2013-05-15T07:26:05-05:00 2012-06-30 450250958 Eide Bailly LLP 800 Nicollet Mall Ste 1300 Minneapolis MN 554027033 990 2011-07-01 460224604 Avera Queen of Peace Hospital AVER 6059952251 525 North Foster Street Mitchell SD 57301 William E Flett 6059952251 2013-05-10 0 Kim Hunwardsen CPA P00484560 6122536500 2013-05-13 2011 2016-02-24 21:20:13Z Avera Queen of Peace Health Service Thomas A Clark 525 North Foster Street Mitchell SD 57301 93753224 0 0928 X www.averaqueenofpeace.org X 1905 SD Promotion of Health 18 14 959 120 0 0 1259988 299594 82985131 91771776 1329553 1356570 -82807 -185416 85491865 93242524 163174 205016 0 0 47230003 52453229 0 0 139704 32188106 35084825 79581283 87743070 5910582 5499454 105824301 111663788 32789972 35720424 73034329 75943364 X Avera is a health ministry rooted in the Gospel. Our mission is to make a positive impact in the lives and health of persons and communities by providing quality services guided by Christian values. 0 0 71069712 205016 91771776 Avera Queen of Peace's mission is to provide healthcare services to Mitchell, SD residents and surrounding area. They provide acute care and long-term healthcare services, of which there were 8,381 acute patient days, 2,503 swing-bed patient days, 1,190 nursery patient days, and 39,970 nursing home resident days. The breakout of these statistics per facility is as follows.Avera Queen of Peace Hospital7,861 Acute patient days1,657 Swing-bed patient days1,190 Newborn patient daysAvera Brady Health and Rehabilitation29,123 Long-term care resident days8,913 Assisted living days1,934 Independent living daysAvera Weskota Memorial Medical Center (CAH)382 Acute patient days537 Swing-bed patient daysAvera De Smet Memorial Hospital (CAH)138 Acute patient days309 Swing-bed patient days Avera Queen of Peace maintains records to identify and monitor the level of charity care it provides. These records include the amount of charges foregone for services and supplies furnished under its charity care policy and equivalent service statistics. The amount of charges foregone, based on established rates, were $2,102,462.Avera Queen of Peace also provides community benefit health activities at less than or at no cost to support those in the area serviced. These activities include community education programs; special programs for the elderly, handicapped, and medically underserved; and a variety of broad community support activities. During the year ended June 30, 2012, specific activities include meals delivered to residential homes; meeting facilities; programs for patients and families suffering from cancer, diabetes, breathing disorders, and others; assistance to health educators; emergency healthcare providers; wellness programs; and overnight housing for families of hospitalized patients.As a member of the Avera Health network, Avera Queen of Peace upholds the vision of the Presentation and Benedictine Sisters to work through collaboration to provide a quality, effective health ministry and to improve the health care of individuals and our communities through a regionally integrated network of persons and institutions. Avera Queen of Peace engages in activities designed to improve the health of individuals and communities in response to a calling to heal the sick, the elderly, and the oppressed. 71069712 1 1 0 1 0 0 0 0 1 1 1 1 0 0 1 1 1 1 0 0 0 0 0 0 0 0 1 1 1 0 1 0 0 0 1 0 0 1 0 0 0 0 0 0 1 1 0 0 0 1 165 0 1 959 1 0 0 0 0 0 0 0 0 0 0 X 18 14 1 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 0 0 0 X Will Flett 6059952251 525 North Foster Mitchell SD 57301 X Roger Musick 2.50 X X 0 0 0 Lori Essig 2.50 X X 0 0 0 Loren Noess 2.50 X 0 0 0 Charles Bergeleen 2.50 X 0 0 0 Sister Kathleen Crowley 2.50 X 0 0 0 Dennis Kruse 2.50 X 0 0 0 Sister Bonita Gacnik 2.50 X 0 0 0 David Olson 2.50 X 0 0 0 Jacquelyn Johnson 2.50 X 0 0 0 Jennifer Tegethoff MD 40.00 X 211069 0 11584 Diane Sandhoff 2.50 X 0 0 0 Robert Snortum MD 40.00 X 344454 0 22343 Jerry Thomsen 2.50 X 0 0 0 Terry Torgerson 2.50 X 0 0 0 Michael Krause DO 2.50 X 40000 0 0 Patricia Malters MD 40.00 X 76075 0 3745 Greg Van Wald 2.50 X 0 0 0 Sister Joan Reichelt 2.50 X 0 0 0 Thomas Clark 40.00 X X 0 161842 14011 William E Flett 40.00 X 59746 0 13242 Patrick J Clark 40.00 X 206629 0 22916 Stephen Dick MD 40.00 X 421749 0 29474 Christopher Krouse MD 40.00 X 1035566 0 29474 Michael Haley MD 40.00 X 447185 0 29474 Dennis Leland MD 40.00 X 566195 0 32473 Brian Kampmann MD 40.00 X 646502 0 29474 Tom Rasmusson 40.00 X 0 253336 18798 4055170 415178 257008 43 1 1 0 Avera Health 3900 W Avera Drive Suite 300 Sioux Falls SD 57108 Shared Services 3709284 Aegis Therapies Inc PO Box 8103 Fort Smith AR 72902 Physical and Occupational Therapy 283916 Custom Touch Homes LLC 411 SE 12th St Madison SD 57042 Construction 205262 Quality Homes LLC 1525 W Elm Ave Mitchell SD 57301 Construction 188960 Integrated Therapy Services PO Box 1284 Sioux Falls SD 57105 PT, OT, Speech Therapy Services 150052 7 299594 299594 Net Patient & Resident 623000 89738446 89738446 Other Revenue 900099 1181634 1181634 Cafeteria 900099 453662 453662 Interest in Avera Heal 900099 285600 285600 Community wellness 900099 112434 112434 91771776 34701 34701 319103 504519 -185416 -185416 -185416 1328050 0 6181 1328050 -6181 1321869 1321869 93242524 91771776 0 1171154 205016 205016 1203971 918036 285935 40774055 33331453 7342356 100246 2010783 1643447 362396 4940 5939628 4818780 1106079 14769 2524792 2058715 460017 6060 6685803 2831873 3853930 453636 86019 367617 8887521 7047818 1828813 10890 244041 147123 96918 1920951 1270741 650210 272029 185303 85756 970 103321 39687 63425 209 712175 712175 4187685 4187685 816129 816129 Medical Supplies 6760724 6760724 Bad Debt Expense 3026522 3026522 Equipment Lease and Ren 128333 106704 21629 Grant program expenditu 124900 124900 761055 750862 8573 1620 87743070 71069712 16533654 139704 3286441 3368813 639 1292 11706690 12573812 108959 39762 1222612 1234335 653214 957408 89438453 51435175 38296504 38003278 7237868 924180 41750866 51789691 332077 292572 1228431 2478645 105824301 111663788 6928998 7863100 128877 33476 22262117 23448866 544037 2925943 4374982 32789972 35720424 X 70490116 73165461 1748895 1981585 795318 796318 73034329 75943364 105824301 111663788 X 5499454 -2590419 X X 0 1 1 X 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 0 0 0 0 1 14322 0 0 0 14322 0 0 1 1034190 6624 1040814 793583 109334 131273 1034190 1032880 -239297 793583 1028163 4717 1032880 0.13080 0.76510 0.10410 0 1 1 1149953 1164024 2313977 51729252 26220564 25508688 33788998 24050775 9738223 1606226 1163836 442390 38003278 Investment in affiliated organizations 166125 C Interest in Avera Health Foundation 2438855 F Interest in net assets of Mabee Trust 754227 F Assets Limited to use - Avera Pooled Investments 48430484 F 51789691 Derivative liability 3039225 Estimated third-party payor settlements 1235000 Capital lease obligations 100757 4374982 93242524 87743070 5499454 -1121879 -1468540 -2590419 2909035 87391701 -1121879 -4392766 -5514645 92906346 336178 336178 93242524 84716548 0 84716548 3026522 3026522 87743070 Part IV, Line 2b: The organization holds funds in trust on behalf of its residents. Description of Intended Use of Endowment Funds: Part V, Line 4: The organization's endowments consist of a portion of their interest in the net assets of Avera Health Foundation and their beneficial interest in the Mabee Trust. Avera Health Foundation includes endowment funds which have been established for a variety of purposes. The endowment fund assets included in the Organization's beneficial interest in the Mabee Trust have been established to purchase equipment and furnishings for the Organization. As required by generally accepted accounting principles, net assets associated with endowment funds, including funds designated by the Board of Directors to function as endowments (if any), are classified and reported based on the existence or absence of donor-imposed restrictions. The Organization's permanently restricted endowment funds are donor restricted. The Organization currently does not have any board-designated endowment funds. Description of Uncertain Tax Positions Under FIN 48: Part X: The Organization is organized as a South 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). The Organization is annually required to file a Return of Organization Exempt from Income Tax (Form 990) with the IRS. In addition, the Organization is subject to income tax on net income that is derived from business activities that are unrelated to its exempt purpose. The Organization files an Exempt Organization Business Income Tax Return (Form 990T) with the IRS to report its unrelated business taxable income. The Organization 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. The Organization 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. The Organization's federal Form 990T filings are no longer subject to federal tax examinations by tax authorities for years before 2009. Part XI, Line 8 - Other Adjustments: Capital Contributions, Net -162,805. Change in Fair Value of Interest Rate Swap -1,193,985. Loss on Refinancing -111,750. Total to Schedule D, Part XI, Line 8: -1,468,540. Part XII, Line 2d - Other Adjustments: Change in Fair Value of Interest Rate Swap -1,193,985. Loss on Refinancing -111,750. Reclassification of Accumulated Losses on Interest Rate Swap -60,509. Provision for bad debts included in revenue on financial statements -3,026,522. Part XII, Line 4b - Other Adjustments: Grants and contributions recorded in fund balance for financial statements 48,747. Change in interest in Avera Foundation recorded in fund balance for F/S 296,541. Change in interest in Mabee Trust recorded in fund balance for F/S -9,110. Part XIII, Line 4b - Other Adjustments: Provision for bad debts included in revenue on financial statements 3,026,522. 1 1 X 1 X 1 X 1 1 0 1 1 2154 854145 854145 0.01010 6631 7149781 4992731 2157050 0.02550 8785 8003926 4992731 3011195 0.03560 29 44642 49789 625 49164 0.00060 1 4 12042 12042 0.00010 41 42245 166055 166055 0.00200 71 86891 227886 625 227261 0.00270 71 95676 8231812 4993356 3238456 0.03830 1 500 2196 2196 0.00000 1 247 1681 1681 0.00000 1 68679 46800 21879 0.00030 3 747 72556 46800 25756 0.00030 1 3026522 0 28804465 34836000 -6031535 X 1 1 3 1 Avera Queen of Peace Hospital

525 North Foster Street Mitchell SD 57301

X X X 3 Provider Based Clinics 2 Avera Weskota Memorial Medical Center

609 1st Street NE Wessington Springs SD 57382

X X X 3 Avera De Smet Memorial Hospital

306 Prairie Avenue SW De Smet SD 57231

X X X Avera Queen of Peace Hospital 1 0 1 1 150.000000000000 1 400.000000000000 1 X X X X X X 1 1 X X X 1 0 1 X 1 1 Avera Weskota Memorial Medical Center 2 0 1 1 150.000000000000 1 400.000000000000 1 X X X X X X 1 1 X X X 1 0 1 X 1 1 Avera De Smet Memorial Hospital 3 0 1 1 150.000000000000 1 400.000000000000 1 X X X X X X 1 1 X X X 1 0 1 X 1 1 2 Avera Brady Assisted Living

1414 W Cedar Ave Mitchell SD 57301

Assisted Living Avera Brady Health and Rehab

500 S Ohman St Mitchell SD 57301

Nursing Home Part I, Line 3c: To determine eligibility for charity care, Avera Queen of Peace Hospital has developed a test which utilizes a combination of household income, household assets, and also considers unpaid past and ongoing medical expenses. Charity discount may range from 10 - 100% depending on score. Part I, Line 6a: Part 1, line 6A: Our community benefit report is contained in a report prepared by Avera Health, a related organization. It is available through the website and requested mailing, and is filed with the Catholic Health Association. Part I, Line 7: Charity care and unreimbursed medicaid was converted to cost using the cost to charge ratio in IRS worksheet 2. The amounts on lines 7e-i represent expenses reported in the general ledger. Part I, L7 Col(f): AQOP bad debt expense of $3,026,522 is included on Form 990, Part IX, Line 25, Column (A) but excluded for purposes of calculating this percentage. Part II: Avera Queen of Peace supports numerous economic development organizations with participation at meetings and donations throughout its service area. Additionally, Avera Queen of Peace works with Dakota Wesleyan University, the Mitchell Technical Institute, and local high schools to address healthcare worker shortages in the communities of its service area. Part III, Line 4: Bad debt is reported at charges as recorded by the organization. Bad debt expense is reported net of discounts and contractual allowances. A payment on an account previously written off reduces bad debt expense in the current year. Note from Financial Statement:Patient and resident receivables are uncollateralized patient, resident and third-party payor obligations. Payments of patient and resident receivables are allocated to the specific claims identified on the remittance advice or, if unspecified, are applied to the earliest unpaid claim.The carrying amount of patient and resident receivables is reduced by a valuation allowance that reflects management's estimate of amounts that will not be collected from patients, residents and third-party payors. Management reviews patient and resident receivables by payor class and applies percentages to determine estimated amounts that will not be collected from third parties under contractual agreements and amounts that will not be collected from patients and residents due to bad debts. Management considers historical write off and recovery information in determining the estimated bad debt provision. Management also reviews accounts to determine if classification as charity care is appropriate. Part III, Line 8: Medicare allowable costs of care are based on the Medicare cost report. The Medicare Cost Report is completed based on the rules and regulations set forth by CMS. Avera Queen of Peace follows the CHA guidelines in reporting community benefits and therefore any Medicare shortfall (as calculated including our non-cost report entities) is excluded from our community benefit report. However, Medicare is the organization's largest payer and patients with Medicare coverage are accepted regardless of whether or not a surplus or deficit is realized from providing the services. This basis therefore means providing Medicare services promotes access to healthcare services which is a key advantage for our community. Part III, Line 9b: If the patient qualifies for the organization's financial assistance policy for low-income, uninsured patients and is cooperating with the organization with regard to efforts to settle an outstanding bill within a reasonable time period, the organization or it's agent shall not send, nor indicate that it will send, the unpaid bill to any outside agency if doing so may negatively impact a patient's credit. At such time as the organization sends the uncollected account to an outside collection agency, the amount referred to the agency shall reflect the reduced-payment level for which the patient was eligible under the organization's financial assistance policy for low-income uninsured patients. Any extended payment plans offered by a hospital in settling the outstanding bills of low income, uninsured patients who qualify for financial assistance shall be interest-free so long as the repayment schedule is met. Avera Queen of Peace Hospital Part V, Section B, Line 13g: A summary of the financial assistance policy is posted in the hospital facility's emergency rooms, waiting rooms, and admissions office and included in the billing statement. In addition, the financial assistance policy is discussed with the patient upon admission to the facility. Avera Weskota Memorial Medical Center Part V, Section B, Line 13g: A summary of the financial assistance policy is posted in the hospital facility's emergency rooms, waiting rooms, and admissions office and included in the billing statement. In addition, the financial assistance policy is discussed with the patient upon admission to the facility. Avera De Smet Memorial Hospital Part V, Section B, Line 13g: A summary of the financial assistance policy is posted in the hospital facility's emergency rooms, waiting rooms, and admissions office and included in the billing statement. In addition, the financial assistance policy is discussed with the patient upon admission to the facility. Avera Queen of Peace Hospital Part V, Section B, Line 19d: The maximum amount charged to a patient under the financial assistance policy for emergency and medically necessary care is 90% of the gross charges. This is based on the lowest discount under the charity care policy of 10%. Avera Weskota Memorial Medical Center Part V, Section B, Line 19d: The maximum amount charged to a patient under the financial assistance policy for emergency and medically necessary care is 90% of the gross charges. This is based on the lowest discount under the charity care policy of 10%. Avera De Smet Memorial Hospital Part V, Section B, Line 19d: The maximum amount charged to a patient under the financial assistance policy for emergency and medically necessary care is 90% of the gross charges. This is based on the lowest discount under the charity care policy of 10%. Avera Queen of Peace Hospital Part V, Section B, Line 20: The hospital provides a reduction to gross charges under their financial assistance policy. The hospital has not determined the amount generally billed under the various proposed methods of calculation. Therefore, it is possible a patient under the financial assistance policy could have paid more than the amount generally billed. The hospital will review the various methods to ensure appropriate discounts are provided to equal or exceed the amounts generally billed to those with insurance. Avera Weskota Memorial Medical Center Part V, Section B, Line 20: The hospital provides a reduction to gross charges under their financial assistance policy. The hospital has not determined the amount generally billed under the various proposed methods of calculation. Therefore, it is possible a patient under the financial assistance policy could have paid more than the amount generally billed. The hospital will review the various methods to ensure appropriate discounts are provided to equal or exceed the amounts generally billed to those with insurance. Avera De Smet Memorial Hospital Part V, Section B, Line 20: The hospital provides a reduction to gross charges under their financial assistance policy. The hospital has not determined the amount generally billed under the various proposed methods of calculation. Therefore, it is possible a patient under the financial assistance policy could have paid more than the amount generally billed. The hospital will review the various methods to ensure appropriate discounts are provided to equal or exceed the amounts generally billed to those with insurance. Avera Queen of Peace Hospital Part V, Section B, Line 21: Individuals eligible for financial assistance are not charged gross charges for emergency or other medically necessary care; however may be charged gross charges for elective care. Avera Weskota Memorial Medical Center Part V, Section B, Line 21: Individuals eligible for financial assistance are not charged gross charges for emergency or other medically necessary care; however may be charged gross charges for elective care. Avera De Smet Memorial Hospital Part V, Section B, Line 21: Individuals eligible for financial assistance are not charged gross charges for emergency or other medically necessary care; however may be charged gross charges for elective care. Part VI, Line 2: Avera Queen of Peace is currently conducting a Community Health Needs Assessment. Several groups/organizations have been contacted and interviews have been set up in order to cultivate their needs and input. A target date of January 2013 has been set to quantify information received from these meetings. Part VI, Line 3: Anyone who is uninsured receives a letter with their itemized bill which describes both the uninsured program and the charitycare program. Any uninsured patient is contacted by phone or letter by our collections department at which time our programs are described. Also, inpatient and same day surgery patients receive a brochure in their admissions packet. Pre-collection letters also include information regarding our charity care and uninsured programs. Part VI, Line 4: Avera Queen of Peace's service area includes Davison County and surrounding counties in South Dakota. In 2010, the population for Davison County was estimated to be 19,504. Approximately 16.9% of the population is age 65 or older. The average per capita income is $23,510 and approximately 12% of individuals are below the federal poverty level. The nearest hospital in the area is approximately 22 miles from Avera Queen of Peace. Part VI, Line 5: AVERA QUEEN OF PEACE IS A VERIFIED LEVEL III TRAUMA CENTER AND OPERATES AN EMERGENCY DEPARTMENT STAFFED 24 HOURS PER DAY WITHBOARD CERTIFIED PHYSICIANS. EMERGENCY CARE IS PROVIDED ON AN OPEN DOOR BASIS REGARDLESS OF ABILITY TO PAY. AVERA QUEEN OF PEACE LEASES OR MANAGES THREE CRITICAL ACCESS HOSPITALS WHICH PROVIDE A BROAD RANGE OF INPATIENT, OUTPATIENT SERVICES AND 24 HOUR EMERGENCY ROOMS IN 3 VERY RURAL COMMUNITIES.AVERA QUEEN OF PEACE OWNS THREE RURAL HEALTH CLINICS WHICH PROVIDE PRIMARY CARE SERVICES IN THREE RURAL COMMUNITIES. SIMILAR TO THE HOSPITALS IN THE AQOP REGION, THESE CLINICS ARE OPERATED ON AN OPEN DOOR BASIS AND CARE IS PROVIDED REGARDLESS OF ABILITY TO PAY. MEDICAL STAFF PRIVILEGES ARE EXTENDED TO ALL LICENSED AND QUALIFIED APPLICANTS. THE AVERA QUEEN OF PEACE BOARD OF DIRECTORS IS PRINCIPALLY COMPRISED OF COMMUNITY MEMBERS FROM THE PRIMARY AND SECONDARY SERVICES AREAS. MEMBERS COME FROM A VARIETY OF BACKGROUNDS INCLUDING BANKING, EDUCATION, AGRICULTURE, HEALTHCARE, AND PRIVATE INDUSTRY. Part VI, Line 6: The communities in which Avera operates all have unique health and community benefit needs and in keeping with the Catholic Healthcare Association guidelines each hospital strives to meet its community's identified needs. The Avera central office advocates for all on community benefit related matters of state, regional and nation importance. 1 Mitchell Tech Institute Foundation 821 N Capital Mitchell SD 57301 460452950 501(c)(3) 58948 donation University of South Dakota 414 E Clark St Vermillion SD 57069 466018891 501(c)(3) 24000 donation 2 0 Procedure for Monitoring Grants in the U.S.: Part I, Line 2: Schedule I, Part I, Line 2: The organization only makes grants to other organizations which are tax-exempt under Section 501(c)(3). 0 0 0 0 0 0 0 0 0 Jennifer Tegethoff MD 124871 0 85810 0 388 0 10584 0 1273 0 222926 0 0 0 Robert Snortum MD 311679 0 28001 0 4774 0 12250 0 10608 0 367312 0 0 0 Thomas Clark 0 122288 0 25000 0 14554 0 7995 0 6016 0 175853 0 0 Patrick J Clark 184527 0 17186 0 4916 0 11832 0 11157 0 229618 0 0 0 Stephen Dick MD 354913 0 45452 0 21384 0 12250 0 17972 0 451971 0 0 0 Christopher Krouse MD 880157 0 92964 0 62445 0 12250 0 18736 0 1066552 0 0 0 Michael Haley MD 195359 0 244849 0 6977 0 12250 0 18088 0 477523 0 0 0 Dennis Leland MD 192359 0 371739 0 2097 0 12250 0 21311 0 599756 0 0 0 Brian Kampmann MD 547149 0 45186 0 54167 0 12250 0 18713 0 677465 0 0 0 Tom Rasmusson 0 213452 0 2000 0 37884 0 8645 0 10506 0 272487 0 0 Supplemental Information Part III Schedule J, Part I Line 3: The President/CEO's compensation is paid by a related organization, Avera Health. Avera Queen of Peace relied on the related organization for determining the compensation for the President/CEO using the methods described in Part I, Line 3. Brian Kampmann recruitment X 136000 4028 0 1 1 Patricia Malters recruitment X 30000 17867 0 1 1 David Malters recruitment X 30000 17867 0 1 1 39762 David Malters MD Family member of board member 159934 compensation 0 Form 990, Part VI, Section A, line 2 SISTER KATHLEEN CROWLEY HAS A BUSINESS RELATIONSHIP WITH THOMAS CLARK. Form 990, Part VI, Section A, line 6 The sole member of the organization is Avera Health, a nonprofit corporation organized and existing under the laws of the state of South Dakota and exempt under 501(c)(3) of the Internal Revenue Code of 1986, as amended. Form 990, Part VI, Section A, line 7a Avera Health, as the sole member, has the power to appoint and remove, with or without cause, members of the board of directors. Form 990, Part VI, Section A, line 7b Avera Health has the following rights as the Member. 1) To approve the adoption, amendment or repeal of the statements of philosophy, mission and values of Corporation; 2) To initiate the adoption, amendment or repeal of any provision of the Articles of Incorporation or Bylaws of Corporation, and to give final approval of any such action with respect thereto; 3) To approve and act upon the alienation of real property and precious artifacts under the canonical stewardship of the Sisters of the Presentation of the Blessed Virgin Mary of Aberdeen, South Dakota ("Presentation Sisters") or the Benedictine Sisters of Sacred Heart Monastery ("Benedictine Sisters"), pursuant to the policies established by the Member; 4) To approve any plan of merger, consolidation or dissolution of the Corporation, or the divestiture of a sponsored work or ministry associated with the Corporation; 5) To approve the creation of new sponsored works or ministries to be conducted by or under the authority of the Corporation; 6) To appoint and remove, with or without cause, the Board of Directors of the Corporation. 7) To appoint and/or remove, with or without cause, the President and Chief Executive Officer of the Corporation. 8) To approve operating/capital budgets and strategic plans of the Corporation. 9) To approve expenditures outside of operating and capital budgets exceeding defined thresholds according to policy which may be adopted from time to time by the Member. 10) To approve acquisitions, sales and leases, according to policy which may be adopted from time to time by the Member. 11) To establish and maintain employee benefit programs. 12) To establish and maintain insurance programs. 13) To approve major community fund drives. 14) To approve the appointment of auditors. 15) To adopt policies designed to effectuate the reserved powers of the Member. Form 990, Part VI, Section B, line 11 The return is reviewed initially by the CFO. The return is made available to the Board of Directors for review prior to filing. Form 990, Part VI, Section B, line 12c The conflict of interest policy covers board members, officers, and key employees. At each board meeting, a request is made for all board members to disclose any potential conflict of interest pertaining to any item listed on the agenda or pertaining to any potential item that could be discussed during the course of the meeting. The declaration of conflict of interest is recorded in the meeting minutes. The board makes a determination of whether there is a conflict of interest and if so, implements the procedure for evaluating the issue or transaction involved. The board member or officer with the conflict must refrain from voting. A statement of conflict of interest disclosure is made on an annual basis by officers and directors. The information is maintained in a database and a report is provided to the board. The CEO is compensated by Avera Health. Annually the Compensation Committee of Avera Health, which is comprised of six (6) System Members appointed by the Religious Orders, meets with an independent consultant regarding fair market value of officers and key employees. The Compensation Committee approves all salaries based on comparable data and documents the basis for their decision in meeting minutes. The compensation of the Senior VP of Finance is determined by Human Resources based on a market analysis of comparable positions. The compensation is approved by the CEO. Form 990, Part VI, Section C, line 19 The organization's governing documents and conflict of interest policy are not available to the general public. The organization's financial statements are attached to the Form 990 per IRS instructions and therefore are available to the general public. Form 990, Part VII: In addition to the hours served at Avera Queen of Peace Hospital, Sister Kathleen Crowley also serves 1 hour per week at both Avera Workers' Compensation Trust and Avera Holy Family and 5 hours per week at Avera Health and Sister Joan Reichelt also serve 1 and three-tenths hours per week at Avera Marshall and 2 hours per week at Avera McKennan. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: Net unrealized losses on investments: -1,121,879. Capital Contributions, Net -162,805. Change in Fair Value of Interest Rate Swap -1,193,985. Loss on Refinancing -111,750. Total to Form 990, Part XI, Line 5: -2,590,419. Form 990, Part XII, Line 2c: The Audit Committee of Avera Health, parent organization, selects the auditor and reviews the audited financial statements for Avera Queen of Peace. Form 990, Part X, Line 20: The issue price includes the filing organization's share of the entire bond issue, which was issued to Avera Health on behalf of the Avera Obligated Group. The Avera Obligated Group consists of Avera Health, Avera McKennan, Avera St. Luke's, Avera Queen of Peace, Avera Marshall, and Avera Sacred Heart. In accordance with IRS instructions, information related to the tax exempt bond reporting is being reported on Avera Health's tax return (EIN 46-0422673). Avera Health 3900 West Avera Drive Suite 300 Sioux Falls SD 57108 460422673 Promotion of Health SD 501(c)(3) Line 9 N/A 0 Avera Workers' Compensation Trust 3900 West Avera Drive Sioux Falls SD 57108 460407148 Economical Coverage of Workers' Compensation Claims SD 501(c)(3) Line 11b, II Avera Health 0 Avera St Anthony's Hospital 300 N 2nd Street ONeill NE 68763 470463911 Healthcare Education NE 501(c)(3) Line 3 Avera Health 0 Avera Holy Family 826 North 8th Street Estherville IA 51334 420680370 Healthcare Services IA 501(c)(3) Line 3 Avera Health 0 Avera Holy Family Foundation 826 North 8th Street Estherville IA 51334 421317452 Fundraising IA 501(c)(3) Line 9 Avera Holy Family 0 Avera Marshall 300 S Bruce Street Marshall MN 56258 410919153 Healthcare Services MN 501(c)(3) Line 3 Avera Health 0 Avera Marshall Foundation 300 S Bruce Street Marshall MN 56258 411784801 Fundraising MN 501(c)(3) Line 7 Avera Marshall 0 St Benedict Health Center 401 West Glynn Drive Parkston SD 57366 460226738 Healthcare Services SD 501(c)(3) Line 3 Avera Health 0 St Benedict Health Center Foundation West Glynn Drive PO Box B Parkston SD 57366 460458725 Support Health Related Services SD 501(c)(3) Line 11a, I St Benedict Health Center 0 Avera McKennan 1325 S Cliff Ave PO Box 5045 Sioux Falls SD 57117 460224743 Healthcare Services SD 501(c)(3) Line 3 Avera Health 0 Sacred Heart Health Services 501 Summit Street Yankton SD 57078 460225483 Healthcare Services SD 501(c)(3) Line 3 Avera Health 0 Sacred Heart Rural Health Clinics Inc 501 Summit Street Yankton SD 57078 460423930 Clinic Services SD 501(c)(3) Line 3 Sacred Heart Health Services 0 Health Management Services 501 Summit Yankton SD 57078 460399291 Adult Daycare and Homemaking Services SD 501(c)(3) Line 9 Sacred Heart Health Services 0 Lewis and Clark Health Education and Service Agency 1000 W 4th Street Suite 9 Yankton SD 57078 460337013 Healthcare Services SD 501(c)(3) Line 9 Sacred Heart Health Services 0 Avera St Luke's 305 South State Street Aberdeen SD 57401 460224598 Healthcare Services SD 501(c)(3) Line 3 Avera Health 0 Q&M Properties LLC 525 North Foster Mitchell SD 57301 731652049 medical clinic building SD N/A excluded - Sec 512 -477 412030 0 1 0.50000 Avera Home Medical Equipment LLC 1325 S Cliff Ave PO Box 5045 Sioux Falls SD 57117 460488198 medical services - home medical equipment SD N/A Midwest Regional Imaging Services LLC 1325 S Cliff Ave PO Box 5045 Sioux Falls SD 57117 470874983 health care - medical imaging SD N/A Home Medical of Pierre LLC 329 E Dakota Pierre SD 57501 460444002 medical services - home medical equipment SD N/A Avera Home Medical Equipment of Floyd Valley Hospital LLC 714 Lincoln St NE Lemars IA 51031 820582350 medical services - home medical equipment SD N/A Avera Home Medical Equipment of Estherville LLC PO Box 5045 Sioux Falls SD 57117 201686097 medical services - home medical equipment SD N/A Avera Home Medical Equipment of Sioux Center LLC 38 19th ST SW Sioux Center IA 51250 753203100 medical services - home medical equipment SD N/A Avera Home Medical Equipment of Marshall LLC 1104 East College Drive Marshall MN 56258 205271924 medical services - home medical equipment SD N/A Avera Home Medical Equipment of Spencer Hospital LLC 2400 S Minnesota Ave 102 Sioux Falls SD 57117 800619999 medical services - home medical equipment SD N/A Surgical Associates Endoscopy Clinic LLC 310 S Pennsylvania St Aberdeen SD 57401 460461429 surgical associates SD N/A Heart Hospital of South Dakota LLC 10720 Sikes Place Suite 300 Charlotte NC 28277 562143771 healthcare services NC N/A Accounts Management Inc 5132 S Cliff Ave Suite 101 Sioux Falls SD 57108 460373021 collection agency SD N/A C Avera Health Plans Inc 3900 West Avera Drive Suite 101 Sioux Falls SD 57108 460451539 health financing and health plan administration SD N/A C Avera Property Insurance Inc 610 W 23rd St Ste 1 PO Box 38 Yankton SD 57078 460463155 insurance SD N/A C Dr Donald & Marguerite Mabee Trust c/o First National Bank of South Da Mitchell SD 57301 466056202 investing SD N/A T -9110 754227 1.00000 Valley Health Services 501 Summit Street Yankton SD 57078 460357149 medical equipment SD N/A C 0 1 0 0 0 0 0 0 0 0 0 0 0 1 1 0 1 1 Dr Donald & Marquerite Mabee Trust 0