2013-12-11T13:58:25-06:00 2013-01-31 990 2012-02-01 521115873 Covenant Health Care Centers Inc COVE 8474807110 2155 Pfingsten Road Northbrook IL 60062 Elizabeth Buikema 7738782294 2013-12-11 2012 2015-11-30 17:44:51Z Elizabeth Buikema c/o CRC - 5700 Old Orchard Rd Skokie IL 60077 25092565 0 2650 X www.covenantretirement.org X 1969 IL Care for senior adults. 20 16 0 250 0 0 57362 196820 23620982 23712015 1318340 1139889 39531 43841 25036215 25092565 0 0 0 0 12675018 12629129 0 0 83900 10558476 12489046 23233494 25118175 1802721 -25610 58754224 59904258 32640150 33797106 26114074 26107152 X As a ministry of the Evangelical Covenant Church, Covenant Retirement Communities celebrates God's gift of life in Christian community. We follow the Great Commandment to love and serve God and one another as taught by Jesus Christ. (SEE SCHEDULE O) 0 0 5477479 6920333 Assisted Living & Assisted Dementia: The number of persons who benefited from the services we provided for the year ended January 31, 2013 were as follows:There were a total of 119 assisted living residents at 01/31/2013 Assisted living residency for the fiscal year totaled 43,852 patient days. 14980280 16835523 Skilled Nursing & Skilled Dementia: The number of persons who benefited from the services we provided for the year ended January 31, 2013 were as follows:There were a total of 165 skilled care patients at 01/31/2013.Skilled care residency for the fiscal year totaled 58,536 patient days. 20457759 1 0 0 0 0 0 0 0 1 0 1 1 0 1 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 X 20 16 0 1 0 0 1 0 1 1 1 1 0 1 1 1 1 1 1 0 0 0 X Elizabeth Buikema 7738782294 C/O CRC 5700 Old Orchard Rd Skokie IL 60077 X Jon P Aagaard MD 1.00 1.00 X 0 0 0 Curtis B Anderson 1.00 1.00 X 0 0 0 Rev Richard B Berry 1.00 1.00 X 0 0 0 Pamela Christensen 1.00 1.00 X 0 0 0 Wendell Danielson 1.00 1.00 X 0 0 0 Rev Harvey Drake 1.00 1.00 X 0 0 0 Mark C Eastburg 1.00 1.00 X 0 0 0 James Elving 1.00 1.00 X 0 0 0 Marc E Espinosa 1.00 1.00 X 0 0 0 Carol A Findling 1.00 1.00 X 0 0 0 Lorene G Flewellen 1.00 1.00 X 0 0 0 Rhoda Friesen 1.00 1.00 X 0 0 0 Thomas F Heywood 1.00 1.00 X 0 0 0 Donald Hodgkinson 1.00 1.00 X 0 0 0 Jody Holt 1.00 1.00 X 0 0 0 Cletus J Moll 1.00 1.00 X 0 0 0 Joyce Peterson 1.00 1.00 X 0 0 0 Walter Schiller 1.00 1.00 X 0 0 0 Marlene Stante 1.00 1.00 X 0 0 0 Anne Vining 1.00 1.00 X 0 0 0 David A Dwight 1.00 40.00 X 0 581280 129403 Rick K Fisk 1.00 40.00 X X 0 594265 61092 Scott MacDonald 1.00 1.00 X 0 0 0 Gary Walter 1.00 40.00 X 0 157472 117568 Steven P Anderson 1.00 40.00 X 0 29325 12327 Elizabeth B Buikema 1.00 40.00 X 0 276556 62425 Moraine M Byrne 1.00 40.00 X 0 73352 47422 Terri S Cunliffe 1.00 40.00 X 0 266398 87577 John R Harriff 1.00 40.00 X 0 236007 10277 David G Erickson 1.00 40.00 X 0 210313 44208 Kathleen Jenkins 1.00 40.00 X 0 132856 55436 0 2557824 627735 0 0 1 0 0 196820 196820 Routine Services 623000 16043618 16043618 Medicare/Medicaid 623000 4161040 4161040 Ancillary Services 623000 3494608 3494608 Meals 623000 12749 12749 23712015 703786 703786 436103 0 436103 436103 436103 Services to Residents 623000 19222 19222 Support Services 623000 11864 11864 12755 12755 43841 25092565 23755856 0 1139889 9940748 8989807 929485 21456 398418 360154 37353 911 1529214 1357734 164374 7106 760749 651492 107800 1457 114940 114940 22621 22621 3439 3439 2145700 1932334 212809 557 4535 4535 1172593 1022291 150285 17 184036 9449 174587 521905 521905 35424 33134 2256 34 33944 5253 28691 1823826 1179286 620100 24440 1877673 1214306 638409 24958 314847 314847 Admin & General 1604001 1435097 168904 Related Party Activity 1234527 582 1230981 2964 Dining Services 840183 840183 Resident Care 386930 386930 167922 88035 79887 25118175 20457759 4576516 83900 150 150 35072 25985 1882020 2609132 31133 23421 41627450 20712586 21660341 20914864 10519169 8163933 3697711 4738405 20928628 23428368 58754224 59904258 1403982 1390305 31004450 32229468 44523 35435 187195 141898 32640150 33797106 X 26096338 26070729 17736 36423 26114074 26107152 58754224 59904258 X -25610 18688 X 0 1 X 1 0 X 168263 41394 174291 57362 196820 638130 21558929 22256292 23096597 23620982 23712015 114244815 21727192 22297686 23270888 23678344 23908835 114882945 0 0 0 114882945 905986 1355567 1295783 1318340 1139889 6015565 905986 1355567 1295783 1318340 1139889 6015565 22633178 23653253 24566671 24996684 25048724 120898510 0.95020 0.95030 0.04980 0.04970 X 0 1 X 156030 156030 37015776 18522909 18492867 4234250 2155484 2078766 221394 34193 187201 20914864 Mortgages 452936 F Domestic Equity 628676 F International Equity 999188 F Hedge Funds & Derivatives 1652989 F Private Equity 742721 F International Real Estate 261895 F 4738405 Unamortized Debt & Related Expenses 488421 Unamortized Original Issue Discount 51853 Inter-company Advance Accounts 22888094 23428368 Accrued Taxes & Employee Benefits 60498 Other Liabilities 81400 141898 X Part IV, Line 2b: Part IV, line 2b: Resident Trust Fund Account: Per state regulations, an account is made available to Skilled Nursing Facility residents wishing to deposit personal needs funds that they can access as needed. Interest is paid based on the interest received from the bank for those deposited funds and allocated among the individual trust fund accounts based on average balances. Resident Entrance Fee Account: Prospective residents pay an application fee deposit which is carried in an escrow account. At move in, the deposit is applied against the total entrance fee amount and the remainder of the money is collected and put in this account. At the end of the month the resident has moved in, all money is transferred out of the escrow account. Description of Uncertain Tax Positions Under FIN 48: Part X, Line 2: Part X, Line 2: A FIN 48 footnote was included in the consolidated audited financial statements of Covenant Retirement Communities, Inc. and affiliates which states: "Accounting principles generally accepted in the United States of America require management to evaluate tax positions taken by the Retirement Communities and recognize a tax liability if the Retirement Communities have taken an uncertain position that more likely than not would not be sustained upon examination by the IRS or other applicable taxing authorities. Management has analyzed the tax positions taken by the Retirement Communities and has concluded that as of January 31, 2013, there are no uncertain positions taken or expected to be taken that would require recognition of a liability or disclosure in the consolidated financial statements. The Retirement communities are subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Retirement Communities believe they are no longer subject to U.S. federal, state, and local, or non-U.S. income tax examinations by tax authorities for years before 2010." 1 1 0 0 0 0 0 1 0 David A Dwight 0 503155 0 0 0 78125 0 102125 0 27278 0 710683 0 0 Rick K Fisk 0 412768 0 91770 0 89727 0 38852 0 22240 0 655357 0 0 Gary Walter 0 157472 0 0 0 0 0 28402 0 89166 0 275040 0 0 Elizabeth B Buikema 0 212825 0 31980 0 31751 0 35157 0 30947 0 342660 0 0 Terri S Cunliffe 0 198566 0 32000 0 35832 0 72711 0 17477 0 356586 0 0 John R Harriff 0 47175 0 16064 0 172768 0 632 0 12256 0 248895 0 24946 David G Erickson 0 155845 0 29129 0 25339 0 23153 0 26818 0 260284 0 0 Kathleen Jenkins 0 82597 0 7500 0 42759 0 37065 0 21041 0 190962 0 11185 Part I, Line 3 See Schedule O explanation for Form 990 Part VI Section B Line 15 for the methods used to determine CEO compensation. Part I, Lines 4a-b Part I, Line 4a: John R. Harriff, an officer and Senior Vice President of Covenant Retirement Communities, Inc. (CRC) until February 2012 received $132,525 severance payment from CRC. Part I, Line 4b: Executive Benefit Plan Covenant Ministries of Benevolence (CMB) provides certain supplemental retirement benefits to its officers and key employees. These benefits are provided through a nonqualified deferred compensation plan, under which a portion of the benefits being earned are subject to a "substantial risk of forfeiture." The supplemental retirement benefits are structured to provide a retention incentive that has been determined by the Compensation Committee of CMB's Board to be of substantial value to the organization. The Committee approves all retirement benefits, together with all other forms of compensation and benefits for these and other executives, in a manner intended to qualify for the rebuttable presumption of reasonableness under the intermediate sanctions rules of federal income tax law. The following listed individuals participated in the Executive Benefit Plan: David Dwight - $78,482.61 Rick Fisk - $61,269.96 Elizabeth Buikema - $24,608.58 Steven P. Anderson - $19,987.26 John R. Harriff - $11,783.44 Terri Cunliffe - $21,899.90 David Erickson - $21,270.98 Kathleen Jenkins - $10,789.45 Moraine Byrne - $18,560.00 Part I, Line 7 Part I, Line 7: The following applies to certain individuals listed on Part VII whose compensation is paid from related organizations: The Executive Compensation Committee (the "Committee") follows a prescribed method for calculating bonuses. The calculation is based on measurable targets determined at the beginning of the year. The Committee has the ability to adjust the dollar value of the calculated awards by up to 10%. The adjustment can be an upward or downward adjustment based on various performance factors. Refer to additional information on the Committee included in Schedule O. Supplemental Information Part III Part II, Column B (i): Base compensation for certain individuals may include payments from deferred compensation plans. Part II, Column B (ii): Bonus and incentive compensation - Certain key persons employed by CRC are eligible for incentive compensation as determined by the CRC Board Compensation Committee. Incentives paid in 2012 relate to the achievement of targets for the fiscal year ended 1/31/2012. Part II, Column C: Deferred compensation includes an estimate of the contribution made to an employer sponsored defined benefit pension plan. Part II, Column D: Nontaxable benefits include health insurance premiums paid by the employer and employee. Mission Statement: Form 990 - Part III - Line 1 As a ministry of the Evangelical Covenant Church, Covenant Retirement Communities celebrate God's gift of life in Christian community. We follow the Great Commandment to love and serve God and one another as taught by Jesus Christ. That compels us to affirm the dignity of each person and to pursue excellence and financial integrity in all that we do. As we provide a broad range of resources, services and programs to enhance individual and community wellness, we collaborate with residents and families to achieve the best possible results. While seeking to foster independence, we respond to each individual's evolving needs in order to provide the security that assures peace of mind. In living out the mission, the community provides a complete continuum of care from residential living through skilled nursing. Such services are guided by a series of values and goals addressing resident needs, privacy, safety and dignity, including appropriate access to services. In carrying out the mission statement of Covenant Retirement Communities (CRC), Covenant Health Care Centers, Inc. provided $801,129 free or discounted services to those residents unable to pay all or a portion of their charges, and who meet certain eligibility requirements. Employees and Vendors Form 990 - Part V - Lines 1a & 2a Covenant Health Care Centers, Inc. (CHCC) is a combination of the assisted living and skilled nursing facilities of two continuing care retirement communities (CCRC), Covenant Home Illinois and The Holmstad, Inc. The W2's of employees and 1099-Misc for vendors that do work for CHCC are reported and issued under the FEIN of each campus. No wages or 1099's are issued under the FEIN of CHCC. There are about 735 employees working in these two campus locations and a combined total of 87 vendors were sent 1099's as of 1/31/13. Form 990, Part VI, Section A, line 3 Covenant Health Care Centers, Inc. delegated control over management duties to Covenant Retirement Communities, Inc. (CRC), its parent organization. Form 990, Part VI, Section A, line 6 The sole member is Covenant Retirement Communities, Inc. (CRC) Form 990, Part VI, Section A, line 7b S 2.4 of Bylaws include reserved powers to the [invidual] members such as appointment of president of CRC, changes to mission and strategic plan, approval of certain acquisitions, dispositions and financings, changes to articles and bylaws. Form 990, Part VI, Section B, line 11 Management Review: The draft Form 990 was reviewed by multiple levels of management including the President of CRC, the Vice President of Finance/CFO and the Vice President of Legal Affairs. Board Review: Prior to filing, key provisions of the Form were discussed with the Board of Directors at the Board meeting and the final Form 990 was provided to each Board member. Form 990, Part VI, Section B, line 12c Covenant Retirement Communities, Inc. (CRC) has an Administrative Policy on conflict of interest, identifying the parameters of a conflict of interest and the requirement to disclose any such conflict of interest. Each January, the CRC policy is distributed to CRC board members and officers. They are asked to sign acknowledging receipt of the policy and to disclose if they have any conflict of interests. If someone is absent from the meeting or fails to return the acknowledgment, there is a follow-up with the individual until the signed acknowledgment is provided. In addition to the above, a separate and more comprehensive questionnaire is sent to the board members, officers, key employees and other interested persons. The completed questionnaires are reviewed by CRC's legal counsel to determine if any actual or potential conflicts exist. If a person becomes an interested person, he or she may be considered in determining whether a quorum is present. The interested person may make a short statement relating to the transaction or arrangement in question, but shall not be present during the discussion and shall not vote on the motion addressing the actual or potential conflict. Covenant Retirement Communities' (CRC) Board of Directors has duly appointed an Executive Compensation Committee (the "Committee"), which is responsible for the review and approval of all compensation and benefits provided to CRC's executive management. The Committee has adopted a written Executive Compensation Philosophy Statement and an Executive Compensation Committee Charter governing the work and review process of the Committee. The Committee follows the procedures described in the Philosophy Statement and the Charter when it reviews and approves the compensation and employee benefits provided to the CRC's senior management. The Committee's review analyzes every element of compensation, including current and deferred compensation, and benefits, including qualified and non-qualified benefits. The Committee conducts its review and approval process at least annually, and approves compensation and benefits only to the extent that the Committee has concluded that the compensation and benefits constitute no more than reasonable compensation for each executive. The Committee consists entirely of disinterested members of the Board, and the Committee works with an independent compensation consultant to prepare and review in advance comprehensive data showing the compensation provided by similarly situated organizations for functionally similar positions. The Committee also prepares a timely and thorough written record of its deliberations and conclusions. As a result, the Committee's review process is designed to satisfy the procedural criteria necessary to qualify for the rebuttable presumption of reasonableness under the federal income tax law intermediate sanctions rules. The resources utilized by the compensation Committee include: 1) independent compensation consultant; 2) written employment contract; 3) compensation survey or study; 4) approval by the board or compensation committee. Form 990, Part VI, Section C, line 18 Form 990, Part VI, Section C, Line 18: A copy of the organization's Form 990 is available upon request by contacting the CRC accounting department at 773-878-5744. Form 990, Part VI, Section C, line 19 Form 990, Part VI, Section C, Line 19: The governing documents, conflict of interest policy and financial statements are available upon request by contacting the CRC accounting department at 773-878-5744. Contact Info for Directors & Officers Form 990 - Part VI - Line 9 All of the organization's directors and officers can be contacted at this address: Covenant Retirement Communities, Inc. - 5700 Old Orchard Road, Skokie, IL 60077. Related Organization Form 990 - Part VII - Section A Column B Officers and Directors devote approximately 1 hour per week to related organizations except for those individuals that are employees of these related organizations; those individuals devote approximately 40 hours to the organizations at which they are employed. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 9: Change in Temporarily Restricted Net Assets not included on Income Stmnt 18,688. Evangelical Covenant Church 8303 West Higgins Road Chicago IL 60631 362167730 Church IL 501(c)(3) Line 1 N/A 0 Swedish Covenant Faculty Group (SCFG) 5145 North California Avenue Chicago IL 60625 363686216 Patient Treatment/Education IL 501(c)(3) Line 11a, I Swedish Covenant Hospital 0 Swedish Covenant Hospital 5145 North California Avenue Chicago IL 60625 362179813 Hospital IL 501(c)(3) Line 3 Covenant Ministries of Benevolence 0 Swedish Covenant Hospital Foundation (SCHF) 5145 North California Avenue Chicago IL 60625 205055155 Supporting Organization of SCH IL 501(c)(3) Line 7 Swedish Covenant Hospital 0 SC Insurance Company 6970 E Chauncey Lane Suite 100 Phoenix AZ 85054 273312053 Insurance AZ 501(c)(3) Line 11a, I Swedish Covenant Hospital 0 Coast Asset Management LLC 2450 Colorado Ave Suite 100 E Tower Santa Monica CA 90404 954763400 Hedge Fund Investment CA N/A N/A 0 0 Covenant Village of Portland LP 420 NE Mason St Portland OR 97211 364356838 Assisted Living Community OR N/A N/A 0 0 Swedish Covenant Surgery LLC 5215 N California Avenue Chicago IL 60625 272485300 Outpatient Medical Services IL N/A N/A 0 0 Covenant International Insurance Company Ltd Crawford House 50 Cedar Avenue Hamilton BD Insurance BD N/A 0 Covenant Trust Company 5215 Old Orchard Road Suite 725 Skokie IL 60077 363583163 Financial Services IL N/A C 0 Swedish Covenant Management Services Inc (SCMS) 5145 North California Avenue Chicago IL 60625 364073303 Physician Practice Management IL N/A C 0 Swedish Covenant Managed Care Alliance (SCMCA) 2740 West Foster Avenue Suite 409 Chicago IL 60625 364118659 Physician - Hospital Organization IL N/A C 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 Covenant Retirement Communities Inc P 2806846 Covenant Retirement Communities Inc A 458726