISCUSSED AND COMMITTEE MEMBERS AND TRUSTEES HAD AN OPPORTUNITY TO ASK QUESTIONS. COINCIDING WITH THE FINANCE COMMITTEE MEETING, ELECTRONIC COPIES OF THE 990S WERE MADE AVAILABLE TO ALL MEMBERS OF THE FINANCE COMMITTEE AND THE BOARD OF TRUSTEES THROUGH THE DIRECTOR'S PORTAL SITE, PRIOR TO THE FILING WITH THE IRS. NORTON IS THE PARENT OF NORTON PROPERTIES, INC., COMMUNITY MEDICAL ASSOCIATES, INC., NORTON HOSPITALS, INC., NORTON HEALTHCARE FOUNDATION, INC., AND THE CHILDREN'S HOSPITAL FOUNDATION, INC. Form 990, Part VI, Line 12c Conflict of interest policy THE ORGANIZATION REGULARLY AND CONSISTENTLY MONITERS AND ENFORCES COMPLIANCE WITH THE CONFLICT OF INTEREST POLICY BY ANNUALLY DISTRIBUTING A QUESTIONNAIRE THAT REQUIRES OFFICERS, TRUSTEES, AND KEY EMPLOYEES TO DISCLOSE INTERESTS THAT MAY GIVE RISE TO CONFLICTS. IF A CONFLICT ARISES, THE POLICY PROVIDES PROCEDURES FOR ADDRESSING CONFLICTS TO ENSURE DECISIONS ARE MADE IN THE BEST INTEREST OF THE ORGANIZATION. Form 990, Part VI, Line 15a Process to establish compensation of top management official SEE NARRATIVE BELOW FOR LINE 15B. Form 990, Part VI, Line 15b Process to establish compensation of other employees The organization takes all necessary steps to ensure that compensation for all officers, directors and key employees is reasonable and appropriate for the services provided to the organization. The organization provides a total compensation package that is on par with compensation provided by similar organizations and which conforms to the policies and guidelines set out by the Board of Trustees. Norton Healthcare, Inc. (Norton) engages an outside independent compensation consultant, Integrated Healthcare Strategies (IHS), to provide comparability data for Norton's officers and key employees on total compensation for similar positions at health systems and hospital organizations similar in size, scope of services, and circumstances. In addition, the organization participates in third party surveys which provide aggregate, comparative compensation data for officers and key employees in similar positions at similar organizations. IHS consultants presented and discussed this comparability data in 2015 for the 2016 compensation review and met in 2016 for the 2017 compensation review with the committee of board leadership (now Executive Committee) of the Board of Trustees (Board) The Committee reviewed the executive compensation and benefits program, determined total compensation for the CEO, and approved compensation for other officers and key employees. The Committee reviewed Norton's variable compensation program and determined appropriate awards for performance relative to goals set for the year. After the Committee determined appropriate compensation and benefits for officers and key employees, the Board approved their total compensation. Form 990, Part VI, Line 19 Required documents available to the public FINANCIAL STATEMENTS, GOVERNING DOCUMENTS, AND CONFLICTS OF INTEREST POLICIES ARE NOT REQUIRED DISCLOSURES PURSUANT TO INTERNAL REVENUE CODE (IRC) SECTION 6104. THESE DOCUMENTS ARE NOT AVAILABLE TO THE PUBLIC. Form 990, Part VII, Section A, Line 1a, Column (E) Board Member Stipend Payments Norton Healthcare, Inc. (Norton) and affiliates (Norton Hospitals, Inc., Community Medical Associates, Inc., Norton Properties, Inc., Norton Healthcare Foundation, Inc., and The Children's Hospital Foundation, Inc.) encourages and facilitates board member attendance at educational programs and conferences on subjects relevant to Norton. Norton's travel policy for Board of Trustees provides that for each trustee that attends at least one out of town educational conference, a lump sum stipend will be paid to cover unreimbursed travel expense and other miscellaneous expenses associated with conference preparation, attendance or follow up. In compliance with IRS regulations, Norton provides a form 1099 to any trustee that receives a stipend. These amounts have been reported in Part VII of the form 990 as reportable compensation to the trustee receiving stipends in 2016. NORTON HEALTHCARE INC ACCOUNTING 224 E BROADWAY 5TH FLOOR LOUISVILLE KY 40202 611028725 PROVIDE ADMINISTRATIVE AND SUPPORT SERVICES KY 501(c)(3) Type II NA false NORTON HOSPITALS INC ACCOUNTING 224 E BROADWAY 5TH FLOOR LOUISVILLE KY 40202 610703799 PROVIDE HOSPITAL SERVICES KY 501(c)(3) 3 NORTON HEALTHCARE INC false COMMUNITY MEDICAL ASSOCIATES INC ACCOUNTING 224 E BROADWAY 5TH FLOOR LOUISVILLE KY 40202 611276316 OPERATES A NETWORK OF PHYSICIAN PRACTICES KY 501(c)(3) 9 NORTON HEALTHCARE INC false THE CHILDREN'S HOSPITAL FOUNDATION INC ACCOUNTING 224 E BROADWAY 5TH FLOOR LOUISVILLE KY 40202 616027530 GENERATE FUNDS TO SUPPORT PROGRAMS AND SERVICES KY 501(c)(3) 7 NORTON HEALTHCARE INC false NORTON HEALTHCARE FOUNDATION INC ACCOUNTING 224 E BROADWAY 5TH FLOOR LOUISVILLE KY 40202 310914919 GENERATE FUNDS TO SUPPORT PROGRAMS AND SERVICES KY 501(c)(3) 7 NORTON HEALTHCARE INC false false false false false false false false false false true false false false false true false false true true