2016-08-12T10:51:24-05:00 2015-09-30 420714325 RSM US LLP 1 S Wacker Drive Ste 800 Chicago IL 60606 990 2014-10-01 362179813 SWEDISH COVENANT HOSPITAL SWED 7738788200 5145 N CALIFORNIA AVE CHICAGO IL 60625 THOMAS J GARVEY SENIOR VP & CFO 7738788200 2016-08-12 1 Wayne Harder P00294296 3126343400 2014 2016-09-27 15:27:22Z THOMAS J GARVEY 5145 N CALIFORNIA AVE CHICAGO IL 60625 291222358 0 X www.swedishcovenant.org X 1907 IL Providing excellent healthcare services for our culturally diverse communities for over 120 years. 24 14 2233 162 2813093 0 501774 324033 241686328 259348588 9162954 5408516 19166926 26141221 270517982 291222358 962433 954750 0 0 119059824 119276648 0 0 0 133132311 138848247 253154568 259079645 17363414 32142713 442054712 446778668 272555069 277220750 169499643 169557918 X Our Mission is to provide a continuum of excellent healthcare services. Rooted in The Evangelical Covenant Church, the hospital is dedicated to serving the physical, spiritual and psychological needs of our culturally diverse communities. 0 0 225291205 954750 284158235 Since 1886, Swedish Covenant Hospital (SCH) has been dedicated to providing community benefit healthcare services and healthcare education. As part of its mission as a not-for-profit, church-based community hospital, Swedish Covenant has served as an educational center, health rehabilitation center, illness prevention center, social support services center, and community center. Swedish Covenant Hospital serves as a solid community structure through employment of over 1,797 individuals.Recognizing its mission to the community, Swedish Covenant Hospital offers the following quality medical healthcare services regardless of race, creed, sex, national origin, handicap, age or ability to pay:General Medicine, Surgery, ICUSwedish Covenant Hospital continually offers the latest technology to meet the vast needs of the community. During the fiscal year, SCH serviced 13,570 inpatients and more than 273,000 outpatients at a total cost of $212,631,515.Physical Medicine/Rehab ServicesSCH is dedicated to providing a comprehensive Rehab Unit that combines the disciplines of physical therapy, speech therapy, occupational therapy and social work to help patients regain their strength and skills. The Rehab unit features a special room that simulates a home environment so patients can practice with home-like carpeting, furniture and fixtures while supervised by nurses. During the fiscal year, 214,981 inpatient and outpatient treatments for rehab, speech and occupational therapy were provided for a total cost of $4,643,987.Cardiac Care and RehabThe Cardiac Rehabilitation program offered by Swedish Covenant Hospital has improved the lives of many individuals with such innovative programs as "Coronary Heart Disease Reversal." SCH also offers a state-of-the-art Cardiac Catheterization Lab, and other diagnostic and preventive programs. During the fiscal year, SCH provided 30,558 treatments and 1,751 procedures by the Cardiac Rehab program and Cardiac Catheterization Lab, respectively, for a total cost of $7,072,750.In addition to the program services listed above, Swedish Covenant Hospital also offers the following services to the community:Health Screening, Health Promotions, Education, PreventionSCH offers year-round health screenings to members of the community. Blood pressure screening events are provided in collaboration with the hospital's Stroke Education Coordinator.Each year free or reduced-cost cancer screenings are offered to the community. These included prostate, skin, cervical and breast screenings. Additionally, dozens of programs led by oncologists and dietitians from the hospital address topics of cancer prevention, treatment, nutrition, fitness and other healthy lifestyle recommendations.The hospital also has an in-house smoking cessation program, which offers customized treatment plans and ongoing group support.During the fiscal year Swedish Covenant Hospital served a total of 15,631 persons through participation in health promotions, education, and prevention for a total cost of $340,353.Community Wellness and Prevention programs continue to serve the community with 225 events held at the Hospital or in the community through collaboration with community partners. These events include health fairs, screenings, daytime and evening lectures, seminars, classes, Speakers' Bureau presentations, children's events and other health related activities. Throughout the year the Hospital collaborated with dozens of community organizations to provide wellness and prevention programs.Swedish Covenant Hospital publishes periodic health and wellness information which is distributed through mailings and web-based programs to 985,265 households throughout the surrounding community for a cost of $54,015.During the fiscal year, Swedish Covenant Hospital also offered transportation services to 3,269 members of the community at a net cost of $136,426.Interpreter ServicesSwedish Covenant Hospital provides in-house interpreters for patients who speak Korean, Spanish, and Russian, the primary non-English languages in the community. In FY 2015, the interpreters participated in a total of 1,983 sessions. Additionally, SCH uses professional telephone interpretive assistance and had a total of 167,070 telephonic interpretation minutes in 74 languages. For deaf or hearing impaired patients who request sign language interpreters, the Hospital provides interpreters through CAIRS and Chicago Hearing Society. SCH incurred a total cost of $412,159 for interpreter services serving a total of 41,690 persons.Medical Education ProgramSwedish Covenant Hospital is an independent teaching hospital, with residency programs in family medicine, osteopathic internal medicine, and podiatric surgery. Swedish Covenant Hospital also has fellowship programs in Critical Care Medicine and Pulmonary Critical Care Medicine.Swedish Covenant Hospital utilizes board-certified physicians who are employed by Swedish Covenant Management Services, a wholly-owned subsidiary of Swedish Covenant Hospital to provide teaching, training and supervision of the residents in Swedish Covenant Hospital's Family Medicine (12 residents), Internal Medicine (24 residents), Podiatric Surgery (6 residents) residency programs as well as the Critical Care (2 fellows) and Pulmonary Critical Care Fellowships (3 fellows). As part of Swedish Covenant Hospital's teaching affiliation agreement with Midwestern University Chicago College of Osteopathic Medicine (MWU/CCOM), Swedish Covenant Hospital is a training site for residents in emergency medicine and critical care.Swedish Covenant Hospital has an affiliation agreement with Rush University which allows for the Hospital to be a training site for their OB/GYN residents.In addition to the above, during the fiscal year ended September 30, 2015, Swedish Covenant Hospital voluntarily provided $6,521,194 at cost in charity care/uninsured discounts and provided $21,774,724 at cost in unreimbursed Medicaid services. 225291205 1 1 0 1 0 0 0 0 0 1 1 1 0 1 1 1 0 1 0 0 0 0 0 0 0 0 1 1 1 0 1 1 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 1 1 1 0 0 1 278 1 1 2233 1 1 1 0 0 0 0 0 0 0 0 0 X 24 14 1 0 0 0 1 1 1 1 1 0 0 0 1 1 1 1 1 1 1 1 1 IL X THOMAS GARVEY 7738788200 5145 N CALIFORNIA AVE CHICAGO IL 60625 CHARLES L ADAIR DIRECTOR 1.00 1.00 X 0 0 0 KURT D ANDERSON DIRECTOR 1.00 X 0 0 0 LYLE BANKS DIRECTOR 1.00 X 0 0 0 MICHAEL BAUGHMAN DIRECTOR 1.00 X 0 0 0 RONALD D CURRAN MD DIRECTOR 1.00 40.00 X 34167 788742 30201 VINCENT DIBENEDETTO DIRECTOR 1.00 X 0 0 0 H CLARK FEDERER MD DIRECTOR 1.00 40.00 X 0 340685 27136 MAUREEN T GIRARD DIRECTOR 1.00 X 0 0 0 W J WESLEY KEE DIRECTOR 1.00 X 0 0 0 DAVID J KOO DIRECTOR 1.00 X 0 0 0 BRUCE MCNULTY MD DIRECTOR 7.50 1.00 X 25000 0 0 REV MARK A NILSON DIRECTOR 1.00 X 0 0 0 CHRISTOPHER J OLSON DIRECTOR 1.00 X 0 0 0 BEA REYNA-HICKEY DIRECTOR 1.00 X 0 0 0 CHRIS SULLIVAN DIRECTOR 1.00 X 0 0 0 JEFFREY M TILKIN MD DIRECTOR 1.00 X 13933 0 0 LAWRENCE P ANDERSON DIRECTOR 1.00 42.00 X 0 591281 27429 DAVID A DWIGHT DIRECTOR 1.00 42.00 X 0 657813 38110 ARMINIO SURUCCI MD DIRECTOR 1.00 X 0 0 0 REV GARY B WALTER DIRECTOR 1.00 40.00 X 0 151200 113208 THOMAS M PYRA CHAIRMAN 1.00 X X 0 0 0 JUDITH A PINS VICE CHAIR 1.00 X X 15131 0 0 DAVID R PUTMAN SECRETARY 1.00 1.00 X X 0 0 0 MARK NEWTON PRESIDENT & CEO 40.00 3.00 X X 0 962414 19750 THOMAS J GARVEY SENIOR VP & CFO 40.00 3.00 X 416644 0 58790 JUDITH A BORENSTEIN GENERAL COUNSEL 40.00 3.00 X 360816 0 35282 ANTHONY GUACCIO SENIOR VP & COO 40.00 1.00 X 488047 0 67219 DEREK J KELLY MD VP & CHIEF MEDICAL OFFICER 40.00 X 382949 0 18206 MARY SHEHAN RN SENIOR VP, CNO 40.00 X 303657 0 8561 KATHRYN DONOFRIO RN SENIOR VP, CNO 40.00 X 166449 0 19562 KAREN M SHEEHAN SENIOR VP & CIO 40.00 X 279180 0 25460 JANIS A RUEPING VP QUALITY IMPVMT/RISK MGM 40.00 1.00 X 255137 0 41230 MICHAEL FEINZIMER PHYSICIAN 40.00 X 221180 0 1716 JONATHAN LIND VP OPERATIONS 40.00 X 213456 0 24561 PATRICIA KING ASSOCIATE GENERAL COUNSEL 40.00 X 208049 0 22477 TONY VANCAUWELAERTMD FORMER DIRECTOR,PHYSICIAN 0.00 40.00 X 0 303331 15326 3383795 3795466 594224 80 1 1 0 MIDWESTERN UNIVERSITY 555 31ST STREET DOWNERS GROVE IL 60515 HEALTH CARE 937798 ANDERSON MIKOS ARCHITECTS LTD 17W110 2ND ST SUITE 200 OAKBROOK TERRACE IL 60181 ARCHITECT SERVICES 867782 NEPHRON DIALYSIS CTR LTD 5140 N CALIFORNIA AVE STE 510 CHICAGO IL 60625 HEALTH CARE 659095 PEDIATRIC FACULTY FOUNDATION LURIE CHILD 225 E CHICAGO AVE BOX 152 CHICAGO IL 60611 HEALTH CARE 614395 QUEST DIAGNOSTICS 12989 COLLECTION CENTER DR CHICAGO IL 60693 HEALTH CARE 581376 23 X 263806 60227 324033 HEALTH CARE SERVICES 900099 257010935 257010935 LABORATORY SERVICES 621500 2337653 2337653 259348588 -247024 -247024 6299289 0 6299289 6299289 6299289 5655540 0 5655540 5655540 5655540 CHRPP REBATE 900099 9357953 9357953 CHILD CARE CENTER 624410 1021511 546071 475440 PARKING GARAGE FEES 812930 956284 956284 8506184 8506184 19841932 291222358 284158235 2813093 5408516 X 954750 954750 2223449 921164 1302285 219719 116185 103534 95937640 87416942 8520698 1819457 1635874 183583 12012708 10847278 1165430 7063675 6304296 759379 3028219 3028219 227431 227431 116100 116100 217500 217500 27262034 23569990 3692044 819213 396149 423064 630880 540475 90405 4437343 4106915 330428 375252 252392 122860 8786442 8786442 19234511 17868788 1365723 10021090 9009962 1011128 OTHER OPERATING SUPPLIE 40726756 40616396 110360 IDPA TAX 12709392 12709392 EQUIPMENT REPAIR & MAIN 6328127 6236554 91573 PROPERTY & SALES TAX 2197841 265911 1931930 1730116 1521792 208324 259079645 225291205 33788440 0 288035 11897913 993799 543629 26652044 30947891 4303416 3784892 4752038 4446796 475095084 288103678 193551595 186991406 139816422 133415456 1667943 592357 70317455 73870293 442054712 446778668 32222328 39720768 171843930 167269819 68488811 70230163 272555069 277220750 X 168467998 168484197 1031645 1073721 169499643 169557918 442054712 446778668 X 32142713 -13467349 -18617089 X 0 1 X 1 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 1 0 0 0 0 1 146885 0 1 217500 364385 0 Part II-B, Line 1: In the course of regular business activities, the hospital or its lobbyist perform some lobbying activities on matters of interest to itself and its patients. 21383248 2587312 -164316 1746011 22060233 20747291 2850273 477914 2692230 21383248 20575237 1532811 115000 1475757 20747291 19626213 8677201 127001 7855178 20575237 18814654 1270179 20979 479599 19626213 0.17840 0.82160 0 1 1 7960138 7960138 206553629 91342827 115210802 550932 550932 0 230437044 176237060 54199984 29593341 19972859 9620482 186991406 CMB BOND & EQUITY FUND - FMV 124066502 F US BANK 9346348 F MERRILL LYNCH - FMV 2606 F 133415456 OTHER INVESTMENTS 879216 CAPTIVE RECOVERIES A/R 1628937 CHRPP RECOVERIES A/R 6178000 DUE FROM AFFILIATES 55641103 ASSETS WHOSE USE IS LIMITED 3624951 ALL OTHER CURRENT ASSETS 536226 ACA 400 2319613 PA TAX ASSESSMENT 1946891 STOP LOSS REIMBURSEMENTS 570947 TRANSITIONAL CARE PAYMENT 544409 73870293 ACCRUED LONG TERM MALPRACTICE LIABILITY 18913658 FAIR VALUE OF INTEREST RATE SWAPS 18295741 ASSET RETIREMENT OBLIGATION 1705061 DUE TO THIRD PARTY PAYERS 17840703 NMTC DEBT ISSUE 13475000 70230163 X Part V, Line 4: The earnings are to be used for education, charity care, and other hospital programs. Swedish Covenant Hospital is the related beneficiary of the endowment funds held by Swedish Covenant Hospital Foundation. Part X, Line 2: The Hospital is a not-for-profit organization under the laws of Illinois. The Internal Revenue Service has determined that the Hospital is a not-for-profit organization described in Section 501(c)(3) of the Internal Revenue Code (the Code) and is exempt from federal income taxes on related income pursuant to Section 501(a) of the Code. Accordingly, the Hospital has not provided for income taxes in the accompanying financial statements. The Hospital and its not-for-profit subsidiaries each file Form 990 (Return of Organization Exempt from Income Tax), and the for-profit subsidiary files Form 1120 (U.S. Corporation Income Tax Return) annually. When these returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would ultimately be sustained. Examples of tax positions common to health systems include such matters as the obligated group, the nature, characterization and taxability of joint venture income and various positions relative to potential sources of unrelated business income (UBI). UBI is reported on Internal Revenue Service Form 990-T, as appropriate. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes that it is more likely than not that the tax position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions are not offset or aggregated with other positions. Tax positions that meet the "more likely than not" recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely to be realized on settlement with the applicable taxing authority. The portion of the benefits reflected as a liability for unrecognized tax benefits in the accompanying consolidated statements of financial position along with any associated interest and penalties that would be payable to the taxing authorities upon examination. At September 30, 2015 and 2014, there were no unrecognized tax benefits identified or recorded as liabilities. The Forms 990, Forms 990-T and Forms 1120 filed by the Hospital are subject to examination for up to three years from the extended due date of each return. These returns are no longer subject to examination for tax years ended before September 30, 2012. 1 1 1 X 300.000000000000 1 X 600.000000000000 1 1 1 0 1 0 6637718 6637718 0.02580 78527966 79476079 -948113 0.00000 85165684 79476079 5689605 0.02580 932512 932512 0.00360 3868421 2970648 897773 0.00350 1034560 1034560 0.00400 954750 954750 0.00370 6790243 2970648 3819595 0.01480 91955927 82446727 9509200 0.04060 34476 34476 0.00010 34476 34476 0.00010 1 8312952 83497445 79409573 4087872 X 1 1 1 CHICAGO CK ENTERPRISES LLC OUTPATIENT MEDICAL SERVICES 0.05300 0.00000 0.94700 2 CK PROPERTY DEVELOPMENT LLC PROPERTY MANAGMENT SERVICES 0.36800 0.00000 0.63200 1 1 SWEDISH COVENANT HOSPITAL 5145 N CALIFORNIA AVENUE CHICAGO IL 60625 www.swedishcovenant.org 00002717 X X X X I/P & OP HOSPITAL SERVICES, SKILLED NURSING FACILITY SWEDISH COVENANT HOSPITAL 1 0 0 1 X X X X X X X X X 12 1 0 0 1 X www.swedishcovenant.org X 1 12 1 www.schosp.org 0 0 1 X 300.000000000000 600.000000000000 X X X X 1 1 X X X 1 X www.swedishcovenant.org X www.swedishcovenant.org X www.swedishcovenant.org X X X X 1 X 0 X X X X 1 X 0 0 SWEDISH COVENANT HOSPITAL Part V, Section B, Line 5: The Community Health Needs Assessment was produced in cooperation with the Metropolitan Chicago Healthcare Council (MCHC). The project also received input from several Community Health Needs Assessment Focus Groups, which were comprised of representatives of the partnering organizations as well as other citizens chosen for their relevant experience and interests. The sample design used for this effort consisted of a random sample of 515 individuals age 18 and older in the Swedish Covenant Hospital Service Area. Once the interviews were completed, these were weighted in proportion to the actual population distribution so as to appropriately represent the Swedish Covenant Hospital Service Area as a whole. All administration of the surveys, data collection and data analysis was conducted by Professional Research Consultants, Inc. (PRC). For statistical purposes, the maximum rate of error associated with a sample size of 515 respondents is 4.4% at the 95 percent level of confidence.The sample design and the quality control procedures used in the data collection ensure that the sample is representative. Thus, the findings may be generalized to the total population of community members in the defined area with a high degree of confidence.As part of the Community Health Needs Assessment, seven focus groups were held among key informants in the community on June 21-22 and July 11-12, 2012, each focusing on needs within different geographies or among certain populations. These key informant focus groups allowed for input from persons with special knowledge of or expertise in public health, as well as others who represent the interests of key cultural groups represented in communities served by Swedish Covenant Hospital. In all, 50 key informants participated, including physicians, other health professionals, social service providers, business leaders, minority organizations and other community leaders.Potential participants were chosen because of their ability to identify primary concerns of the populations with whom they work, as well as of the community overall. Participants included a representative of public health, as well as several individuals who work with low-income, minority or other medically underserved populations, and those who work with persons with chronic disease conditions. Specific names/titles of those participating are available upon request. SWEDISH COVENANT HOSPITAL Part V, Section B, Line 11: In acknowledging the wide range of priority health issues that emerged from the CHNA process, Swedish Covenant Hospital determined that it could only effectively focus on those which it deemed most pressing, most under-addressed, and most within its ability to influence. The hospital focused on 7 of the 14 identified needs. Listed below are the seven needs which are being addressed and how they being addressed:1. Access to health servicesSCH continues to identify improper utilization of the Emergency Department and direct patients to Erie Foster Avenue Health Center for follow up care or to establish future medical home. Hospital employees served as Certified Application Counselors to assist consumers with enrollment on the health insurance marketplace. These employees also helped eligible individuals enroll in Medicaid and Medicare throughout the year. The hospital also opened an on-site marketplace assistance center in partnership with ACA Enroll, which was open five days per week during open enrollment. As part of the hospital's Care Transitions Program, recently discharged patients are called to assess educational and social support needs. Patients identified as at risk for readmission receive a home visit by a Wellness Coach, who performs medication reconciliation, education and assistance in scheduling physician appointments and needed transportation. 2. Heart disease and strokeAs part of the hospital's Primary Stroke Center certification, SCH's Stroke Education Coordinator provides blood pressure screenings throughout the community along with education related to warning signs/risk factors for heart disease and stroke. At blood pressure screenings, participants with abnormally high levels are referred for follow-up with their physician or a community health clinic. Discharge Navigators play a leading role in patient follow up and support. Discharge Navigators call patients who were at high risk for readmission, with the majority of these patients receiving multiple calls. The navigator may help to explain medications, assist with getting physician appointments or arrange services such as oxygen delivery, meals on wheels, and home health providers. Patients at risk for re-admission are visited at home by a Wellness Coach to review prescribed medications and provide disease specific education. If appropriate, 90-day home telemonitoring is also available for patients at risk for readmission.3. Nutrition, physical activity and weightThe hospital provides community education regarding healthy eating and fitness. More than 40 programs in FY15 featured nutrition, cooking, diabetes prevention or fitness. Partners included Whole Foods Market, Mariano's, Oak Street Health, The Breakers and Peterson Garden Project. A key partner in this priority is Galter LifeCenter, the certified medical fitness facility on campus (and the only certified medical fitness facility in Chicago), which offers a number of programs in collaboration with SCH, including Fundamental Fitness and Total Control.4. Mental health and mental disordersThe hospital continues to seek ways to provide appropriate resources for mentally ill individuals and to decrease improper use of Emergency Department (ED) services. The hospital maintains an active partnership with Lutheran Social Services of Illinois (LSSI) Project IMPACT on site in the ED. In 2015, 3,657 patients were seen by Project Impact in SCH's ED; 630 patients lacked health insurance. Initiating treatment and intensive case management for uninsured patients in acute crisis holds promise for reducing the number in need of state hospitalization and repeat ED visits. Project IMPACT maintains a Certified Addictions Counselor (CAC) as part of the care team in the hospital's ED. In May 2015 LSSI expanded services on the hospital campus by opening the Welcoming Center in the Foster Medical Pavilion. The Welcoming Center is a behavioral health program that provides open-access to treatment for individuals struggling with emotional stress, mental health symptoms, and substance abuse, no appointments necessary. The center is a safe alternative to seeking care in the emergency room and uses a warm, compassionate environment that is more like a living room than an office. 5. Cancer Swedish Covenant Hospital has a cancer affiliation with Rush University Medical Center. This affiliation results in service and treatment enhancements including: increased access to care, enhanced surgical services, radiation therapy, imaging and specialty care; new research opportunities; increased opportunities for medical students; and lifestyle enhancement for cancer patients through the use of the Galter LifeCenter. The hospital's Integrated Cancer Care Program (ICCP) augments standard cancer care with psychosocial support, nutrition counseling and supplementation, exercise programming, rehabilitation, palliative care planning; as well as complementary treatments. The hospital is committed to serve the uninsured and underinsured in our local service area. The SCH Community Breast Health Program serves approximately 4,000 underserved, low-income women each year. 6. Maternal, infant and child healthIn FY15, SCH opened the Outpatient Breastfeeding Clinic. It is housed on campus in the Women's Health Center. It is the only clinic of its kind in the city of Chicago. Women receive hands-on professional breastfeeding support that is billed directly to insurance, including Medicaid. Before our clinic opened, women's options for breastfeeding support were limited to a few suburban clinics, or private home visit lactation consultants who require payment of $200-250 up front. Our service allows women to take advantage of the insurance provisions of the ACA, which cover multiple visits for lactation support without cost-sharing by the patient. The hospital continues to educate physicians and the community about the importance of fetal development during final weeks of pregnancy to minimize Early Elective Delivery. 7. Respiratory diseasesIn FY15, the hospital's new Heart & Lung Center, which centralizes the outpatient cardiology and respiratory services, began to see patients. The Center expands the hospital's ability to provide Pulmonary Function Testing and adds services including Pulmonary Stress Testing using a metabolic cart, and body Plethysmography, which enables physicians to detect certain pulmonary conditions that conventional testing cannot. Use of the new metabolic cart has been extremely successful to wean ventilator patients in the intensive care units. The Respiratory Department participates in health fairs and screenings throughout the year, providing community members with 1-1 free respiratory screenings utilizing spirometry. Each appointment lasts approximately 10 minutes and results are provided to the patient who in turn is instructed to give to their physicians. In FY16, the department will begin providing free inhaler evaluations and demonstrations, in an effort to combat COPD readmissions. All individuals attending a consultation will be given a spacer (if needed) along with individualized instruction. These demonstrations will also be available in Spanish. Listed below are the health priorities not chosen for action and the reasons as to why they were not selected:Injury & Violence Prevention: Other community organizations have infrastructure and programs in place to better meet this need. Limited resources excluded this as an area chosen for action. Chronic Kidney Disease: SCH regularly partners with organizations including the National Kidney Foundation to provide free screenings to the ethnicities most vulnerable to this disease. SCH feels that efforts outlined herein to improve access to health services will also have a positive impact on chronic kidney disease and that a separate set of specific initiatives was not necessary.Family Planning: The partnership with Erie Family Health will positively impact outreach regarding family planning education. Erie and other community organizations have infrastructure and programs in place to better meet this need. Infectious Diseases: Advisory committee members felt that more pressing health needs existed. Limited resources and lower priority excluded this as an area chosen for action.Sexually Transmitted Diseases: SCH believes that this priority area falls more within the purview of the county health department and other community organizations. Limited resources excluded this as an area chosen for action. Substance Abuse: Other community organizations have infrastructure and programs in place to better meet this need. Limited resources excluded this as an area chosen for action. HIV: SCH believes this area falls more within the purview of the county health department and other community organizations. Limited resources excluded this as an area chosen for action. Part V, Section B, Line 16 Financial Assistance Policy Website Availability SWEDISH COVENANT HOSPITAL Part V, Section B, line 16a website: www.swedishcovenant.org SWEDISH COVENANT HOSPITAL Part V, Section B, line 16b website: www.swedishcovenant.org SWEDISH COVENANT HOSPITAL Part V, Section B, line 16c website: www.swedishcovenant.org 2 LIFE CENTER ON THE GREEN INC 5157 N FRANCISCO AVENUE CHICAGO IL 60625 PHYSICAL REHABILITATION SERVICES SWEDISH COVENANT HOME HEALTH CARE 6141 N CICERO AVENUE CHICAGO IL 60646 HOME HEALTH CARE SERVICES Part I, Line 7: Each net community benefit expense is divided by total hospital expenses (excluding bad debt expense) to determine the percent of community benefits provided for fiscal year 2015. Costing Methodology - For all community benefits, we utilize the cost to charge ratio to calculate the benefit. The net operating costs are calculated by taking the total operating costs less the following: the PA tax and the non-patient care activity costs. The net gross charges are calculated as follows: gross charges less charges for community benefits. Net operating costs divided by net gross charges provides the cost to charge ratio.Part I - Line 7d - column dFor Schedule H, line 7b, column (c) the $78,527,966 in the Community Benefit Expense includes the provider assessment tax of $12,709,392. Had the provider tax been excluded, the total Community Benefit expense would have been $65,818,574. On Schedule H, line 7b, column (d), the direct offsetting revenue of $79,476,079 includes the provider tax revenue of $35,432,229 million. Had the public aid provider revenue been excluded from Schedule H, the direct offsetting revenue would have been $44,043,850. Using an adjusted total community benefit expense of $65,818,574 noted above, minus an adjusted direct offsetting revenue amount of $44,043,850, also noted above, the resulting community benefit dollar amount on Schedule H, line 7b, column (e) would have been $21,774,724. On Schedule H, line 7b, column (f) percentage of total expense would have increased from 0% to 8.46%.The PA tax benefit is not reimbursement for direct patient care and therefore we believe it should be excluded from the Schedule H calculations. Part II, Community Building Activities: Members of Swedish Covenant Hospital staff work with other organizations and participate in many activities to advocate for health improvement in our community. These include:Involvement with the Association for Community Safety Net Hospitals, participation in the Medicaid Rate Reform Tag Group, community meetings, chambers of commerce, education, and seeking of resources with regard to the planning and development of the Emergency Department Renovation Project on the hospital campus to enhance emergency health care services in the community. During the 2015 fiscal year, Swedish Covenant Hospital joined with other area hospitals to develop the Healthy Chicago Hospital Collaborative. The Healthy Chicago Hospital Collaborative is a collaboration of Chicago-based hospitals that strives to promote a collective impact on health outcomes in the city of Chicago through an environment that fosters learning, sharing of resources, data and best practices. Members of the Swedish Covenant Hospital Staff have also worked to establish an affiliation with Rush University Medical Center to allow our emergency room physicians to communicate with Rush University Medical Center neurologists using robotic equipment which enables the Rush neurologists to remotely examine Swedish Covenant emergency department patients for signs of a stroke. This resource can improve patient outcomes by early and accurate diagnosis of stroke. Part III, Line 2: The costing methodology is applying the cost-to-charge ratio of 20% to total bad debt expense. Part III, Line 3: There are no bad debt amounts included in community benefits. Part III, Line 4: This statement is extracted from the SCH consolidated financial statements. For receivables associated with services provided to patients who have third-party coverage, the Hospital analyzes contractually due amounts and provides an allowance for uncollectible accounts and a provision for uncollectible accounts (for example, for expected uncollectible deductibles and copayments on accounts for which the third-party payor has not yet paid, or for payors who are known to be having financial difficulties that make the realization of amounts due unlikely). For receivables associated with self-pay patients (which includes both patients without insurance and patients with deductible and copayment balances due for which third-party coverage exists for part of the bill), the Hospital records a significant provision for uncollectible accounts in the period of service on the basis of its past experience, which indicates that many patients are unable or unwilling to pay the portion of their bill for which they are financially responsible.The difference between the discounted rates and the amounts actually collected after all reasonable collection efforts have been exhausted is written off against the allowance for uncollectible accounts in the period they are determined uncollectible. Part III, Line 8: The hospital has used the standard single apportionment step down cost allocation methodology for the allocation of allowable costs (as defined by the Medicare principles of reimbursement) to the revenue cost centers. Allowable allocated costs are divided by the revenues in each ancillary department and by the days in each nursing unit to determine the appropriate ratios and cost per diems to be applied to the related Medicare ancillary charges and nursing unit days to determine the cost of Medicare services. Part III, Line 9b: Charity Care Patients:If a patient has been determined to meet Hospital Charity Care Guidelines no collection agencies, lien attachments or attempts to possess real or personal property will be made.During the fiscal year 2014, the organization policy of using the Federal Poverty Guidelines to determine eligibility for providing free care to low income individuals was amended from 200% to 300% of the family income limit.The organization has a policy of Presumptive Charity Care for health care services provided to uninsured patients who are presumed eligible for charity care based on criteria demonstrating financial need.Effective January 1, 2014, the regulations adopted by the Illinois Attorney General (77 Ill. Admin. Code Part 4500, Hospital Financial Assistance under the Fair Patient Billing Act), require that a presumptive charity determination take place as soon as possible after the receipt of health care services from the hospital and prior to the issuance of any bill for those health care services by the hospital. According to the regulations, a patient's financial need must be determined by use of presumptive charity criteria (which may be accomplished through software/screening) without further scrutiny by the hospital.Financial Assistance:Patients with a self-pay balance and without the resources to pay their obligations will be assessed for financial assistance by the Credit Services Department. The assessment involves an evaluation for eligibility for all appropriate levels of assistance, including governmental or partial reductions or complete charity care. Part VI, Line 2: Needs AssessmentIn the spring of 2012, Swedish Covenant Hospital (SCH) embarked on a comprehensive Community health Needs Assessment (CHNA) process to identify and address the key issues for our community.Swedish Covenant Hospital is a comprehensive health care facility providing health and wellness services to Chicago's North and Northwest side communities. This 323-bed hospital is one of the few independent, nonprofit hospitals in the area. Its 600 physicians and 2,200 employees remain focused on the hospital's mission of providing compassionate, high quality care in a healing environment. An established teaching hospital, Swedish Covenant Hospital offers a range of medical programs, including the latest cardiac, cancer, orthopedic, surgical, women's health, back health and emergency services.To address concerns about healthcare access, SCH created a partnership with Erie Family Health Center. In July 2013, Erie opened the Erie Foster Avenue Health Center on the hospital's campus. Erie Foster Avenue Health Center is a Federally Qualified Health Center which provides care to patients who come through the emergency department at SCH and might not have a medical home. Swedish Covenant Hospital (SCH) maintains a department dedicated to addressing its outreach objectives of serving the entire community, not only those who come through its doors. Building on a long tradition of service, the Community Relations Department utilizes hospital strengths alongside those of other well-established community partners. This strategy allows SCH to better understand and reach the most vulnerable sectors of the community, while meeting pressing healthcare needs. The goal is to improve the community's health status by empowering citizens to make healthy lifestyle choices. The Community Benefit Plan (Community Health Needs Assessment Implementation Strategy) identifies seven priority health issues to be addressed for providing community benefit. The implementation strategy is intended to exist over a three year time period, after which a new needs assessment and benefit plan will be developed. The following is a list of the seven priorities of the Community Benefit Plan, out of 14 community needs identified, to be addressed on an ongoing basis and reported on annually through FY16. 1. Access to health services 2. Heart disease and stroke 3. Nutrition, physical activity and weight4. Mental health and mental disorders5. Cancer6. Maternal infant and child health7. Respiratory diseases Part VI, Line 3: Patient Education of eligibility for AssistanceCharity or discounted care is available for medically necessary services as defined by Medicare, to patients who meet the financial and documentation criteria defined below. Each situation is reviewed on an individual case-by-case basis. While not absolutely essential, the need for potential charity or discounted care should be established in advance of admission or rendering of service, or shortly thereafter.Notices in English, Greek, Korean, Russian, Spanish and Urdu about the availability of Charity or Discounted Care are posted in the Emergency Room registration area, and the inpatient and outpatient registration areas. The information is also contained in the Patient Handbook, given to all patients upon inpatient admission. Patients and families are encouraged to speak to a financial counselor for more information and assistance. The Guidelines, along with the financial questionnaire, are posted in English, Greek, Korean, Russian, Spanish and Urdu on the hospital's website.In order to be eligible for charity or discounted care, the patient must be willing to provide verification of income by filling out the Patient Financial Statement. The patient is responsible to voluntarily submit any and all documentation in order to be eligible to receive this discount. During the registration and information gathering process, the financial counselors determine if the patient qualifies for medical assistance from other existing financial resources such as Medicare, Medicaid, Kid Care, Family Care or other state or federal programs. If the patient refuses to apply for existing financial resources or to provide information necessary to the application process, charity or discounted care cannot be granted. If the application for existing financial resources is denied, or has been previously denied, consideration for charity or discounted care will then be given.Once the Financial Assistance Application form is received, Credit Services Department determines the eligibility for charity or discount care. SCH suspends the collection process while the Financial Assistance Application is being reviewed. The only criteria considered for Financial Assistance is income and family size. Income is evaluated against the matrix of Federal Poverty Guidelines to determine whether full or partial discount can be approved. Documentation of income is submitted in the form of paycheck stubs, income tax returns, Social Security checks, and other documents that are indicative of income. If the information submitted is not perceived to be accurate or reliable, SCH reserves the right to request additional documentation to substantiate income or family size.The insured patient with a large balance due to deductibles and/or co-payments may be eligible for charity or discounted care. In order to qualify, the patient must complete the Patient Financial Statement and return it to the financial counselors for evaluation and recommendation.If a patient has been determined to meet the Hospital Charity Care Guidelines, no referral to collection agencies, legal actions, lien attachments or attempts to possess real or personal property is pursued.No legal action is taken against uninsured patients for the first one hundred twenty (120) days after discharge.Illinois residents who have a family income that is no more than 600% of the Federal Poverty Guidelines (as determined each year), and who do not have any health insurance (or coverage under workers' compensation, accident liability insurance, or other third party liability) as documented through SCH's insurance verification procedures, receive a discount in accordance with the Hospital Uninsured Patient Discount Act (210 ILCS 89/) (the Act). Part VI, Line 4: Community InformationSCH's community, as defined for the purposes of the hospital's 2012 Community Health Needs Assessment, included each of the residential ZIP Codes that comprise the hospital's Primary Service Area (PSA) and Secondary Service Area (SSA), including: 60613, 60618, 60625, 60626, 60630, 60640, 60641, 60645, 60646, 60659, 60660 and 60712. This encompasses approximately a 5 mile radius surrounding the hospital and was determined because the majority of SCH's patients originate from this area. The population of the hospital's service area is estimated at 631,311 people. It is predominantly non-Hispanic White (63.66%), but also has substantial Hispanic (28.75%) and Asian (10.87%) populations. As throughout the state and nation, our population is aging, with 10.94% currently age 65 and older. This is projected to increase in coming years, as is the need for services to meet the health needs of this older population. Median household income is below the state average at $48,386, and 12.37% of the families in our population remain below the poverty level. The hospital serves a very diverse multicultural community, with the Albany Park neighborhood serving as a key entry point for many new immigrants. To better address the needs of our highly diverse community, the hospital works regularly with dozens of community stakeholders including local ethnic groups, legislators, and community and business organizations, including: the Albany Park Community Center, Centro Romero, Polish American Association, Erie Family Health, Heartland Health, Chicago Department of Public Health, Korean American Community Services, Asian Human Services, Cambodian Association, North River Commission and the Albany Park Chamber of Commerce. These organizations serve as a link between the hospital and the many surrounding niche communities, and the hospital's Community and Government Relations teams communicate regularly online and in-person to propose solutions to issues including Access to Care and health reform. The Spanish and Korean languages represent the majority of interpretative assistance requested at the hospital. To meet this need on an inpatient and outpatient basis, the hospital employs full time Spanish and Korean interpreters. The Korean interpreter also serves as Korean Community Relations Manager, facilitating deeper, ongoing communication between the hospital and its local Korean community partners and physicians. In addition, the hospital uses a telephonic interpretative service to meet interpretative needs in other languages, as well as for Korean and Spanish interpretation when the interpreters are not present.To better serve the Korean community, the hospital partners each year with Korean American Community Services (KACS), the Korean Medical Society and the Korean Nurses Association to host an annual Korean Health Fair at the hospital. This is an annual event, targeting the uninsured and underinsured working population. Nearly 200 Koreans residing in the greater Chicago area attend this event to receive free or reduced cost screenings and services. KACS coordinates the event collaboratively with the hospital's Korean Community Relations Manager.In FY2015, Swedish Covenant Hospital delivered 225 community programs to more than 15,000 individuals in partnership with nearly 100 community organizations, legislators, chambers of commerce, local businesses and schools. Topics included nutrition, fitness, stroke awareness, heart health, cancer prevention, joint health, pregnancy, diabetes education, women's health and pediatrics. Ongoing partnerships exist between many organizations but highlights include Oak Street Health (monthly wellness talks), Peterson Garden Project (on-campus community garden and monthly wellness talks at Fearless Food Kitchen), Budlong Elementary School (healthy nutrition for kids; laboratory tours; career chats), American Cancer Society (cancer screening events), 47th Ward Alderman Ameya Pawar (Annual Wellness Fair and senior activities), Whole Foods Market Sauganash (healthy eating and lifestyle choices), Marianos (community events), The Breakers (health events for seniors), Purple Asparagus (Delicious Nutritious Adventures at Budlong School), Centro Romero (health fair and ACA collaboration), Vietnamese Association of IL (breast cancer awareness and mammography), Casa Ecuatoriana (wellness info and mammography), Korean American Community Services (annual Korean Health Fair at SCH), Indo-American Center (community health talks), and Sulzer Regional Library (health fair). Part VI, Line 5: In keeping with the Hospital's mission to provide a continuum of excellent healthcare services, any surplus funds are invested in capital improvements related to patient care or in community benefit programs.The hospital extends medical staff privileges to all qualified physicians in the communities it serves, in accordance with our medical staff development process. The hospital has an active Board of Directors who meet every two months. In addition to reviewing the hospital's financial results, they discuss the hospital's plans and programs in support of our efforts to enhance the health care environment for the entire community we service. The hospital operates the "HouseCalls" program to provide medical care to the homebound.The Hospital helps community members gain access to health care services by assisting low income families in applying for the Illinois Department of Public Aid's KidCare and FamilyCare programs. Part VI, Line 7, Reports Filed With States IL 1 ERIE FAMILY HEALTH CENTER 1701 W SUPERIOR ST 3RD FLOOR CHICAGO IL 60622 363088628 945000 To help defray the costs of uncompensated care to lower income and medically underserved patients at the Health Center. Part I, Line 2: The mission of Swedish Covenant Hospital is to provide excellent healthcare services for our culturally diverse community. In pursuit of this mission, the hospital will fund or otherwise sponsor programs which advance our mission. If a grant is approved by the Board of Directors, yearly progress reports will be required, with a final report required at the conclusion of the project. An annual audit may be requested, if appropriate. X 1 1 X X X X 0 1 0 0 0 0 0 0 0 RONALD D CURRAN MD DIRECTOR 34167 742050 0 0 0 46692 0 11631 0 18570 34167 818943 0 0 H CLARK FEDERER MD DIRECTOR 0 318358 0 0 0 22327 0 7212 0 19924 0 367821 0 0 LAWRENCE P ANDERSON DIRECTOR 0 396339 0 84558 0 110384 0 7800 0 29412 0 628493 0 0 DAVID A DWIGHT DIRECTOR 0 499292 0 0 0 158521 0 7800 0 30956 0 696569 0 27119 REV GARY B WALTER DIRECTOR 0 151200 0 0 0 0 0 27400 0 85808 0 264408 0 0 MARK NEWTON PRESIDENT & CEO 0 602447 0 176806 0 183161 0 7800 0 12596 0 982810 0 0 THOMAS J GARVEY SENIOR VP & CFO 320150 0 63682 0 32812 0 42104 0 16687 0 475435 0 0 0 JUDITH A BORENSTEIN GENERAL COUNSEL 226209 0 36294 0 98313 0 24134 0 11148 0 396098 0 46764 0 ANTHONY GUACCIO SENIOR VP & COO 353411 0 70687 0 63949 0 45095 0 22124 0 555266 0 17403 0 DEREK J KELLY MD VP & CHIEF MEDICAL OFFICER 302860 0 42039 0 38050 0 0 0 18206 0 401155 0 11681 0 MARY SHEHAN RN SENIOR VP, CNO 216472 0 43793 0 43392 0 7755 0 806 0 312218 0 8822 0 KATHRYN DONOFRIO RN SENIOR VP, CNO 139130 0 6090 0 21229 0 5105 0 14457 0 186011 0 0 0 KAREN M SHEEHAN SENIOR VP & CIO 200394 0 30865 0 47921 0 7627 0 17833 0 304640 0 8409 0 JANIS A RUEPING VP QUALITY IMPVMT/RISK MGM 166012 0 25623 0 63502 0 21265 0 19965 0 296367 0 42398 0 MICHAEL FEINZIMER PHYSICIAN 221180 0 0 0 0 0 0 0 1716 0 222896 0 0 0 JONATHAN LIND VP OPERATIONS 161446 0 24238 0 27772 0 5730 0 18830 0 238016 0 9908 0 PATRICIA KING ASSOCIATE GENERAL COUNSEL 186281 0 8303 0 13465 0 6457 0 16020 0 230526 0 0 0 TONY VANCAUWELAERTMD FORMER DIRECTOR,PHYSICIAN 0 285831 0 0 0 17500 0 7650 0 7676 0 318657 0 0 Part I, Line 1a As part of their compensation package, vice presidents of the organization are offered a $900 reimbursement for membership dues to the health club of their choice. This benefit is treated as taxable compensation. Part I, Line 3 The Hospital and Covenant Ministries of Benevolence follow the requirements set forth in the IRS rebuttable presumption of reasonableness in determining compensation for the CEO and other officers and executive leaders of the corporation. The process includes review of comparability data, retention of an outside compensation consultant, and contemporaneous substantiation of the deliberation and decision through detailed minutes of the compensation committee and full board meetings where executive compensation is considered. Part I, Line 4b Executive Benefit Plan Covenant Ministries of Benevolence (CMB) provides certain supplemental retirement benefits to its officers and key employees. These benefits are provided through a nonqualified deferred compensation plan, under which a portion of the benefits being earned are subject to a substantial risk of forfeiture. The supplemental retirement benefits are structured to provide a retention incentive that has been determined by the Compensation Committee of CMB's Board to be of substantial value to the organization. The Committee approves all retirement benefits, together with all other forms of compensation and benefits for these and other executives, in a manner intended to qualify for the rebuttable presumption of reasonableness under the intermediate sanctions rules of federal income tax law. The following individuals participated in the Executive Benefit Plan: Lawrence Anderson - $64,289 David Dwight - $64,365 Mark Newton - $76,024 Judith Borenstein - $26,856 Thomas Garvey - $45,391 Anthony Guaccio - $41,534 Derek Kelley - $38,083 Mary Shehan - $27,227 Karen Sheehan - $23,779 Janis Rueping - $19,439 Jonathan Lind - $17,541 A Illinois Finance Authority 861091967 45200FEW5 2008-04-08 60000000 2008A IFA Revenue Bonds - Cap Adds & Ref of 01/16/98 & 07/22/99 issues. 0 0 0 B Illinois Finance Authority 861091967 45200FR35 2010-02-02 99390260 2010A IFA Revenue Bonds - Ref of 11/17/03 & 06/17/08 issues. 0 0 0 C Illinois Finance Authority 861091967 2010-11-03 20000000 2010C IFA Revenue Bonds - Cap Adds 0 0 0 D Illinois Finance Authority 861091967 2011-06-28 20000000 2011A IFA Revenue Bonds - Cap Adds & Construction 0 0 0 A 8536000 60846284 11 837840 7508444 52500000 2009 1 0 1 1 B 7120000 99390260 9932548 1982568 88150000 1 0 1 1 C 5406203 20001820 450693 19002109 999711 2014 0 0 1 1 D 11320000 20098509 15509 10110526 10004191 2015 0 0 1 1 A 0 0 1 1 0 0 0 1 B 0 0 1 1 0 0.01500 0.01500 0 0 1 C 0 0 0 0 0 0 1 D 0 0 0 0 0 0 1 A 0 0 1 0 1 0 0 0 1 B 0 0 0 1 0 0 0 0 1 C 0 0 0 1 0 0 0 0 1 D 0 1 0 0 1 0 0 0 1 A 1 B 1 C 1 D 1 Schedule K Supplental Information Form 990 - Schedule K - Part I - Line B - Column f The original 8038 filing for the 2010A bonds listed the issue date of the 2008B refunded bond incorrectly as April 8, 2008. The correct issue date of the 2008B refunded bond is June 17, 2008. Part IV, Line 2c, columns B & C The rebate computations were performed on August 04, 2015. Form 990 - Schedule K - Part II - Line 3 The total amount of proceeds of the bond issues entered on Part II Line 3 include the investment earnings. Part II, Line 4, columns A,C and D The amounts shown here consist solely of sinking fund deposits. Part II, Line 4, column B The amount shown here consists of $9,346,348 in a reasonably required reserve or replacement fund and $586,200 of sinking fund deposits. Brooke Newton Family member of Mark Newton (CEO of Swedish Covenant Hospital) 60622 Wages paid as an employee of Swedish Covenant Hospital 0 Emily Flatley Family member of Mark Newton (CEO of Swedish Covenant Hospital) 40105 Wages paid as an employee of Swedish Covenant Hospital. 0 Elizabeth Pyra Family member of Thomas M. Pyra (Member of the Board of Directors) 60309 Wages paid as an employee of Swedish Covenant Hospital 0 Anne Pyra Family member of Thomas M. Pyra (Member of the Board of Directors) 55876 Wages paid as an employee of Swedish Covenant Hospital 0 Form 990, Part VI, Section A, line 2 Many of the persons listed on Part VII have a business relationship with each other by virtue of sitting on related Swedish Covenant Hospital entity boards. Kurt D. Anderson, Director, and Lawrence P. Anderson, Director, have a family relationship. Form 990, Part VI, Section A, line 6 The sole member is Covenant Ministries of Benevolence (CMB). Form 990, Part VI, Section A, line 7a The member elects the Board of Directors. Form 990, Part VI, Section A, line 7b S 3.1 of the Bylaws grant reserved powers to the member, such as approval of amendments to the Bylaws of the corporation, approval of certain acquisitions, dispositions and financing, and the power to elect or remove the members of the Board of Directors of the Corporation. Form 990, Part VI, Section B, line 11 The draft Form 990 was reviewed by multiple levels of management and by the CFO of Swedish Covenant Hospital. In addition, Swedish Covenant Hospital's external public accounting firm reviews the return prior to filing. After filing, the Form 990 is provided to the Board of Directors and key provisions are discussed. Form 990, Part VI, Section B, line 12c Swedish Covenant Hospital has an Administrative Policy on conflict of interest, identifying the parameters of a conflict of interest and the requirement to disclose any such conflict of interest. Each September, the policy is distributed to the board members, key employees, directors and officers. They are asked to sign acknowledging receipt of policy and to disclose if they have any conflicts of interest. If someone is absent from the meeting or fails to return the acknowledgement, there is a follow-up with the individual until the signed acknowledgement is provided. If a person becomes an interested person he or she may be considered in determining whether a quorum is present. The interested person may make a short statement relating to the transaction or arrangement in question, but shall not vote on the motion addressing the actual or potential conflict. Form 990, Part VI, Section B, line 15 The Hospital and Covenant Ministries of Benevolence follow the requirements set forth in the IRS rebuttable presumption of reasonableness in determining compensation for the CEO and other officers and executive leaders of the corporation. The process includes review of comparability data, retention of an outside compensation consultant, and contemporaneous substantiation of the deliberation and decision through detailed minutes of the compensation committee and full board meetings where executive compensation is considered. The Governance Committee of Swedish Covenant Hospital has established the executive compensation program to enable the Organization to recruit, motivate and retain highly qualified executives to successfully carry out its Mission Statement and Core Values. The program also serves to align the interests of our executive officers with those of our community by placing a reasonable portion of compensation at risk through performance goals that, if achieved, are expected to increase the aggregate health level of the communities we serve and contribute to the long-term success of the Organization. Additionally, the executive compensation program will enable the Organization to reward performance that emphasizes teamwork and close collaboration among executive officers, supports Organizational excellence by leveraging enterprise-wide capabilities, drives efficiencies and integrates care and services for the benefit of our communities. The program will also assist the Organization in rewarding the achievement of specific annual, long-term and strategic goals, and align executive officers' interests with those of the communities we serve by rewarding performance that meets or exceeds established goals, with the ultimate objective of increasing community health. The overall executive compensation program aligns short- and long-term performance with the goals of the Organization and ensures cost-effective and efficient use of capital resources by offering the appropriate amounts and mix of compensation. Base Salary represents a fixed compensation component set at a level commensurate with the roles and responsibilities if each individual executive position to attract, motivate and retain top executive talent. The Annual Incentive Plan is a variable short-term performance-based compensation component with target award amounts set by the Governance Committee for each eligible executive position. Payouts reflect the degree to which the Organization and the individual executives have performed against predetermined 12-month metrics. Resulting total cash compensation levels may be below or above target amounts based on the Organization's performance against its short-term goals. Goals are sometimes set at a "stretch" level such that target performance may result in above-median levels of compensation. The Annual Incentive plan is intended to align the executive compensation program with the Organization's business strategy, and strengthen the relationship between pay and performance. The Long-Term Incentive Plan is a variable three-year performance-based compensation component with target award amounts set by the Governance Committee for each eligible executive position. Payouts reflect the degree to which the Organization and the individual executives have performed against predetermined 12-, 24- and 36-month metrics. Resulting total cash levels may be below or above target amounts based on the Organization's performance against its long-term goals. Goals are sometimes set at a "stretch" level such that target performance may result in above-median levels of compensation. The Long-Term Incentive Plan is intended to align the executive compensation program with the Organization's business strategy, strengthen the relationship between pay and performance, reinforce the link between the interests of executives and the long-range vision of the Board of Directors and promote the retention of executive talent. Qualified and non-qualified retirement benefit plans are provided by the Organization to help meet the executives' pre- and post-retirement financial needs, serve as a backstop for our performance-based programs and promote the retention of executive talent. The Board of Directors and the Governance Committee are comprised of voluntary citizens of the community who perform their duties without compensation for hours devoted to Board work. The Governance Committee includes an executive from the Covenant Ministries of Benevolence, the controlling member of Swedish Covenant Hospital. A majority of voting members of the Governance Committee are independent, and the Committee is responsible for the development of the philosophy, policy and objectives that guide the Organization's executive pay programs as well as establishing our performance standards and determining the compensation of our senior executives. The Governance Committee retains Pearl Meyer as their independent compensation consultant to assist the Committee in the continued development and evaluation of the Organization's compensation policies and practices and the Committee's determination of compensation. The Governance Committee has the sole authority to retain and terminate the independent compensation consultant and to review and approve the consultant's fees and other retention terms. The Governance Committee has the authority to approve new executive compensation plans and material amendments to existing executive compensation plans. The Governance Committee provides the Board with reports on its actions and decisions following every Governance Committee meeting. Management provides data, analysis and recommendations for the Governance Committee's consideration regarding the Organization's executive compensation programs and policies and assists the Governance Committee in carrying out its responsibilities. Management also provides information to the Governance Committee's independent compensation consultant in connection with the consultant's role in advising the Governance Committee. The CEO typically attends the Committee meetings. The Governance Committee also meets regularly in executive session outside the presence of management. While the Governance Committee considers the recommendations of the CEO and the input received from its independent compensation consultant, most compensation decisions for the Organization's executives are made by management within their prescribed parameters dictated by the Governance Committee. The Governance Committee retains its independent compensation consultant to conduct a comprehensive review of the total compensation provided to the Organization's executives relative to competitive and comparable market practices, ensure that the Organization's compensation programs provide total compensation opportunities that are reasonable for purposes of Intermediate Sanctions (IRC Section 4958), assess the competitiveness of the Organization's compensation programs with respect to healthcare industry peer organizations, assist the Governance Committee with its charter review, review annual disclosures and the compensation of "disqualified individuals" whose compensation is subject to a reasonableness review under IRC Section 4958, provide an opinion letter to the Governance Committee regarding the reasonableness of the compensation of the Organization's executives and other "disqualified persons and help to create a rebuttable presumption of reasonableness with regard to executive compensation. Form 990, Part VI, Section C, line 18 A copy of the organization's Form 990 is available upon request by contacting the Swedish Covenant Hospital administration department at 773/878-8200. Form 990, Part VI, Section C, line 19 The governing documents, conflict of interest policy, and financial statements are available upon request, for the same period of disclosure as set forth in IRC Section 6104(d), by contacting the Swedish Covenant Hospital administration department at 773/878-8200. FORM 990,PART VIII,LINES 7A - 7C Publicly traded securities held in an investment pool and allocated by Covenant Ministries of Benevolence on a percentage basis. Form 990, Part IX, line 11g CONSULTING FEES: Program service expenses 427,287. Management and general expenses 904,319. Fundraising expenses 0. Total expenses 1,331,606. PHYSICIANS FEES: Program service expenses 3,853,321. Management and general expenses 0. Fundraising expenses 0. Total expenses 3,853,321. OUTSIDE PROFESSIONAL FEES: Program service expenses 2,732,112. Management and general expenses 0. Fundraising expenses 0. Total expenses 2,732,112. AGENCY FEES: Program service expenses 1,397,256. Management and general expenses 42,026. Fundraising expenses 0. Total expenses 1,439,282. COLLECTION EXPENSE: Program service expenses 95,104. Management and general expenses 1,204,786. Fundraising expenses 0. Total expenses 1,299,890. PURCHASED SERVICES: Program service expenses 15,064,910. Management and general expenses 1,540,913. Fundraising expenses 0. Total expenses 16,605,823. Form 990, Part XI, line 9: Net assets released from restriction 8,426. equity transfer to Covenant Ministries of Benevolence Net restricted funds transfers from Swedish Covenant Hospital Foundation 1,480,721. Equity transfer to Swedish Covenant Management Services Inc. -20,000,000. Other changes in restricted funds -106,236. Evangelical Covenant Church (ECC) 8303 W Higgins Road Chicago IL 60631 362167730 Church IL 501(c)(3) Line 1 N/A 0 Covenant Ministries of Benevolence (CMB) 5145 N California Avenue Chicago ID 60625 363486813 Management/Support Services IL 501(c)(3) Line 11a, I Evangelical Covenant Church (ECC) 0 Swedish Covenant Faculty Group (SCFG) 5145 N California Avenue Chicago IL 60625 363686216 Patient Treatment/Education IL 501(c)(3) Line 11a, I Swedish Covenant Hospital (SCH) 1 Swedish Covenant Hospital Foundation (SCHF) 5145 N California Avenue Chicago IL 60625 205055155 Support of Swedish Covenant Hospital IL 501(c)(3) Line 7 Swedish Covenant Hospital (SCH) 1 SC Insurance Company 6970 E Chauncey Lane Suite 100 Phoenix AZ 85054 273312053 Insurance AZ 501(c)(3) Line 11a, I Swedish Covenant Hospital (SCH) 1 Covenant Village of PortlandLP 420 NE Mason St Portland OR 97211 364356838 Assisted Living Community OR N/A Covenant International Insurance Company Ltd Crawford House 50 Cedar Avenue Hamilton BD Insurance BD N/A C 0 Covenant Trust Company 8303 W Higgins Road 6th Floor Chicago IL 60631 363583163 Financial Services IL N/A C 0 Swedish Covenant Management Services Inc (SCMS) 5145 N California Avenue Chicago IL 60625 364073303 Physician Practice Management IL Swedish Covenant Hospital C -12204003 16100389 1.00000 1 Swedish Covenant Managed Health Care Alliance (SCMCA) 2740 W Foster Suite 409 Chicago IL 60625 364118659 Physician - Hospital Organization IL N/A C 0 St Francis Health Care Ltd 2740 W Foster Avenue Suite 002 Chicago IL 60625 363208131 Independent Group of Physicians IL N/A C 1 0 0 1 0 0 0 0 0 0 1 1 1 1 0 0 1 1 1 1 Swedish Covenant Hospital Foundation M 626919 Cash Value Swedish Covenant Hospital Foundation S 1480071 Cash Value Swedish Covenant Management Services Inc R 38445949 Cash Value SC Insurance Company M 6913020 Cash Value SC Insurance Company L 240000 Cash Value