2016-11-15T11:04:39-06:00 2015-12-31 450250958 EIDE BAILLY LLP PO BOX 1914 BISMARCK ND 585021914 990 2015-01-01 450458242 Southwest Healthcare Services SOUT 7015233214 802 2nd St NW Bowman ND 58623 Becky Hansen CEO 7015233214 2016-11-15 1 Lisa Chaffee CPA P00193453 7012551091 2016-11-15 2015 2017-02-10 21:41:12Z Becky Hansen 802 2nd St NW Bowman ND 58623 15210167 0 X www.swhealthcare.net X 2000 ND Southwest Healthcare Services is organized to provide quality health care services. 9 7 227 55 0 0 2286887 3598317 11521541 11546989 58497 49639 46960 -252 13913885 15194693 0 0 0 0 8298479 8416203 0 0 7063 4575552 4901408 12874031 13317611 1039854 1877082 14249482 42523618 5159100 31598793 9090382 10924825 X Guided by faith-based leadership, we are a family of specialists, each performing a unique service. With a spirit of compassion, we provide excellence in healthcare to those we are privileged to serve. 1 0 11454324 11549544 Southwest Healthcare Services (Southwest) consists of a 23-bed acute care hospital, 40-bed nursing facility, 14-unit apartment complex, 12-unit assisted living facility, visiting nurse service agency, clinic, and ambulance service located in Bowman, North Dakota.Southwest Healthcare Services is organized to provide quality health care services for individuals in the surrounding community. Southwest Healthcare Services operates an acute care hospital, nursing facility, rural health clinic, ambulance service, outpatient therapy services and elderly living facilities. Southwest operates a full time emergency room and provides emergency care regardless of ability to pay. Southwest also provides clinical services needed to operate the emergency center and provides on-site emergency medical, rescue and medical transportation services.Southwest Healthcare Services provides non-emergency services to the community making these services accessible to the community through participation in government programs like Medicare and Medicaid and our own charity care program. Services are provided to all individuals regardless of individual status. Southwest Healthcare Services charity care program provides discounted and free services to patients that are unable to be fully responsible for the cost of the health care they receive. Southwest Healthcare Services is committed to responding to the increasing number of patients who are under-insured or without insurance and who need to seek healthcare services at our facility. To fulfill its mission of community service, Southwest provides care to these patients who meet certain criteria under its charity care policy without charge or at amounts less than its established rates. Because Southwest does not pursue collection of amounts determined to qualify as charity care, they are not reported as patient and resident service revenue. The estimated cost of providing charity care for the year ended December 31, 2015 was $42,000, which was calculated by multiplying the ratio of cost to gross charges by the gross uncompensated charges associated with providing charity care to patients.Southwest Healthcare Services reaches out to people and communities throughout southwestern North Dakota, northwestern South Dakota and eastern Montana through specific health events and health education, for example: reduced rate sports physicals for students, health fairs, and skin cancer screenings. 11454324 1 1 0 0 0 0 0 0 1 1 1 0 0 0 1 1 1 0 0 0 0 0 0 0 1 0 1 1 0 0 1 1 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 1 27 1 1 227 1 0 0 0 0 0 1 1 0 0 0 1 0 X 9 7 0 0 0 0 0 0 0 1 0 0 0 1 1 1 1 1 1 1 1 0 X Sasha Ruggles CFO 7015233214 802 2nd St NW Bowman ND 58623 Galen Strand President (Jan-April) 1.00 X X 0 0 0 Gary Brennan V.P. (Jan-April)/President (May-Dec) 1.00 X X 0 0 0 Roger Walter Trustee (Jan-April)/V.P. (May-Dec) 1.00 X X 0 0 0 Jackie Lambourn Secretary 1.00 X X 0 0 0 Justin Wolbaum Trustee (Jan-April) 1.00 X 0 0 0 Jean Tennant Trustee 1.00 X 0 0 0 Julie Lockert Trustee 1.00 X 0 0 0 Bruce Bowman Trustee 1.00 X 0 0 0 Lynn Peterson Trustee 1.00 X 0 0 0 Dan Powell Trustee (Starting April) 1.00 X 0 0 0 Shonda Schwartz Trustee (Starting April) 1.00 X 0 0 0 Becky Hansen CEO 40.00 X 178644 0 20411 Sasha Ruggles CFO 40.00 X 78757 0 7904 Dr David Meadows Physician 40.00 X 246579 0 0 Dr Forrest Lanchbury Physician 40.00 X 316217 0 20411 Christine Peterson Nurse Practitioner 45.00 X 160346 0 0 Dr Sherryl Tomboulian Physician 40.00 X 243273 0 20411 Valerie Kunze Pharmacist 40.00 X 124522 0 0 1348338 0 69137 6 0 1 0 Dakota Travel Nurse 1200 Collins Ave Mandan ND 58554 Contract Nursing 334899 Avant Healthcare Professionals LLC 1211 Semoran Blvd Suite 226 Casselberry FL 32707 Contract Nursing 182161 MA Mortenson Company PO Box 710 Minneapolis MN 55440 Building Project Contractor 169530 Avera Health 3900 West Avera Drive Sioux Falls SD 57108 ePharmancy & eEmergency 119250 NXC Imagining Inc 2118 4th Avenue South Minneapolis MN 55440 Radiology Purchase Service 109660 7 23751 2894493 680073 71026 3598317 Patient & Resident Service Revenu 622110 11462612 11462612 Supporting Revenue 900099 84377 84377 11546989 38851 38851 10788 0 10788 10788 10788 44472 23751 15474 28998 28998 2555 0 2555 2555 Loss on Refinancing 900099 -31805 -31805 -31805 15194693 11549544 0 46832 X 294115 294115 319910 319910 6554255 5985810 568445 730025 631342 98683 517898 457083 60815 4378 4378 48604 48604 1532874 1356760 176114 61594 61594 282345 131653 150692 235648 235648 215296 213627 1669 121289 89106 32183 2801 2801 116138 116138 995215 995215 98172 98172 Medical Supplies 658238 658238 Bad Debts 285483 285483 Dietary Food and Supple 187039 187039 Dues Licensing & Subscr 49098 26787 22311 7196 133 7063 13317611 11454324 1856224 7063 1559397 556408 1306305 965610 2455853 2068134 193531 201110 81901 88044 25927546 13847078 5795194 12080468 1296956 25410299 33484 160686 160686 1366175 992859 14249482 42523618 1565464 1556629 67418 13541 2325000 25786623 3601 4424 1008471 3165421 189146 1072155 5159100 31598793 X 4631863 6443792 4331407 4353921 127112 127112 9090382 10924825 14249482 42523618 X 1877082 -44000 1361 X 0 1 X 1 1 1 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 1 20776 5702 7063 19415 1 X 127112 725 725 127112 127112 2164 2164 127112 127112 3695 3695 127112 115112 6976 6976 115112 115112 219 -219 115112 0.00000 1.00000 0.00000 1 0 75488 75488 9079333 7093229 1986104 8798709 6753849 2044860 7974016 7974016 12080468 Construction Payable 1072155 1072155 X 14874982 -44000 -285483 -329483 15204465 -9772 -9772 15194693 13040539 15474 15474 13025065 292546 292546 13317611 Part IV, Line 1b: Southwest Healthcare Services has an auxiliary that operates under the same EIN as Southwest Healthcare Services. Part IV, Line 2b: Southwest acts as custodian for the funds of the residents. These funds are included in cash and accounts payable in the financial statements. Resident trust funds totaled $4,424 and $3,601 at December 31, 2015 and 2014. Part V, Line 4: Endowments held and administered by Southwest Healthcare Services: The earnings from the $127,112 are for hospital operations and to support assisted living, as necessary. The principal of $127,112 is permanently restricted. Schedule D, Part V: The organization is reporting a change in the beginning of year endowment fund balance in Schedule D, Part V, column (c), line 1a, due to a restatement of the balances in the permanently restricted net assets included as endowment funds on the audited financial statements. Part X, Line 2: Southwest is organized as a North Dakota nonprofit corporation and has been recognized by the Internal Revenue Service (IRS) as exempt from federal income taxes under Internal Revenue Code Section 501(c)(3). Southwest is annually required to file a Return of Organization Exempt from Income Tax (Form 990) with the IRS. In addition, Southwest is subject to income tax on net income that is derived from business activities that are unrelated to its exempt purpose. Southwest has determined it is not subject to unrelated business income tax and has not filed an Exempt Organization Business Income Tax Return (Form 990-T) with the IRS. Southwest believes that it has appropriate support for any tax positions taken affecting its annual filing requirements, and as such, does not have any uncertain tax positions that are material to the financial statements. Southwest would recognize future accrued interest and penalties related to unrecognized tax benefits and liabilities in income tax expense if such interest and penalties are incurred. Part XI, Line 2d - Other Adjustments: Provision for Bad Debts included in Expenses on Form 990 -285,483. Part XI, Line 4b - Other Adjustments: Auxiliary Revenue 5,702. Fundraising Expenses reported in Revenue on Form 990 -15,474. Part XII, Line 2d - Other Adjustments: Fundraising Expenses reported in Revenue on Form 990 15,474. Part XII, Line 4b - Other Adjustments: Auxiliary Expenses 7,063. Provision for Bad Debts included in Expenses on Form 990 285,483. Celebrity Waiter 68223 23751 44472 525 7216 3350 4383 68223 23751 44472 525 7216 3350 4383 15474 28998 1 1 X 1 X 1 X 1 1 0 1 1 42000 42000 0.00320 42000 42000 0.00320 9362 1714 7648 0.00060 2449412 1994530 454882 0.03490 2458774 1996244 462530 0.03550 2500774 1996244 504530 0.03870 61985 7989 53996 0.00410 61985 7989 53996 0.00410 0 285483 57097 2665093 2758002 -92909 X 1 1 1 1 Southwest Healthcare Services 14 6th Ave SW Bowman ND 58623 5006 X X X X Rural Health Clinic Southwest Healthcare Services 1 0 0 1 X X X X X X X X 13 1 0 0 1 X http://swhealthcare.net/events/chna.html X See Part V, Section C, Line 7d for URL X X 1 13 1 http://swhealthcare.net/events/chna.html 0 0 1 X 100.000000000000 200.000000000000 X X X X X 1 1 X X X X 1 X See Part V, Section C, line 16i X X X X X X 1 X 0 X X X X 1 X 0 0 Southwest Healthcare Services Part V, Section B, Line 5: A Community Advisory Committee was organized with specific individuals from the community served. Personal invitations were sent to organizations representing various community, business, educational and religious groups. Representatives from the local healthcare providers and the county public health department were included to bring in additional professional perspective. Southwest Healthcare Services Part V, Section B, Line 7d: Ruralhealth.und.edu/projects/flex/hospitals#bowman Southwest Healthcare Services Part V, Section B, Line 11: The organization is addressing the significant needs in its most recently conducted CHNA in the following ways:Improvement/Replacement Hospital Facility: We have been working diligently for the last few years on a capital campaign and other financing sources for the replacement of the hospital facility. Substantial completion is expected in January of 2017 with occupancy projected in February 2017. Shortage of Healthcare Staff: We are constantly advertising for new staff. We have used various recruiting companies and recruiting techniques to hire more staff. We offer sign on bonuses and relocation assistance for many positions. We also offer CNA classes to try and train new staff.Access to Mental Health Services: At this time, we contract with Aurora to provide mental health services in our community. We have also been in contact with a psychologist in hopes of recruiting her to Southwest Healthcare. Awareness of services provided and access to specialty services: We try to accomplish all of these goals through our advertising campaigns. We have increased the dollars we spend on advertising to try and reach these goals.Education and implementation of Health Lifestyle Program: One of our physicians sends out a weekly newsletter to patients. This newsletter is full of healthy lifestyle tips. SWHC also provides some information on our website and at community events such as a booth at the Bowman County Fair.Percentage of Population considered obese: One of our providers specializes in obesity/weight loss and is available to patients. Our weekly newsletter also often contains articles related to healthy living and weight loss.Percentage of Population reporting a lack of exercise: The lack of exercise is a risk factor for any diseases and conditions including obesity. By choosing to address obesity as a priority area, we feel we will be addressing physical activity. Employees of SWHC are encouraged to exercise. We provide benefits to employees in the form of a voucher which can be redeemed for various things which include exercise at 3 local gyms. Southwest Healthcare Services Part V, Section B, Line 13h: Soft credit check Southwest Healthcare Services Part V, Section B, Line 16i: The FAP application form can be found on our website at: http://swhealthcare.net/patient/financials/financial_assistance_form.htmlA summary of the financial assistance policy and financial assistance contact information can be found at the admissions desk in the hospital, clinic, and online. The financial assistance application is also summarized on the back of our billing invoices. 5 1 - Southwest Healthcare Services 802 2nd St NW Bowman ND 58623 Independent Living and LTC 2 - Bowman Ambulance Services 111 Highway 12 W Bowman ND 58623 Ambulance Services 3 - Sunrise Village 203 11th Ave NW Bowman ND 58623 Assisted Living and Home Care 4 - Southwest Healthcare Clinic 12 6th Ave SW Bowman ND 58623 Rural Healthcare Clinic 5 - Southwest Healthcare Services 705 3rd St NW Bowman ND 58623 Outpatient Therapy Part I, Line 6a: The Organization's Community Benefit Report is contained in their annual meeting booklet. The annual meeting booklets are available at our facilities. Part I, Line 7: Charity care expense was converted to cost on line 7a based on an overall cost-to-charge ratio addressing all patient segments. Community health improvement services, line 7e, are reported based on actual expense amounts recorded from the events in the general ledger. The cost for subsidized health services reported on line 7g was determined using the Medicare Cost Report. Part I, Ln 7 Col(f): The amount of bad debt expense removed from total expenses reported on Form 990 was $285,483. Part II, Community Building Activities: Southwest Healthcare Services provides EMS staff support at public sporting events such as Motocross races, rodeos, and school sport activities. Support is also provided to the high school in the form of sports medicine for their sports activities. Southwest Healthcare Services also provides pastorial care and support in the form of medication for mission trips. Part III, Line 2: Bad debt is reported as charges on the financial statements. Part III, Line 3: Patient accounts are written off to bad debt after every effort is made to collect the balance and patients are given opportunities to complete charity care applications or set up payment plans. All discounts and contractual adjustments are applied to accounts before they are written off to bad debt. Payments on accounts are first applied to any current portion due and then applied to any amount previously written off to bad debt. If an account has no current portion due and has been written off to bad debt, any payments made would reduce bad debt expense.We review accounts on an individual basis before turning them over to bad debt. Based on our review, it is safe to reasonably estimate that 20% of bad debt expense is attributable to patients eligible under our charity care policy. If these individuals would have completed the paperwork required to obtain charity care, they may have qualified. Southwest Healthcare Services does not refuse service to patients that generate bad debt. This is evidence that the care is given for community benefit motivations. Part III, Line 4: The footnote to the Organization's financial statements can be found on page 9 of the attached audited financial statements. Part III, Line 8: IRS Rev. Rul. 69-545, which established the community benefit standard for nonprofit hospitals, states that if a hospital serves patients with government health benefits, including Medicare, then this is an indication that the hospital operates to promote the health of the community. In some communities, Medicare is the largest payer, and hospitals must accept these patients regardless of whether they make a surplus or deficit from providing such services. If the Medicare participation is premised on this fact, then providing Medicare services promotes access to healthcare services which is a community benefit. Also, the elderly are often an underserved population who experience issues with access to healthcare services. Without tax-exempt hospitals like Southwest Healthcare Services providing Medicare services, the government would bear the burden of directly providing services to the elderly.Medicare allowable costs were obtained from the 2015 Medicare cost report. The Medicare Cost Report is completed based on the rules and regulations set forth by the Centers for Medicare and Medicaid Services. Part III, Line 9b: If an individual submits an incomplete financial assistance application, a call is made to the patient to inform them of the additional information that is required in order to determine eligibility for financial assistance. The patient has 45 days to complete the application without payments and during this time, no collection letters are sent, however statements are. If an individual submits a complete financial assistance application, statements are still sent however any collection letters would not be sent. The patient is asked, if possible, to make a minimum payment in order to keep their account current. If a patients is determined to be eligible for financial assistance after being sent to collection, the collection actions would be reversed assuming that the accounts were not older than 18 months. Documentation is made as to whether the individual was determined to be eligible or ineligible for financial assistance. Part VI, Line 2: The Organization completed a Community Health Needs Assessment in 2013. An initial meeting with the Community Advisory Committee began with a discussion of the role of the Community Advisory Committee and a review of the applicable Internal Revenue Service requirements for non-profit hospitals. These rules require input from the community in identifying and prioritizing the health needs of the community and implementation strategy for addressing the needs identified. Discussion led to the development of a survey tool. The survey was distributed to others in the community and returned for review and analysis. The results of the survey were communicated to the Community Advisory Committee. Lists of 21 potential community needs were developed. A prioritization process was used to identify seven priority issues for the community. Part VI, Line 3: A summary of our financial assistance policy and financial assistance contact information can be found at the admissions desk in the hospital, clinic, online, and on the back our statements. Financial assistance contact information is included in patient bills and is discussed with patients as well as the availability of various government benefits, such as Medicaid or state programs. Patients are assisted with qualification for such programs where applicable. Employees who are responsible for registering patients are asked to consider/screen patients who may appear to qualify or who have asked about financial assistance. The registration clerk is to give the patient a brochure explaining the Financial Assistance program which contains information on how to access the Patient Financial Services Representative (PFS) to obtain assistance. Part VI, Line 4: The community is largely agricultural based but in recent years the oil and gas industry has grown extensively. We anticipate that this will increase at an even greater pace in the next several years thus increasing the patient base that our organization will serve. The city we reside in is located at an intersection of two main highways in the state of North Dakota. Southwest Healthcare Services is the largest employer in the city and serves an area that extends approximately 45 miles in all directions, North, South, East and West. There is one other rural health clinic in our city limits that is operated by another healthcare facility which is 40 miles from our city.Southwest Healthcare Services serves over 5,300 people in rural counties of Bowman and Slope, North Dakota and Harding County in South Dakota. We have been very fortunate to have an unemployment rate in 2015 of 2.4% in Bowman County, 2.4% in Slope County and 2.3% in Harding County and a median income in 2014 of $59,000 for our service area. In 2015, approximately 13% of the residents in our community were uninsured. Southwest Healthcare Services is the only hospital in our service area with no medically underserved areas. Part VI, Line 5: Southwest Healthcare Services extends medical privileges to all providers in the community, and has a community board. Any surplus funds are used for investments in both capital assets, and medical equipment which improve services available as well as the quality of care that we give to the patients in our service area.Southwest Healthcare Services operates an emergency room available to all regardless of ability to pay. The Hospital participates in education and training of healthcare professionals and serves as a vehicle to attract and effectively use donated funds. Southwest Healthcare Services also participates in the Vision West strategic planning process for our region and community and leads the healthcare focus group.Southwest Healthcare Services provides EMS staff support at public sporting events such as Motocross races, rodeos, and school sport activities. Support is also provided to the high school in the form of sports medicine for their sports activities. We do health fairs in 6 communities across our service area. We provide CPR and first aid classes to local coaches. We participate in job shadow events and career fairs. X X X 0 0 0 0 0 0 0 1 0 Becky Hansen CEO 178644 0 0 0 0 0 0 0 25079 0 203723 0 0 0 Dr David Meadows Physician 246579 0 0 0 0 0 0 0 0 0 246579 0 0 0 Dr Forrest Lanchbury Physician 316217 0 0 0 0 0 0 0 20411 0 336628 0 0 0 Christine Peterson Nurse Practitioner 160346 0 0 0 0 0 0 0 4080 0 164426 0 0 0 Dr Sherryl Tomboulian Physician 243273 0 0 0 0 0 0 0 20411 0 263684 0 0 0 Part I, Line 7 Dr. Lanchbury receives a production incentive based on exceeding an average of 100 billable visits per month. This is reviewed and reimbursed on a quarterly basis. A City of Bowman North Dakota 456002040 10302TAM2 2015-07-28 16300000 See Supplemental Information 0 0 0 B Bowman County North Dakota 456002202 103004AA5 2015-07-28 10000000 See Supplemental Information 0 0 0 A 16303258 222969 2161180 13915851 1 0 0 0 B 10002293 136791 9863209 0 0 0 0 A 0 0 0 0 0.00000 0.00000 0.00000 0 0 0 B 0 0 0 0 0.00000 0.00000 0.00000 0 0 0 A 0 0 0 0 0 0 0 0 0 B 0 0 0 0 0 0 0 0 0 A 0 B 0 Description of Purpose: Bond A: To refund bonds issued 8/3/2006, and to finance construction and equipping of new hospital, clinic, therapy/rehabilitation department, and renovate certain existing facilities Description of Purpose: Bond B: To finance construction and equipping of new hospital, clinic, therapy/rehabilitation department, and renovate certain existing facilities Rochelle Thompson Rochelle is the daughter of board member Galen Strand 47134 Compensation 0 Sarah Wolbaum Sarah is the wife of board member Justin Wolbaum 43522 Compensation 0 Shannon Bowman Shannon is the daughter-in-law of board member Bruce Bowman 55814 Compensation 0 Christine Peterson Christine is the sister of CFO Sasha Ruggles 160346 Compensation 0 Susan Powell Susan is the wife of board member Dan Powell 13094 Compensation 0 X 2 47977 Blue Book Value X Power Wheel Chair 1 23049 Comparable Products 3 0 0 0 Form 990, Part III, line 2 We began to offer stem cell procedures on a cash basis. We began to offer this service on the beginning of 2015. Form 990, Part VI, Section A, line 1 The Board of Trustees may designate an Executive Committee composed of the President, Vice President and at least one other trustee designated by the Board of Trustees. Subject to the limitations prescribed by the North Dakota Century Code, the Executive Committee has the authority of the Board of Trustees in the management of the business of this corporation in the interval between meetings of the Board of Trustees and the Executive Committee is at all times subject to the control and direction of the Board of Trustees. Form 990, Part VI, Section A, line 8b The Organization has an Executive Committee, however it did not engage in 2015. Form 990, Part VI, Section B, line 11 The return is reviewed initially by the CEO, CFO, and Accountant. The return is then emailed to the Board of Directors for review and approval prior to being filed with the IRS. Form 990, Part VI, Section B, line 12c All officers, directors, and key employees are required to complete a conflict of interest form annually. The forms are reviewed initially by the CEO for potential conflicts. Any actual conflicts are reviewed by the Board of Directors. A person with a conflict is restricted from voting on related matters. Form 990, Part VI, Section B, line 15 A review of current salary surveys for CEOs provided by state associations is reviewed and a performance evaluation is completed by the Board of Directors. A fair compensation is set within the salary survey ranges supplied and as determined by the evaluation review by the Board of Directors. For the CFO, compensation is based on a performance evaluation as well as a review of current market rates through salary surveys for comparable sized facilities. The CEO completes the performance evaluation which is reviewed by Human Resources and if there is a need for a market rate adjustment, this is reviewed at the board level with discussion and data and then approved at that time. These processes take place on an annual basis and are documented in the board minutes. Form 990, Part VI, Section C, line 19 The Organization makes its governing documents, conflict of interest policy, and financial statements available to the public upon request. Form 990, Part IX, line 11g Repairs, Maintenance and Service Contracts and Fees: Program service expenses 417,425. Management and general expenses 91,487. Fundraising expenses 0. Total expenses 508,912. Purchased Services and Recruitment: Program service expenses 250,481. Management and general expenses 52,344. Fundraising expenses 0. Total expenses 302,825. Professional Fees and Consulting: Program service expenses 688,854. Management and general expenses 32,283. Fundraising expenses 0. Total expenses 721,137. Form 990, Part XI, line 9: Auxiliary Net Income 1,361.