2013-05-14T10:19:09-05:00 2012-06-30 450250958 EIDE BAILLY LLP 200 EAST 10TH ST PO BOX 5125 SIOUX FALLS SD 571175125 990 2011-07-01 460225414 St Michael's Hospital Inc STMI 6055893341 410 West 16th Avenue Tyndall SD 570662318 Carol Deurmier 6055893341 2013-05-07 1 Laurie Hanson P00851848 6053391999 2013-05-07 2011 2016-02-24 21:20:13Z Carol Deurmier 410 West 16th Avenue Tyndall SD 570662318 8627115 0 0928 X www.avera.org/ash/stmichaels X 1966 SD To provide healthcare services. 7 7 96 63 268056 -66175 26224 55105 8156936 8503622 69866 61337 -6095 -2926 8246931 8617138 0 0 0 0 3746458 3984020 0 0 0 4121466 4195902 7867924 8179922 379007 437216 8194262 8178739 1729418 1343319 6464844 6835420 X It is the mission of St. Michael's Hospital to provide readily accessible health care to the people of Bon Homme County and the surrounding areas. In keeping with the heritage of the Catholic Church, St. Michael's will aim to promote the physical, mental, social and spiritual health of all its patients and residents. The health care centers will continue to offer quality services based on community needs and fiscal solvency. 0 0 7273122 8235566 St. Michael's Hospital, Inc. (SMH) operates a 25-bed critical access hospital with provider based rural health clinics located in Tyndall and in Avon. Provider staff, nursing personnel, laboratory and radiology personnel are available as needed 24-hours a day, 7-days a week. During the fiscal year ending June 30, 2012, patient days were 314 and swing-bed days were 2,857. 7273122 1 1 0 0 0 0 0 0 0 1 1 1 0 0 0 1 1 0 0 0 0 0 0 0 0 0 1 1 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 17 0 1 96 1 1 1 0 0 0 0 0 0 0 0 0 X 7 7 0 1 0 0 0 0 0 1 0 0 0 1 1 1 1 1 1 1 1 0 X Lisa Ronke 6055893341 410 W 16th Ave Tyndall SD 570662318 Russell Bechtold 1.00 X X 0 0 0 Jim Stoebner 1.00 X X 0 0 0 Marlene Zieser-Blackburn 1.00 X X 0 0 0 Sister Paulette Larsen 1.00 X 0 0 0 Marty Koch 1.00 X 0 0 0 Don Irish 1.00 X 0 0 0 Father Joe Forcelle 1.00 X 0 0 0 Carol Deurmier 50.00 X 120275 0 22872 Lisa Ronke 40.00 X 37629 0 15396 Dr Melvin Wallinga 40.00 X 166090 0 20507 Dr Jill Kruse 40.00 X 197596 0 21792 Jaclyn Dvoracek 37.00 X 106333 0 19451 627923 0 100018 4 0 1 1 Avera Sacred Heart Hospital 501 Summit Yankton SD 57078 Management, Occupational&Speech Therapy, 585136 1 28781 26324 55105 Patient Service Fees 621110 6198982 6198982 Retail Pharmacy 446110 2257006 1988950 268056 Miscellaneous 900099 47634 47634 8503622 60780 60780 7051 9977 -2926 -2926 -2926 557 0 557 557 557 8617138 8235566 268056 58411 199298 199298 3198737 2932276 266461 105599 97098 8501 260643 239406 21237 219743 198529 21214 115722 115722 33375 33375 131063 124183 6880 6980 2345 4635 130150 68624 61526 112994 112994 113092 113057 35 16244 10201 6043 5345 4735 610 44798 44798 451562 451562 72472 72472 Medical Supplies 2555098 2555098 Equipment & Maintenance 263975 231857 32118 Bad Debt 88787 88787 Dues and Subscriptions 34158 18064 16094 20087 20030 57 8179922 7273122 906800 0 1465504 1749703 762484 810451 26172 0 409483 379189 32121 56129 7560072 4485137 3369301 3074935 841735 833858 1262940 1252809 24522 21665 8194262 8178739 878481 560561 237 11822 850700 770936 1729418 1343319 X 6433186 6803783 12020 11739 19638 19898 6464844 6835420 8194262 8178739 X 437216 -66640 X 0 1 0 X 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 19638 260 19898 19378 260 19638 19138 240 19378 18878 260 19138 1.00000 0 0 92059 92059 3519356 1866354 1653002 3848130 2561184 1286946 100527 57599 42928 3074935 Interest in Avera Pooled Investment Funds 1252809 F 1252809 8617138 8179922 437216 -66640 -66640 370576 8461711 -66640 -66640 8528351 88787 88787 8617138 8091135 0 8091135 88787 88787 8179922 Description of Intended Use of Endowment Funds: Part V, Line 4: The intended use of the organization's endowment funds is to provide for capital needs that may arise. Description of Uncertain Tax Positions Under FIN 48: Part X: The Hospital 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 Hospital 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 Hospital's federal Form 990T filings are no longer subject to federal tax examinations by tax authorities for years before 2009. Part XII, Line 4b - Other Adjustments: Bad Debt Expense 88,787. Part XIII, Line 4b - Other Adjustments: Bad Debt Expense 88,787. 1 1 X 1 X 1 X 150.000000000000 1 0 1 1 49000 49000 0.00610 249627 227920 21707 0.00270 298627 227920 70707 0.00880 136589 6407 130182 0.01610 26502 934 25568 0.00320 1367179 704193 662986 0.08190 8849 8849 0.00110 1539119 711534 827585 0.10230 1837746 939454 898292 0.11110 538 538 0.00010 277 277 0.00000 815 815 0.00010 0 88787 31075 2874492 2846031 28461 X 1 1 1 1 St Michael's Hospital Inc

410 West 16th Avenue Tyndall SD 570660027

X X X X St Michael's Hospital Inc 1 0 1 1 100.000000000000 1 150.000000000000 0 1 1 X X 1 0 1 X 0 1 3 St Michaels Hospital Inc

410 West 16th Avenue Tyndall SD 57066

Wellness Center Bon Homme Family Practice Clinic

130 Main Street Avon SD 57315

Family Practice Clinic Bon Homme Family Practice Clinic

410 West 16th Avenue Tyndall SD 57066

Family Practice Clinic Part I, Line 3c: In addition to the use of FPG to determine eligibility for free or discounted care, SMH also looks at the patient's assets, liabilities, outstanding medical debts and the overall debt to asset ratio for each situation. Being in a rural community with a small population, SMH may also use known information of a patient's hardships in making the final determination. Part I, Line 6a: SMH prepares a community benefit report that is submitted to Avera Health. The information is made available to the public through Avera Health's community benefit report. Part I, Line 7: Charity care expense was converted to cost on line 7a based on an overall cost-to-charge ratio addressing all patient segments. Lines 7e, 7f, and 7i were obtained utilizing the actual general ledger system. Lines 7b and 7g were obtained from the Medicare cost report. Part I, L7 Col(f): Bad debt expense of $88,787 was subtracted from total operating expense. Part II: SMH is involved with the area Chamber of Commerce and Rotary Club. SMH works to enhance the quality of life and empower its patients, care-givers and community with the resources they need when they need them. SMH also provides healthcare career education to promote healthcare careers and rural health. Part III, Line 4: a) The amount on line 3 of $31,075 is 35% of total bad debt expense. The number is based on a detailed review of the accounts that are currently listed with Credit Collection Bureau and Accounts Management. Upon reviewing each account that is at CCB and AMI, it was found that about 35% of the outstanding balances may have been eligible under the facility's charity care policy. Since we are a small community, we were able to identify which accounts may have qualified for charity care because of low income or some known hardship to the household. Also for this review process, any families with prior applications for charity care were given consideration when reviewing the CCB and AMI accounts. b) Bad debt expense is made up of the actual accounts that are written off during the year as well as a change in the estimate for patient accounts that are still outstanding on the books and records of the facility. Bad debt recoveries are posted as a reduction to bad debt expense.c) Footnote From Financial Statement: Patient accounts receivable are reduced by an allowance for doubtful accounts. In evaluating the collectability of accounts receivable, the Hospital analyzes its past history and identifies trends for each of its major payor sources of revenue to estimate the appropriate allowance for doubtful accounts and provision for bad debts. Management regularly reviews data about these major payor sources of revenue in evaluating the sufficiency of the allowance for doubtful accounts. For receivables associated with services provided to patients who have third party coverage, the Hospital analyzes contractually due amounts and provides an allowance for doubtful accounts and a provision for bad debts, if necessary (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 bad debts 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 standard rates (or the discounted rates, if negotiated) and the amounts actually collected after all reasonable collection efforts have been exhausted is charged off against the allowance for doubtful accounts. Part III, Line 8: Medicare allowable cost of care was calculated from the medicare cost report for the fiscal year ending 6/30/2012. Part III, Line 9b: SMH provides care to patients who meet certain criteria under its charity care policy without charge or at amounts less than its established rates. The Hospital does not pursue collections of amounts determined to qualify as charity care. St. Michael's Hospital, Inc. Part V, Section B, Line 13g: Staff discuss the availability of its charity care policy with patients upon admission. Notice is also included in payment reminder letters. St. Michael's Hospital, Inc. Part V, Section B, Line 19d: All patients are charged gross charges initially. As of year end, a policy had not been approved by management to determine the amounts generally billed discount under the Prospective or Look-back Method.The Hospital is in the process of updating policies and procedures to meet the provisions of the new 501(r). They will be using the proposed regulations as a guideline for making changes to current policies. St. Michael's Hospital, Inc. Part V, Section B, Line 20: The Hospital is in the process of updating policies and procedures to meet the provisions of the new 501(r). They will be using the proposed regulations as a guideline for making changes to current policies. St. Michael's Hospital, Inc. Part V, Section B, Line 21: The Hospital is in the process of updating policies and procedures to meet the provisions of the new 501(r). They will be using the proposed regulations as a guideline for making changes to current policies. Part VI, Line 2: The South Dakota Department of Health's Rural Health office conducted a Community Assessment for Bon Homme County with a special focus on the needs of the communities of Tyndall and Avon. SMH utilized this data in determining services needed.The Community Assessment compiled by the South Dakota Office of Rural Health for Bon Homme County identified a high health status indicator for diabetes mellitus (41.6 compared to 25.0 in the entire state of South Dakota and 24.4 in the United States). SMH has established a diabetes education program that has been awarded Education Recognition by the American Diabetes Association. This education is provided by an interdisciplinary team which includes a dietitian and nurses with specialized training. The program is available to all persons, and is designed to provide a benefit to the community.The Medical Staff of SMH, in working with the activity directors and coaching staffs of our local schools, also identified a concern for safety for athletes who have suffered a concussion and the need for a consistent process to determine when it is safe for the child to resume participation. In response to that need, SMH now provides an Impact program to high school students who participate in athletic programs in Tyndall and in Avon. The Impact program is funded totally by SMH and is provided free of charge to the students. It provides a baseline which can be used to assist in the determination for safe return to play after a concussion occurs. Part VI, Line 3: The SMH staff assists patients who may be eligible for financial assistance by discussing the availability of various government benefits, such as Medicaid or state programs, and assisting the patient with qualification for such programs where applicable. The programs are discussed at the time of admission and by patient request. Posters highlighting various assistance options (i.e. All Women Count) are posted in the admission area. SMH staff also discuss the availability of its charity care policy with patients upon admission. Part VI, Line 4: SMH serves a rural population in Bon Homme County which includes the cities of Tyndall, Avon, Tabor, and Springfield. There is one other hospital in Bon Homme County located in Scotland.The 2011 census for Bon Homme County reported 6,983 people with 12.1% of the population at 100% poverty or below. 19% of Bon Homme County's population is age 65 or older (compared to 14.4% in the state of South Dakota). Part VI, Line 5: The majority of SMH's governing body is comprised of persons who reside in Bon Homme County who are neither employees nor contractors of the organization, nor family members thereof. The organization extends medical staff privileges to all qualified physicians in its community for some or all of its departments. SMH applies surplus funds to improvements in patient care and provides readily accessible health care to the people of Bon Homme County and the surrounding area.SMH provides a variety of community benefit health activities at no cost or less than cost. These activities include wellness programs, diabetes education, foot clinics, CPR classes, and blood pressure screenings. A variety of programs are provided at no charge for the children in our communities such as the Impact concussion program, flu shot clinics, and athletic screenings. SMH also provides athletic physicals for students at a discounted rate. SMH provides a nurse on an as needed basis for ambulance transfers at no cost to the local ambulance service. Approximately 2,016 clients were served during the fiscal year ended 6/30/2012. SMH provided financial and in kind donations for various community needs such as meeting room availability, medical staff coverage at local sporting events, supplies for local blood drive and health education, along with Health Profession education for nursing and physical therapy students.SMH provides emergency services 24-hours a day, 7-days a week. In addition to nursing staff, a midlevel provider and/or physician are in house or on call at all times to provide care to anyone presenting with an emergent condition, regardless of their ability to pay. For fiscal year ended 6/30/2012, there were 586 patients who received emergency care at SMH.SMH has also made available e-Emergency services through an arrangement with Avera Health whereby emergency physicians and other specialists are available via videoconferencing to assist the medical staff and nurses with patients presenting to the SMH emergency room. The e-Emergency services are provided at no cost to the patient. 80 patients benefited from the e-Emergency services during fiscal year ended 6/30/2012. Part VI, Line 6: SMH is a managed facility of Avera Health. Avera Health and the Hospital work cooperatively to enhance healthcare throughout the community served by the Hospital. As a managed facility, SMH is able to participate in Avera e-CARE services. These services include Avera e-ICU, e-Emergency, e-Pharmacy and e-Consult. These services allow rural patients to be cared for at their local hospitals, provide rural hospitals access to immediate specialty care and support, and help reduce health care costs and travel.SMH also has access to "back office" support services, such as legal consultation, quality benchmarking, coding, computer services, contract negotiations, administrative consultation, group purchasing, human resource assistance and many other services. Avera Health is able to provide these services to SMH at a cost below that which the Hospital could otherwise achieve. In turn, local caregivers are able to devote more resources to patient and resident care. Avera Health and SMH dedicate resources to endeavors that make a positive difference to improve the health of the communities they serve. These activities include leadership development and training for community members, economic development, physical improvements in the community, contributions to nonprofit community organizations, nonprofit event sponsorships, donated medical supplies, community health education and support groups, health screenings, flu-shot clinics, community health education and various other activities. X X 0 0 0 1 0 0 0 0 0 Carol Deurmier 119311 0 0 0 964 0 5383 0 17489 0 143147 0 0 0 Dr Melvin Wallinga 165316 0 0 0 774 0 6985 0 13522 0 186597 0 0 0 Dr Jill Kruse 164330 0 0 0 33266 0 8271 0 13522 0 219389 0 0 0 Part I, Line 5 Dr. Wallinga is paid based on production. Supplemental Information Part III Form 990, Part VII, Section A, Line 5 & Form 990, Schedule J, Part II: Carol Deurmier, CEO, is compensated by Avera Sacred Heart Hospital, 501 Summit, Yankton, SD 57078. Form 990, Part VI, Section A, line 3 St. Michael's Hospital has a Partners in Health management agreement with Avera Sacred Heart Hospital. Form 990, Part VI, Section A, line 8b The Board of Director committees are advisory in nature only and do not have authority to act on behalf of the governing body. Form 990, Part VI, Section B, line 11 The CEO and CFO review the 990. The 990 is then provided to each board member for their review prior to the actual filing of the 990. Form 990, Part VI, Section B, line 12c St. Michael's Hospital Conflict of Interest Policy covers any director/trustee, officer, member of a committee with Board-delegated powers, member of management who has a direct or indirect financial interest, CEO and CFO as well as their family members. SMH requires any director/trustee, Board committee member, officer and member of management to disclose the existence of a financial interest, other actual or possible conflict of interest and all material facts annually by completing a disclosure statement; and if a conflict of interest arises after the completion of the annual disclosure, at the time the new conflict arises. The Board of Directors makes the determination as to whether a conflict of interest exists. The Board of Directors addresses conflict of interests via a formalized procedure. This procedure may include a presentation by the interested person, but excludes the interested person from further discussion or voting on the transaction or arrangement that may constitute a conflict of interest. The Board of Directors also include a standing agenda item at the beginning of each meeting which requires the disclosure of potential conflict of interest for any items included on the agenda. Form 990, Part VI, Section B, line 15 Compensation for the CEO is determined by SMH's Board of Directors. This compensation process includes an annual performance review and comparability data. The CEO determines the compensation for other members of management including the CFO based on an annual performance appraisal and use of comparability data. Form 990, Part VI, Section C, line 19 The documents are not available to the public. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: Net unrealized losses on investments: -66,640.