2017-06-01T12:54:31-05:00 2016-08-31 450250958 Eide Bailly LLP 800 Nicollet Mall Ste 1300 Minneapolis MN 554027033 990 2015-09-01 410693880 HealthEast St Joseph's Hospital HEAL 6512321000 PO Box 64624 St Paul MN 551640624 Doug Davenport SVP/CFO 6512322300 2017-06-01 1 Kim Hunwardsen P00484560 6122536500 2017-05-23 2015 2021-01-29 14:40:06Z Kathryn Correia 559 Capitol Blvd St Paul MN 55103 279148694 0 X www.healtheast.org X 1987 MN HealthEast St. Joseph's Hospital is an acute care hospital. 16 13 2214 289 9108025 0 1291000 1716309 270897838 277318150 382544 100914 10368 6800 272581750 279142173 0 0 0 0 130801216 138597515 0 0 0 158912357 159935452 289713573 298532967 -17131823 -19390794 157376297 154316528 17810678 19626703 139565619 134689825 X We are called to improve the health of our neighbors. 0 0 249399446 268210125 HealthEast St. Joseph's Hospital is HealthEast Care System's largest hospital. St. Joseph's offers a comprehensive range of programs, including medical, surgical, maternity, diagnostic, rehabilitation, mental health and addiction treatment. State-of-the-art heart care has been a mainstay of the hospital's care delivery for generations of Twin Cities residents.Our scope of services includes: * Bariatric Care* Mental Health/Addiction* Cancer Care* CyberKnife Center* Emergency Care* Heart Care* Hospice Care* Kidney Stone Institute* Maternity Care* Medical Laboratory services* Neuroscience* Orthopaedic Care* Radiology* Infusion Therapy* Spine Care* Stroke Care* Surgery* Vascular Center HealthEast St. Joseph's is Minnesota's first hospital and was founded by the Sisters of St. Joseph of Carondelet in 1853. Located in downtown St. Paul, St. Joseph's has 401 licensed beds. The hospital is a member of the University of Minnesota's Family Medicine and Community Health residency program and is Medicare certified. HealthEast St. Joseph's services listed above support the hospital's health care mission to provide high quality, cost effective compassionate health care for Twin Cities east metro residents. Hospital revenue includes payment from the Medicare and Medicaid programs. The medical services relate directly to the exempt purpose of caring for sick, infirm, aged and injured persons regardless of their race, color, creed, religion, national origin, sex, marital status, status with regard to public assistance, membership or activity in a local commission, disability, sexual orientation, gender identity or expression, age or genetic information. HealthEast seeks to be a welcoming and inclusive provider of care providing optimal health and well-being for our patients, our communities and ourselves. This organization provides emergency and medically necessary non-emergency services regardless of ability to pay. Additionally, this organization offers financial aid for eligible services in the form of free or discounted care to those low income, underinsured or uninsured individuals who meet qualification criteria.HealthEast St. Joseph's Hospital Fiscal Year 2016 Statistics: *Hospital Inpatient Admissions: 10,767 *Outpatient Visits: 81,493 *Births: 782 *Emergency Department Visits: 23,243 HealthEast St. Joseph's is part of the HealthEast Care System. HealthEast Care System is a community-focused, non-profit health care system that provides innovative technology, compassionate care and a full spectrum of family health services. In 1986, the leaders of seven hospitals in St. Paul, Minnesota blended their Baptist, Roman Catholic and Lutheran cultures to become HealthEast Care System, united in pursuit of a common mission built on Judeo-Christian values. Today, HealthEast Care System includes three short-term acute hospitals and one long-term acute care hospital, as well as 14 clinics, outpatient services, home care, hospice, medical transportation and community outreach programs. Practicing financial responsibility, HealthEast Care System is one of the largest, locally-owned health care organizations in the East Metro area of St. Paul. *Mission: We are called upon to improve the health of our neighbors. *Values: Create a "customer first" experience. Act with courage. Nurture trust and confidence. Find joy in what we do. *Vision: Optimal health and well-being for our patients, our communities and ourselves. *Spiritual Philosophy: By sustaining HealthEast's Christian heritage and identity, we provide compassionate service that respects the dignity of each person and welcomes all faith traditions, cultures and communities. HealthEast Care System fiscal year 2016 statistics: *Total Hospital Inpatient Admissions: 31,194 *Total Outpatient Visits: 214,299 *Total Emergency Department Visits: 91,297 *Lab tests: over 2.7 Million *Home Care Patients Served: 8,679 *Home Care Patient Visits: 79,886 *Health Alert Subscribers: almost 2,900 *Primary and Specialty Care Professional Visits: 1,271,643 *Primary and Specialty Care Ancillary Services: 1,070,810 *Total Clinic Patients: over 154,000 *Patient Transports: 41,104 *Employees: almost 7,000 *Volunteers: 960 249399446 1 1 0 1 0 0 0 0 0 0 1 0 0 0 1 1 0 1 0 0 0 0 0 0 0 0 1 1 0 0 1 0 0 0 0 0 0 0 0 1 0 0 0 0 1 0 0 0 1 X 0 0 2214 1 1 1 0 0 0 0 0 0 0 0 0 X 16 13 1 0 0 0 1 0 0 1 1 0 0 1 1 1 1 1 1 1 1 1 1 MN X Doug Davenport 6512322300 559 Capitol Blvd St Paul MN 55103 X Kathryn G Correia President/CEO 0.00 40.00 X X 0 900601 186376 Roland L Hayes Chair 0.00 4.00 X X 0 65000 0 Fred Harris Jr Immediate Past Chair 0.00 4.00 X X 0 31000 0 William Brombach MD Director 0.00 42.00 X 0 431647 54747 Julie S Causey Director 0.00 2.00 X 0 34200 0 Michael R Connly Director 0.00 2.00 X 0 27000 0 John R Finnegan Jr PhD Director 0.00 2.00 X 0 29000 0 Louis C Henry Jr Director 0.00 2.00 X 0 27000 0 Howard P Kern Director 0.00 2.00 X 0 27000 0 Tim Marx Director 0.00 2.00 X 0 27833 0 Anne M Pearson MD Director 0.00 42.00 X 0 380710 46445 Leonard M Randolph Jr MD Director 0.00 2.00 X 0 28000 0 Wayne A Sensor Director 0.00 2.00 X 0 27833 0 Jone M Tiffany Director 0.00 2.00 X 0 37000 0 Heidi Wilson Director, began 1-2016 0.00 2.00 X 0 0 0 James W Wiltz Director 0.00 2.00 X 0 31000 0 Douglas Davenport SVP/Chief Financial Officer 0.00 40.00 X 0 543411 103559 Catherine J Barr SVP/COO 0.00 40.00 X 0 449558 78834 Scott L North SVP/Acute Care ended 11-2015 0.00 40.00 X 0 578285 147524 Stephen J Kolar MD SVP CMO 0.00 40.00 X 0 275088 64491 Joanne M Sunquist SVP/CIO 0.00 40.00 X 0 376206 87306 Dawn Kessler SVP/Chief HR Officer/Org Excel 0.00 40.00 X 0 391672 65985 Paul Torgerson SVP/CAO/Gen Counsel 0.00 40.00 X 0 539612 121515 Eric Nelson VP Ops Amb/Med Svcs 0.00 40.00 X 0 214237 44910 Kevin Garrett MD SVP/Chief Medical Officer 0.00 40.00 X 0 411702 97936 Debra J Hurd VP Acute Care Nursing 0.00 40.00 X 0 253704 49629 John Kvasnicka MD VP/Executive Medical Director 0.00 40.00 X 0 408475 95137 Brian Gager VP Ops Acute/Surg Sv 40.00 0.00 X 262285 0 66460 Daniel Berndt MD Physician 40.00 0.00 X 315107 0 43002 Brian Ness MD Physician 40.00 0.00 X 362432 0 49582 Robert Burge MD Physician 40.00 0.00 X 308085 0 40179 Derrick Fenchel MD Physician 40.00 0.00 X 296875 0 25464 Amadeo Sturla MD Physician 40.00 0.00 X 293146 0 34711 Brian Patty MD Former Officer 0.00 40.00 X 0 165343 52604 Mary F Pynn Former Officer 0.00 40.00 X 0 340435 60614 Thomas A Schmitt Former Key Employee 0.00 40.00 X 0 560682 17087 Julie A Schmidt Former Key Employee 0.00 40.00 X 0 190449 105298 1837930 7803683 1739395 164 1 1 0 Regents of the University of Minnesota NW 5960 PO Box 1450 Minneapolis MN 554855960 Medical Services 2801792 Restoration Technologies Inc 8201 Central Avenue North Spring Lake Park MN 55432 Construction Services 1855818 Favorite Healthcare Staffing INC PO Box 803356 Kansas City MO 641803356 Staffing Services 1545290 Mayo Collaborative Service Inc PO Box 9146 Minneapolis MN 554809146 Medical Services 1541748 Cardiopulmonary Support Services 7 Preserve Trail St Paul MN 551264789 Medical Services 874599 54 1716309 116179 1716309 Patient Revenue 622110 263876209 263876209 Lab Services 621500 11051457 1989505 9061952 Cafeteria Revenue 722310 963070 963070 Parking Revenue 912930 887301 841228 46073 Allowances 900099 278616 278616 261497 261497 277318150 51952 51952 6800 0 6800 6800 6800 55483 6521 48962 48962 48962 279142173 268210125 9108025 107714 X 304843 304843 107184213 103608210 3576003 8625966 8338177 287789 14836026 14341049 494977 7646467 7370395 276072 7668 7668 11304 11304 44905134 44663948 241186 48913 40048 8865 6578996 6079373 499623 31512 16763 14749 4945067 4914456 30611 315863 303204 12659 153303 147614 5689 4008281 4008281 7554934 7475199 79735 1934017 1934017 Medical Supplies 41568305 41568305 0 0 Management Fee 40974920 0 40974920 0 MN Care Tax 2437165 2437165 0 0 Medical Surcharge 1994269 1994269 0 0 2465801 2081686 384115 298532967 249399446 49133521 0 7634 6599 169786 352250 33580208 32900626 3980786 4658175 2528048 2400245 225042691 111769969 115964364 113272722 718627 698225 426844 27686 157376297 154316528 16645705 18275315 154127 151642 1010846 1199746 17810678 19626703 X 139565619 134689825 139565619 134689825 157376297 154316528 X -19390794 14515000 X 0 1 X 1 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 0 0 0 0 0 0 0 1 11304 11304 0 Part II-B, Line 1: The organization pays annual membership dues to the American Hospital Association and the Minnesota Hospital Association. A portion of these annual dues are determined to be used for lobbying purposes. 844435 844435 159891931 70931246 88960685 583413 405152 178261 62666531 39834700 22831831 1056381 598871 457510 113272722 Asbestos Abatement Liability 742570 Third Party Settlements 457176 1199746 X Part X, Line 2: HealthEast has not identified any significant liability for uncertain tax positions, and accordingly, no such liability is recorded for the years ended August 31, 2016 or 2015. 1 1 X 1 X 1 X 1 0 1 1 2073479 2073479 0.00700 41609923 29169122 12440801 0.04190 7325170 3709000 3616170 0.01220 51008572 32878122 18130450 0.06110 451560 19620 431940 0.00150 5576976 1676634 3900342 0.01310 10342055 5734995 4607060 0.01550 7245 7245 0.00000 16377836 7431249 8946587 0.03010 67386408 40309371 27077037 0.09120 1 1574180 0 106007589 124033167 -18025578 X 1 1 1 Gallery Imaging LLC Radiology Imaging Center 0.50000 0.50000 1 1 HealthEast St Joseph's Hospital 45 West 10th Street St Paul MN 55102 http://www.healtheast.org/st-josephs-h 371350 X X X HealthEast St Joseph's Hospital 1 0 0 1 X X X X X X X X 14 1 1 0 1 X See Part V, Section C for website X 1 14 1 See Part V, Section C for website 0 0 1 X 200.000000000000 300.000000000000 X X X X X 1 1 X X X 1 X healtheast.org/get-to-know-us/insurance/billing-financial-assistance.html X healtheast.org/images/stories/billing/he_financial_aid_form.pdf X healtheast.org/get-to-know-us/insurance/billing-financial-assistance.html X X X X X X 1 X 0 X X X X 1 X 0 0 HealthEast St. Joseph's Hospital Part V, Section B, Line 5: In conducting the Community Health Needs Assessment, the organization took into account input from representatives of the community it serves, including those with special knowledge of or expertise in public health in the following ways:Initially, the organization collected results from more than 1700 surveys administered to their clinic patients and City Passport members. Key themes were identified by the organization's care coordinators, social workers, and other professionals in a series of seven discussion groups. Other community needs were identified during discussions with Hmong, Karen, and Vietnamese immigrants and refugees who receive services and support from the Center for Social Healing, a Wilder Foundation program.The organization consulted with leaders in the community with special knowledge of or expertise in public health when conducting the Community Health Needs Assessment.Representatives from St. Paul-Ramsey County Department of Public Health, Dakota County Department of Public Health, Washington County Public Health, Children's Hospitals and Clinics of Minnesota and Allina Health provided feedback throughout the process. HealthEast St. Joseph's Hospital Part V, Section B, Line 6a: The organization's community needs health assessment was conducted with the following hospital facilities:HealthEast Bethesda HospitalHealthEast St. John's HospitalHealthEast Woodwinds HospitalPart V, Section B, Line 7a:https://healtheast.org/images/stories/about/community-health-assessment.pdfPart V, Section B, Line 10:https://healtheast.org/images/stories/about/2016-18-comm-health-implement-plan.pdf HealthEast St. Joseph's Hospital Part V, Section B, Line 11: Aligned with the organization's vision for Optimal Health and Well-being, our Community Health Needs Assessment Advisory Committee and other stakeholders created three priority goals, with supporting objectives and strategies from the most recently conducted Community Health Needs Assessment. The goals aim to reduce health disparities and improve well-being among east metro residents, particularly among aging residents, residents living in poverty, and communities of color. A number of strategies included in the implementation plan also address other community health concerns that were identified during the assessment process, but not elevated as a priority issue. As of year-end, the organization began implementing several strategies surrounding their three priority goals. The following are the actions taken by the organization on their three priority goals this year.*Priority: Obesity*Goal: Promote healthy lifestyles and improve access to nutritious food and physical activity in order to increase the percentage of people living at a healthy weight.The first objective the organization wanted to achieve was an increase in participation regarding nutrition and physical activity education classes offered in targeted neighborhoods or in areas with priority populations. The organization offered these free or reduced cost wellness and prevention community programs:*A diabetes prevention program was offered with the following results: 12 participants. A 2% group weight loss was achieved versus a target of 7% and the group averaged 327 minutes of physical activity per week compared to a target 150 minutes/week.*A Tai Ji Quan fall prevention program included 24 participants which reported a reduction in falls from 10 (pre-class) to 0 (during 12-week class). 80% of the participants reported doing exercises they learned in class while at home and 30% reported they made changes at home to reduce risk their of falling.*The Matter of Balance Fall Prevention Program offered an 8-week program and had 70 participants. The participants reported a 70% decrease in falls during 8-week program and a 9% decrease in fear of falling while 88% percent did exercises at home and 50% made changes at home to reduce the risk of falling.The second objective in the obesity priority was to improve access to healthy food. The organization, along with other community partners, explored food systems in the east metro area and identified opportunities to increase healthy food choices and access to healthy food. The partners, all concerned about health and well-being on St. Paul's East Side, co-designed an 18-month prototype to improve access to healthy food on the East Side by providing opportunities to develop food skills. They secured funding, hired a project coordinator, drafted an evaluation and measurement plan and prepared for program launch in February 2017. *Priority: Unmet Mental Health Needs *Goal: Improve access to and awareness of culturally appropriate mental health resources and education.The first objective within this priority is to increase access to resources for patients with mental health needs.The organization did the following things that aligned with this objective:*With the help of community partners, we provided culturally responsive mental health and addiction resources to the Karen community by reaching over 300 participants through community education or pastor trainings. *The organization helped provide mental health medication and financial assistance through the Mental Health Alliance Collaboration. A Mental Health Medication Financial Assistance fund was created by east metro hospitals to assist community members with medication management needs. 300 people were served across the Twin Cities east metro area. Philanthropic funding was provided by HealthEast Foundation.*Through the East Side Mental Health and Stress Resilience Partnership, we helped develop an 18-month prototype to increase opportunities to build stress-resilience and holistic well-being. Services will include cultural brokers to increase access to culturally-based services and social supports; provider trainings to increase knowledge, cultural responsiveness and collaboration; community dialogues to decrease cultural stigmas associated with mental health; and safe and sacred spaces. The second objective within the unmet mental health needs priority is to increase social connectedness for aging population through the Passport Program. This is a program that serves people age 50+ to give them opportunities to connect and socialize through City Passport Center and community-based activities and events. Partners include the City of St. Paul and Metropolitan Area Agency on Aging. The program reported 11,807 encounters with members.*Priority: Access to Services and Resources* Goal: Improve access to and understanding of resources that positively impact health and the social determinants of health.The first objective of this priority is to reduce stressors and increase coping skills regarding basic needs (social determinants of health). The organization wants to promote housing options for homeless patients to decrease hospital readmission rates and improve the health and well-being of this group. Along with community partners, planning began in FY 2016 with a project launch in April 2017. Target population is 12 inpatient mental health patients with serious and persistent mental health issues who have been chronically homeless. The aim is to identify eligible patients for targeted case management. Upon discharge from the hospital, patient will be referred to temporary housing with a goal to be in permanent supported housing within 120 days. The second objective within this priority is to promote access to services in the community. This was addressed though Faith Community Nurses (FCN) who provided basic health screenings, referrals to community resources and social connection in community-based settings. In FY 2016, FCN had 2,300 encounters with community members. To enhance access to health care services through insurance coverage, a pilot project has been developed to embed a Health Insurance Liaison into clinical settings that have a large population of immigrants and refugees with no health insurance. The liaison will help patients navigate health coverage programs, including Medicaid, Minnesota Care, Portico or employer health insurance plans. Pilot to end in May 2017. Significant needs identified through our assessment that will not be addressed in the current three-year plan are listed below.Affordable Housing and Housing Supports. This issue is beyond what our resources can support at this time.Social Isolation. This issue will not be addressed as a primary need, but will be impacted through our mental health and access to services priorities.Transportation. This issue will not be addressed as a primary need, but will be impacted through our access to services priority.Poor Nutrition. This issue will not be addressed as a primary need, but will be impacted through our obesity priority.Physical Inactivity. This issue will not be addressed as a primary need, but will be impacted through our obesity priority.Tobacco. Significant progress has already been made on this issue; need identified as a low priority.Unintentional Injury. Need identified as a low priority; unintentional injuries related to falls among the aging population will be addressed through our obesity priority. HealthEast St. Joseph's Hospital Part V, Section B, Line 13b: The Minnesota Attorney General agreement was used in the determination of the eligibility for financial assistance. HealthEast St. Joseph's Hospital Part V, Section B, Line 16i: The organization attaches a summary of the policy to billing invoices and also communicates to patients during admission, financial counseling and collection calls that there is a financial assistance program and that an application can be provided to them. 3 1 - HealthEast Hospice Care - The Pillars 6025 Upper 35th Street North Oakdale MN 55128 Hospice Residental Facility 2 - HealthEast Hospice 45 West 10th Street St Paul MN 55102 Hospice Facility 3 - Mental Health & Addiction Care - St Jos 45 West 10th Street St Paul MN 55102 Outpatient Mental Health Care Part I, Line 6a: This organization is part of the HealthEast Care System which prepares an annual community benefit report called "HealthEast Report to the Community" on a consolidated basis. Part I, Line 7: The amounts reported on Form 990, Schedule H, Part I, Line 7a, 7b, 7c and 7g were determined using the cost to charge ratio derived from Worksheet 2 in the Schedule H, Form 990 Instructions. Form 990, Schedule H, Part I, Lines 7e, 7f and 7i are reported at charges as recorded by the organization. Part I, Ln 7 Col(f): The Bad Debt expense included on Form 990, Part IX, Line 25, Column (A), but subtracted for purposes of calculating the percentage in this column is $1,574,180. Part III, Line 2: The bad debt expense reported on Part III, Line 2 is reported at charges as recorded by the organization.The following describes the costing methodology used in determining bad debt and the rationale for including a portion of bad debt as community benefit:The bad debt allowance is calculated as a percentage of patient receivables after deductions for estimated provisions for contractual adjustments (discounts) on services provided to enrollees of Medicare, Medicaid, third-party payor programs, charity care, uninsured discounts, and other administrative adjustments.Certain patient accounts are written off to bad debt because the organization does not have sufficient information to determine if the patient would qualify for free care or financial aid. Therefore, it is possible that some bad debt is actually charity care. However, if a patient account is written off to bad debt and the collection agency later determines that the patient would have qualified for free care or financial aid, then the bad debt expense is reclassified to charity care. Part III, Line 4: The footnote to the financial statements that describes the bad debt expense is located on page 10 of the audited financial statements. Part III, Line 8: The organization believes that at least some portion of the costs we incur in excess of payments received from the Federal government for providing medical services to Medicare enrollees and beneficiaries under the Federal Medicare Program (shortfall or Medicare shortfall) constitutes a community benefit. Providing these services clearly lessens the burdens of the government by alleviating the Federal government from having to directly provide these medical services. As demonstrated and calculated on Form 990, Schedule H, Part III, Lines 5, 6 and 7, our Medicare "allowable costs" clearly exceed the payments we receive for providing these medical services under the Medicare Program. By absorbing the Medicare shortfall costs we are providing a community benefit as well as easing the burden of the Federal government having to cover these costs.To arrive at the Form 990, Schedule H, Part III, Line 6 amount we used actual Medicare charges from internal records and applied an estimated cost to charge ratio to determine the Medicare allowable costs. The estimated Medicare cost to charge ratio is the prior period Medicare Cost Report cost to charge ratio. Part III, Line 9b: The organization's collection policy and practices provide that a patient who indicates an inability to pay be provided with the information and application for the organization's financial aid policy. When a completed financial assistance application is received, it is processed according to the organization's policy to determine whether the patient qualifies for discounted or free medical services. The organization will not begin the billing process until a determination is made whether the patient qualifies for discounted or free medical services. However, if a patient expires or files for bankruptcy prior to providing a completed financial assistance application, there is no way to determine if the patient qualifies for charity care. Part VI, Line 2: HealthEast contracted with Wilder Research to design and implement an assessment process that would build on work done in prior assessments and to better understand community health needs.The CHNA process was designed to gather current demographic and health data from a variety of sources in order to understand the needs of east metro residents. Results from more than 1700 surveys administered to HealthEast primary care clinic patients and City Passport members were collected. Key themes were identified by HealthEast care coordinators, social workers and other professionals through discussion groups.Discussions with Hmong, Karen, and Vietnamese immigrants and refugees through the Center for Social Healing, helped to identify community needs. HealthEast patient data appropriate to population health was used to identify areas where HealthEast serves the largest numbers of patients, as well as potentially underserved areas. A comprehensive review of local demographic and health data was used to identify health status and health disparities. This included a review of data for the leading causes of death in the east metro counties, as well as common risk factors that contribute to poor health, including obesity, physical inactivity, and tobacco use. Part VI, Line 3: HealthEast St. Joseph's Hospital has Financial Counselors and Social Workers available to assist patients in determining whether they qualify for help with their medical bills. Billing and Insurance Information is available online and in the patient handbook that is provided to patients, which explain the organization's billing and payment policies as well as contact information for discussing financial assistance with our Financial Counselors and Social Workers. Patients are informed about the availability of federal, state and local medical assistance programs, charity care availability as well as discounted care eligibility requirements.The patient handbook also provides information regarding collection policies and practices. Bills provided to patients include the following statement: "Financial Aid Available: It is important that you let us know if you will have trouble paying your bill. HealthEast may be able to help you get free or low-cost health coverage through community or government programs. Although HealthEast can assist you in this process, you must apply for these benefits if you are eligible." Part VI, Line 4: The primary service area for HealthEast Care System hospitals includes the three east metro counties of Dakota County, Ramsey County, and Washington County. Combined, the service area includes over one million residents and there are three major demographic trends. 1-A growing aging population: Across the state and in the east metro, the percentage of aging residents is growing. By 2030, approximately 1 in 4 residents in the east metro will be age 65 and older. Right now, nearly one-third (30%) of residents age 65 or older have one or more disabilities. As this number increases, so will the need for a range of services, supports, and accommodations to help aging residents maintain a high quality of life. 2-Continued poverty: Rates of poverty are notably higher in Ramsey County, where 17 percent of residents live at or below the federal poverty line, compared to Dakota (7%) and Washington (6%) counties. Poverty rates have decreased in Ramsey and Washington counties since the peak of the recession (2008-2010), while poverty rates have continued to increase in Dakota County, potentially due to a growing number of lower-income immigrant and refugee residents. Rates of unemployment are approximately twice as high in Ramsey County (10%) than in Dakota (5%) or Washington (4%) counties.3-Increasing cultural diversity: The percentage of residents of color has increased dramatically during the past 25 years. Today, nearly one-third of Ramsey County residents are persons of color. This shift in diversity is shaped predominately by changes in young adults and children. Only 5 percent of Twin Cities residents age 85 or older are people of color, compared to 41 percent of residents age 5 or younger. The ten leading causes of premature death in the Twin Cities east metro include a number of chronic conditions (e.g., cancer, heart disease, stroke, diabetes, chronic lower respiratory disease), unintentional injury, acute illness (e.g., pneumonia/ influenza), and suicide. Part VI, Line 5: In addition to the community benefits and activities described in other parts of this filing, HealthEast St. Joseph's Hospital is part of the HealthEast Care System which furthers its tax-exempt charitable purpose and promotes the health of the communities it serves including, but not limited to the following: The organization's hospitals extend medical staff privileges to all qualified physicians in the community. HealthEast St. Joseph's Hospital as part of the HealthEast Care System, a tax-exempt health care system, reinvests any excess revenues back into the core operations of the organization for which the tax-exemption was granted.The organization offers various health care classes, health screenings, support groups and other events related to the promotion of health. Some examples are in the following areas: Diabetes, Pain Care, Pregnancy, Birthing, Parenting, Heart Disease, Weight Loss, Women's Health, Vein Therapy, Chemical Dependency, Stroke, Cancer, Brain Injury, Smoking Cessation and CPR (Cardiopulmonary Resuscitation).HealthEast Care System is governed by a board of directors that are members of the community the organization serves. Part VI, Line 6: HealthEast Care System is a community-focused, non-profit health care organization that provides innovative technology, compassionate care, and a full spectrum of family health services. HealthEast includes Bethesda Hospital, St. John's Hospital, St. Joseph's Hospital, and Woodwinds Health Campus as well as outpatient services, clinics, home care, and medical transportation services.Organization Mission:We are called to improve the health of our neighbors.HealthEast includes four hospitals, 14 primary care clinics, outpatient services, home care and medical transportation services. With approximately 7,500 employees and 850 physicians on staff, it meets a broad array of community health needs, through a blend of "high tech" services, traditional medicine and integrative therapies. 1 1 0 0 0 0 0 1 0 Kathryn G Correia President/CEO 0 892714 0 0 0 7887 0 152178 0 34198 0 1086977 0 0 William Brombach MD Director 0 409527 0 6500 0 15620 0 24744 0 30003 0 486394 0 13298 Anne M Pearson MD Director 0 347022 0 20000 0 13688 0 23052 0 23393 0 427155 0 9390 Douglas Davenport SVP/Chief Financial Officer 0 485949 0 50000 0 7462 0 81502 0 22057 0 646970 0 0 Catherine J Barr SVP/COO 0 396379 0 0 0 53179 0 55720 0 23114 0 528392 0 42653 Scott L North SVP/Acute Care ended 11-2015 0 389089 0 0 0 189196 0 115288 0 32236 0 725809 0 53784 Stephen J Kolar MD SVP CMO 0 250423 0 0 0 24665 0 47852 0 16639 0 339579 0 24665 Joanne M Sunquist SVP/CIO 0 363955 0 0 0 12251 0 59001 0 28305 0 463512 0 0 Dawn Kessler SVP/Chief HR Officer/Org Excel 0 385117 0 0 0 6555 0 62811 0 3174 0 457657 0 0 Paul Torgerson SVP/CAO/Gen Counsel 0 529291 0 0 0 10321 0 83989 0 37525 0 661126 0 0 Eric Nelson VP Ops Amb/Med Svcs 0 213757 0 0 0 480 0 34122 0 10788 0 259147 0 0 Kevin Garrett MD SVP/Chief Medical Officer 0 406147 0 0 0 5555 0 66413 0 31523 0 509638 0 0 Debra J Hurd VP Acute Care Nursing 0 245027 0 0 0 8677 0 43398 0 6231 0 303333 0 0 John Kvasnicka MD VP/Executive Medical Director 0 405359 0 0 0 3116 0 68068 0 27070 0 503613 0 0 Brian Gager VP Ops Acute/Surg Sv 244393 0 0 0 17892 0 38639 0 27821 0 328745 0 0 0 Daniel Berndt MD Physician 300485 0 0 0 14622 0 20770 0 22232 0 358109 0 12608 0 Brian Ness MD Physician 321784 0 21635 0 19013 0 27432 0 22151 0 412015 0 11884 0 Robert Burge MD Physician 290303 0 14733 0 3049 0 15900 0 24279 0 348264 0 0 0 Derrick Fenchel MD Physician 271391 0 25000 0 484 0 15900 0 9564 0 322339 0 0 0 Amadeo Sturla MD Physician 274656 0 18000 0 490 0 15900 0 18811 0 327857 0 0 0 Brian Patty MD Former Officer 0 53002 0 0 0 112341 0 48824 0 3780 0 217947 0 38065 Mary F Pynn Former Officer 0 300663 0 0 0 39772 0 37183 0 23431 0 401049 0 34312 Thomas A Schmitt Former Key Employee 0 112756 0 0 0 447926 0 6493 0 10594 0 577769 0 192629 Julie A Schmidt Former Key Employee 0 72784 0 0 0 117665 0 98682 0 6616 0 295747 0 27069 Part I, Line 3 HealthEast Care System, a related tax-exempt organization, engages an external consulting firm to review annually the compensation of the organization's CEO, Senior Vice Presidents and Vice Presidents. The review was last completed in November 2015. The process includes the external consulting firm evaluating current base salaries and total cash and benefits compared to comparable positions within the comparator group. The external firm presents its findings to the affiliated tax-exempt organization's Executive Committee of the Board and indicates any recommendations for change. The affiliated tax-exempt Executive Committee of the Board approves the salaries of the CEO, Senior Vice Presidents and Vice Presidents. The consulting firm issues a reasonable compensation letter to affiliated tax-exempt organization's Board of Directors. Part I, Lines 4a-b The following individuals received severance payments during the year from this organization or a related organization: Thomas Schmitt $ 219,470 The terms and conditions of the severance payments are a signed release of rights and an agreement to not make any disparaging remarks about the organization from each individual. Eligible executives receive severance payments for one year. The following individuals participated in and received payment from a supplemental nonqualified retirement plan. The amount listed is the amount paid to the individual and reported accordingly on their 2015 W-2 Form. The terms and conditions of this supplemental nonqualified retirement plan is a five year cliff vesting arrangement: Catherine J. Barr $ 42,653 Anne M. Pearson, MD $ 9,390 Julie A. Schmidt $ 27,069 Stephen J. Kolar, MD $ 24,665 William Brombach, MD $ 13,298 Scott L. North $ 53,784 Brian Patty, MD $ 38,065 Mary F. Pynn $ 34,312 Thomas A. Schmitt $192,629 Brian Ness, MD $ 11,884 Daniel Berndt, MD $ 12,608 The following individuals were participants in the supplemental nonqualified retirement plan. The following amounts are their current year contribution into the plan and are accordingly included in Schedule J, Column C: Kathryn Correia $124,108 Douglas Davenport $ 65,656 Paul Torgerson $ 68,085 Dawn Kessler $ 44,224 Joanne M. Sunquist $ 42,070 Catherine J. Barr $ 31,134 Anne M. Pearson, MD $ 7,791 William Brombach, MD $ 5,426 Stephen J. Kolar, MD $ 15,188 Eric Nelson $ 21,326 Kevin Garrett, MD $ 48,811 Mary F. Pynn $ 19,384 John Kvasnicka, MD $ 48,183 Debra Hurd $ 23,968 Brian Gager $ 24,982 Brian Ness, MD $ 4,020 Daniel Berndt, MD $ 3,431 Part I, Line 7 HealthEast Care System provides a Management Incentive Program. The program provides lump sum financial awards based on system-wide, business unit and/or department financial and quality measures. Annual goals, specifically tied to productivity and quality indicators, are set for the fiscal year and an incentive paid out annually if key goals and measures are achieved. Before HealthEast Care System can authorize payment of any awards, it must meet the following qualifications: * Financial - HealthEast must have sufficient net income for the fiscal year to cover the cost of any awards. * Accreditation - All HealthEast business units must maintain a level of quality and performance that results in, and maintains, accreditation by Joint Commission (JCAHO) and equivalent licensing boards. * Approval -The HealthEast Board of Directors has final approval of all incentive program payouts. In addition, each participant must meet individual performance qualifications to be eligible to receive an award. X Remodeling Projects 2 66562 Cost X Exercise Equipment 1 37600 Cost X Medical Equipment 1 10660 Cost X Office Equipment 1 1357 Cost 0 0 1 0 Form 990, Part IV, Line 24a This organization along with related organizations HealthEast Care System, HealthEast St. John's Hospital and HealthEast Woodwinds Hospital are equally liable for the repayment of the bonds reported on the HealthEast Care System Form 990. Form 990, Part V, Line 1a Cash disbursements are centralized through the parent organization. Therefore the parent organization, HealthEast Care System, makes the payment and files the related Form 1099's and Form 1096 instead of HealthEast St. Joseph's Hospital. Form 990, Part VI, Section A, line 1 The Executive Committee shall consist of five or more members, including the ex officio members. The Chair shall chair the Executive Committee. The Executive Committee shall recommend to the Board of Directors changes in the Bylaws, approve conflict of interest policies and review compliance with conflict of interest policies. The Executive Committee shall have all the power and authority of the Board of Directors. The Executive Committee shall have the power to act only in the intervals between meetings of the Board. Only the Outside Directors of the Executive Committee shall be entitled to vote on any action taken by the Executive Committee in discharging its duties with regard to human resources and governance. Members of the Executive Committee who are Inside Directors shall not participate in, or be present during, any discussion of actions proposed or taken with respect to the duties with regard to human resources and governance, except to the extent requested to do so by the Outside Directors on the Executive Committee. Form 990, Part VI, Section A, line 2 All officers and employees are employed by related organizations in which the board members are also board members of the related organization. Therefore, a business relationship exists between these individuals. Form 990, Part VI, Section A, line 6 The sole member of HealthEast St. Joseph's Hospital is HealthEast Care System, a 501(c)(3) tax-exempt, non-profit organization. The member organization does not elect the members of HealthEast St. Joseph's Hospital Board of Directors because HealthEast St. Joseph's Hospital has a self-electing board. The member organization does not approve any decisions of the board. The member of the organization receives the organization's net assets upon dissolution. Form 990, Part VI, Section B, line 11 The Form 990 is sent electronically to all members of the Board of Directors prior to the filing of the Form 990. A representative of the tax department will be available to discuss and answer any questions regarding the Form 990 at the Executive meeting. Form 990, Part VI, Section B, line 12c HealthEast Care System monitors proposed or ongoing transactions for conflicts of interest through the procedures set forth in its Conflicts of Interest Policy (the Policy). The Policy covers HealthEast Care System's Directors, Officers and members of a Committee with Board-delegated powers. A Director, Officer or member of a Committee with Board-delegated powers who has a direct or indirect financial interest, is an interested person under the terms of the Policy. If a person is an interested person with respect to any entity in the HealthEast Care System he or she is an interested person with respect to all entities in the HealthEast Care System. Pursuant to the terms of the Policy, in connection with any actual or possible conflicts of interest, an interested person must disclose the existence of his or her financial interest and must be given the opportunity to disclose all material facts relating to his or her financial interest to the Directors or members of Committees with Board-delegated powers considering the proposed transaction or arrangement. After disclosure of the financial interest and all material facts, and after any discussion with the interested person, the interested person must leave the Board (or Committee) meeting while the financial interest is discussed and voted upon. The remaining Board (or Committee) members shall decide if a conflict of interest exists. An interested person may make a presentation at the Board or Committee meeting regarding the proposed transaction or arrangement, but after such presentation, the interested person shall leave the meeting during the discussion of, and the vote on, the proposed transaction or arrangement that results in the conflict of interest. Form 990, Part VI, Section B, line 15 The Chair of the Board of Directors engages an external consulting firm to review the compensation of the organization's CEO, Senior Vice Presidents and Vice Presidents annually and was last completed in November 2015. The process includes the external consulting firm evaluating current base salaries and total cash and benefits compared to comparable positions within the comparator group. The external firm presents its findings to the Executive Committee of the Board and indicates any recommendations for change. The Executive Committee of the Board approves the salaries. The consulting firm issues a reasonable compensation letter to the Board of Directors. Form 990, Part VI, Section C, line 19 The Articles of Incorporation for this organization are available to the public through the Secretary of State Office. The organization's conflict of interest policy and other governing documents are not made available to the public. The financial statements for this organization are made available to the public through the Attorney General's Office and are also attached to this Form 990. Form 990, Part VII, Section A, Column B This organization is a subsidiary of HealthEast Care System, a 501(c)(3), tax-exempt, non-profit organization. The Board of Directors for this organization is the same as the Board of Directors for HealthEast Care System. All hours worked as a member of the Board of Directors are reported on the Form 990 for the parent organization, HealthEast Care System. Therefore, we have reported 0.00 hours worked by each member of the Board of Directors on this organization's return. Form 990, Part IX, line 11g Temporaries: Program service expenses 2,295,132. Management and general expenses 0. Fundraising expenses 0. Total expenses 2,295,132. Professional Fees: Program service expenses 1,269,539. Management and general expenses 78,864. Fundraising expenses 0. Total expenses 1,348,403. Purchased Services: Program service expenses 41,099,277. Management and general expenses 162,322. Fundraising expenses 0. Total expenses 41,261,599. Form 990, Part XI, line 9: Transfers from Parent Company 14,515,000. D & T Facility Management Company PO Box 64624 St Paul MN 55164 411928275 Management of Diagnostic Medical Services MN 501(c)(3) Line 11a, I HealthEast Woodwinds Hospital 0 HealthEast Medical Research Institute PO Box 64624 St Paul MN 55164 411765832 Medical Research MN 501(c)(3) Line 4 HealthEast Care System 0 HealthEast Professional Services PO Box 64624 St Paul MN 55164 261226617 Physician services provided to related tax-exempt hospitals. MN 501(c)(3) Line 9 HealthEast Care System 0 HealthEast St John's Hospital PO Box 64624 St Paul MN 55164 411456897 Hospital MN 501(c)(3) Line 3 HealthEast Care System 0 HealthEast Woodwinds Hospital PO Box 64624 St Paul MN 55164 411592761 Hospital MN 501(c)(3) Line 3 HealthEast Care System 0 HealthEast Care System PO Box 64624 St Paul MN 55164 363517697 Hospital MN 501(c)(3) Line 3 N/A 0 Maplewood Professional Building Limited Partnership 1655 Beam Avenue Maplewood MN 55109 411431847 Rental Real Estate MN N/A HealthEast Surgery Center-Maplewood LLC 1655 Beam Avenue Maplewood MN 55109 203349887 Outpatient Surgery Center MN N/A East Metro Insurance LTD 62 Forum Lane 3rd Floor Camana Ba Grand Cayman CJ KY1-1203 980417513 Captive Insurance Organization CJ N/A C 0 HealthEast Diversified Services Inc PO Box 64624 St Paul MN 55164 411388583 Reference Lab & Rental Real Estate MN N/A C 0 0 0 0 0 0 0 0 0 1 0 1 1 1 0 1 0 0 1 0