2013-11-14T13:10:20-06:00 2012-12-31 205325889 ACCUITY LLP 999 BISHOP STREET STE 1900 HONOLULU HI 96813 990 2012-01-01 990107971 HAWAII DENTAL SERVICE HAWA 8085211431 700 BISHOP STREET NO 700 HONOLULU HI 96813 CHERYL TAKITANI-SMITH 8085211431 2013-11-08 0 ACCUITY LLP P00037058 8085313400 2012 2016-02-24 21:20:13Z FAYE W KURREN 700 BISHOP STREET SUITE 700 HONOLULU HI 96813 223471845 0 X WWW.HAWAIIDENTALSERVICE.COM X 1962 HI PROMOTE AND ENCOURAGE THE BETTERMENT OF THE GENERAL MEDICAL AND DENTAL HEALTH OF THE PUBLIC (CONTINUED) FOR THE COMMON GOOD AND GENERAL WELFARE OF THE COMMUNITY. 15 6 101 0 0 0 0 0 182496411 183236375 4113361 4079635 277429 17092 186887201 187333102 1535028 2068508 164709135 158461708 8451269 10082412 0 0 0 4428566 4766869 179123998 175379497 7763203 11953605 144353905 155904958 28473858 23776689 115880047 132128269 X SEE SCHEDULE O. 1 0 167118378 2068508 183253467 TO PROMOTE AND ENCOURAGE THE BETTERMENT OF THE GENERAL MEDICAL AND DENTAL HEALTH OF THE PUBLIC FOR THE COMMON GOOD AND GENERAL WELFARE OF THE COMMUNITY. SEE SCHEDULE O - FORM 990, PART III, LINE 4A FOR PROGRAM SERVICE ACCOMPLISHMENTS. 543165 0 0 MANAGING THE DENTAL BENEFITS OF ELIGIBLE BENEFICIARIES COVERED BY THE STATE OF HAWAII MEDICAID PROGRAM. 167661543 0 0 0 0 0 0 0 0 0 1 0 0 0 1 0 0 1 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 1 1 1 0 0 0 0 0 1 1 1 0 1 2941 0 1 101 1 1 1 0 0 0 0 0 X 15 6 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 X CHERYL TAKITANI-SMITH 8085211431 700 BISHOP STREET SUITE 700 HONOLULU HI 96813 T KIMO BLAISDELL 1.00 0.00 X 0 0 0 JOHN BLACK 1.00 0.00 X 0 0 0 PAUL CHANG 1.00 1.00 X 0 0 0 NORMAN S CHUN 1.00 0.00 X 0 0 0 HAROLD J DIAS JR 1.00 0.00 X 0 0 0 CLAY R HIRAMOTO 1.00 0.00 X 0 0 0 SUZY HOLLINGER 1.00 0.00 X 0 0 0 JOHN I KOTAKE 1.00 1.00 X 0 0 0 KIM JAMES LAWLER 1.00 1.00 X 0 0 0 SUSAN A LI 1.00 1.00 X 0 0 0 GARY K NAKATA 1.00 0.00 X 0 0 0 PATSY NANBU 1.00 0.00 X 0 0 0 GARRETT B K OKA 1.00 1.00 X 0 0 0 MICHAEL J O'MALLEY 1.00 0.00 X 0 0 0 CASEY Z TAMASHIRO 1.00 1.00 X 0 0 0 TRAVIS UMEMOTO 1.00 0.00 X 0 0 0 JON YOSHINO 1.00 0.00 X 0 0 0 FAYE W KURREN 40.00 1.00 X 3596144 0 104371 KATHY FAY 40.00 0.00 X 215761 0 110520 CHERYL TAKITANI-SMITH 40.00 1.00 X 216242 0 81458 TOM DELANEY 40.00 0.00 X 153712 0 65573 ROBERT SHERMAN 40.00 0.00 X 158851 0 58451 JIM JOHNSON 40.00 0.00 X 129353 0 58636 LYNETTE ARAKAWA 40.00 0.00 X 130149 0 78148 ROQUE ARANADOR 40.00 0.00 X 122518 0 52478 4722730 0 609635 8 0 1 0 STRATEGIC COMMUNICATIONS PO BOX 283137 HONOLULU HI 968283137 ADVERTISING 450260 ERNST & YOUNG LLP 55 MERCHANT STREET 1900 HONOLULU HI 96813 ACCOUNTING SERVICE 246309 BENEFIT PLAN SOLUTIONS INC 680 IWILEI ROAD 528 HONOLULU HI 96817 BROKER 190455 TOWERS WATSON DELAWARE INC PO BOX 741909 ATLANTA GA 303741909 BROKER 130313 HEALTHENTIC INC 9706 FOURTH AVE NE 208 SEATTLE WA 98115 REPORTING 115000 6 SUBSCRIPTIONS EARNED 621300 183235700 183235700 MEMBERSHIP DUES 621300 675 675 183236375 2954027 2954027 6000 6000 0 37258351 36131376 1367 1126975 -1367 1125608 1125608 ALL OTHER REVENUE 900099 13875 13875 FMG - VA HERO 900099 3217 3217 17092 187333102 183253467 0 4079635 2068508 2068508 158461708 158461708 3928957 3928957 3558284 2982792 575492 1333345 694010 639335 753503 405912 347591 508323 230829 277494 125254 31523 93731 218245 16204 202041 18848 18848 1410521 908994 501527 304754 199691 105063 468630 468630 596748 486729 110019 143416 80665 62751 530728 285903 244825 89494 32261 57233 48934 15947 32987 147802 3888 143914 217123 180109 37014 DUES & SUBSCRIPTIONS 282327 1677 280650 BANK CHARGES 76051 76051 ALL OTHER EXPENSES 72439 13957 58482 ORAL HEALTH EDUCATION 15555 15555 175379497 167661543 7717954 0 0 0 38746650 43706220 0 0 9335462 8692280 0 0 0 0 0 0 0 0 3098067 2438365 4810535 4590979 325228 219556 92848498 100848537 0 0 0 0 0 0 0 0 144353905 155904958 9906285 8352796 0 0 2076380 2472565 0 0 0 0 0 0 0 0 0 0 16491193 12951328 28473858 23776689 X 115880047 132128269 0 0 0 0 115880047 132128269 144353905 155904958 X 11953605 4805591 -716505 205531 X 0 1 X 1 0 1363581 1304339 59242 2572452 2424714 147738 874502 861926 12576 219556 CLAIMS PAYABLE TO DENTISTS 8603911 REFUNDABLE GROUP SUBSCRIPTIONS 4347417 12951328 1 CHILDREN'S DISCOVERY CENTER 111 OHE ST HONOLULU HI 96813 990241632 501(C)(3) 6560 TO PROMOTE ORAL HEALTH HAWAII DENTAL SERVICE FOUNDATION 700 BISHOP ST STE 700 HONOLULU HI 96813 990246999 501(C)(4) 2000000 SUPPORT ORGANIZATION PROGRAMS ALOHA UNITED WAY 200 N VINEYARD BLVD HONOLULU HI 96817 990073494 501(C)(3) 10000 GENERAL SUPPORT GIRL SCOUTS OF AMERICA 420 WYLLIE STREET HONOLULU HI 96817 990073488 501(C)(3) 10000 GENERAL SUPPORT 3 1 DESCRIPTION OF ORGANIZATION'S PROCEDURES FOR MONITORING THE USE OF GRANTS FROM 990, SCHEDULE I THE PURPOSE OF THE GRANTS AWARDED BY HAWAII DENTAL SERVICE (HDS) ARE REVIEWED AND APPROVED BY HDS CEO EXCEPT FOR GRANTS TO HDS FOUNDATION, WHICH ARE APPROVED BY THE HDS BOARD OF DIRECTORS. HDS FOUNDATION CHAIR REPORTS ON THE USE OF GRANTS TO HDS BOARD OF DIRECTORS. OTHER GRANTS ARE AWARDED TO VARIOUS PUBLIC CHARITABLE ORGANIZATIONS TO SUPPORT THE EXEMPT FUNCTIONS OF THE ORGANIZATIONS AND ARE NOT MONITORED. X X X 1 1 X X X X X 0 1 0 0 0 0 0 1 0 FAYE W KURREN 418063 0 143215 0 3034866 0 93690 0 10681 0 3700515 0 1661515 0 KATHY FAY 166221 0 49540 0 0 0 100619 0 9901 0 326281 0 0 0 CHERYL TAKITANI-SMITH 166702 0 49540 0 0 0 66606 0 14852 0 297700 0 0 0 TOM DELANEY 140635 0 13077 0 0 0 57024 0 8549 0 219285 0 0 0 ROBERT SHERMAN 149179 0 9672 0 0 0 52530 0 5921 0 217302 0 0 0 JIM JOHNSON 121425 0 7928 0 0 0 44787 0 13849 0 187989 0 0 0 LYNETTE ARAKAWA 121781 0 8368 0 0 0 67712 0 10436 0 208297 0 0 0 ROQUE ARANADOR 115009 0 7509 0 0 0 38697 0 13781 0 174996 0 0 0 SUPPLEMENTAL INFORMATION PART III SUPPLEMENTAL COMPENSATION INFORMATION SCHEDULE J, PART I, LINE 1A HDS HAS A CORPORATE MEMBERSHIP IN A SOCIAL CLUB IN WHICH THE CLUB REQUIREMENTS DICTATE THAT AN INDIVIDUAL BE IDENTIFIED TO AUTHORIZE TRANSACTIONS. AS SUCH, HDS'S CEO HAS BEEN DESIGNATED AS THE AUTHORIZED INDIVIDUAL. ONLY BUSINESS TRANSACTIONS ARE ALLOWED AND SUBSTANTIATED BY PROPER DOCUMENTATION. DISCRETIONARY SPENDING ACCOUNT: THE CEO RECEIVES AN ALLOWANCE OF $6,000 ANNUALLY FOR BUSINESS USE OF PERSONAL AUTOMOBILE. THIS AMOUNT HAS BEEN INCLUDED IN FORM W-2 AS COMPENSATION. TAX INDEMNIFICATION AND GROSS-UP PAYMENTS: CEO RECEIVES GROSS UP PAYMENTS FOR LIFE INSURANCE PREMIUMS OVER $50,000 AND PARKING OVER INTERNAL REVENUE SERVICE LIMITS. CEO, VP FINANCIAL AFFAIRS, AND DIRECTOR OF MARKETING RECEIVE GROSS UP PAYMENT FOR PARKING EXCEEDING INTERNAL REVENUE SERVICE LIMITS. THE PAYMENTS TO THE INDIVIDUALS ABOVE ARE INCLUDED IN THEIR W-2S AS COMPENSATION. SCHEDULE J, PART I, LINE 4B ON DECEMBER 31, 2009, THE BOARD OF DIRECTORS APPROVED A SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP) FOR HDS'S PRESIDENT & CEO, FAYE KURREN. THE BENEFIT WAS RETROACTIVE FROM 9/3/03. BENEFIT PAYMENTS OF $3,028,866 FOR THE PERIOD FROM 9/3/03 THROUGH 12/31/12 WERE PAID TO FAYE KURREN ON DECEMBER 31, 2012 IN ACCORDANCE WITH THE TERMS OF THE EMPLOYMENT AGREEMENT. SCHEDULE J, PART I, LINE 7 HDS HAS AN INCENTIVE BONUS PLAN DETAILING THE BONUS CALCULATION WHEN THE COMPANY ACHIEVES CERTAIN PERFORMANCE STANDARDS AND STRATEGIC GOALS. BONUS AMOUNT VARIES EACH YEAR DEPENDING ON PERFORMANCE AND ACHIEVEMENT OF STRATEGIC GOALS. BONUS AMOUNT FOR OFFICERS AND CERTAIN DIRECTORS WITH REPORTABLE COMPENSATION EXCEEDING $150,000 ARE PRESENTED TO AND APPROVED BY THE BOARD OF DIRECTORS COMPENSATION COMMITTEE WHICH IS DOCUMENTED IN MINUTES. BONUS PAYMENTS FOR MANAGEMENT AND STAFF ARE CALCULATED BY HUMAN RESOURCES AND APPROVED BY OFFICERS. ON DECEMBER 31, 2009, THE BOARD OF DIRECTORS APPROVED A SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP) FOR THE PRESIDENT & CEO, FAYE KURREN. THE BENEFIT WAS RETROACTIVE EFFECTIVE FROM 9/3/03. BENEFIT PAYMENTS OF $3,028,866 FOR THE PERIOD FROM 9/3/03 THROUGH 12/31/12 WERE PAID TO FAYE KURREN ON DECEMBER 31, 2012. PAUL CHANG OFFICER IS DIR OF HDS 2312191 PREMIUM FOR DENTAL PLAN 0 SUSAN LI OFFICER IS DIR OF HDS 2721055 PREMIUM FOR DENTAL PLAN 0 PATSY NANBU OFFICER IS DIR OF HDS 2721055 PREMIUM FOR DENTAL PLAN 0 NORMAN CHUN DIRECTOR 419171 DENTAL SVCS TO HDS SUBSCRIBERS 0 JOHN BLACK DIRECTOR 112544 DENTAL SVCS TO HDS SUBSCRIBERS 0 JOHN KOTAKE DIRECTOR 362240 DENTAL SVCS TO HDS SUBSCRIBERS 0 KIM LAWLER DIRECTOR 215638 DENTAL SVCS TO HDS SUBSCRIBERS 0 GARRET OKA DIRECTOR 181580 DENTAL SVCS TO HDS SUBSCRIBERS 0 CASEY TAMASHIRO DIRECTOR 256080 DENTAL SVCS TO HDS SUBSCRIBERS 0 ORGANIZATION MISSION STATEMENT FORM 990, PART III, LINE 1 HAWAII DENTAL SERVICE OPERATES FOR THE PROMOTION OF THE COMMON GOOD AND GENERAL WELFARE OF THE PEOPLE. ITS GOAL IS TO INNOVATE AND CONDUCT PROGRAMS FOR DENTAL CARE AND TO MAKE AVAILABLE, IN A BROAD SCALE, THE BENEFITS OF THE SCIENCE OF DENTISTRY TO MEMBERS OF THE PUBLIC. DENTAL COVERAGE IS AVAILABLE TO THE GENERAL PUBLIC AS HAWAII DENTAL SERVICE MAINTAINS AN ENROLLMENT POLICY THAT IS OPEN TO INDIVIDUALS AND FAMILIES, AS WELL AS SMALL AND LARGE GROUPS. IN ADDITION, HAWAII DENTAL SERVICE PROVIDES FUNDING TO HAWAII DENTAL SERVICE FOUNDATION THAT GRANTS TO ORGANIZATIONS WHICH HAVE PROGRAMS IN PLACE TO SUPPORT ORAL HEALTH INITIATIVES IN THE COMMUNITY. NEW PROGRAM SERVICES FORM 990, PART III, LINE 2 IN 2012 HAWAII DENTAL SERVICE WAS AWARDED THE STATE OF HAWAII MEDICAID CONTRACT AND WILL BE RESPONSIBLE FOR MANAGING THE DENTAL BENEFITS OF ELIGIBLE BENEFICIARIES COVERED BY THE MEDICAID PROGRAM, FURTHER EXPANDING THE ABILITY OF HDS TO ACCOMPLISH ITS GOAL TO MAKE AVAILABLE, IN A BROAD SCALE, THE BENEFITS OF THE SCIENCE OF DENTISTRY TO MEMBERS OF THE PUBLIC. FORM 990, PART III, LINE 4A, DESCRIPTION OF PROGRAM SERVICE: HAWAII DENTAL SERVICE (HDS) OFFERS AND ADMINISTERS DENTAL CARE PROGRAMS TO SUBSCRIBER GROUPS AND INDIVIDUALS THROUGHOUT THE STATE OF HAWAII. THE TERMS OF THE AGREEMENTS GENERALLY PROVIDE THAT THE SUBSCRIBER GROUPS OR INDIVIDUALS PAY HDS A STIPULATED AMOUNT, INCLUDING AN ADMINISTRATIVE FEE, WHICH IS USED TO PAY FOR DENTAL SERVICES AND EXPENSES OF ADMINISTERING THE DENTAL SERVICE CONTRACTS. IN ADDITION, HDS FUNDED $2,000,000 TO HDS FOUNDATION IN 2012 TO SUPPORT ORAL HEALTH INITIATIVES IN THE COMMUNITY. FORM 990, PART IV, LINE 12B, AUDITED FINANCIAL STATEMENTS: THE ORGANIZATION IS INCLUDED IN THE CONSOLIDATED AUDITED FINANCIAL STATEMENTS OF HAWAII DENTAL SERVICE, HAWAII DENTAL SERVICE FOUNDATION, AND HAWAII CLIENT SERVICES CORPORATION. THE AUDIT COMMITTEE, WHICH CONSISTS OF BOARD MEMBERS, SELECTS THE AUDITORS AND REVIEWS THE CONSOLIDATED AUDITED FINANCIAL STATEMENTS. FORM 990, PART VI, SECTION A, LINE 6 DESCRIPTION OF ORGANIZATION'S MEMBERS: MEMBERSHIP IN THE CORPORATION IS COMPRISED OF DENTIST AND PUBLIC MEMBERS. DENTIST MEMBERSHIP IS AVAILABLE TO ALL DENTISTS AND DENTAL SURGEONS WHO HAVE BEEN DULY LICENSED TO PRACTICE IN THE STATE OF HAWAII BY THE BOARD OF DENTAL EXAMINERS OF THE STATE OF HAWAII. APPLICATION IS MADE IN WRITING AND APPROVED BY THE BOARD OF DIRECTORS. CERTAIN ORGANIZATIONS (COMPANIES, ORGANIZATIONS, OR ENTITIES CONTRACTING WITH HDS FOR DENTAL BENEFITS FOR AT LEAST 2 CONSECUTIVE YEARS WITH MORE THAN 100 OR MORE ELIGIBLE SUBSCRIBERS AT THE TIME OF SUCH DESIGNATION) ARE INVITED TO BECOME PUBLIC MEMBERS AND APPROVED BY THE BOARD OF DIRECTORS. BOTH MEMBERSHIPS OF THE CORPORATION MAY AT ANY TIME DEPOSE OR REMOVE FROM OFFICE ANY DIRECTOR, WITH OR WITHOUT CAUSE, EXCEPT AS SUCH REMOVAL WOULD BE CONTRARY TO LAW. FORM 990, PART VI, SECTION A, LINE 7A ELECT BOARD MEMBERS: DENTISTS AND PUBLIC MEMBERS RESPECTIVELY ELECT DENTISTS AND PUBLIC DIRECTORS TO THE BOARD OF DIRECTORS FOR A THREE YEAR TERM. DUE TO STAGGERED TERMS 1/3 OF DIRECTORS ARE ELECTED ANNUALLY. FORM 990, PART VI, SECTION A, LINE 7B APPROVAL OF DECISIONS: AMENDMENTS TO THE BYLAWS REQUIRE APPROVAL OF NOT LESS THAN A MAJORITY OF EACH CLASS OF MEMBERSHIP. FORM 990, PART VI, SECTION B, LINE 11 APPROVED COPY OF FORM 990: THE RETURN IS THOROUGHLY REVIEWED BY THE CONTROLLER PRIOR TO FINAL REVIEW WITH THE VP-FINANCIAL AFFAIRS AND PRESIDENT. A COPY OF FORM 990 IS PROVIDED TO BOARD OF DIRECTORS PRIOR TO FILING. FORM 990, PART VI, SECTION B, LINE 12C WRITTEN CONFLICT OF INTEREST POLICY: PURSUANT TO THE HDS CONFLICTS OF INTEREST POLICY, EMPLOYEES AND DIRECTORS OF HDS ARE PROVIDED WITH THE CONFLICTS OF INTEREST POLICY AND ARE REQUIRED TO SUBMIT A CONFLICTS OF INTEREST DISCLOSURE STATEMENT ANNUALLY. COMPLIANCE DEPARTMENT REVIEWS THE ANNUAL CONFLICTS OF INTEREST DISCLOSURE STATEMENTS AND REPORTS POTENTIAL CONFLICTS OF INTERESTS TO THE HDS BOARD OF DIRECTORS. THE BOARD OF DIRECTORS ARE NOT ALLOWED TO PARTICIPATE IN DELIBERATIONS OR VOTE ON ISSUES/TRANSACTIONS WHICH THEY HAVE A CONFLICT OF INTEREST IN. FORM 990, PART VI, SECTION B, LINE 15 PROCESS FOR DETERMINING COMPENSATION: COMPENSATION FOR THE CEO AND OFFICERS ARE DETERMINED BASED ON ADVICE FROM AN INDEPENDENT COMPENSATION CONSULTANT WHO USES DELTA DENTAL PLANS ASSOCIATION SURVEY AND THE HAWAII EMPLOYERS COUNCIL SURVEYS FOR COMPARABLE POSITIONS. THE INDEPENDENT CONSULTANT ALSO USES THEIR OWN COMPENSATION SURVEY AS APPROPRIATE TO PROVIDE ADVICE. OFFICER COMPENSATION IS PRESENTED TO AND APPROVED BY THE BOD COMPENSATION COMMITTEE. AMOUNTS ARE DOCUMENTED IN MINUTES AND HUMAN RESOURCE DEPARTMENT RECONCILES THE PAYMENT AT END OF EACH YEAR. COMPENSATION FOR MANAGEMENT AND STAFF POSITIONS ARE EVALUATED AND DETERMINED BASED ON HAWAII EMPLOYERS COUNCIL SURVEYS AND APPROVED BY THE PRESIDENT AND CEO ANNUALLY. FORM 990, PART VI, SECTION C, LINE 19 PUBLIC DISCLOSURE OF ORGANIZATION GOVERNING DOCUMENTS: GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY AND FINANCIAL STATEMENTS ARE AVAILABLE UPON REQUEST. CHANGES IN NET ASSETS OR FUND BALANCES: FORM 990, PART XI, LINE 9: CHANGE IN ACCRUED POSTRETIREMENT LIABILITIES 205,531. HAWAII DENTAL SERVICE FOUNDATION 700 BISHOP STREET SUITE 700 HONOLULU HI 96813 990246999 SUPPORT COMM. HI 501(C)(4) N/A N/A 1 HAWAII CLIENT SERVICES CORPORATION 700 BISHOP STREET SUITE 710 HONOLULU HI 96813 452740308 ADMIN SERVICES HI HI DENTAL SCVS C 368147 989565 1.00000 1 1 1 0 0 0 0 0 0 0 0 1 0 0 1 1 0 1 0 0 HAWAII DENTAL SERVICE FOUNDATION B 2000000 CASH HAWAII CLIENT SERVICES CORPORATION O 183386 CASH HAWAII CLIENT SERVICES CORPORATION A 6000 CASH