2017-04-18T00:00:00-05:00 2016-06-30 560747981 DIXON HUGHES GOODMAN LLP 500 RIDGEFIELD COURT ASHEVILLE NC 28806 990 2015-07-01 560619359 GASTON MEMORIAL HOSPITAL INC GAST 7048342000 2525 COURT DRIVE GASTONIA NC 28054 DAVID O'CONNOR EVP, CFO 7048342000 2017-04-19 1 AMY BIBBY P00445891 8282542254 2015 2021-01-29 14:40:06Z CAROMONT REGIONAL MEDICAL CTR DAVID O'CONNOR 2525 COURT DRIVE GASTONIA NC 28054 465507489 0 X WWW.CAROMONT.ORG X 1945 NC TO PROVIDE EXCEPTIONAL HEALTH CARE TO THE COMMUNITIES WE SERVE. 14 10 3485 202 366070 83797 403474 425622 426753833 460065910 -1432 331205 5300270 4437368 432456145 465260105 1154560 1196625 0 0 177029770 183770425 0 0 0 214914529 250673308 393098859 435640358 39357286 29619747 398347138 434982179 322645715 330366723 75701423 104615456 TO PROVIDE EXCEPTIONAL HEALTH CARE TO THE COMMUNITIES WE SERVE. 0 0 405306513 1196625 460336287 CAROMONT'S PHILOSOPHY OF CARE PLAYS THREE DISTINCT ROLES. IT'S A HEALTH SYSTEM THAT STRATEGICALLY INVESTS IN THE FUTURE OF HEALTHCARE, FROM RESEARCH TO EDUCATION. IT'S AN ACTIVE COMMUNITY PARTNER, DRIVING PROGRAMS THAT ENCOURAGE HEALTHY CHOICES EVEN BEFORE PATIENTS WALK THROUGH OUR DOORS. IT'S A DYNAMIC ORGANIZATION ON A PATH OF CONTINUOUS IMPROVEMENT, DELIVERING BOTH WORLD-CLASS MEDICINE AND COMPASSIONATE, PERSONAL CARE. THE FISCAL YEAR ENDING JUNE 30, 2016 SAW CAROMONT HEALTH LIVING ITS VISION TO BE A NATIONALLY RECOGNIZED LEADER AND VALUED COMMUNITY PARTNER. THE COMPLETE 2016 COMMUNITY REPORT CAN BE FOUND AT WWW.CAROMONTHEALTH.ORG 405306513 1 1 0 1 0 0 0 0 0 1 1 0 0 1 1 1 0 1 0 0 0 0 0 0 0 0 1 1 1 1 1 1 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 1 0 0 0 1 800 0 1 3485 1 1 1 0 0 0 0 0 0 0 0 0 X 14 10 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 NC X DAVID O'CONNOR 7048342000 2525 COURT DRIVE GASTONIA NC 28054 MR K CHRISTOPHER PEEK CHAIR - 2016 1.00 1.00 X X 0 0 0 MR WILLIAM ANTHONY CHAIR - 2015 1.00 1.00 X X 0 0 0 MR DONNIE LOFTIS VICE CHAIR - 2016 1.00 2.00 X X 957 0 0 MR W MICHAEL DICKSON VICE CHAIR - 2015 1.00 2.00 X X 0 0 0 MR BARRY M POMEROY SECRETARY - 2016 1.00 1.00 X X 0 0 0 MS ANNETTE CARTER SECRETARY - 2014 1.00 1.00 X X 0 0 0 MR JAMES R BEAM TREASURER - 2016 1.00 1.00 X X 0 0 0 MR JOSEPH B DAVIS JR DIRECTOR 1.00 1.00 X X 0 0 0 MR TIMOTHY E GAUSE DIRECTOR 1.00 1.00 X 0 0 0 MR HOLT D ROBINSON DIRECTOR (THROUGH 6/15) 1.00 X 0 0 0 MR JAMES W BAILEY DIRECTOR (THROUGH 8/15) 1.00 X 0 0 0 DR CHARLES MEAKIN III DIRECTOR 1.00 3.00 X 0 0 0 MS PEARL BURRIS FLOYD DIRECTOR 1.00 2.00 X 0 0 0 MR J CHRISTOPHER HOWELL DIRECTOR 1.00 1.00 X 0 0 0 MR R JASON WILLIAMS DIRECTOR (THROUGH 5/16) 1.00 1.00 X 0 16439 0 DR PATRICK RUSSO CHIEF-OF-STAFF 1.00 2.00 X 0 625603 37373 MR TOM KEIGHER DIRECTOR (BEGAN 6/16) 1.00 1.00 X 0 18515 0 DAVID O'CONNOR EVP/CFO/ASST. TREASURER 40.00 15.00 X 581461 0 107692 MARIA LONG EVP CHIEF LEGAL OFFICER/AS 40.00 15.00 X 458895 0 80718 DOUG LUCKETT CEO/PRESIDENT 40.00 15.00 X 939128 0 180413 KATHLEEN K BESSON EVP/COO 40.00 X 472479 0 101235 TODD DAVIS MD EVP/CMO 40.00 X 469837 0 88168 ANDREA K SERRA VP WELLNESS DEVELOPMENT 40.00 X 330036 0 59991 ELIZABETH MCCRAW VP HUMAN RESOURCES 40.00 X 327432 0 68702 MICHAEL R JOHNSON VP CIO 40.00 X 489467 0 58734 RICHARD C BLACKBURN VP SUPPORT SERVICES 40.00 X 295598 0 64728 BONNIE FAUST VP/CNO 40.00 X 305407 0 14512 RANDALL L KELLEY FORMER OFFICER 0.00 X 502177 0 0 JERRY LEVINE FORMER KEY EMPLOYEE 0.00 X 380890 0 0 5553764 660557 862266 140 1 1 0 BRASFIELD AND GORRIE LLC PO BOX 11407 BIRMINGHAM AL 352460351 CONSTRUCTION MANAGEMENT 12824416 MERCY SPECIALIZED BILLINGS SERVICES 14528 S OUTER FORTY RD CHESTERFIELD MO 63017 CONSULTING 11536341 MORRISON'S MANAGEMENT SPECIALISTS PO BOX 102289 ATLANTA GA 30368 CAFETERIA MANAGEMENT 4509041 ARAMARK CTS 12483 COLLECTION CENTER DR CHICAGO IL 60693 BIOMED EQUIPMENT SERVICES 4305457 EPIC SYSTEMS CORP 1979 MILKY WAY VERONA WI 53593 PHARMACY SERVICES 4141703 59 419786 5836 425622 PATIENT SERVICES REVENUE 621500 457521798 457521798 ANCILLARY REVENUE 621500 2544112 2544112 460065910 326870 11484 315386 4335 0 4335 4335 4335 276863 247384 29479 29479 CAFETERIA & VENDING INCOME 722210 2136940 2136940 MEANINGFUL USE 621500 986609 986609 MISCELLANEOUS 900099 680613 680613 603727 185449 354586 63692 4407889 465260105 460251359 366070 4217054 1076622 1076622 120003 120003 2348307 469662 1878645 137793 137793 144554711 129052548 15502163 7996994 7051718 945276 18332265 16165318 2166947 10400355 9170992 1229363 490205 490205 638613 638613 149820 149820 7074 7074 38747674 33425696 5321978 247886 92896 154990 3917615 2338824 1578791 2847300 2847300 10257955 10257955 145512 79544 65968 475566 108103 367463 7060400 7060400 35540115 35540115 2344903 2344903 UBI TAX 30549 30549 SUPPLIES 75687108 75687108 BAD DEBT 61540469 61540469 R&M EQUIPMENT 4999347 4993209 6138 5545197 5255130 290067 435640358 405306513 30333845 0 18897 34281 51995088 58169462 7407651 7784308 8161745 7985020 590364092 315412593 257496124 274951499 10020 9539 3559270 4919920 2311646 2311646 67386697 78816504 398347138 434982179 44957674 41809328 189837913 183724702 87850128 104832693 322645715 330366723 X 75691404 104605917 10019 9539 75701423 104615456 398347138 434982179 X 29619747 -558 -705156 X X 0 1 X 1 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 1 1 0 0 0 0 1 44987 0 1 90334 135321 0 PART II-B, LINE 1: ANNUAL DUES WERE PAID TO THE NORTH CAROLINA HOSPITAL ASSOCIATION AND THE AMERICAN HOSPITAL ASSOCIATION, OF WHICH $27,678 WAS DETERMINED TO BE EXPENDITURES USED IN LOBBYING ACTIVITIES BY THESE ORGANIZATIONS. AN ADDITIONAL $62,656 IN LEGAL FEES WERE PAID FOR LOBBYING EXPENDITURES. 10002 -278 203 9521 10186 630 405 1219 10002 9488 1251 553 10186 8149 1500 962 1123 9488 6999 1500 221 571 8149 0 0 4512106 4512106 310567935 147711511 162856424 3836590 1274704 2561886 262905194 166426378 96478816 8542267 8542267 274951499 NET PENSION ASSET & PENSION DEFERRAL 14826018 DEFERRED FINANCING COSTS 1607654 OTHER RECEIVABLES 2612454 457B PLAN ASSETS 8298264 DEFERRED CHARGE - INTEREST RATE SWAP 33702180 457F PLAN ASSETS 1384934 PREPAID COUNTY LEASE 16385000 78816504 457B PLAN LIABILITY 8298264 ESTIMATED 3RD PARTY SETTLEMENTS 48431281 INTEREST RATE SWAP LIABILITY 33702180 457F PLAN LIABILITY 1384934 PENSION DEFERRED INFLOW 5816641 NET PENSION LIABILITY 7199393 104832693 X 402945107 -558 565950 565392 402379715 62880390 62880390 465260105 374037541 0 374037541 61602817 61602817 435640358 PART V, LINE 4: THE ORGANIZATION'S ENDOWMENT FUNDS ARE USED FOR ONCOLOGY MEDICATIONS FOR INDIGENT PATIENTS. PART X, LINE 2: THE SYSTEM IS A NOT-FOR-PROFIT CORPORATION AS DESCRIBED IN SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE AND IS EXEMPT FROM FEDERAL INCOME TAXES ON RELATED INCOME PURSUANT TO SECTION 501(A) OF THE CODE. THE SYSTEM HAS DETERMINED THAT IT DOES NOT HAVE ANY UNRECOGNIZED TAX BENEFITS OR OBLIGATIONS AS OF JUNE 30, 2016 AND 2015. FISCAL YEARS ENDING ON OR AFTER JUNE 30, 2012 REMAIN SUBJECT TO EXAMINATION BY FEDERAL AND STATE TAX AUTHORITIES. PART XI, LINE 2D - OTHER ADJUSTMENTS: INTERCOMPANY TRANSFER FROM AFFILIATE 565,950. PART XI, LINE 4B - OTHER ADJUSTMENTS: BAD DEBT 61,540,469. CHANGE IN VALUE OF INTEREST RATE SWAP 1,271,106. AUXILIARY REVENUES 68,815. PART XII, LINE 4B - OTHER ADJUSTMENTS: BAD DEBT 61,540,469. AUXILIARY EXPENSES 62,348. 1 1 1 X 1 X 1 1 0 1 1 9861044 9861044 0.02640 64443491 48611349 15832142 0.04230 74304535 48611349 25693186 0.06870 1634032 20629 1613403 0.00430 2396787 251954 2144833 0.00570 75 1076833 296905 779928 0.00210 1787229 1787229 0.00480 75 6894881 569488 6325393 0.01690 75 81199416 49180837 32018579 0.08560 1392205 1392205 0.00370 1392205 1392205 0.00370 1 61540469 2786034 91558073 105793092 -14235019 X 1 1 1 1 CAROMONT REGIONAL MEDICAL CENTER 2525 COURT DRIVE GASTONIA NC 28054 X X X 3 DIAGNOSTIC IMAGING CENTERS AND 6 OP SERIVCE CENTER CAROMONT REGIONAL MEDICAL CENTER 1 0 0 1 X X X X X X X X 15 1 0 1 1 X WWW.CAROMONTHEALTH.ORG X WWW.GASTONGOV.COM/DEPARTMENTS/HEALTH-AND-HUMAN-SERVICES X X 1 15 0 1 0 1 X 200.000000000000 200.000000000000 X X X X 1 1 X X X X 1 X SEE DISCLOSURE X SEE DISCLOSURE X SEE DISCLOSURE X X X X X X 1 0 X X X X X 1 X 0 0 CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 5: GASTON COUNTY COMMUNITY HEALTH ASSESSMENT WAS CONDUCTED BY THE FOLLOWING PARTNERS: THE GASTON COUNTY DEPARTMENT OF HEALTH AND HUMAN SERVICES, GASTON TOGETHER, UNITED WAY OF GASTON COUNTY AND CAROMONT HEALTH. DATA IN THIS ASSESSMENT IS DERIVED FROM THREE SOURCES: 1) GASTON COUNTY HEALTH DATA, 2) COUNTY HEALTH RANKINGS AND 3) GASTON COUNTY QUALITY OF LIFE SURVEY, 2015. THE QUALITY OF LIFE SURVEY WAS CONDUCTED TO ASSESS THE OPINIONS OF GASTON COUNTY RESIDENTS REGARDING THEIR PERSONAL HEALTH. TO GET A COMPREHENSIVE PICTURE OF THESE OPINIONS, FOUR DIVERSE GROUPS WERE INTERVIEWED: 1) COMMUNITY LEADERS, 2) COMMUNITY RESIDENTS, 3) HIGH SCHOOL JUNIORS AND 4) PERSONS LIVING IN LOW-INCOME AREAS THROUGHOUT THE COUNTY. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 6B: THE HOSPITAL CONDUCTED THEIR CHNA WITH THE FOLLOWING ORGANIZATIONS: GASTON COUNTY HEALTH DEPARTMENT, GASTON TOGETHER, AND UNITED WAY OF GASTON COUNTY. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 7D: 1) HOSPITAL'S FACEBOOK PAGE 2) PRESENTED FINDINGS TO COMMUNITY AT VARIOUS MEETINGS 3) COPY IN GASTON COUNTY LIBRARY - HAD ADS PROMOTING THIS CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 11: THE CHNA WAS PRESENTED TO THE CAROMONT HEALTH BOARD ON 5/23/16 WHICH LED INTO A DISCUSSION RESULTING IN THE FOLLOWING PRIORITIES BEING APPROVED: 1) INCREASE MENTAL HEALTH SERVICES PROVIDED BY LCSWS IN CAROMONT MEDICAL GROUP PRACTICES AND 2) STANDARDIZATION OF CHRONIC OPIOID MANAGEMENT IN CAROMONT MEDICAL GROUP. THESE PRIORITIES ARE A PART OF CAROMONT HEALTH'S CORPORATE GOALS. IDENTIFIED NEEDS THAT ARE NOT BEING ADDRESSED ARE: 1) ILLEGAL DRUG ABUSE, 2) TEEN PREGNANCY AND 3) ALCOHOL ABUSE. THESE CAN BE BETTER ADDRESSED BY OTHER LOCAL ORGANIZATIONS. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 13B: REGARDLESS OF INCOME, ASSETS ARE ALSO USED TO DETERMINE IF A PATIENT QUALIFIES FOR CHARITY. BELOW IS THE VERBIAGE FROM THIS POLICY: EXEMPT ASSETSTHE PRIMARY RESIDENCE ON UP TO ONE ACRE OF LAND, ONE AUTOMOBILE FOR EACH WORKING AGED ADULT, AND OTHER ASSETS, INCLUDING BUT NOT LIMITED TO, RETIREMENT FUNDS, INVESTMENTS AND OTHER FINANCIAL ASSETS, CASH VALUE OF LIFE INSURANCE POLICIES, AND EQUITY IN PROPERTY OR REAL ASSETS, TOTALING UP TO $25,000 ARE ALSO EXEMPT FROM CONSIDERATION AS ASSETS IN DETERMINING CHARITY CARE ELIGIBILITY. ANNUAL INCOME FROM PROPERTY OF REAL ASSETS WILL BE DEDUCTED FROM THE AMOUNT OF EQUITY IN THE ASSET WHEN CALCULATING THE EXEMPTION. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 15E: CAROMONT HEALTH HAS A TEAM DEDICATED TO EDUCATING AND/OR ASSISTING PATIENTS WITH OTHER STATE OR GOVERNMENT AGENCIES THAT MAY BE A SOURCE OF ASSISTANCE. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 16I: PLAIN LANGUAGE BROCHURES AT REGISTRATION SITES. PROACTIVELY COMMUNICATING VERBALLY OR IN WRITING TO SCHEDULED PATIENTS PRIOR TO SERVICE. COMMUNICATING IN-HOUSE, DURING SERVICE, OR AFTER SERVICE TO THOSE MOST LIKELY TO REQUIRE FINANCIAL ASSISTANCE. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 18D: COLLECTION ACTIONS ARE TAKEN AFTER REASONABLE EFFORTS HAVE BEEN MADE TO DETERMINE PATIENT'S ELIGIBILITY FOR ASSISTANCE. CAROMONT REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 20E: PLAIN LANGUAGE BROCHURES AT REGISTRATION SITES. PROACTIVELY COMMUNICATING VERBIALLY OR IN WRITING TO SCHEDULED PATIENT PRIOR TO SERVICE. COMMUNICATING IN-HOUSE, DURING SERVICE, OR AFTER SERVICE TO THOSE MOST LIKELY TO REQUIRE FINANCIAL ASSISTANCE. PART V, SECTION B, LINE 16A: HTTP://WWW.CAROMONTHEALTH.ORG/DOCUMENTS/REGISTRATION_CHARITYCAREPOLICY .PDF PART V, SECTION B, LINE 16B: HTTP://WWW.CAROMONTHEALTH.ORG/DOCUMENTS/CHARITY-CARE-APPLICATION-ENGLIS H.PDF PART V, SECTION B, LINE 16C: HTTP://WWW.CAROMONTHEALTH.ORG/DOCUMENTS/REGISTRATION_CHARITYCAREPOLICY .PDF PART I, LINE 3C: REGARDLESS OF INCOME, ASSETS ARE ALSO USED TO DETERMINE IF A PATIENT QUALIFIES FOR CHARITY. BELOW IS THE VERBIAGE FROM THIS POLICY:EXEMPT ASSETSTHE PRIMARY RESIDENCE ON UP TO (1) ACRE OF LAND, ONE AUTOMOBILE FOR EACH WORKING AGED ADULT, AND OTHER ASSETS, INCLUDING BUT NOT LIMITED TO, RETIREMENT FUNDS, INVESTMENTS AND OTHER FINANCIAL ASSETS, CASH VALUE OF LIFE INSURANCE POLICIES, AND EQUITY IN PROPERTY OR REAL ASSETS, TOTALING UP TO $25,000 ARE EXEMPT FROM CONSIDERATION AS ASSETS IN DETERMINING CHARITY CARE ELIGIBILITY. ANNUAL INCOME FROM PROPERTY OF REAL ASSETS WILL BE DEDUCTED FROM THE AMOUNT OF EQUITY IN THE ASSET WHEN CALCULATING THE EXEMPTION.PART 1, LINE 6A:COMMUNITY BENEFIT REPORT: THE ORGANIZATION'S COMMUNITY BENEFIT REPORT MADE AVAILABLE TO THE PUBLIC CONTAINS COMMUNITY BENEFITS FOR ALL RELATED ORGANIZATIONS TO THE HOSPITAL. PART I, LINE 7: THE COSTING METHODOLOGY USED IS A COST ACCOUNTING SYSTEM. ALL PATIENT SEGMENTS ARE INCLUDED. THIS SYSTEM ASSIGNS DIRECT COSTS TO SUPPLIES, PROCEDURES, ROUTINE AND SPECIALTY ROOM RATES BASED ON THE DEPARTMENT OF ORIGINATION. FIXED COSTS ARE ALLOCATED BASED ON STATISTICAL BASIS. THESE COSTS ARE THEN AGGREGATED AT THE PATIENT LEVEL AND TABULATED BY PAYOR TYPE. NO COST TO CHARGE RATIOS WERE USED IN THE CALCULATIONS. PART I, LN 7 COL(F): 61,540,469 BAD DEBT EXPENSE REMOVED FROM TOTAL EXPENSES PRIOR TO CALCULATING PERCENT OF TOTAL EXPENSE. PART I, LINE 7H: RESEARCH ACTIVITIES: CAROMONT HEALTH IS INVOLVED IN APPROXIMATELY 65 RESEARCH STUDIES, APPROXIMATELY 50% OF WHICH ARE CLINICAL TRIALS COOPERATIVE GROUP PROGRAM STUDIES SPONSORED BY THE NATIONAL CANCER INSTITUTE (NCI). CAROMONT HEALTH ALSO PARTICIPATES IN DRUG AND DEVICE STUDIES SPONSORED BY VARIOUS PHARMACEUTICAL, BIOTECHNOLOGY, AND DEVICE COMPANIES, AS WELL AS UNFUNDED ONCOLOGY, NURSING AND PHARMACY RESEARCH STUDIES. PART I, LINE 3B: UNINSURED PATIENTS WHO DO NOT QUALIFY FOR A CHARITY CARE DISCOUNT WILL BE ELIGIBLE FOR AN UNINSURED DISCOUNT. PART II, COMMUNITY BUILDING ACTIVITIES: WORKFORCE DEVELOPMENT - CAROMONT HEALTH'S RECRUITMENT OF EMPLOYEES, PHYSICIANS AND ADVANCED CARE PRACTITIONERS INTO THE FIVE COUNTIES THE SYSTEM SERVES IS DRIVEN BY THE CHANGING LANDSCAPE OF HEALTH CARE REFORM. THE SYSTEM RECRUITS BASED ON A MEDICAL STAFF DEVELOPMENT PLAN THAT IDENTIFIES COMMUNITY HEALTH CARE NEEDS FOR THE NEXT FIVE YEARS. THE SYSTEM'S GOAL IS TO BE PRO-ACTIVE AND ANTICIPATORY SO THAT THE HEALTH CARE NEEDS OF THE COMMUNITY ARE MET IN A QUALITY-DRIVEN AND CONVENIENT MANNER. PART III, LINE 2: CHARGES WRITTEN OFF TO BAD DEBT WERE TABULATED AT THE PATIENT LEVEL AND ARE REPORTED AT THE AMOUNT CHARGED TO PATIENTS. ACCOUNTS ARE RESERVED AS BAD DEBT BASED ON AN ACCOUNTS RECEIVABLE AGING METHODOLOGY. WHEN ACCOUNTS ARE SENT TO A COLLECTION AGENCY, THEY ARE WRITTEN OFF THE ACCOUNTS RECEIVABLE SYSTEM. ANY SUBSEQUENT COLLECTIONS ON THE ACCOUNTS ARE POSTED AS RECOVERIES AND REDUCE THE EXPENSE. ALL UNINSURED PATIENTS RECEIVE A DISCOUNT ON THEIR BILL, WHICH IS RECORDED AS A CONTRACTUAL ADJUSTMENT. THE AMOUNT OF THE UNINSURED DISCOUNTS ARE EXCLUDED FROM BAD DEBT EXPENSE. PART III, LINE 3: CHARGES FOR SERVICES PROVIDED IN THE EMERGENCY DEPARTMENT ARE EVALUATED FOR CHARITY BASED ON MEANS TESTING. CHARGES FOR SERVICES PROVIDED ELSEWHERE IN THE HOSPITAL ARE EVALUATED FOR CHARITY BASED ON MEANS TESTING AND/OR APPLICATIONS FILED BY THE PATIENTS. IF NO MEANS TESTING IS DONE AND NO APPLICATION IS FILED, THE UNPAID AMOUNT IS WRITTEN-OFF TO BAD DEBT. THE % OF PATIENTS QUALIFYING FOR CHARITY IN THE EMERGENCY DEPARTMENT WAS APPLIED TO THE REMAINDER OF THE HOSPITAL TO DETERMINE THE % OF BAD DEBT PATIENTS WHO COULD HAVE BEEN CHARITY. PART III, LINE 4: THE ORGANIZATION'S FINANCIAL STATEMENTS DO NOT CONTAIN A FOOTNOTE ON BAD DEBT EXPENSE. BAD DEBT EXPENSE IS REPORTED AS A DEDUCTION FROM PATIENT REVENUE. PART III, LINE 8: THE MEDICARE COST REPORT STANDARD COSTING METHODOLOGY WAS FOLLOWED WHEN FILING THE COST REPORT. THIS IS A STEP DOWN METHODOLOGY THAT APPLIES THE AVERAGE PATIENT COST TO MEDICARE PATIENTS. THE COST REPORT DOES NOT ALLOW HOSPITALS TO REPORT ALL OPERATING COSTS. BECAUSE OF THESE TWO ISSUES, THE MEDICARE COST REPORT METHODOLOGY UNDERSTATES THE TRUE COST OF TREATING MEDICARE PATIENTS. USING TOTAL COSTS FROM MEDICARE PATIENTS, THE HOSPITAL HAD AN ACUTAL MEDICARE SHORTFALL OF $21.0 MILLION. PART III, LINE 9B: THE POLICY CONTAINS PROVISIONS ON THE COLLECTION PRACTICES TO BE FOLLOWED FOR PATIENTS WHO ARE KNOWN TO QUALIFY FOR CHARITY CARE OR FINANCIAL ASSISTANCE. BELOW IS VERBIAGE FROM THE CHARITY POLICY:CAROMONT REGIONAL MEDICAL CENTER OFFERS MEDICAL SERVICES FREE OR AT A REDUCED RATE THROUGH THE CHARITY CARE PROGRAM. DETERMINATION OF FULL OR PARTIAL CHARITY CARE WILL BE BASED ON THE PATIENT'S INCOME, FAMILY SIZE, AND ASSETS. POTENTIAL ELIGIBILITY EXISTS ONLY AFTER REIMBURSEMENT EFFORTS FROM ALL OTHER THIRD PARTY RESOURCES, FEDERAL, STATE, AND LOCAL ASSISTANCE PROGRAMS HAVE BEEN EXHAUSTED. PART VI, LINE 2: CAROMONT HEALTH ESTABLISHES COMMUNITY PRIORITIES THROUGH A NUMBER OF MECHANISMS, INCLUDING FEEDBACK AND INPUT FROM INTERNAL AND EXTERNAL STAKEHOLDERS AND COMMUNITY LEADERSHIP, COMMUNITY NEEDS ASSESSMENTS AND QUALITY OF LIFE SURVEYS, AND THE ANALYZATION OF SERVICE AREA AND PATIENT POPULATION-SPECIFIC DATA. PART VI, LINE 3: THE ORGANIZATION INFORMS AND EDUCATES THE PATIENTS ABOUT THEIR ELIGIBILITY FOR ASSISTANCE IN SEVERAL WAYS. A CHARITY AND FINANCIAL SUMMARY IS ON OUR WEBSITE, AND BROCHURES ARE DISTRIBUTED IN THE EMERGENCY ROOM AND ALL OTHER REGISTRATION SITES. SPECIFICALLY TRAINED STAFF (FINANCIAL COUNSELORS AND BENEFIT ELIGIBILITY SPECIALISTS) PROACTIVELY MAKE CONTACT WITH PATIENTS PRIOR TO, AT TIME OF SERVICE, AND/OR AFTER DISCHARGE TO DISCUSS ELIGIBILITY FOR MEDICAID AND OTHER INSURANCE BENEFITS AND OFFER ASSISTANCE WITH THE APPLICATIONS. THE COMMUNICATION IS ATTEMPTED AS SOON AS POSSIBLE. WRITTEN COMMUNICATION IS MADE PRIOR TO COLLECTION AGENCY PLACEMENT. PART VI, LINE 4: GASTON COUNTY, LOCATED IN THE PIEDMONT REGION OF NORTH CAROLINA, IS THE ORGANIZATION'S PRIMARY MARKET. LINCOLN, CLEVELAND AND YORK COUNTY, AS WELL AS THE NORTHWEST PORTION OF MECKLENBURG COUNTY, MAKE UP THE HEALTH SYSTEM'S SECONDARY MARKET. ACCORDING TO THE U.S. CENSUS BUREAU, GASTON COUNTY HAD AN ESTIMATED POPULATION OF 213,442 (2015), A MEDIAN HOUSEHOLD INCOME OF $42,429 (2011-2015) AND 16.7% OF PERSONS IN POVERTY (2011-2015). THE ETHIC/RACIAL DEMOGRAPHICS STATE THAT 79.7% OF THE POPULATION IDENTIFY THEMSELVES AS WHITE, 16.4% AS BLACK OR AFRICAN AMERICAN, 6.6% AS HISPANIC AND 1.5% AS ASIAN. PART VI, LINE 5: OUR COMMUNITY HEALTH INITIATIVES ARE FOCUSED PRIMARILY ON DISEASE PREVENTION AND BETTER MANAGEMENT OF CHRONIC ILLNESSES. THAT INCLUDES WORKING WITH LOCAL EMPLOYERS ON INNOVATIVE PROGRAMS AND COLLABORATING WITH OUR HEALTH CARE NEIGHBORS, MANAGING ILLNESS WITHIN OUR OWN WORKFORCE AND HEAVILY FOCUSING ON SUCCESSFUL CARE COORDINATION FOR PATIENTS WITH CHRONIC DISEASE. ADDITIONALLY, CAROMONT PROVIDES MORE THOUSANDS OF DOLLARS ANNUALLY IN SPONSORSHIP AND GRANT SUPPORT FOR LOCAL NON-PROFITS, COMMUNITY PROGRAMS AND SERVICES, AND OTHER COMMUNITY INITIATIVES AIMED AT IMPROVING THE HEALTH OF OUR COMMUNITY. THROUGH INNOVATION AND A FOCUS ON COMMUNITY WELLNESS, CAROMONT HEALTH IS DETERMINED TO MAKE POSITIVE IMPACT ON HEALTH AND WELLNESS OF THE POPULATIONS WE SERVE. PART VI, LINE 6: CAROMONT REGIONAL MEDICAL CENTER IS A 435-BED ACUTE CARE HOSPITAL ASSOCIATED WITH CAROMONT HEALTH, A REGIONAL, INDEPENDENT, NOT-FOR-PROFIT HEALTH CARE SYSTEM LOCATED IN GASTONIA, NC. THE SYSTEM IS ALSO COMPRISED OF COURTLAND TERRACE, A 96-BED SKILLED NURSING FACILITY; GASTON HOSPICE, WHICH INCLUDES THE 12-BED ROBIN JOHNSON HOUSE INPATIENT FACILITY; AND CAROMONT MEDICAL GROUP, A NETWORK OF 42 PRIMARY AND SPECIALTY PHYSICIAN OFFICES. CAROMONT HEALTH'S VISION IS TO BE A NATIONALLY RECOGNIZED LEADER AND VALUED PARTNER IN PROMOTING INDIVIDUAL HEALTH AND VIBRANT COMMUNITIES.CAROMONT HEALTH HAS 3 OFF-SITE IMAGING LOCATIONS, 2 SAME-DAY SURGERY CENTERS, 1 FREE-STANDING ENDOSCOPY CENTER, 1 OCCUPATIONAL MEDICINE CLINIC, AND 1 OFF-SITE EMERGENCY DEPARTMENT. PART VI, LINE 7, REPORTS FILED WITH STATES NC 1 GASTON FAMILY HEALTH SERVICES 991 WEST HUDSON BOULEVARD GASTONIA NC 28052 581958398 501(C)(3) 338286 FEDERALLY QUALIFIED HEALTH DEPARTMENT OFFERING MEDICAL CARE TO LOW INCOME RESIDENTS MOUNT HOLLY COMMUNITY DEVELOPMENT FOUNDATION 1068 SOUTH MAIN STREET MOUNT HOLLY NC 28120 200738339 501(C)(3) 100000 COMMUNITY ASSISTANCE GASTON REGIONAL CHAMBER 601 W FRANKLIN BLVD GASTONIA NC 28053 560232990 501(C)(6) 22805 COMMUNITY ASSISTANCE GASTON TOGETHER PO BOX 817 GASTONIA NC 28053 562048064 501(C)(3) 40625 COMMUNITY ASSISTANCE CITY OF BELMONT RAIL TRAIL 115 N MAIN STREET BELMONT NC 28012 770338658 GOVERNMENT 20000 COMMUNITY ASSISTANCE COMMUNITY FOUNDATION 1201 E GARRISON BLVD GASTONIA NC 28052 581340834 501(C)(3) 20000 COMMUNITY ASSISTANCE MONTCROSS AREA CHAMBER OF COMMERCE PO BOX 368 BELMONT NC 28012 560710166 501(C)(6) 21500 COMMUNITY ASSISTANCE GASTONIA GRIZZLIES PO BOX 177 GASTONIA NC 28053 421554288 501(C)(3) 36500 COMMUNITY ASSISTANCE HOLY ANGELS FOUNDATION 660 WILKINSON BLVD BELMONT NC 28012 561762654 501(C)(3) 17160 10735 FMV MISC MED EQUIPMENT COMMUNITY ASSISTANCE UNITED WAY 200 EAST FRANKLIN BLVD GASTONIA NC 28052 560653356 501(C)(3) 12000 COMMUNITY ASSISTANCE GIRLS ON THE RUN OF GASTON COUNTY 190 S OAKLAND STREET GASTONIA NC 28052 474179257 501(C)(3) 10000 COMMUNITY ASSISTANCE NC PHYSICIANS HEALTH PROGRAM 220 HORIZON DR SUITE 201 RALEIGH NC 27615 561846599 501(C)(3) 10000 COMMUNITY ASSISTANCE MCADENVILLE FOUNDATION PO BOX 1939 MCADENVILLE NC 28101 560623961 501(C)(3) 10000 COMMUNITY ASSISTANCE AS ONE MINISTRIES 805 WEST AIRLINE AVENUE GASTONIA NC 28054 562180931 501(C)(3) 16200 COMMUNITY ASSISTANCE BOYS & GIRLS CLUBS OF GREATER GASTON PO BOX 23 GASTONIA NC 28053 561419498 501(C)(3) 6000 COMMUNITY ASSISTANCE BELMONT ABBEY COLLEGE PARTNERSHIP 100 BELMONT-MT HOLLY ROAD BELMONT NC 28012 560547498 501(C)(3) 7500 COMMUNITY ASSISTANCE AMERICAN CANCER SOCIETY 1901 BURNSWICK AVE SUITE 100 CHARLOTTE NC 28207 131788491 501(C)(3) 6000 COMMUNITY ASSISTANCE MT HOLLY FARMERS MARKET PO BOX 352 MT HOLLY NC 28120 260464156 501(C)(3) 6000 COMMUNITY ASSISTANCE 27 FOREVER FOUNDATION 2030 LINDA STREET GASTONIA NC 28054 461843123 501(C)(3) 5000 COMMUNITY ASSISTANCE BACKPACK FOOD PROGRAM PO BOX 551030 GASTONIA NC 28055 471591744 501(C)(3) 5000 COMMUNITY ASSISTANCE GASTON GAZETTE 1893 REMOUNT RD GASTONIA NC 28054 472464986 501(C)(3) 5000 COMMUNITY ASSISTANCE LET ME RUN OF GASTON COUNTY - GASTON COUNTY HEALTH DEPARTMENT 991 WEST HUDSON BOULEVARD GASTONIA NC 28052 566000300 GOVERNMENT 5000 COMMUNITY ASSISTANCE DANIEL STOWE BOTANICAL GARDEN 6500 S NEW HOPE RD BELMONT NC 28012 208362933 501(C)(3) 32500 COMMUNITY ASSISTANCE LUMIERE MEDICAL MINISTRIES PO BOX 26 LOWELL NC 28098 561574483 501(C)(3) 40045 FMV MISC MED EQUIPMENT COMMUNITY ASSISTANCE GASTON COLLEGE 201 HIGHWAY 321 SOUTH DALLAS NC 28034 560792292 501(C)(3) 5600 FMV MISC MED EQUIPMENT COMMUNITY ASSISTANCE GASTON COUNTY HEALTH DEPARTMENT 991 W HUDSON BLVD GASTONIA NC 28052 566000300 501(C)(3) 26786 FMV MISC MED SUPPLIES COMMUNITY ASSISTANCE MEDASSIST OF MECKLENBURG 601 E 5TH STREET SUITE 350 CHARLOTTE NC 28202 562018957 501(C)(3) 5000 COMMUNITY ASSISTANCE GASTON FAMILY YMCA 3210 UNION ROAD GASTONIA NC 28056 560655420 501(C)(3) 60000 COMMUNITY ASSISTANCE BELMONT DEVELOPMENT ASSOC PO BOX 431 BELMONT NC 28012 474333734 501(C)(3) 25000 COMMUNITY ASSISTANCE GREATER GASTON DEVELOPMENT CORPORATION 620 NORTH MAIN STREET BELMONT NC 28012 471726248 501(C)(3) 25000 COMMUNITY ASSISTANCE 28 2 AUXILIARY SCHOLARSHIPS 38 59900 ONCOLOGY PHARMACY ASSISTANCE 6 203 PART I, LINE 2: OTHER ORGANIZATIONS THAT RECEIVE GRANT FUNDS MAY BE REQUIRED TO SUBMIT MONTHLY REPORTS THAT ARE MONITORED BY MANAGEMENT AND/OR THE BOARD OF DIRECTORS. ALL GRANTS DECISIONS ARE DOCUMENTED. SCHEDULE I, PART III THE PURPOSE OF THE GERTRUDE CLINTON HEALTH CAREERS SCHOLARSHIP IS TO ENCOURAGE MEDICAL AND HEALTH-RELATED PROFESSIONALS IN THE FIELD OF HUMAN SERVICES TO PRACTICE THEIR SPECIALTIES AT CAROMONT REGIONAL MEDICAL CENTER OR IN GASTON COUNTY. X X X X X 1 1 0 0 0 1 1 0 0 DR PATRICK RUSSO CHIEF-OF-STAFF 0 569569 0 55341 0 693 0 18390 0 18983 0 662976 0 0 DAVID O'CONNOR EVP/CFO/ASST. TREASURER 380983 0 117308 0 83170 0 89652 0 18040 0 689153 0 78545 0 MARIA LONG EVP CHIEF LEGAL OFFICER/AS 318608 0 97039 0 43248 0 78567 0 2151 0 539613 0 42762 0 DOUG LUCKETT CEO/PRESIDENT 604074 0 251233 0 83821 0 161259 0 19154 0 1119541 0 82868 0 KATHLEEN K BESSON EVP/COO 329672 0 100855 0 41952 0 83444 0 17791 0 573714 0 37526 0 TODD DAVIS MD EVP/CMO 318090 0 94200 0 57547 0 70451 0 17717 0 558005 0 56956 0 ANDREA K SERRA VP WELLNESS DEVELOPMENT 229176 0 67127 0 33733 0 51136 0 8855 0 390027 0 32818 0 ELIZABETH MCCRAW VP HUMAN RESOURCES 224628 0 69566 0 33238 0 51438 0 17264 0 396134 0 28528 0 MICHAEL R JOHNSON VP CIO 257319 0 80037 0 152111 0 41837 0 16897 0 548201 0 146338 0 RICHARD C BLACKBURN VP SUPPORT SERVICES 201715 0 61996 0 31887 0 47592 0 17136 0 360326 0 19792 0 BONNIE FAUST VP/CNO 73604 0 0 0 231803 0 10776 0 3736 0 319919 0 92737 0 RANDALL L KELLEY FORMER OFFICER 0 0 0 0 502177 0 0 0 0 0 502177 0 214052 0 JERRY LEVINE FORMER KEY EMPLOYEE 0 0 0 0 380890 0 0 0 0 0 380890 0 141121 0 PART I, LINE 3 THE CEO, CFO, CMO, COO, AND CHIEF LEGAL OFFICER ARE COMPENSATED FOR THEIR SERVICES BY CAROMONT REGIONAL MEDICAL CENTER, A SUBSIDIARY OF CAROMONT HEALTH, INC. THE COMPENSATION OF ALL CAROMONT EXECUTIVES FOR EACH YEAR IS ESTABLISHED BY THE COMPENSATION COMMITTEE OF THE CAROMONT HEALTH BOARD OF DIRECTORS, BASED ON GUIDANCE AND OPINIONS PROVIDED BY AN INDEPENDENT, THIRD-PARTY COMPENSATION CONSULTANT. PURSUANT TO THE COMMITTEE CHARTER FOR THE COMPENSATION COMMITTEE OF THE BOARD, THE BOARD OF DIRECTORS APPROVES THE EXECUTIVE COMPENSATION PHILOSOPHY, WHICH ESTABLISHES THE PARAMETERS FOR ALL EXECUTIVE COMPENSATION DECISIONS. THE BOARD OF DIRECTORS DELEGATES ALL COMPENSATION DECISIONS FOR ALL EXECUTIVES TO THE COMPENSATION COMMITTEE, PROVIDED SUCH DECISIONS ARE CONSISTENT WITH THE COMPENSATION PHILOSOPHY. BOARD APPROVAL MUST BE OBTAINED WHEN COMPENSATION DECISIONS DEVIATE FROM THE COMPENSATION PHILOSOPHY. BOARD MEMBERS WHO SERVE ON THE COMPENSATION COMMITTEE ARE INDEPENDENT AND FREE OF ANY CONFLICT OF INTEREST. ANY COMPENSATION COMMITTEE MEMBER WHO DEVELOPS A CONFLICT OF INTEREST DURING HIS/HER TERM WITH RESPECT TO THE DISCUSSION OF ANY EXECUTIVE'S COMPENSATION DOES NOT PARTICIPATE IN THE DISCUSSION OR DECISION-MAKING BY THE REMAINING INDEPENDENT MEMBERS OF THE COMPENSATION COMMITTEE. THE COMPENSATION COMMITTEE RETAINS JURISDICTION OVER THE TOTAL COMPENSATION PACKAGE FOR EXECUTIVES AND REVIEWS EXECUTIVE BENEFITS AND PERQUISITES AS WELL AS TOTAL CASH COMPENSATION. COMPENSATION FOR THE CEO IS ESTABLISHED THROUGH A PROCESS OF PERFORMANCE EVALUATION, COMPARISON WITH COMPARABLE MARKET DATA AND DETERMINATION BY THE COMPENSATION COMMITTEE OF ACCEPTABLE SALARY RANGE AND PERCENTILE RANKING. ALL COMPENSATION DECISIONS FOR THE CEO ARE APPROVED BY THE COMPENSATION COMMITTEE, AS LONG AS THE COMPENSATION DECISIONS ARE CONSISTENT WITH THE EXECUTIVE COMPENSATION PHILOSOPHY. THE PROCESS FOR DETERMINING COMPENSATION FOR EXECUTIVE DIRECTORS AND MANAGEMENT, UTILIZES COMPENSATION SURVEYS AND STUDIES. FULL COLLECTED COMPENSATION INFORMATION AND ANY COMPENSATION OPINIONS PROVIDED DURING THESE PROCESSES WILL BE KEPT WITH THE COMPENSATION COMMITTEE OR BOARD MINUTES, AS APPLICABLE. PART I, LINES 4A-B DURING THE YEAR THE ORGANIZATION PAID SEVERANCE PAYMENTS TO THE FORMER OFFICER, KEY EMPLOYEE, AND HIGHLY COMPENSATED EMPLOYEE IDENTIFIED BELOW: RANDALL L. KELLEY, FORMER OFFICER $502,177 JERRY LEVINE, FORMER KEY EMPLOYEE $380,890 THE FOLLOWING INDIVIDUALS RECEIVED DEFERRED COMPENSATION ALLOCATIONS FROM THE FILING ORGANIZATION FROM A SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP): DAVID O'CONNOR - $ 73,752 MARIA LONG - 61,467 DOUG LUCKETT - 146,940 ANDREA K. SERRA - 34,538 KATHLEEN K. BESSON - 64,339 ELIZABETH MCCRAW - 35,034 TODD DAVIS, MD - 55,876 MICHAEL R. JOHNSON - 19,665 RICHARD C. BLACKBURN - 31,222 BONNIE H. FAUST - 7,965 PART I, LINE 6 EXECUTIVE INCENTIVE COMPENSATION PLAN FOR ALL KEY EMPLOYEES BASED ON THE ACHIEVEMENT OF ANNUAL BUSINESS OBJECTIVES WHICH INCLUDE A FINANCIAL GOAL ATTRIBUTABLE TO OPERATING MARGIN. MANAGER INCENTIVE PLAN BASED ON CONSOLIDATED CORPORATE AND INDIVIDUAL PERFORMANCE GOALS. CERTAIN CAROMONT MEDICAL GROUP, INC. PHYSICIAN'S COMPENSATION PACKAGES ARE BASED ON THE INDIVIDUAL PHYSICIANS NET RESULTS FROM OPERATIONS AS CALCULATED BASED SOLELY ON HIS/HER NET CHARGES LESS HIS/HER ALLOCABLE SHARE OF CLINIC OVERHEAD COSTS. A NORTH CAROLINA MEDICAL CARE COMMISSION 521309402 65820HVF7 2003-01-23 120000000 SEE PART VI 0 0 0 B NORTH CAROLINA MEDICAL CARE COMMISSION 521309402 65820HG64 2008-01-31 118400000 SEE PART VI 0 0 0 A 1200000 123594002 5150936 1256069 3386000 91583288 22217709 2005 0 1 1 1 B 50320000 118649846 610174 917471 1553718 28952424 86616059 2009 1 0 1 1 A 0 0 1 1 1 1 0.00220 0.00220 0 1 0.00110 0 1 B 0 0 1 1 1 1 0.00010 0.00010 0.00020 0 1 0.00040 0 1 A 0 0 0 1 1 1 MERRILL LYNCH CAPITAL SERVICES 31.600000000000 1 0 0 0 1 B 0 0 1 1 0 1 MERRILL LYNCH DERIVATIVE PRODUCTS 21.000000000000 1 0 0 0 1 A 1 B 1 DATE REBATE COMPUTATION PERFORMED ISSUER NAME: NORTH CAROLINA MEDICAL CARE COMMISSION DATE THE REBATE COMPUTATION WAS PERFORMED: 03/18/2013 ISSUER NAME: NORTH CAROLINA MEDICAL CARE COMMISSION DATE THE REBATE COMPUTATION WAS PERFORMED: 02/25/2013 SCHEDULE K SUPPLENTAL INFORMATION THREE 501(C)(3) ORGANIZATIONS WITHIN THE PARENT-SUBSIDIARY CONTROLLED GROUP BENEFIT FROM THE BONDS AS FOLLOWS: GASTON MEMORIAL HOSPITAL, INC. (56-0619359) CAROMONT HEALTH, INC. (58-1636959) CAROMONT HEALTH SERVICES, INC. (56-1455630) CAROMONT REGIONAL MEDICAL CENTER HOLDS THE LIABILITY FOR THE BONDS, PER AUDITED FINANCIAL STATEMENTS. SCHEDULE K, PART I, LINE A, COLUMN (C): THIS BOND ISSUE INCLUDES TWO CUSIPS MATURING ON THE SAME DATE: 65820HVG5 AND 65820HVF7. SCHEDULE K, PART I, COLUMN (F); DESCRIPTION OF PURPOSE: ISSUE A - THE SYSTEM USED THE PROCEEDS FROM THESE BONDS FOR VARIOUS CAPITAL IMPROVEMENTS, INCLUDING, BUT NOT LIMITED TO A NEW WOMEN'S CENTER AND PARKING DECK, RENOVATIONS TO EXISTING FACILITIES, AND EQUIPMENT. IN ADDITION, PROCEEDS WERE USED TO REFUND IN ADVANCE OF THEIR MATURITIES $17,000,000 IN PRINCIPAL AMOUNT OF THE SERIES 1998 HOSPITAL REVENUE BONDS, ISSUED ON AUGUST 27, 1998. ISSUE B - THE SYSTEM USED THE PROCEEDS FROM THE BONDS FOR VARIOUS CAPITAL IMPROVEMENTS, INCLUDING, BUT NOT LIMITED TO, THE RENOVATION OF CERTAIN FLOORS OF THE PATIENT TOWER, RENOVATION OF THE DAY OF SURGERY UNIT, INSTALLATION OF FIRE SPRINKLERS IN NON-SPRINKLED AREAS, AND THE UPGRADE OF LIFE SAFETY AND CRITICAL POWER. IN ADDITION, THE HOSPITAL USED THE PROCEEDS TO REFUND THE AGGREGATE PRINCIPAL AMOUNT OF THE SERIES 1995 REVENUE BONDS, ISSUED ON NOVEMBER 15, 1995, IN THE AMOUNT OF $41,210,000 AND TO REFUND THE AGGREGATE PRINCIPAL AMOUNT OF THE SERIES 1998 REVENUE BONDS, ISSUED ON AUGUST 27, 1998, IN THE AMOUNT OF $49,710,000. SCHEDULE K, PART II, LINE 3 COLUMN (A): LINE 3 COLUMN (A) INCLUDES THE TOTAL INVESTMENT EARNINGS ON BOND PROCEEDS IN THE AMOUNT OF $ 3,594,002. SCHEDULE K, PART II, LINE 3 COLUMN (B): LINE 3 COLUMN (B) INCLUDES THE TOTAL INVESTMENT EARNINGS ON BOND PROCEEDS IN THE AMOUNT OF $ 249,846. SCHEDULE K, PART II, LINE 11; OTHER SPENT PROCEEDS: OTHER SPENT PROCEEDS INCLUDE DEPOSITS MADE INTO A REFUNDING ESCROW ACCOUNT ALONG WITH INTEREST EARNED ON THE ACCOUNT, BOTH OF WHICH WERE SUBSEQUENTLY USED TO PAY PRINCIPLE AND INTEREST ON THE REFUNDED BONDS. SEE THE RESPONSE FOR PART I, COLUMN (F) FOR DETAILS. SCHEDULE K, PART IV, LINES 3 AND 4A, COLUMN (B): THE SERIES 2008 BONDS WERE ORIGINALLY ISSUED AS VARIABLE BONDS BEARING INTEREST AT WEEKLY RATES. CAROMONT HEALTH, INC. ENTERED INTO INTEREST SWAP AGREEMENTS TO HEDGE ITS INTEREST RISK WITH RESPECT TO A PORTION OF THE SERIES 2008 BONDS. ON SEPTEMBER 1, 2010, THE SERIES 2008 BONDS WERE CONVERTED TO FIXED INTEREST RATES TO MATURITY. HOWEVER, THE INTEREST RATE SWAPS WERE NOT TERMINATED IN CONNECTION WITH SUCH FIXED RATE CONVERSION AND REMAIN IN EFFECT. SCHEDULE K, PART IV, LINE 4C, COLUMN (B): THIS BOND ISSUE HAS TWO HEDGE TERMS: 11.0 YEARS AND 21.0 YEARS. GENA POMEROY FAMILY RELATIONSHIP WITH BOARD MEMBER 48053 COMPENSATION FOR EMPLOYEE SERVICES 0 STEPHEN O'CONNOR FAMILY RELATIONSHIP WITH OFFICER 17486 COMPENSATION FOR EMPLOYEE SERVICES 0 SUZANNE HOWELL FAMILY RELATIONSHIP WITH BOARD MEMBER 72254 COMPENSATION FOR EMPLOYEE SERVICES 0 FORM 990, PART VI, SECTION A, LINE 6 THE SOLE MEMBER OF THE CORPORATION SHALL BE CAROMONT HEALTH, INC., A NORTH CAROLINA NOT-FOR-PROFIT CORPORATION. FORM 990, PART VI, SECTION A, LINE 7A THE BOARD OF DIRECTORS SHALL CONSIST OF FOURTEEN (14) MEMBERS, ALL OF WHOM SHALL BE THE MEMBERS OF THE BOARD OF DIRECTORS OF CAROMONT HEALTH, INC., AND ALL OF WHOM SHALL BE APPOINTED BY THE BOARD OF DIRECTORS OF CAROMONT HEALTH. FORM 990, PART VI, SECTION A, LINE 7B THE FOLLOWING POWERS OF THE CORPORATION SHALL BE RESERVED TO CAROMONT HEALTH, INC., THE PARENT CORPORATION AND HOLDING COMPANY OF THE CORPORATION: (A) FINANCIAL POWERS, INCLUDING THE POWER TO APPROVE AN OPERATING BUDGET FOR THE CORPORATION, POWER TO APPROVE COMPENSATION PLANS, AND POWER TO ASSUME DEBT ON BEHALF OF THE CORPORATION; (B) GOVERNING POWERS, INCLUDING THE POWER TO APPROVE ALL CHANGES TO THE GOVERNING DOCUMENTS OF THE CORPORATION AND POWER TO APPROVE THE MISSION, VISION AND VALUES OF THE CORPORATION; AND (C) STRATEGIC POWERS, INCLUDING THE POWER TO APPROVE ALL CERTIFICATE OF NEED APPLICATIONS WHICH THE CORPORATION MAY FILE IN ANY STATE, AND THE POWER TO APPROVE ALL SALE OR LEASE TRANSACTIONS OF THE CORPORATION. FORM 990, PART VI, SECTION B, LINE 11 THE ORGANIZATION'S FORM 990 WAS REVIEWED BY THE AUDIT FINANCE INVESTMENT COMMITTEE OF THE BOARD OF DIRECTORS PRIOR TO PRESENTATION TO THE FULL BOARD BEFORE THE FORM WAS FILED WITH THE IRS. FORM 990, PART VI, SECTION B, LINE 12C EACH EMPLOYEE AND DIRECTOR SHALL FULLY AND TRUTHFULLY COMPLETE A QUESTIONNAIRE CONCERNING POTENTIAL AND ACTUAL CONFLICTS OF INTEREST ANNUALLY. SUCH QUESTIONNAIRE SHALL IDENTIFY THE INDIVIDUAL'S OBLIGATION TO IMMEDIATELY MAKE THE CORPORATE COMPLIANCE OFFICER AWARE IN WRITING OF ANY POTENTIAL OR ACTUAL CONFLICTS OF INTEREST AS THEY MAY ARISE AND CONTAIN SAID INDIVIDUAL'S AGREEMENT TO ABIDE BY ALL TERMS AND CONDITIONS OF THIS POLICY AS A CONDITION OF RETAINING THEIR POSITION. SUCH QUESTIONNAIRES ARE REVIEWED ANNUALLY BY THE CHIEF LEGAL OFFICER AND THE CORPORATE COMPLIANCE OFFICER. QUESTIONNAIRES SUBMITTED BY DIRECTORS ARE REVIEWED ANNUALLY BY THE NOMINATING COMMITTEE OF THE BOARD. FORM 990, PART VI, SECTION B, LINE 15 THE CEO, CFO, COO, CMO AND CHIEF LEGAL OFFICER ARE COMPENSATED FOR THEIR SERVICES BY CAROMONT REGIONAL MEDICAL CENTER, A SUBSIDIARY OF CAROMONT HEALTH, INC. THE COMPENSATION OF ALL CAROMONT EXECUTIVES FOR EACH YEAR IS ESTABLISHED BY THE COMPENSATION COMMITTEE OF THE CAROMONT HEALTH BOARD OF DIRECTORS, BASED ON GUIDANCE AND OPINIONS PROVIDED BY AN INDEPENDENT, THIRD-PARTY COMPENSATION CONSULTANT. PURSUANT TO THE COMMITTEE CHARTER FOR THE COMPENSATION COMMITTEE OF THE BOARD, THE BOARD OF DIRECTORS APPROVES THE EXECUTIVE COMPENSATION PHILOSOPHY, WHICH ESTABLISHES THE PARAMETERS FOR ALL EXECUTIVE COMPENSATION DECISIONS. THE BOARD OF DIRECTORS DELEGATES ALL COMPENSATION DECISIONS FOR ALL EXECUTIVES TO THE COMPENSATION COMMITTEE, PROVIDED SUCH DECISIONS ARE CONSISTENT WITH THE COMPENSATION PHILOSOPHY. BOARD APPROVAL MUST BE OBTAINED WHEN COMPENSATION DECISIONS DEVIATE FROM THE COMPENSATION PHILOSOPHY. BOARD MEMBERS WHO SERVE ON THE COMPENSATION COMMITTEE DO NOT HAVE SUBSTANTIAL INFLUENCE OVER THE CORPORATION'S BUSINESS AND ARE FREE OF ANY CONFLICT OF INTEREST. ANY COMPENSATION COMMITTEE MEMBER WHO DEVELOPS A CONFLICT OF INTEREST DURING HIS/HER TERM WITH RESPECT TO THE DISCUSSION OF ANY EXECUTIVE'S COMPENSATION DOES NOT PARTICIPATE IN THE DISCUSSION OR DECISION-MAKING BY THE REMAINING MEMBERS OF THE COMPENSATION COMMITTEE. THE COMPENSATION COMMITTEE RETAINS JURISDICTION OVER THE TOTAL COMPENSATION PACKAGE FOR EXECUTIVES AND REVIEWS EXECUTIVE BENEFITS AND PERQUISITES AS WELL AS TOTAL CASH COMPENSATION. COMPENSATION FOR THE CEO IS ESTABLISHED THROUGH A PROCESS OF PERFORMANCE EVALUATION, COMPARISON WITH COMPARABLE MARKET DATA AND DETERMINATION BY THE COMPENSATION COMMITTEE OF ACCEPTABLE SALARY RANGE AND PERCENTILE RANKING. ALL COMPENSATION DECISIONS FOR THE CEO ARE APPROVED BY THE COMPENSATION COMMITTEE, AS LONG AS THE COMPENSATION DECISIONS ARE CONSISTENT WITH THE EXECUTIVE COMPENSATION PHILOSOPHY. THE PROCESS FOR DETERMINING COMPENSATION FOR EXECUTIVE MANAGEMENT UTILIZES COMPENSATION SURVEYS AND STUDIES. FULL COLLECTED COMPENSATION INFORMATION AND ANY COMPENSATION OPINIONS PROVIDED DURING THESE PROCESSES WILL BE KEPT WITH THE COMPENSATION COMMITTEE OR BOARD MINUTES, AS APPLICABLE. FORM 990, PART VI, SECTION C, LINE 18 THE ORGANIZATION'S FORM 990 IS MADE AVAILABLE TO THE PUBLIC UPON REQUEST. FORM 990, PART VI, SECTION C, LINE 19 AT THIS TIME, THE ORGANIZATION'S GOVERNING DOCUMENTS AND CONFLICT OF INTEREST POLICY ARE NOT MADE AVAILABLE TO THE PUBLIC. THE ENTIRE ORGANIZATION'S COMBINED FINANCIAL STATEMENTS ARE MADE AVAILABLE UPON REQUEST. FORM 990, PART XI, LINE 9: INTERCOMPANY TRANSFER FROM AFFILIATE 565,950. CHANGE IN VALUE OF INTEREST RATE SWAP -1,271,106. PART XII, LINE 2C THE PROCESS HAS NOT CHANGED FROM LAST YEAR. FORM 990, PART V AND PART VII COMMON PAYMASTER: THE FILING ORGANIZATION USES A RELATED ORGANIZATION FOR ITS PAYROLL FUNCTION. ALL W-2S ARE FILED BY THE COMMON PAYMASTER. HOWEVER, AMOUNTS PAID BY THE COMMON PAYMASTER ARE TREATED AS IF PAID DIRECTLY BY THE ORGANIZATION FOR WHICH SERVICES ARE PERFORMED. CAROMONT HEALTH INC 2525 COURT DRIVE GASTONIA NC 28054 581636959 MEDICAL SERVICES NC 501(C)(3) LINE 11B, II N/A 0 CAROMONT HEALTH SERVICES INC 2526 COURT DRIVE GASTONIA NC 28054 561455630 OUTPATIENT SERVICES NC 501(C)(3) LINE 3 CAROMONT HEALTH INC 0 GASTON MEMORIAL HOSPITAL FOUNDATION INC 2527 COURT DRIVE GASTONIA NC 28054 561479699 FOUNDATION NC 501(C)(3) LINE 9 CAROMONT HEALTH INC 0 CAROMONT MEDICAL GROUP INC 2528 COURT DRIVE GASTONIA NC 28054 561479712 MEDICAL GROUP NC 501(C)(3) LINE 9 CAROMONT HEALTH INC 0 HOSPICE OF GASTON COUNTY INC 2529 COURT DRIVE GASTONIA NC 28054 581341530 HOSPICE CARE NC 501(C)(3) LINE 7 CAROMONT HEALTH INC 0 GASTON EMERGENCY PHYSICIANS INC 2531 COURT DRIVE GASTONIA NC 28054 562209423 SUPPORTING ORGANIZATION NC 501(C)(3) LINE 11A, I CAROMONT HEALTH INC 0 GASTON COUNTY PO BOX 1578 GASTONIA NC 280531578 566000300 GOVERNMENT ADMINISTRATION NC N/A 0 0 0 1 0 0 0 0 0 0 0 1 0 0 1 1 1 1 1 1