2013-08-12T06:59:40-05:00 2012-09-30 010494526 BAKER NEWMAN & NOYES BOX 507 PORTLAND ME 04112 990 2011-10-01 030177161 Carlos G Otis Health Care Center CARL 8023657920 PO Box 216 Townshend VT 053530216 Stephen A Brown 8023657920 2013-08-08 1 Timothy R Hepburn CPA P00182393 2078792100 2013-08-08 2011 2016-02-24 21:20:13Z Jeffrey White PO Box 216 Townshend VT 053530216 24020143 0 X www.gracecottage.org X 1949 VT Provision of health care services 11 9 218 111 0 0 750710 811781 18985022 22879619 -954 -12989 334281 323244 20069059 24001655 50000 0 0 0 12296999 13340068 0 0 245733 8209644 8347554 20556643 21687622 -487584 2314033 12689832 17706645 5767927 7891445 6921905 9815200 The Otis Health Care Center promotes excellence in healthcare and well being, putting people first. It aims to be the standard for patient care. 0 0 19380430 0 23202863 Grace Cottage Hospital is a critical access hospital offering 24-hour emergency services, inpatient acute and skilled care, 24 hour diagnostic imaging services, a full-service laboratory, a pharmacy, a variety of outpatient medical care services, including physical therapy, occupational therapy, and speech therapy, and a rural health clinic providing primary care and psychiatric services. 19380430 1 1 0 1 0 0 0 0 0 1 1 0 0 1 0 1 0 1 0 0 0 0 0 0 0 0 1 1 0 0 1 0 0 0 0 0 1 1 0 0 0 0 0 0 1 1 0 0 0 1 15 0 1 218 1 0 0 0 0 0 0 0 0 0 0 X 11 9 1 0 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 1 0 X Stephen A Brown 8023653601 185 Grafton Road Townshend VT 05353 X Deborah Boyle 1.00 X X 0 0 0 Kathleen Ballantine 1.00 X X 0 0 0 Stephan Morse 1.00 X X 0 0 0 Kevin Meyer 1.00 X X 0 0 0 Gail Ann Fisher 1.00 X X 0 0 0 Roger Allbee 1.00 X 0 0 0 J Walter Corcoran 1.00 X 0 0 0 Edward Elliott MD 1.00 X 0 0 0 Barry Emerson 1.00 X 0 0 0 Stanley Holt 1.00 X 0 0 0 John Nopper 1.00 X 0 0 0 Timothy P Shafer MD 50.00 X 209952 0 28610 Allan Shirks 1.00 X 0 0 0 Michael L Brant 40.40 X 184163 0 26820 Stephen A Brown 46.50 X 184102 0 28209 Maurice Geurts MD 50.00 X 262704 0 29270 Moss J Linder MD 42.00 X 208431 0 26651 Evan Ginsberg 43.00 X 201395 0 22112 James Heal 39.70 X 136820 0 26201 Richard Meyer 42.00 X 146579 0 13262 1534146 0 201135 17 0 1 0 Cerner Corporation PO Box 412702 Kansas City MO 64141 Computer hardware/software/support 920417 Brunelle & Son Construction 416 Tucker Reed Road East Dummerston VT 05346 Building Construction/renovation 243328 CPSI PO Box 850309 Mobile AL 366850309 Computer hardware/software/support 116667 Brattleboro Retreat PO Box 803 Brattleboro VT 05302 Contracted Psychiatrist 115797 4 777358 34423 811781 Patient service revenu 900099 16673727 16673727 Pharmacy revenue 900099 3854147 3854147 Meaningful use revenue 900099 2351745 2351745 22879619 623 623 4876 18488 -13612 -13612 -13612 GCF administration & o 900099 235595 235595 Miscellaneous revenue 900099 87649 87649 323244 24001655 23202863 0 -12989 702021 283923 418098 9772570 8965031 722716 84823 162100 150694 6627 4779 1997150 1720325 163922 112903 706227 621431 69475 15321 18720 18720 93238 93238 318409 266576 51833 120540 8883 111498 159 578809 451371 115823 11615 551803 430330 120863 610 318215 302598 8417 7200 118876 95234 16045 7597 136072 115661 20411 957129 953108 4021 237688 201536 35653 499 Medical supplies & lab 3193592 3193592 Provision for bad debts 735648 735648 Medicaid tax 625404 625404 Equipment repair expens 222952 222952 120459 36133 84099 227 21687622 19380430 2061459 245733 251107 59804 122754 38102 1574273 2259928 22295 7021 769304 983595 150364 103272 13978333 7840384 5012843 6137949 4786892 8116974 12689832 17706645 1971996 2398201 1530000 1425000 2265931 4068244 5767927 7891445 X 4285101 7206493 482676 254035 2154128 2354672 6921905 9815200 12689832 17706645 X 2314033 579262 X X 0 1 1 X 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 0 0 0 0 0 0 0 1 5067 5067 0 Explanation of Lobbying Activities: Part II-B, Line 1: Carlos G. Otis Health Care Center is a member of the Vermont Association of Hospitals and Health Systems and the American Hospital Association. A portion of the dues paid to these organizations is available for lobbying expenditures on behalf of Carlos G. Otis Health Care Center in furtherance of its exempt purpose. Carlos G. Otis Health Care Center does not directly perform any lobbying activities. AHA, portion of dues available for lobbying: $526 VAHHS, portion of dues available for lobbying: $4,541 2636804 1267 99915 129279 2608707 2443026 186971 25839 19032 2636804 2298260 104897 39869 2443026 2513056 24191 -75026 163961 2298260 0.08060 0.90260 0.01680 0 1 1 30549 30549 6109445 3771287 2338158 7407124 3987757 3419367 431215 81340 349875 6137949 Deferred financing costs & bond fees, net 40207 Estimated third-party payor settlements 560814 Beneficial interest in net assets of GCF 5106125 Bond interest reserve 58083 Meaningful use receivable 2351745 8116974 24001655 21687622 2314033 579262 579262 2893295 23266007 0 23266007 735648 735648 24001655 20951974 0 20951974 735648 735648 21687622 Description of Intended Use of Endowment Funds: Part V, Line 4: Assist in the provision of health care. Description of Uncertain Tax Positions Under FIN 48: Part X: The verbatim paragraph pertaining to FIN 48 in the consolidated audited financial statements for Carlos G. Otis Health Care Center, Inc. and Subsidiary ("The Organization") is as follows: OHCC and the Foundation are tax-exempt corporations as described in Section 501(c)(3) of the Internal Revenue Code and are exempt from federal income taxes on related income pursuant to Section 501(a) of the Internal Revenue Code. In addition, the Foundation qualifies for the charitable contribution deduction under Section 170(b)(1)(a) and had been classified as an organization that is not a private foundation under Section 509(a)(2). Management evaluated the Organization's tax positions and concluded the Organization has maintained its tax-exempt status, does not have any significant unrelated business income and had taken no uncertain tax positions that require adjustment to or disclosure in the accompanying consolidated financial statements. With few exceptions, the Organization is no longer subject to income tax examination by the U.S. federal or state tax authorities for years before 2009. Part XI, Line 8 - Other Adjustments: Increase in beneficial interest & unrestricted net assets of GCF 579,262. Part XII, Line 4b - Other Adjustments: Bad debt provision 735,648. Part XIII, Line 4b - Other Adjustments: Bad debt provision 735,648. 1 1 1 X 1 X 1 1 1 0 1 1 305477 305477 0.01460 3028449 1280041 1748408 0.08340 3333926 1280041 2053885 0.09800 112323 19029 93294 0.00450 75247 75247 0.00360 187570 19029 168541 0.00810 3521496 1299070 2222426 0.10610 1 628688 52237 10306172 9868026 438146 X 1 0 1 1 Grace Cottage Hospital

185 Grafton Road Townshend VT 05353

X X X X Grace Cottage Hospital 1 1 X X X X X X X X 12 1 1 1 X X X 0 1 1 100.000000000000 1 200.000000000000 1 X 1 1 X X 0 0 1 X 0 1 2 Messenger Valley Pharmacy

170 Grafton Road Townshend VT 05353

Pharmacy Grace Cottage Family Health

185 Grafton Road Townshend VT 05353

Rural health clinic Part I, Line 3c: N/A Part I, Line 6a: N/A Part I, Line 7: The amounts reported for Charity Care and Means-Tested Government Programs were calculated using a cost-to-charge ratio derived from Worksheet 2, Ratio of Patient Care Cost-to-Charges. Part I, Line 7g: N/A Part I, Line 7, Column (f): The Bad Debt expense included on Form 990, Part IX, Line 25, Column (A), but subtracted for purposes of calculating the percentage in this column is $ 735648. Part III, Line 4: The cost of the Bad Debt expense reported on line 2 was calculated by applying the Ratio of Patient Care Cost-to-Charges (calculated on Worksheet 2) to the total Bad Debt expense. The amount of Bad Debt expense for accounts written off as bad debt is the account balance after all charity care discounts, contractual allowances, and insurance/patient payments have been applied. Any cash collected on accounts previously written off is included as an offset to bad debt expense.The amount of bad debt expense (at cost) attributable to patients eligible under our charity care policy reported on line 3 was estimated based on a review of accounts written off and identifying those that had charity care eligibility and/or Medicaid eligibility for dates of service in close proximity to the dates of service that were written off as bad debt. We feel that this estimate should actually be much higher because though we work hard to educate our patients regarding the charity care policy, including having a Resource Advocate to help them complete applications if they require assistance, many of the applications we distribute to patients are not returned. Knowing our patient population as we do, we feel it is primarily attributable to patients not wanting to share the income information. Footnote 1 to the Audited Consolidated Financial Statements of the Hospital contains the following to address bad debt: Accounts receivable are stated at the amount management expects to collect from outstanding balances. Management provides for probable uncollectible amounts through a charge to operations and a credit to the allowance for doubtful accounts based on its assessment of individual accounts and historical experience. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and a credit to accounts receivable. Part III, Line 8: Medicare allowable costs reported in the Medicare Cost Report are reported in accordance with CMS Guidelines using the cost-to-charge ratio methodology. Part III, Line 9b: N/A Grace Cottage Hospital Part V, Section B, Line 3: Grace Cottage Hospital conducts a Community Health Needs Assessment (CNHA) every three years, as required by Vermont statute. In 2012, the Community Health Needs Assessment was done collaboratively with Brattleboro Memorial Hospital (BMH) and The Brattleboro Retreat. These three healthcare organizations focused on involving as many stakeholders and community members as possible in the data collection. The three hospitals set up a steering committee made up of individuals from the State of Vermont Department of Health, Brattleboro Memorial Hospital, Grace Cottage Hospital, The Brattleboro Retreat, United Way, Agency of Human Services, Visiting Nurse Association & Hospice of VT & NH, Valley Cares, and Senior Solutions. Additionally, the participating organizations engaged a range of stakeholders through the surveys and focus groups, including health care providers, human service organizations, youth development organizations, schools and other nonprofit organizations. The activities completed to collect both the quantitative and qualitative data included: - Formation of Steering Committee composed of a multi-disciplinary group of community leaders - Seven Steering Committee formal meetings were held 10/19/11 through 7/15/12 - Focus group interviews conducted with representatives from community and health care organizations - On-line community needs survey questionnaire conducted by both GCH & BMH- Survey questionnaire distribution at Windham County public events - Provider survey of community needs (6/12) - Collection of data by the Steering Committee (11/11 - 6/12) - Collection of county data through an outside independent consultant (6/12 - 8/12) - Collaborative development of the CHNA report (7/12 - 8/12) Grace Cottage Hospital will continue to collaborate with BMH and the Brattleboro Retreat to improve outcomes on two of the identified community needs. The goals are to: - Improve mental health awareness and protocols in the community, particularly suicide prevention. - Improve community awareness of existing health and wellness programs and services to Windham County residents. Grace Cottage Hospital will address two additional needs in the assessment:- Diabetes awareness, management and education. - Transportation needs for the rural area in which we serve. Grace Cottage Hospital Part V, Section B, Line 4: The Community Health Needs Assessment 2012 was conducted with Brattleboro Memorial Hospital and The Brattleboro Retreat. Grace Cottage Hospital Part V, Section B, Line 5c: The results of the 2012 survey are available to the public on the hospital's website, www.gracecottage.org, and are also available upon request from the hospital facility. Grace Cottage Hospital Part V, Section B, Line 6i: As the survey was not completed until the end of the fiscal year, the information will be used in strategic planning during FY2013. Grace Cottage Hospital Part V, Section B, Line 7: The needs identified in the Community Health Needs Assessment finalized at the end of FY2012 will be addressed in FY2013 and implemented as part of Grace Cottage Hospital's strategic plan. Grace Cottage Hospital Part V, Section B, Line 19d: The Hospital charged standard facility rates as billed to all patient and insurers. Patients were eligible to apply for financial assistance based on policy. Grace Cottage Hospital Part V, Section B, Line 21: As stated on line 19d, all charges billed were standard facility charges. Part VI, Line 2: Grace Cottage Hospital is such a small hospital in a rural, relatively sparsely populated area, so our community leaders, patients, and members of the public are quick to inform our administrators and our medical staff about how Grace Cottage serves the healthcare needs of the public. Because of Grace Cottage's small size, we can be responsive to community requests made via our website, e-mails to members of our staff, or informal face-to-face meetings with people in the communities we serve. Part VI, Line 3: Although we are Vermont's smallest Critical Access Hospital, Grace Cottage Hospital believes that quality health care should be available to all; and that we all have a responsibility to help others in need regardless of their ability to pay. Posters and brochures detailing the availability of help with billing, public programs and charity care are posted in high traffic areas throughout the hospital, rural health clinic and pharmacy, as well as listed on the Hospital's website. The staff reaches out to patients in a variety of ways to ensure that they are aware that help is available. During FY12, the Hospital employed a Resource Advocate to help uninsured and underinsured patients locate and procure services for which they may qualify. The Resource Advocate's services were free of charge for community members between the ages of 18-64 years (those 65 and older were encouraged to contact Senior Solutions, formerly Southeastern Vermont Council on Aging, located on the hospital premises). The Hospital's Resource Advocate helped many people with a wide variety of resource issues, helping to fill out necessary forms and making connections for patients with other federal, state and local resources. This employee was expert in filling out reduced fee applications, finding sources for reduced-cost or free prescription medications, and locating other avenues of support. Part VI, Line 4: Grace Cottage Hospital plays a vital role in this rural, mountainous community. Its federal designation as a Critical Access Hospital recognizes its importance in providing health care to an otherwise medically underserved community. The Hospital's Emergency Department is especially vital to members of the community, who would otherwise have to travel many miles on winding mountainous highways to reach emergency medical care at another hospital. Grace Cottage Hospital is located in Windham County, in southeastern Vermont. According to the U.S. Census Bureau, Windham County has an estimated total of 44,513 residents. Grace Cottage Hospital's patient base is approximately 26,000 residents, mostly from 21 surrounding towns. The median household income of Windham County, Vermont, is $46,912, below the national average of $50,221 (U.S. Census Bureau "Quick Facts," updated 6-3-11). Income statistics for the total population served by Grace Cottage Hospital are not available because Grace Cottage only requires income information from patients requesting reduced fees or free care. Part VI, Line 5: Grace Cottage Hospital is a Critical Access Hospital located in rural, mountainous Townshend, Vermont. The Hospital is served by a Board of Trustees consisting of local citizens active in community businesses and organizations. Only one of the eleven trustees, a physician, is a hospital employee. All trustees reside in the Hospital's service area and bring a wealth of community input to the Hospital's strategic planning process. The Hospital extends medical staff privileges to all qualified physicians in the community.Grace Cottage Hospital applies any surplus funds towards improving its ability to provide quality patient care and being an integral part of assuring the health and well-being of the communities we serve. Despite its small size, Grace Cottage Hospital is committed to giving back to the community to the greatest extent possible. Area non-profit organizations providing health-related and emergency preparedness-related services to the community are provided with meeting and training space at the Hospital. In response to the last Community Health Needs Assessment, the Hospital has worked collaboratively with local schools and organizations to promote healthy, fun activities and provides opportunities that make the most of staying as healthy as possible. Community Wellness: In 2012, 525 people attended activities in the Community Wellness Center at Grace Cottage Hospital, with a total of 5,313 wellness visits. In 2012, wellness activities included: Arthritis Support, Meditation Circle, Strong Bones, Tobacco/Smoking Cessation Classes, Weight Control Programs, Yoga, and Zumba. For the first time ever, Grace Cottage Hospital employees collaborated with Brattleboro Memorial Hospital and The Brattleboro Retreat to organize and implement a Community Health Festival. Over 40 area non-profit organizations and more than 200 members of the community attended the Health Festival on September 21, 2012. In addition, Brattleboro Memorial Hospital, The Brattleboro Retreat, and Grace Cottage Hospital collaborated on a Wellness in Windham website and Health Education calendar. Grace Cottage employees also assisted in coordinating a community blood drive in Newfane, Vermont, in conjunction with the American Red Cross.Grace Cottage Hospital plays a pivotal role in Emergency/Disaster Preparedness in this rural, mountainous area of Windham County, Vermont. The Hospital works collaboratively with:- the local town volunteer fire and first responder rescue departments; - the regional ambulance service, Rescue Inc.;- Windham County Regional Commission - the Local Emergency Planning Committee covering the towns that Grace Cottage serves;- The local Citizens Emergency Response Team (CERT); - The local Radio Amateur Civil Emergency Service (RACES) - West River Radio Club meets and stores equipment at Grace Cottage Hospital; - Vermont Association of Hospitals and Health Systems; - Vermont Department of Health. Grace Cottage Hospital houses the local non-profit transport ambulance service, Rescue Inc., free of charge, on the Hospital grounds. Rescue Inc. is based in Brattleboro, VT, 18 miles away; the branch that is located at Grace Cottage 24 hours a day, 365 days a year, is known as Rescue Inc. Division Two. In 2012, this area had 521 Emergency Calls to 9-1-1; of these calls, 228 patients were transported to Grace Cottage Hospital's Emergency Department. Grace Cottage Hospital staff participates in onsite training for disaster preparedness as well as offsite training with other hospitals. Part VI, Line 6: N/A Reports Filed With States Part VI, Line 7 VT X X 0 0 0 0 0 0 0 1 0 Timothy P Shafer MD 200560 0 6000 0 3392 0 5924 0 22686 0 238562 0 0 0 Michael L Brant 181308 0 0 0 2855 0 5525 0 21295 0 210983 0 0 0 Stephen A Brown 167504 0 0 0 16598 0 5523 0 22686 0 212311 0 0 0 Maurice Geurts MD 209923 0 50089 0 2692 0 6584 0 22686 0 291974 0 0 0 Moss J Linder MD 158375 0 47099 0 2957 0 3965 0 22686 0 235082 0 0 0 Evan Ginsberg 200000 0 0 0 1395 0 0 0 22112 0 223507 0 0 0 James Heal 134664 0 0 0 2156 0 3515 0 22686 0 163021 0 0 0 Richard Meyer 145184 0 0 0 1395 0 0 0 13262 0 159841 0 0 0 Part I, Line 7 Physician contracts are being re-written at renewal to be productivity based. Contracts provide the opportunity for physicians to receive additional payments for productivity above minimum thresholds. For the period reported, three physicians listed in Part VII were under such a contract: Dr. Maurice Geurts, Dr. Moss Linder, and Dr. Timothy Shafer, who received incentive compensation payments of $50,089, $47,099, and $6,000 respectively. Edward Elliott MD Trustee who is also President of Windham Radiology Associates, Inc. 10876 Windham Radiology Associates, Inc. was reimbursed a total of $10,876 in the fiscal year ended 9/30/12 for the amounts they paid on OHCC'S behalf to Virtual Radiologic Corporation. 0 Laura D Brant Spouse of CEO 10008 Ms. Brant is the spouse of Michael L. Brant, who was OHCC'S CEO and listed in Part VII. Ms. Brant was compensated as an employee of OHCC as a per-diem radiology technician. The compensation paid was in accordance with OHCC'S standard employment practices and policies. 0 Form 990, Part VI, Section A, line 2 Deborah Boyle is married to Kathleen Ballantine's brother. Form 990, Part VI, Section B, line 11 A draft of the Form 990 is initially reviewed in detail by Carlos G. Otis Health Care Center's key finance employees. Thereafter, the final draft is provided to the full Board for review prior to filing with the IRS. Form 990, Part VI, Section B, line 12c A copy of the conflict of interest policy is distributed annually to the Board of Trustees and each trustee signs to confirm that they have thoroughly read, understand and agree to comply with the conflict of interest policy. Form 990, Part VI, Section B, line 15 CEO's Compensation: The CEO's compensation and benefits are reviewed, adjusted and voted on by the full board annually. The Board used external market compensation data to determine the CEO's initial compensation when hired and annually uses such data to compare OHCC's CEO compensation with that of other hospital executives in the Northeast region. The CEO is excused from Board discussion and voting on issues surrounding CEO compensation and benefits. Compensation of other hospital employees: The CEO reviews the salaries of employees annually and determines compensation based on performance and salary ranges, using regional salary range data for comparison. Form 990, Part VI, Section C, line 19 Upon request, Carlos G. Otis Health Care Center, Inc. makes its governing documents, conflict of interest policy, or financial statements available to the public. Reportable compensation for services as employee Form 990, Part VII, Section A, Column D The 2011 compensation reported for Dr. Timothy Shafer was for his services as a full-time physician. He was not compensated for his services as members of OHCC's Board of Trustees. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: Increase in beneficial interest & unrestricted net assets of GCF 579,262. Total to Form 990, Part XI, Line 5: 579,262. Audit Review Process Form 990, Part XI, Line 2C The Finance and Audit Committee oversees the audit process for the Carlos G. Otis Health Care Center, Inc. and Grace Cottage Foundation, Inc. The audit process for the financial statements did not change from the prior year. Independent accountants performed the audit for both fiscal years. Grace Cottage Foundation Inc PO Box 1 Townshend VT 05353 030343282 Solicit contributions for the funding of health care services by OHCC VT 501(c)(3) 509(a)(3) Type I 1 0 0 1 0 0 0 0 0 0 0 0 1 1 1 0 1 0 0 Grace Cottage Foundation Inc P 235595 Actual per books Grace Cottage Foundation Inc C 777358 Actual per books