2013-11-14T16:00:56-06:00 2012-12-31 990 2012-01-01 562098809 NMG SERVICES INC F/K/A ROWAN MEDICAL PRACTICES INC NMGS 3367182803 2085 FRONTIS PLAZA BLVD WINSTON SALEM NC 27103 FRED HARGETT 3367182803 2013-11-14 2012 2016-02-25 16:41:14Z CLEGGPHIPPSLANGFORD 2085 FRONTIS PLAZA BLVD WINSTON SALEM NC 27103 34897702 0 X N/A X 1998 NC SEE SCHEDULE O 6 4 156 6 0 0 0 0 25847069 34744888 5434 -12703 165687 152634 26018190 34884819 0 1000 0 0 8210358 13104639 0 0 0 19291375 25096103 27501733 38201742 -1483543 -3316923 45762750 41328305 47363761 46303370 -1601011 -4975065 X SEE SCHEDULE O 0 0 22148551 1000 20081249 NMG SERVICES, INC. OFFERS PHYSICIAN SERVICES TO THE COMMUNITY AT SEVERAL LOCATIONS. NMG SERVICES, INC. PROVIDED 89,502 OUTPATIENT ENCOUNTERS DURING 2012. THE ORGANIZATION'S OPERATIONS SERVE THE COMMUNITY BY PROVIDING ACCESS TO MUCH NEEDED HEALTHCARE SERVICES, REGARDLESS OF THE PATIENT'S ABILITY TO PAY. 14814333 14814333 NMG SERVICES, INC., A SUBSIDIARY OF NOVANT HEALTH, INC., OWNS AND OPERATES THE NOVANT HEALTH SYSTEM'S AMBULATORY ELECTRONIC MEDICAL RECORD INITIATIVE. 36962884 1 0 0 1 0 0 0 0 0 0 1 0 0 0 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 1 1 1 1 0 0 1 0 0 156 1 0 0 0 0 0 0 0 0 0 0 X 6 4 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 0 0 1 0 0 NC X KAREN DAUGHERTY 3367182803 2085 FRONTIS PLAZA BLVD WINSTON SALEM NC 27103 X CLEGGHERBERT W 60.00 X X 0 846679 48676 BARRROBERT 2.00 X 0 0 0 BILASJAY 2.00 X X 0 0 0 GORDONROBERT 2.00 X X 0 0 0 POLLARD IIIHAROLD 2.00 X X 0 0 0 VALENTINEPEGGY 2.00 X 0 0 0 LANGFORDKATHRYN MICHELE 60.00 X 0 620399 37849 PHIPPSJOHN D 60.00 X 0 696861 51288 WALSHBETSY JEAN 2.00 X 0 275123 48748 MOOREALICE KEITH 2.00 X 0 206225 27227 BARTOLOZZIMARK A 40.00 X 422497 0 37069 HARRISCHARLES W 40.00 X 207161 0 29496 HARRISONJOHN ARTHUR 40.00 X 437693 0 30408 MAGALSKI JRJOSEPH JOHN 40.00 X 518925 1750 29690 TAGHIZADEHBEHZAD 40.00 X 440893 0 39663 2027169 2647037 380114 21 0 1 0 TEK SYSTEMS INC PO BOX 198568 ATLANTA GA 30384 IT CONSULTING 2123596 DELL MARKETING LP 7489 COLLECTIONS CENTER DR CHICAGO IL 60693 MARKETING 516001 NURSEFINDERS INC PO BOX 910738 DALLAS TX 75391 STAFFING 496564 MISSION CRITICAL TECHNOLOGY PO BOX 56346 ATLANTA GA 30343 IT SERVICES 206803 NATIONAL CAR RENTAL PO BOX 402334 ATLANTA GA 30384 CAR RENTAL SERVICE 183152 6 PHYSICIAN FEES 621110 19930555 19930555 EMR SYSTEM SUPPORT 541511 14814333 14814333 34744888 1940 0 1940 1940 1940 180 12883 -12703 -12703 -12703 MISCELLANEOUS REVENUE 900099 150694 150694 150694 34884819 34895582 0 -10763 1000 1000 11187166 11061870 125296 372429 368258 4171 966005 955186 10819 579039 572554 6485 9600 9492 108 4871 4871 1106129 1093741 12388 23326 23065 261 444413 439436 4977 10374235 10374235 1316515 1301770 14745 545395 539287 6108 3408349 3370175 38174 85821 84860 961 DRUGS 4398780 4398780 CORPORATE ALLOCATION 997043 997043 BAD DEBT 807744 807744 MEDICAL SUPPLIES 462171 462171 1111711 1099260 12451 38201742 36962884 1238858 0 10027 33439 1565186 3338862 104558 105292 47729829 9879117 44082979 37850712 45762750 41328305 129063 479004 47234698 45824366 47363761 46303370 X -1601011 -4975065 -1601011 -4975065 45762750 41328305 X -3316923 -200 -56931 X 0 1 X 1 0 X 5397488 657481 25847069 34744888 66646926 5397488 657481 25847069 34744888 66646926 0 3389640 14116382 17506022 3389640 14116382 17506022 49140904 1790 1255 1162 1940 6147 1790 1255 1162 1940 6147 164525 150694 315219 5399278 658736 26012756 34897522 66968292 0.73380 0.88500 0.00010 0.00010 X SCHEDULE A, PART IV, SUPPLEMENTAL INFORMATION: SCHEDULE A, PART III, LINE 12, EXPLANATION FOR OTHER INCOME: OTHER INCOME: $315,219 0 0 0 0 0 0 0 0 1 2516 2516 0 EXPLANATION OF LOBBYING ACTIVITIES: PART II-B, LINE 1: DUES PAID TO CERTAIN ORGANIZATIONS WHICH INCLUDE A PORTION RELATED TO LOBBYING ACTIVITIES. 2337 249 2088 8950 373 8577 16451942 5094940 11357002 31266600 4783555 26483045 37850712 0 DUE TO AFFILIATE 45824366 45824366 X DESCRIPTION OF UNCERTAIN TAX POSITIONS UNDER FIN 48: PART X, LINE 2: LIABILITY UNDER FIN 48 (ASC 740) FOOTNOTE THE AUDIT FOR NOVANT HEALTH AND ITS AFFILIATES IS PREPARED ON A CONSOLIDATED BASIS. THE COMPANY WAS REQUIRED TO EVALUATE UNCERTAIN TAX POSITIONS. THIS EVALUATION INCLUDES A QUANTIFICATION OF TAX RISK IN AREAS SUCH AS UNRELATED BUSINESS TAXABLE INCOME AND THE TAXATION OF OUR FOR-PROFIT SUBSIDIARIES. THIS EVALUATION DID NOT HAVE A MATERIAL EFFECT ON THE COMPANY'S STATEMENT OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011. X X X X X X 1 1 0 1 0 0 0 0 0 0 0 CLEGGHERBERT W 0 391669 0 288088 0 166922 0 22500 0 26176 0 895355 0 123429 LANGFORDKATHRYN MICHELE 0 353958 0 218990 0 47451 0 24161 0 13688 0 658248 0 0 PHIPPSJOHN D 0 398103 0 267770 0 30988 0 22500 0 28788 0 748149 0 0 WALSHBETSY JEAN 0 225470 0 44265 0 5388 0 21545 0 27203 0 323871 0 0 MOOREALICE KEITH 0 183823 0 21505 0 897 0 11248 0 15980 0 233453 0 0 BARTOLOZZIMARK A 283494 0 137941 0 1062 0 15000 0 22069 0 459566 0 0 0 HARRISCHARLES W 194866 0 11120 0 1175 0 12000 0 17496 0 236657 0 0 0 HARRISONJOHN ARTHUR 283996 0 153235 0 462 0 9632 0 20776 0 468101 0 0 0 MAGALSKI JRJOSEPH JOHN 307690 0 210773 0 462 1750 15000 0 14690 0 548615 1750 0 0 TAGHIZADEHBEHZAD 439795 0 0 0 1098 0 15000 0 24663 0 480556 0 0 0 PART I, LINE 1A FRINGE OR EXPENSE EXPLANATION FIRST-CLASS OR CHARTER TRAVEL: FIRST-CLASS OR CHARTER TRAVEL IS NOT A COVERED TRAVEL EXPENSE FOR EXECUTIVES; THEY ARE LIMITED TO BUSINESS OR COACH CLASS FARES COMMERCIAL FLIGHTS. HOWEVER, CHARTER TRAVEL IS AVAILABLE TO CERTAIN EXECUTIVES, BOARD MEMBERS, AND APPROVED BUSINESS PERSONNEL IN LIMITED CIRCUMSTANCES DEEMED TO INVOLVE BUSINESS NECESSITY. TRAVEL FOR COMPANIONS: COMPANIONS ARE ALLOWED ON CERTAIN CHARTER FLIGHTS PAID FOR BY THE ORGANIZATION. IN THAT CASE, THE VALUE OF THE COMPANION'S FLIGHT IS CALCULATED UNDER APPLICABLE TAX LAWS AND THAT AMOUNT IS INCLUDED IN THE EXECUTIVE'S TAXABLE INCOME AS PRESCRIBED BY THE APPLICABLE TAX LAWS. TAX INDEMNIFICATION AND GROSS-UP PAYMENTS: EXECUTIVES WHO PURCHASE SPLIT DOLLAR INSURANCE THROUGH THEIR DISCRETIONARY SPENDING ACCOUNT MAY HAVE THE ADDITIONAL INCOME TAX OWED ON THE PS-58 COSTS PAID BY THE ORGANIZATION. EXECUTIVES WHO RECEIVE TAXABLE RELOCATION INCOME MAY HAVE THE ADDITIONAL INCOME TAX OWED ON THE INCOME PAID BY THE ORGANIZATION. EXECUTIVES MAY RECEIVE AS SEVERANCE BENEFITS CASH PAYMENTS IN LIEU OF PREMIUMS PAID FOR COVERAGE OF CERTAIN GROUP BENEFITS THAT ENDED WITH THE EXECUTIVE'S TERMINATION. THE ORGANIZATION MAY PAY THE ADDITIONAL TAX OWED ON ACCOUNT OF THESE PAYMENTS. DISCRETIONARY SPENDING ACCOUNT: CERTAIN EXECUTIVES RECEIVE A DISCRETIONARY SPENDING ACCOUNT. THE DOLLAR AMOUNT IN THE ACCOUNT IS PRE-APPROVED BY THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE NOVANT HEALTH BOARD. THE ACCOUNT CAN BE USED ONLY FOR AN APPROVED LIST OF EXPENDITURES. ALL OPTIONS OTHER THAN A DEFERRED, AT-RISK, COMPENSATION OPTION ARE CONSIDERED TAXABLE AND ARE INCLUDED IN THE EXECUTIVE'S TAXABLE INCOME AS PRESCRIBED BY THE APPLICABLE TAX LAWS. HOUSING ALLOWANCE OR RESIDENCE FOR PERSONAL USE: WE PROVIDE TEMPORARY HOUSING ALLOWANCES IN CERTAIN EXECUTIVE RECRUITMENT AND RELOCATION PACKAGES. IN THE CASE THAT SUCH EXPENSE IS NOT REIMBURSABLE UNDER THE ACCOUNTABLE PLAN RULES, THE VALUE IS CALCULATED UNDER APPLICABLE TAX LAWS AND THAT AMOUNT IS INCLUDED IN THE EXECUTIVE'S INCOME AS PRESCRIBED BY THE APPLICABLE TAX LAWS. HEALTH OR SOCIAL CLUB DUES OR INITIATION FEES: IN CASES WHERE CORPORATE MEMBERSHIPS ARE NOT AVAILABLE, A MEMBERSHIP MAY BE OBTAINED IN AN EXECUTIVE'S NAME WITH A "BUSINESS USE ONLY" RESTRICTION. AT THIS TIME NOVANT HAS ONE SUCH MEMBERSHIP. PART I, LINE 3 THE FILING ORGANIZATION IS AN AFFILIATE IN AN INTEGRATED HEALTHCARE SYSTEM AND IS SUPPORTED BY A PARENT ORGANIZATION THAT USES THE PROCESS DESCRIBED IN PART VI, LINE 15A OF THIS RETURN TO ESTABLISH THE COMPENSATION OF THE TOP MANAGEMENT OFFICIAL OF THE FILING ORGANIZATION. THIS PROCESS ADHERES TO THE REQUIREMENTS SET FORTH TO SECURE THE REBUTTABLE PRESUMPTION OF REASONABLENESS AND INCLUDES A REVIEW AND APPROVAL BY INDEPENDENT AND DISINTERESTED MEMBERS OF A COMPENSATION COMMITTEE, CONSULTATION WITH INDEPENDENT COMPENSATION CONSULTANTS, THE UTILIZATION OF THIRD-PARTY COMPARABILITY DATA SUCH AS PUBLISHED COMPENSATION SURVEYS, AND CONTEMPORANEOUS SUBSTANTIATION OF THE DELIBERATION AND DECISION. PART I, LINE 4B PART I, LINE 4 - SEVERANCE, NONQUALIFIED, AND EQUITY-BASED PAYMENTS SEVERANCE NONQUALIFIED EQUITY-BASED CLEGG, HERBERT W. 0 123,429 0 SUPPLEMENTAL INFORMATION PART III PART III - OTHER ADDITIONAL INFORMATION DESCRIPTIONS OF SUPPLEMENTAL EXECUTIVE BENEFITS INCLUDED IN PART VII AND SCHEDULE J: EXECUTIVE ANNUAL INCENTIVE PLAN: AS PART OF THE REPORTED COMPENSATION AMOUNTS, THE REPORTING ORGANIZATION PROVIDES ANNUAL INCENTIVE COMPENSATION TO OFFICERS AND KEY EMPLOYEES UNDER AN EXECUTIVE ANNUAL INCENTIVE PLAN. THE INCENTIVE PLAN IS DESIGNED TO OFFER OPPORTUNITIES FOR ADDITIONAL COMPENSATION, BUT ONLY TO THE EXTENT THAT ELIGIBLE EXECUTIVES HAVE PROVIDED EXTRAORDINARY SERVICES AND ACHIEVED EXTRAORDINARY RESULTS THAT MEET OR EXCEED PREDETERMINED GOALS IN THE AREAS OF QUALITY, PATIENT SATISFACTION, EMPLOYEE SATISFACTION AND FINANCIAL VITALITY. THESE GOALS ARE ESTABLISHED AND APPROVED BY INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD). THESE GOALS ARE WEIGHTED EQUALLY. THE ADDITIONAL COMPENSATION CAN RANGE ANYWHERE FROM ZERO TO A MAXIMUM PERCENTAGE OF BASE SALARY THAT DIFFERS BY THE CLASS OF EXECUTIVE; THIS MAXIMUM PERCENTAGE RANGES FROM 30% TO 70% OF BASE SALARY. IN ADDITION, THE INDEPENDENT AND DISINTERESTED MEMBERS OF THE BOARD OF TRUSTEES WHO OVERSEE THE INCENTIVE COMPENSATION PROGRAM APPLY TWO "CIRCUIT BREAKERS," WHICH ARE SUBSTANTIAL LEVELS OF ORGANIZATION-WIDE ACHIEVEMENT THAT MUST BE SATISFIED BEFORE ANY AWARDS ARE PAID TO ANY EXECUTIVE UNDER THE PROGRAM. THE INCENTIVE COMPENSATION AWARDS HAVE BEEN INCLUDED IN THE COMPENSATION AMOUNTS REPORTED IN PART VII AND IN COLUMN (B)(II) OF SCHEDULE J. THEY ARE REPORTED IN THE YEAR PAID. INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD) REVIEW, APPROVE, AND OVERSEE ALL ASPECTS AND ALL ELEMENTS OF EXECUTIVE COMPENSATION AND BENEFITS, INCLUDING THE AMOUNTS AWARDED UNDER THIS ANNUAL INCENTIVE PLAN. LONG-TERM INCENTIVE PLAN: THE REPORTING ORGANIZATION OFFERS A LONG-TERM INCENTIVE PLAN (THE "PLAN") TO CERTAIN KEY EXECUTIVES. THE PLAN TIES A KEY EXECUTIVE'S COMPENSATION TO THE ORGANIZATION'S LONG-TERM STRATEGIC PERFORMANCE, PROVIDES A RETENTION INCENTIVE FOR KEY EXECUTIVES, AND ALLOWS THE ORGANIZATION TO COMPETE IN THE MARKETPLACE FOR TOP LEADERSHIP TALENT. THE PLAN OPERATES ON THREE-YEAR PERFORMANCE CYCLES THAT BEGIN EACH YEAR. LONG-TERM STRATEGIC GOALS (IN THE PRINCIPAL AREAS OF QUALITY OF PATIENT CARE AND LONG-TERM FINANCIAL STRENGTH) ARE ESTABLISHED AND APPROVED FOR EACH CYCLE, IN ADVANCE, BY INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD). NOVANT HEALTH'S INTERNAL AUDIT DEPARTMENT REVIEWS THE METHODOLOGY AND PROCESS USED TO DETERMINE ACHIEVEMENT OF THE QUALITY METRICS. AWARDS ARE PAYABLE FOR A PARTICULAR THREE-YEAR PERFORMANCE CYCLE ONLY IF THE REQUISITE LEVEL OF COMMUNITY BENEFIT AND CHARITY CARE, ALONG WITH THE REQUIRED LEVEL OF FINANCIAL PERFORMANCE TO DEMONSTRATE LONG-TERM FINANCIAL STRENGTH, HAVE BEEN MET FOR THAT RESPECTIVE THREE-YEAR PERFORMANCE PERIOD. IF AN AWARD IS EARNED AT THE END OF A PERFORMANCE CYCLE, THEN THE INCENTIVE AWARD IS PAID OUT AND IS INCLUDED IN THE COMPENSATION AMOUNTS REPORTED IN PART VII AND IN COLUMN (B)(II) OF SCHEDULE J. THEY ARE REPORTED IN THE YEAR PAID. INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD) REVIEW, APPROVE, AND OVERSEE ALL ASPECTS AND ALL ELEMENTS OF EXECUTIVE COMPENSATION AND BENEFITS, INCLUDING THE AMOUNTS AWARDED UNDER THE PLAN. SCHEDULE J PART I LINE 4A - SEVERANCE PLAN: ELIGIBLE EXECUTIVES MAY RECEIVE SEVERANCE PAY THAT IS A SPECIFIED MULTIPLE OF ANNUAL COMPENSATION. THE SEVERANCE PAY WOULD BE PAID ONLY IN THE EVENT OF CERTAIN TYPES OF EMPLOYMENT TERMINATION, AND IS FURTHER CONTINGENT ON THE SATISFACTION OF OTHER CONDITIONS SUCH AS COMPLIANCE WITH A NON-COMPETITION COVENANT. ANY CURRENT YEAR PAYMENTS HAVE BEEN INCLUDED IN THE COMPENSATION AMOUNTS REPORTED IN PART VII AND IN COLUMN (B)(III) OF SCHEDULE J. INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD) REVIEW, APPROVE, AND OVERSEE ALL ASPECTS AND ALL ELEMENTS OF EXECUTIVE COMPENSATION AND BENEFITS, INCLUDING THE AMOUNTS AWARDED UNDER THIS SEVERANCE PLAN. SCHEDULE J PART I LINE 4B - SUPPLEMENTAL NONQUALIFIED RETIREMENT PLANS: THE SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN ("SERP") IS INTENDED TO SUPPORT RETENTION OF KEY EXECUTIVES, AND TO OFFER COMPETITIVE TOTAL COMPENSATION. THESE SERP BENEFITS ARE CALCULATED WITH REFERENCE TO A FORMULA THAT TAKES INTO CONSIDERATION THE EXECUTIVE'S TOTAL YEARS OF SERVICE WITH THE ORGANIZATION AND OTHER RETIREMENT INCOME. THESE BENEFITS ARE FULLY AT RISK AND WILL NOT BE PAID UNLESS THE EXECUTIVE PROVIDES SUBSTANTIAL FUTURE SERVICES TO THE ORGANIZATION. UNTIL THOSE REQUIREMENTS ARE SATISFIED, IF EVER, THE EXECUTIVE IS NOT ENTITLED TO ANY SERP BENEFIT. IF THE EXECUTIVE WERE TO HAVE LEFT THE ORGANIZATION VOLUNTARILY DURING THE YEAR FOR WHICH THESE AMOUNTS ARE BEING REPORTED (BEFORE REACHING BOTH AGE 55 AND HAVING FIVE YEARS OF SERVICE WITH THE ORGANIZATION), THE EXECUTIVE'S SERP BENEFIT WOULD HAVE BEEN ENTIRELY FORFEITED. THE SERP BENEFIT IS REDUCED AT THE RATE OF 2 PERCENTAGE POINTS PER YEAR FOR PAYMENTS RECEIVED BETWEEN THE AGES OF 55 AND 62. CURRENT YEAR PAYMENTS OF SERP BENEFITS HAVE BEEN INCLUDED IN THE COMPENSATION AMOUNTS REPORTED IN PART VII AND IN COLUMN (B)(III) OF SCHEDULE J. AN ESTIMATE OF THE ANNUAL INCREASE IN ACTUARIAL VALUE IS REPORTED AS DEFERRED COMPENSATION IN PART VII AND IN COLUMN (C) OF SCHEDULE J FOR ELIGIBLE EXECUTIVES. INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD) REVIEW, APPROVE, AND OVERSEE ALL ASPECTS AND ALL ELEMENTS OF EXECUTIVE COMPENSATION AND BENEFITS, INCLUDING THE AMOUNTS AWARDED UNDER THIS SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN. ACTIVITIES FORM 990, PART I, LINE 1: ORGANIZATION'S MISSION OR MOST SIGNIFICANT NMG SERVICES, INC. IS AN INTEGRAL PART OF THE NOVANT HEALTH SYSTEM (COLLECTIVELY KNOWN AS "NOVANT HEALTH"), A NOT-FOR-PROFIT INTEGRATED GROUP OF HOSPITALS, PHYSICIAN CLINICS, OUTPATIENT CENTERS AND OTHER HEALTHCARE SERVICE PROVIDERS. NOVANT HEALTH IS RANKED AS ONE OF OUR NATION'S TOP 25 INTEGRATED HEALTHCARE SYSTEMS CARING FOR PATIENTS AND COMMUNITIES IN NORTH CAROLINA, VIRGINIA AND SOUTH CAROLINA. THE NOVANT HEALTH SYSTEM REPORTED $3.555 BILLION IN REVENUES IN 2012. NMG SERVICES, INC. IS A SUBSIDIARY OF NOVANT HEALTH, INC. AND ENGAGES IN A VARIETY OF PHYSICIAN BASED SERVICES INCLUDING THE OWNERSHIP AND IMPLEMENTATION OF THE SYSTEM'S AMBULATORY ELECTRONIC HEALTH RECORD (EHR) INITIATIVE. A CONCURRENT EHR INITIATIVE IS BEING UNDERTAKEN BY THE HOSPITAL FACILITIES IN THE SYSTEM. SOON NOVANT CLINICIANS WILL BE ABLE TO SHARE PATIENTS' MEDICAL INFORMATION BETWEEN PHYSICIAN OFFICES, OUTPATIENT CENTERS AND HOSPITALS. THIS SHARING OF INFORMATION WILL IMPROVE SAFETY AND COORDINATION OF CARE, AS WELL AS PROMOTE CONNECTIVITY AND COMMUNICATION BETWEEN HOSPITAL CAREGIVERS, SPECIALISTS AND PRIMARY CARE PROVIDERS. EMBARKING ON THE JOURNEY TO CREATE A SHARED EHR IS THE MOST SIGNIFICANT AND IMPORTANT INVESTMENT NOVANT HAS EVER MADE FOR ITS PATIENTS, STAFF AND PHYSICIANS. COMMUNITY BENEFIT REPORT: HTTP://WWW.NOVANTHEALTH.ORG/GIVEBACK/COMMUNITYBENEFITREPORT.ASPX THE COMMUNITY BENEFIT REPORT PREPARED BY NOVANT HEALTH IS A SYSTEM-WIDE REPORT THAT INCLUDES QUALITATIVE AND QUANTITATIVE INFORMATION. IN THIS REPORT, THE NOVANT HEALTH SYSTEM'S COMMUNITY BENEFIT WAS APPROXIMATELY $546,000,000 IN 2012. PLEASE NOTE THAT THE NUMERIC DATA IN THIS REPORT IS NOT BASED UPON THE FORM 990, SCHEDULE H CRITERIA, BUT RATHER IT HAS BEEN PREPARED IN ACCORDANCE WITH THE NORTH CAROLINA HOSPITAL ASSOCIATION REPORTING GUIDELINES. IT SHOULD NOT BE RELIED UPON AS THE ORGANIZATION'S FORM 990, SCHEDULE H COMMUNITY BENEFIT REPORT. FORM 990, PART III, LINE 1: MISSION, VISION, AND VALUES MISSION: NOVANT HEALTH EXISTS TO IMPROVE THE HEALTH OF COMMUNITIES, ONE PERSON AT A TIME. VISION: WE, THE EMPLOYEES OF NOVANT AND OUR PHYSICIAN PARTNERS, WILL DELIVER THE MOST REMARKABLE PATIENT EXPERIENCE, IN EVERY DIMENSION, EVERY TIME. VALUES: COMPASSION: WE TREAT OUR CUSTOMERS AND THEIR FAMILIES, STAFF AND OTHER HEALTHCARE PROVIDERS AS FAMILY MEMBERS BY SHOWING THEM KINDNESS, PATIENCE, EMPATHY AND RESPECT. DIVERSITY: WE RECOGNIZE THAT EVERY PERSON IS DIFFERENT, EACH SHAPED BY UNIQUE LIFE EXPERIENCES. THIS ENABLES US TO BETTER UNDERSTAND ONE ANOTHER AND OUR CUSTOMERS. PERSONAL EXCELLENCE: WE STRIVE TO GROW PERSONALLY AND PROFESSIONALLY, AND WE APPROACH EACH SERVICE OPPORTUNITY WITH A POSITIVE, FLEXIBLE ATTITUDE. HONESTY AND PERSONAL INTEGRITY GUIDE ALL THAT WE DO. TEAMWORK: THE NEEDS AND EXPECTATIONS OF ANY ONE CUSTOMER ARE GREATER THAN THAT WHICH ONE PERSON'S SERVICE EFFORTS CAN SATISFY. WE SUPPORT EACH OTHER SO THAT TOGETHER AS A TEAM, WE CAN BE SUCCESSFUL IN THE EYE OF THE CUSTOMER AS A QUALITY SERVICE PROVIDER. FORM 990, PART I, LINE 6: THE NUMBER OF VOLUNTEERS REPORTED INCLUDES THOSE VOLUNTEERS SERVING AS BOARD MEMBERS. FORM 990, PART VI, SECTION A, LINE 6 CLASSES OF MEMBERS OR STOCKHOLDERS THE CORPORATION IS A NONPROFIT CORPORATION WITH MEMBERS (OR A MEMBER). FORM 990, PART VI, SECTION A, LINE 7A ELECTION OF MEMBERS AND THEIR RIGHTS NMG SERVICES, INC.'S DIRECTORS ARE THE SAME AS THOSE OF NOVANT MEDICAL GROUP, WHICH ARE APPOINTED BY NOVANT HEALTH, INC. FORM 990, PART VI, SECTION A, LINE 7B DECISIONS SUBJECT TO APPROVAL OF MEMBERS NOVANT MEDICAL GROUP APPROVES BYLAW AMENDMENTS. FORM 990, PART VI, SECTION B, LINE 11 ORGANIZATION'S PROCESS TO REVIEW FORM 990 THE BOARD HAS DELEGATED REVIEW OF THE FORM 990 TO NOVANT HEALTH'S AUDIT AND COMPLIANCE COMMITTEE, WHICH OVERSEES TAX MATTERS FOR NOVANT HEALTH. THE AUDIT AND COMPLIANCE COMMITTEE IS THE REVIEW BODY FOR ALL OF THE FORM 990S FILED FOR ORGANIZATIONS WITHIN THE NOVANT HEALTH SYSTEM. THE AUDIT AND COMPLIANCE COMMITTEE MEETS BEFORE THE FORM 990S ARE FILED WITH THE IRS AND AFTER ALL BOARD MEMBERS HAVE RECEIVED A COPY OF THE FORM 990 AND A SUMMARY OF ITS CONTENTS. THE SENIOR DIRECTOR OF TAX AND LEGAL COUNSEL FOR NOVANT HEALTH ATTEND THE MEETING TO ANSWER ANY QUESTIONS AND ADDRESS ANY SIGNIFICANT DISCLOSURES WITHIN THE FORM 990. FORM 990, PART VI, SECTION B, LINE 12C MONITORING AND ENFORCEMENT OF COI THE ORGANIZATION'S TRUSTEE CONFLICT OF INTEREST POLICY APPLIES TO ALL TRUSTEES, PRINCIPAL OFFICERS OR MEMBERS OF A COMMITTEE WITH BOARD DELEGATED POWERS INCLUDING ANY APPLICABLE DISREGARDED ENTITIES. ALL TRUSTEES ARE SENT AN ANNUAL DISCLOSURE FORM. ANY POSITIVE ANSWERS ON THE TRUSTEE ANNUAL DISCLOSURE FORM ARE REVIEWED BY THE GENERAL COUNSEL. IF THE RELATIONSHIP DISCLOSED IS DETERMINED NOT TO POSE A POTENTIAL CONFLICT OF INTEREST GENERALLY, THEN NO ACTION IS TAKEN. WITH RESPECT TO PARTICULAR TRANSACTIONS THAT COME BEFORE THE BOARD, THE POTENTIAL CONFLICT OF INTEREST IS DISCLOSED BY THE BOARD MEMBER, GENERALLY IN ADVANCE OF THE MEETING AT WHICH A VOTE IS TO TAKE PLACE, AND LEGAL COUNSEL DISCUSSES THE POTENTIAL CONFLICT OF INTEREST WITH THE BOARD MEMBER. THE BOARD MEMBER IS INSTRUCTED IN ACCORDANCE WITH THE TRUSTEE CONFLICT OF INTEREST POLICY. IF A CONFLICT OF INTEREST IS FOUND TO EXIST, THEN THE BOARD MEMBER WITH THE CONFLICT REFRAINS FROM PARTICIPATION IN THE BOARD'S DELIBERATIONS AND VOTE ON THE TRANSACTION. FORM 990, PART VI, SECTION B, LINE 13: WRITTEN WHISTLEBLOWER POLICY THE ORGANIZATION IS PART OF THE INTEGRATED HEALTHCARE SYSTEM OPERATED BY NOVANT HEALTH, INC. ("NOVANT HEALTH"), THE PARENT ORGANIZATION. NOVANT HEALTH'S BYLAWS AUTHORIZE IT TO ESTABLISH CERTAIN POLICIES FOR ALL OF ITS SUBSIDIARIES WITHIN THE SYSTEM. ALL SUBSIDIARY ORGANIZATIONS FOLLOW ALL APPLICABLE NOVANT HEALTH CORPORATE POLICIES IN THEIR OPERATIONS. NOVANT HEALTH HAS ESTABLISHED A WHISTLEBLOWER POLICY, WHICH ALL SUBSIDIARY ORGANIZATIONS IN THE SYSTEM FOLLOW. THE INDIVIDUAL SUBSIDIARY ORGANIZATION'S BOARD OF TRUSTEES DO NOT SPECIFICALLY ADOPT OR APPROVE EACH OPERATING POLICY, AS THERE ARE HUNDREDS OF POLICIES THAT APPLY TO ALL SUBSIDIARY ORGANIZATIONS AND THEY CANNOT PRACTICABLY BE APPROVED BY ALL OF THE INDIVIDUAL BOARDS. FORM 990, PART VI, SECTION B, LINE 14: WRITTEN DOCUMENT RETENTION AND DESTRUCTION POLICY THE ORGANIZATION IS PART OF THE INTEGRATED HEALTHCARE SYSTEM OPERATED BY NOVANT HEALTH, INC. ("NOVANT HEALTH"), THE PARENT ORGANIZATION. NOVANT HEALTH'S BYLAWS AUTHORIZE IT TO ESTABLISH CERTAIN POLICIES FOR ALL OF ITS SUBSIDIARIES WITHIN THE SYSTEM. ALL SUBSIDIARY ORGANIZATIONS FOLLOW ALL APPLICABLE NOVANT HEALTH CORPORATE POLICIES IN THEIR OPERATIONS. NOVANT HEALTH HAS ESTABLISHED A DOCUMENT RETENTION AND DESTRUCTION POLICY, WHICH ALL SUBSIDIARY ORGANIZATIONS IN THE SYSTEM FOLLOW. THE INDIVIDUAL SUBSIDIARY ORGANIZATION'S BOARD OF TRUSTEES DO NOT SPECIFICALLY ADOPT OR APPROVE EACH OPERATING POLICY, AS THERE ARE HUNDREDS OF POLICIES THAT APPLY TO ALL SUBSIDIARY ORGANIZATIONS AND THEY CANNOT PRACTICABLY BE APPROVED BY ALL OF THE INDIVIDUAL BOARDS. FORM 990, PART VI, SECTION B, LINE 15A FORM 990, PART VI, SECTION B, LINE 15A: COMPENSATION PROCESS FOR TOP OFFICIAL INDEPENDENT AND DISINTERESTED MEMBERS OF THE NOVANT HEALTH BOARD OF TRUSTEES (WHO COMPRISE THE COMPENSATION AND LEADERSHIP COMMITTEE OF THE BOARD) REVIEW, APPROVE, AND OVERSEE ALL ASPECTS OF COMPENSATION AND BENEFITS FOR CERTAIN LEADERS AND EXECUTIVES ("EXECUTIVES") SERVING RELATED OR DISREGARDED ENTITIES. THE COMMITTEE WORKS WITH AN INDEPENDENT COMPENSATION CONSULTANT, USES THIRD PARTY COMPARABILITY DATA FOR FUNCTIONALLY SIMILAR POSITIONS AT SIMILARLY SITUATED ORGANIZATIONS, AND MAKES SURE THAT TOTAL COMPENSATION AND BENEFITS FOR EACH EXECUTIVE DO NOT EXCEED FAIR MARKET VALUE WHEN COMPARED TO THE MARKET DATA FOR SIMILAR POSITIONS. THE COMMITTEE REVIEWS AND APPROVES EXECUTIVE COMPENSATION AND BENEFITS ANNUALLY, CONSISTENT WITH THE WRITTEN EXECUTIVE COMPENSATION PHILOSOPHY OF NOVANT HEALTH, AND IN A MANNER THAT QUALIFIES FOR THE REBUTTABLE PRESUMPTION OF REASONABLENESS, THEREBY ASSURING THAT TOTAL COMPENSATION AND BENEFITS PROVIDED TO EACH EXECUTIVE IS REASONABLE. THE COMMITTEE REVIEWS AND APPROVES EACH ITEM OF THE NOVANT HEALTH SYSTEM CEO'S COMPENSATION AND BENEFITS. FORM 990, PART VI, SECTION B, LINE 15B: COMPENSATION PROCESS FOR OFFICERS THE ORGANIZATION DOES NOT HAVE ANY KEY EMPLOYEES AND THE ORGANIZATION'S ONLY OFFICERS, OTHER THAN THE TOP MANAGEMENT OFFICIAL, ARE STATE LAW BOARD OFFICERS. THESE EMPLOYEES DO NOT HOLD A CORPORATE POSITION OF INFLUENCE THAT RESULTS IN REVIEW OF THEIR COMPENSATION BY THE PARENT ORGANIZATION'S COMPENSATION AND LEADERSHIP COMMITTEE, AS DESCRIBED IN LINE 15A. FORM 990, PART VI, SECTION C, LINE 19 GOVERNING DOCUMENTS DISCLOSURE THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS CONTAINING ALL ORGANIZATIONS IN THE NOVANT HEALTH SYSTEM ARE POSTED TO THE NOVANT HEALTH WEBSITE. THE GOVERNING DOCUMENTS AND CONFLICT OF INTEREST POLICY ARE NOT AVAILABLE TO THE PUBLIC. FORM 990, PART VII, SECTION A, COLUMN B: RELATED ORGANIZATIONS THE ORGANIZATION EMPLOYS CERTAIN EXECUTIVES WHOSE ROLES ARE SUCH THAT THEY PROVIDE SERVICES TO NOT ONLY THE ORGANIZATION, BUT ALSO TO SOME OR ALL OF THE OTHER TAX-EXEMPT ORGANIZATIONS WITHIN THE NOVANT HEALTHCARE SYSTEM. FOR EXAMPLE, MANY OF THESE EXECUTIVES' ROLES FOCUS ON PARTICULAR SERVICE LINES WHICH CROSS THE VARIOUS GEOGRAPHIC MARKETS OUR ORGANIZATIONS SERVE, THUS THE SERVICES PROVIDED BY THESE EXECUTIVES MAY BENEFIT AND BE RECEIVED BY MULTIPLE ORGANIZATIONS WITHIN THE SYSTEM. THE EXECUTIVES DO NOT ALLOCATE THEIR HOURS BETWEEN THE VARIOUS ORGANIZATIONS, BUT RATHER THEIR TIME SPENT ON SERVICES TO THE ORGANIZATION IS INCLUSIVE OF SERVICES TO ALL OF THE ORGANIZATIONS THEY SERVE WITHIN THE SYSTEM. CHANGES IN NET ASSETS OR FUND BALANCES: FORM 990, PART XI, LINE 9: MALPRACTICE INSURANCE -56,931. 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