2011-10-05T12:00:05-05:00 2010-12-31 CROWE HORWATH LLP 70 West Madison Street Suite 700 Chicago IL 606024903 990 2010-01-01 203238867 ALVERNO PROVENA HOSPITAL LABORATORIES INC ALVE 2199893857 2434 Interstate Plaza Drive Hammond IN 46324 SAMUEL C TERESE JR 2011-09-30 true 3128997000 2010 2016-03-07 17:11:31Z CHERYL VANCE 2434 Interstate Plaza Drive Hammond IN 46324 102419048 false X WWW.ALVERNOCLINICALLABS.ORG X 2005 IN BRINGING CHRIST'S MINISTRY TO THOSE WE SERVE THROUGH TIMELY HIGH-QUALITY LABORATORY TESTING TO OUR 25 NOT-FOR-PROFIT HOSPITALS AND AFFILIATES LOCATED THROUGHOUT ILLINOIS AND INDIANA. X 12 12 0 12 0 0 0 0 99198042 100409861 145502 428483 0 0 99343544 100838344 0 0 0 0 0 0 0 0 0 100246507 101135006 100246507 101135006 -902963 -296662 10765628 11886945 10015628 11736945 750000 150000 X BRINGING CHRIST'S MINISTRY TO THOSE WE SERVE THROUGH TIMELY HIGH-QUALITY LABORATORY TESTING TO OUR 25 NOT-FOR-PROFIT HOSPITALS AND AFFILIATES LOCATED THROUGHOUT ILLINOIS AND INDIANA. false 96251192 100409861 ALVERNO PROVENA HOSPITAL LABORATORIES, INC.'S (APHL) PRIMARY FUNCTION IS TO PROVIDE LABORATORY TESTING SERVICES TO ITS TWENTY-FIVE (25) AFFILIATED NOT-FOR-PROFIT HOSPITALS AND AFFILIATES LOCATED THROUGHOUT ILLINOIS AND INDIANA. THE ORGANIZATION MAINTAINS A STRATEGIC PLAN THAT IS STRUCTURED ON THE FOLLOWING FIVE AREAS: STEWARDSHIP, PEOPLE, SERVICE, GROWTH, AND QUALITY. (CONTINUED IN SCHEDULE O) 96251192 true false false false false false false false false true true false true true true true false false false false false false false false false false false false true false false false false false false false false false false false true false true false false false false true 22 0 true 0 false false false false false false false false false false X 12 12 false false false false true true true true true false false true true true true true true true true false IL IN X STEVEN WOJNICKI 2199893857 2434 INTERSTATE PLAZA DRIVE Hammond IN 46324 X STEVEN G WOJNICKI 32 X 0 244611 34853 MEGHAN KIEFFER 1 X 0 0 0 JOEL HOFF 1 X X 0 0 0 JOHN WALTON 1 X X 0 0 0 SAMUEL C TERESE JR 32 X 0 256881 28240 CHERYL L VANCE 32 X 0 381405 21669 THOMAS GRYZBEK 1 X X 0 0 0 BERNARD HENRY 32 X 0 197674 8162 MARSHA COOPER 32 X 0 180518 15332 ROBERT BIEDRON 1 X X 0 0 0 ROGER BARKSDALE 1 X 0 0 0 TONY FILER 1 X 0 0 0 EDWARD MOLARE 1 X 0 0 0 JOHN PETRU 40 X 0 118124 18629 CAROL ALKEMA 40 X 0 110263 16907 LYNN CHEESEMAN 40 X 0 112321 18992 DAVID DILORETO MD 1 X 0 0 0 VICKI REZAI MD 1 X 0 0 0 JOHN ORSINI 1 X 0 0 0 MARK FRITSCH MD 1 X 0 0 0 VIVIAN SARASHINSKY 40 X 0 113951 12033 ALEX WLODZIMIERSKI 40 X 0 122710 18298 0 1838458 193115 0 false true false ALVERNO CLINICAL LABORATORIES LLC 2434 INTERSTATE PLAZA DRIVE HAMMOND IN 46324 LAB & MANAGEMENT 27981419 QUEST DIAGNOSTICS 12436 COLLECTIONS CENTER DRIVE CHICAGO IL 606932436 REFERENCE LABORATORY 3364254 MAYO MEDICAL LABORATORIES PO BOX 9146 MINNEAPOLIS MN 554809146 REFERENCE LABORATORY 461130 NOW COURIER & MESSENGER INC PO BOX 6066 INDIANAPOLIS IN 462066066 COURIER SERVICES 338243 PROMETHEUS LABORATORIES INC PO BOX 7738 SAN FRANCISCO CA 94120 REFERENCE LABORATORY 239326 6 0 LAB SERVICES FOR PATRON HOSPITALS 100409861 100409861 0 0 0 0 100409861 428483 428483 0 0 0 0 0 0 0 0 0 0 1580704 1580704 0 0 0 0 0 0 100838344 100409861 0 428483 0 0 0 0 0 0 0 0 0 0 0 126539 126539 37244 37244 0 0 0 25128570 24326165 802405 0 408768 408768 85221 85221 0 0 78296 78296 0 6434 6434 526 526 0 21160 21160 358955 358955 COMPENSATION PAID BY ACL 48747813 46340597 2407216 MEDICAL SUPPLIES 14385586 14385586 REFERENCE LABORATORY 6868293 6868293 EQUIPMENT RENT & MAINTENANCE 2296833 2296833 FREIGHT 324742 324742 2260026 749616 1510410 0 101135006 96251192 4883814 0 0 4230754 4351799 186410 155155 246254 369694 854758 827239 5328 5328 888 0 4701017 5336471 0 545547 846587 10765628 11886945 6063786 6638479 3951842 5098466 10015628 11736945 X 750000 150000 750000 150000 10765628 11886945 X -296662 -303338 X false true true X false X 0 0 0 0 0 0 5328 5328 0 0 0 0 0 POOLED INVESTMENTS 5336471 F 5336471 CAPITAL LEASES, NET 0 DUE FROM PROVENA FACILITIES 2169 DUE FROM FRANCISCAN FACILITIES 844418 846587 0 DUE TO FRANCISCAN FACILITIES 2108306 DUE TO PROVENA FACILITIES 1790239 DUE TO RESURRECTION FACILITIES 124993 DUE TO ACL, LLC 194347 PENSION LIABILITY 880581 5098466 100838344 101135006 -296662 296662 -600000 -303338 -600000 102715710 296662 1580704 1877366 100838344 0 0 100838344 102715710 1580704 1580704 101135006 0 0 101135006 FIN 48 (ASC 740) footnote Schedule D, Part X, Line 2 APHL INC. HAS ESTABLISHED ITS STATUS AS AN ORGANIZATION EXEMPT FROM INCOME TAXES UNDER THE INTERNAL REVENUE CODE ("THE CODE") SECTION 501(E) AND THE LAWS OF THE STATES IN WHICH IT OPERATES. A TAX POSITION IS RECOGNIZED AS A BENEFIT ONLY IF IT IS "MORE LIKELY THAN NOT" THAT THE TAX POSITION WOULD BE SUSTAINED IN A TAX EXAMINATION, WITH A TAX EXAMINATION BEING PRESUMED TO OCCUR. THE AMOUNT RECOGNIZED IS THE LARGEST AMOUNT OF TAX BENEFIT THAT IS GREATER THAN 50% LIKELY OF BEING REALIZED ON EXAMINATION. FOR TAX POSITIONS NOT MEETING THE "MORE LIKELY THAN NOT" TEST, NO TAX BENEFIT IS RECORDED. THE COMPANY RECOGNIZES INTEREST AND PENALTIES RELATED TO UNRECOGNIZED TAX BENEFITS IN INTEREST AND INCOME TAX EXPENSE, RESPECTIVELY. THE COMPANY HAS NO AMOUNTS ACCRUED FOR INTEREST OR PENALTIES AS OF DECEMBER 31, 2010 AND 2009. DUE TO ITS TAX-EXEMPT STATUS, THE COMPANY IS NOT SUBJECT TO U.S. FEDERAL INCOME TAX OR STATE INCOME TAX. THE COMPANY DOES NOT EXPECT THE TOTAL AMOUNT OF UNRECOGNIZED TAX BENEFITS TO SIGNIFICANTLY CHANGE IN THE NEXT 12 MONTHS. Other changes in net assets Schedule D, Part XI, Line 8 DISTRIBUTION OF PATRONS' EQUITY - -600000; Other revenues in audited financial statements not in form 990 Schedule D, Part XII, Line 2d COST OF GOODS SOLD - 1580704; Other expenses in audited financial statements not in form 990 Schedule D, Part XIII, Line 2d COST OF GOODS SOLD - 1580704; X X X X false false false false false false false STEVEN G WOJNICKI 0 190031 0 39091 0 15489 0 18702 0 16151 0 279464 0 0 SAMUEL C TERESE JR 0 204421 0 44440 0 8020 0 12050 0 16190 0 285121 0 0 CHERYL L VANCE 0 284640 0 81101 0 15664 0 13475 0 8194 0 403074 0 0 BERNARD HENRY 0 156837 0 32788 0 8049 0 8162 0 0 0 205836 0 0 MARSHA COOPER 0 146204 0 27114 0 7200 0 7433 0 7899 0 195850 0 0 SCHEDULE J, PART I, LINE 3 METHODS FOR ESTABLISHING THE COMPENSATION OF CEO/EXECUTIVE DIRECTOR ALVERNO CLINICAL LABORATORIES, LLC (ACL), A RELATED ORGANIZATION, IS THE PAY AGENT FOR ALVERNO PROVENA HOSPITAL LABORATORIES, INC. (APHL). ACL USED THE FOLLOWING METHODS TO ESTABLISH COMPENSATION FOR APHL'S PRESIDENT/CEO: -COMPENSATION COMMITTEE -INDEPENDENT COMPENSATION CONSULTANT -COMPENSATION SURVEY OR STUDY -APPROVAL BY THE BOARD OR COMPENSATION COMMITTEE SEE SCHEDULE N, PART III 2010-08-25 200000 BOOK VALUE 351330472 FRANCISCAN ALLIANCE 1515 DRAGOON TRAIL MISHAWAKA IN 465444710 501(C)(3) SEE SCHEDULE N, PART III 2010-08-25 200000 BOOK VALUE 363366652 PROVENA HEALTH 9223 WEST ST FRANCIS ROAD FRANKFORT IL 604238334 501(C)(3) SEE SCHEDULE N, PART III 2010-08-25 200000 BOOK VALUE 362235165 RESURRECTION HEALTH CARE CORPORATION 7435 WEST TALCOTT AVENUE CHICAGO IL 60631 501(C)(3) false false false false DESCRIPTION OF ASSETS DISTRIBUTED SCHEDULE N, PART II, LINE 1 ALVERNO PROVENA HOSPITAL LABORATORIES, INC. (APHL) WAS FORMED ON SEPTEMBER 1, 2005 AS A COOPERATIVE JOINT VENTURE BETWEEN FRANCISCAN ALLIANCE, INC. (FRANCISCAN), FORMERLY SISTER OF ST. FRANCIS HEALTH SERVICES, INC., AND PROVENA HEALTH (PROVENA). ON JANUARY 31, 2008, RESURRECTION HEALTHCARE (RESURRECTION) JOINED APHL AS AN EQUAL PARTICIPANT. APHL IS AN INDIANA NOT-FOR-PROFIT, TAX-EXEMPT ORGANIZATION, WHICH PROVIDES LABORATORY SERVICES FOR ITS PATRON NOT-FOR-PROFIT HOSPITALS AND AFFILIATES LOCATED THROUGHOUT ILLINOIS AND INDIANA. THE AGREED-UPON INVESTMENTS IN APHL WERE CONTRIBUTED ASSETS AS DEFINED BY THE ARTICLES OF INCORPORATION FOR APHL, WHICH WERE REDEFINED EFFECTIVE JANUARY 31, 2008 WHEREBY OWNERSHIP IS EQUALLY SHARED AMONGST THE THREE PARTICIPANTS. UPON RESURRECTION JOINING APHL, EACH PATRON'S EQUITY WAS ADJUSTED TO $250,000. IN AUGUST OF 2010, APHL'S THREE PARTICIPANTS AGREED TO A DISTRIBUTION OF PATRON'S EQUITY OF $200,000 EACH. THIS ADJUSTMENT REDUCED THE PATRONS' EQUITY TO $50,000 PER PATRON. THE PATRONS AND GOVERNING BOARD HAVE THE RESERVE RIGHT TO ASSESS THESE ISSUES ANNUALLY AND TO CAPITALIZE APHL IN AGGREGATE AND AMONG MEMBER PATRONS, AS THEY DEEM APPLICABLE. THIS INCLUDES ANY FUTURE ACTIONS TO ADDRESS THE OWNERSHIP INTEREST PERCENTAGES OF THE PATRONS. EFFECTIVE JANUARY 31, 2008, THE GOVERNING BOARD IS EVENLY SPLIT FOR VOTING PURPOSES BETWEEN FRANCISCAN, PROVENA, AND RESURRECTION LEADERSHIP. PROGRAM SERVICE ACCOMPLISHMENTS FORM 990, PART III, LINE 4A APHL'S LONG TERM OBJECTIVE IS TO CONTINUE TO GROW SO AS TO PROVIDE QUALITY LABORATORY SERVICES TO OUR PATRON FAITH BASED HOSPITALS. IN SO DOING APHL'S LONG TERM OBJECTIVE IS TO CONTROL COSTS, AND TO INCREMENT THE NUMBER OF TESTS AVAILABLE, WITH A FOCUS ON HIGHLY RELIABLE SCIENTIFIC TEST RESULTS WHILE BUILDING A CULTURE OF SERVICE. APHL SEEKS TO ATTRACT A WORK FORCE DEDICATED TO SERVICE OF ITS PATIENTS. APHL'S SHORT TERM OBJECTIVES INCLUDE THE ENHANCEMENT OF THE COST MODEL TO IMPROVE THE RELATIVE VALUE UNIT THAT CAPTURES THE COMPLEXITY AND QUANTITATES THE PRODUCTION COST SO AS TO PROVIDE THE COOPERATIVE WITH AN INTEGRATED DELIVERY SYSTEM TO PROVIDE FOR PATIENT NEEDS. ON THE PRODUCTION SIDE THE USE OF LEAN CONCEPTS PROMOTES THE ELIMINATION OF WASTE AND THE EFFICIENT FLOW OF PRODUCTION. SCORECARDS ARE IN PLACE AND MONITORED FOR QUALITY INTERVENTION NEED. APPROXIMATELY 10,366 TESTS A DAY ARE PERFORMED AT THE CENTRAL LABORATORY WHILE MAINTAINING RAPID RESPONSE LABORATORIES AT EACH HOSPITAL SITE. EACH LABORATORY SITE IS INSPECTED BY CAP AND PROVIDED A CERTIFICATION IN ADDITION TO THE INTERNAL APHL QUALITY DEPARTMENT INSPECTIONS AND PROGRAMS PROMOTING EXCELLENCE IN LABORATORY SCIENCE. Classes of members or stockholders Form 990, Part VI, Section A, Line 6 THE ORGANIZATION HAS TWO CLASSES OF MEMBERS, VOTING AND NON-VOTING. THE ORGANIZATION HAS ONE CLASS OF VOTING MEMBER, REFERRED TO AS "PARTICIPANT HOSPITALS," AND ONE CLASS OF NON-VOTING MEMBERS, REFERRED TO AS "PATRON HOSPITALS." EACH "PARTICIPANT" HAS THE RIGHT TO APPOINT BOARD MEMBERS WHO HAVE THE RIGHT TO VOTE ON ALL MATTERS PRESENTED TO THE MEMBERS OF THE CORPORATION, INCLUDING THE ELECTION OF DIRECTORS. THE "PATRONS" DO NOT HAVE VOTING RIGHTS. CURRENTLY, APHL, INC. HAS THREE PARTICIPANTS AND NO PATRONS. Members or stockholders electing members of governing body Form 990, Part VI, Section A, Line 7a PARTICIPANT HOSPITAL SYSTEM REPRESENTATIVES ARE APPOINTED BY THE PARTICIPANT HOSPITAL SYSTEM OF APHL'S PARENT ORGANIZATIONS. THE PARTICIPANT HOSPITAL SYSTEM REPRESENTATIVES CAN ACT ON BEHALF OF THE PARTICIPANT HOSPITAL SYSTEM CEO ON ALL MATTERS. Decisions requiring approval by members or stockholders Form 990, Part VI, Section A, Line 7b THE PARTICIPANT HOSPITAL SYSTEMS SHALL HAVE THE EXCLUSIVE POWER TO: A) APPROVE THE ADMISSION OF ADDITIONAL PARTICIPANTS OF THE CORPORATION; B) APPOINT AND REMOVE DIRECTORS AND FILL VACANCIES ON THE BOARD OF DIRECTORS; C) APPOINT AND REMOVE THE PRESIDENT OF THE CORPORATION; D) APPROVE AMENDMENTS AND/OR RESTATEMENTS FROM TIME TO TIME TO THE ARTICLES PROPOSED BY THE BOARD OF DIRECTORS; E) APPROVE AMENDMENT OR REPEAL OF THE BYLAWS AND THE ADOPTION OF NEW BYLAWS; F) APPROVE THE SALE, LEASE, PURCHASE, EXCHANGE, OR DISPOSITION OF ALL OR SUBSTANTIALLY ALL OF THE PROPERTY AND ASSETS OF THE CORPORATION OR THE DISPOSITION OF ASSETS OF THE CORPORATION OTHER THAN IN THE ORDINARY COURSE OF BUSINESS; G) APPROVE THE VOLUNTARY DISSOLUTION OF THE CORPORATION OR THE MERGER OR CONSOLIDATION OF THE CORPORATION WITH ANOTHER CORPORATION; H) APPROVE THE PLAN FOR ALLOCATION AND DISTRIBUTION OF THE CORPORATION'S PROPERTY UPON DISSOLUTION IF NOT OTHERWISE PROVIDED FOR UNDER THE BYLAWS; I) APPROVE PARTICIPANTS' REQUIRED CAPITAL CONTRIBUTIONS TO THE CORPORATION OR DUES PAYABLE TO THE CORPORATION; J) APPROVE THE INCURRENCE OF DEBT BY THE CORPORATION IN EXCESS OF AMOUNTS DETERMINED FROM TIME TO TIME BY THE PARTICIPANTS; K) ADOPT THE ANNUAL CAPITAL AND OPERATING BUDGETS OF THE COMPANY, AND ANY MATERIAL DEVIATIONS THEREFROM, SUCH ANNUAL BUDGETS TO INCLUDE ANY PREVIOUSLY APPROVED CAPITAL CONTRIBUTIONS; L) ADOPT THE STRATEGIC PLANS FOR THE CORPORATION AND APPROVE ANY MATERIAL CHANGES TO THE SERVICES OFFERED BY THE CORPORATION WHICH ARE NOT EXPRESSLY IDENTIFIED IN THE PREVIOUSLY APPROVED STRATEGIC PLANS; M) ORGANIZE OR ACQUIRE, OR AUTHORIZE THE ORGANIZATION OR ACQUISITION OF, ANY SUBSIDIARY OR AFFILIATE OF THE CORPORATION; AND N) APPROVE ANY AMENDMENTS TO THE COOPERATIVE SERVICES AGREEMENT AMONG THE CORPORATION AND THE PARTICIPANTS, EFFECTIVE AS OF JULY 1, 2005 OR SUCH OTHER DATE AGREED UPON BY THE PARTICIPANTS. Review of form 990 by governing body Form 990, Part VI, Section B, Line 11b THE FORM 990 IS REVIEWED IN DETAIL BY THE ORGANIZATION'S MANAGEMENT. THEN A FINAL DRAFT OF THE FULL FORM 990, INCLUDING ALL APPLICABLE SCHEDULES, IS MADE AVAILABLE TO EACH MEMBER OF THE BOARD OF GOVERNANCE AT A SCHEDULED BOARD MEETING WITH OUR TAX ADVISORS PRESENT. THESE REVIEWS OCCUR PRIOR TO FILING WITH THE IRS. Conflict of interest policy Form 990, Part VI, Section B, Line 12c COVERED PERSONS: ALL MANAGEMENT PERSONNEL AND MEMBERS OF THE BOARD OF DIRECTORS ARE COVERED UNDER THE ORGANIZATION'S CONFLICT OF INTEREST POLICY. MANAGEMENT PERSONNEL INCLUDE SUPERVISORS THROUGH THE PRESIDENT/CEO OF THE ORGANIZATION. POLICY SUMMARY: THE CONFLICT OF INTEREST POLICY IS SENT OUT TO ALL COVERED PERSONS FOR REVIEW. EACH PERSON IS REQUIRED TO COMPLETE THE CONFLICT OF INTEREST QUESTIONNAIRE AND RETURN IT. IT IS THE RESPONSIBILITY OF HUMAN RESOURCES AND THE EXECUTIVE ASSISTANT TO ENSURE ALL QUESTIONNAIRES ARE RETURNED AND COMPLETED. THE COMPLETED QUESTIONNAIRES ARE FORWARDED TO THE VICE PRESIDENT OF HUMAN RESOURCES FOR REVIEW TO DETERMINE IF CONFLICTS EXIST. AN INTERESTED PERSON HAS A CONFLICT OF INTEREST WITH RESPECT TO A CONTRACT, TRANSACTION OR ARRANGEMENT IN WHICH ALVERNO PROVENA HOSPITAL LABORATORIES, INC. (APHL) IS (OR WOULD BE, IF APPROVED) A PARTY IF THE PERSON HAS, DIRECTLY OR INDIRECTLY, THROUGH A BUSINESS, INVESTMENT, FAMILY OR OTHER RELATIONSHIP: (A) AN OWNERSHIP OR INVESTMENT INTEREST IN ANY ENTITY INVOLVED IN SUCH CONTRACT, TRANSACTION OR ARRANGEMENT; (B) A COMPENSATION ARRANGEMENT WITH AN INDIVIDUAL OR ENTITY INVOLVED IN SUCH CONTRACT, TRANSACTION OR ARRANGEMENT; (C) A POTENTIAL OWNERSHIP OR INVESTMENT INTEREST IN, OR COMPENSATION ARRANGEMENT WITH, AN INDIVIDUAL OR ENTITY WITH WHICH APHL IS NEGOTIATING SUCH CONTRACT, TRANSACTION OR ARRANGEMENT; OR (D) A FIDUCIARY POSITION (E.G., MEMBER, OFFICER, DIRECTOR, COMMITTEE MEMBER) WITH RESPECT TO AN ENTITY INVOLVED IN SUCH CONTRACT, TRANSACTION OR ARRANGEMENT; OR (E) A NON-ECONOMIC AFFILIATION OR RELATIONSHIP, DIRECTLY (OR INDIRECTLY, THROUGH A THIRD PARTY) WITH AN INDIVIDUAL OR ENTITY WITH WHICH APHL IS NEGOTIATING OR MAINTAINS A CONTRACT, TRANSACTION OR ARRANGEMENT SUCH THAT THE AFFILIATION OR RELATIONSHIP COULD RENDER THE INTERESTED PERSON INCAPABLE OF MAKING A DECISION WITH ONLY THE BEST INTERESTS OF APHL IN MIND. IN ADDITION, AN INTERESTED PERSON HAS A CONFLICT OF INTEREST IN ANY EXISTING OR POTENTIAL COMPENSATION ARRANGEMENT BETWEEN APHL AND THAT INTERESTED PERSON OR ANY BUSINESS, INVESTMENT OR FAMILY MEMBER RELATED TO THAT PERSON. FOR PURPOSES OF THIS SECTION, COMPENSATION INCLUDES DIRECT AND INDIRECT REMUNERATION, AS WELL AS GIFTS OR FAVORS THAT ARE SUBSTANTIAL IN NATURE. SERVICE OF INDIVIDUALS ON THE BOARD OF DIRECTORS FOR ALVERNO PROVENA HOSPITAL LABORATORIES, INC. (AND COMMITTEES THEREOF), BOARDS OR COMMITTEES OF THE MEMBER ORGANIZATIONS OR EMPLOYMENT BY A MEMBER ORGANIZATION OR ALVERNO CLINICAL LABORATORIES, A RELATED ORGANIZATION, IS NOT CONSIDERED A CONFLICT OF INTEREST, AS DEFINED IN THE POLICY. THE VP OF HUMAN RESOURCES COMPILES THE RESULTS AND FORWARDS THE RESULTS TO THE CEO. THE ASSESSMENTS OF ANY POTENTIAL CONFLICT ARE MADE IN COLLABORATION WITH LEGAL COUNSEL AS APPROPRIATE. THE CEO REVIEWS ANY CONFLICTS WITH THE BOARD DURING A SCHEDULED BOARD MEETING. POLICY VIOLATIONS: IF THE BOARD OF MANAGERS HAS REASON TO BELIEVE THAN AN INTERESTED PERSON HAS FAILED TO COMPLY WITH THE DISCLOSURE OBLIGATIONS OF THIS POLICY, THE BOARD OF MANAGERS SHALL INFORM THAT PERSON OF THE BASIS FOR ITS BELIEF AND PROVIDE THAT PERSON AN OPPORTUNITY TO ADDRESS THE ALLEGED FAILURE TO DISCLOSE. AFTER HEARING THE RESPONSE OF SUCH A PERSON AND CONDUCTING FURTHER INVESTIGATION AS MAY BE WARRANTED UNDER THE CIRCUMSTANCES, THE BOARD OF MANAGERS SHALL DETERMINE WHETHER SUCH PERSON HAS IN FACT, VIOLATED THE DISCLOSURE REQUIREMENTS OF THE CONFLICT OF INTEREST POLICY. IF THE BOARD DETERMINES THAT THERE HAS BEEN A VIOLATION, THE BOARD SHALL TAKE APPROPRIATE DISCIPLINARY AND CORRECTIVE ACTION, WHICH MAY INCLUDE REMOVAL (IF THE INTERESTED PERSON IS A BOARD OR COMMITTEE MEMBER, DIRECTOR OR MANAGEMENT EMPLOYEE) OR TERMINATION (IF THE INTERESTED PERSON IS AN EMPLOYEE OF ALVERNO PROVENA HOSPITAL LABORATORIES, INC., ALVERNO CLINICAL LABORATORIES, LLC OR A MEMBER ORGANIZATION). RESTRICTIONS IMPOSED ON PERSONS WITH A CONFLICT ARE DETERMINED ON A CASE BY CASE BASIS BY THE CEO IN COLLABORATION WITH LEGAL COUNSEL. AS OF THIS DATE, NO MATERIAL CONFLICTS OF INTEREST HAVE BEEN IDENTIFIED. IF A MATERIAL CONFLICT IS IDENTIFIED IN THE FUTURE, THAT PERSON WOULD BE REQUIRED TO RECLUSE THEMSELVES FROM PARTICIPATING IN DECISIONS AND/OR VOTING PRIVILEGES DIRECTLY RELATED TO THE CONFLICT. Process used to establish compensation of top management official Form 990, Part VI, Section B, Line 15a COMPENSATION OF THE ORGANIZATION'S TOP MANAGEMENT OFFICIAL AND OTHER OFFICERS IS PAID BY ALVERNO CLINICAL LABORATORIES, LLC, A RELATED ORGANIZATION. THE BOARD OF DIRECTORS APPOINTED A COMPENSATION COMMITTEE, WHICH IS A SUB-COMMITTEE OF THE BOARD. THE BOARD ENGAGED AN OUTSIDE CONSULTING GROUP TO CONDUCT A MARKET REVIEW OF EXECUTIVE COMPENSATION AND PREPARE A COMPARATIVE ANALYSIS BASED ON ALVERNO'S EXECUTIVE PAY LEVELS. AS A RESULT OF THE ANALYSIS, THE CONSULTING GROUP DEVELOPED A REBUTTABLE PRESUMPTION OF REASONABLENESS LETTER UNDER THE INTERMEDIATE SANCTION REGULATIONS OF THE INTERNAL REVENUE SERVICE. THE TOTAL COMPENSATION PACKAGE WAS APPROVED IN ADVANCE BY THE BOARD, AND NO INDIVIDUALS WHO HAD AN ACTUAL OR POTENTIAL CONFLICT OF INTEREST WITH RESPECT TO THE COMPENSATION ARRANGEMENT PARTICIPATED IN THE DELIBERATIONS; THE BOARD ADEQUATELY AND CONTEMPORANEOUSLY DOCUMENTED THE BASIS FOR ITS DETERMINATION. THIS PROCESS IS PERFORMED APPROXIMATELY EVERY THREE YEARS AND WAS LAST UNDERTAKEN IN 2007 AND THE FIRST QUARTER OF 2011 FOR THE PRESIDENT/CEO, VICE PRESIDENT OF HUMAN RESOURCES, CHIEF FINANCIAL OFFICER, VICE PRESIDENT OF HOSPITALS, AND THE CHIEF OPERATIONS OFFICER. IN ADDITION, THE COMPENSATION COMMITTEE ESTABLISHES, REVIEWS, AND APPROVES THE COMPENSATION GUIDELINES AND PHILOSOPHY ACCORDING TO CURRENT INDUSTRY STANDARDS AND THE REBUTTABLE PRESUMPTION OF REASONABLENESS LETTER IN ORDER TO DETERMINE ANY COMPENSATION INCREASES. THE BOARD OF DIRECTORS ALSO APPROVES THE LINE-BY-LINE OPERATING BUDGET ON AN ANNUAL BASIS. THESE PROCESSES ARE DOCUMENTED IN THE RESPECTIVE COMPENSATION COMMITTEE/BOARD MEETING MINUTES AND WERE LAST PERFORMED IN 2010. Process used to establish compensation of other officers/key employees Form 990, Part VI, Section B, Line 15b SEE NARRATIVE FOR FORM 990, PART VI, SECTION B, LINE 15B. Public Disclosure Form 990, Part VI, Section C, Line 19 THE ORGANIZATION'S GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS ARE MADE AVAILABLE TO THE PUBLIC UPON REQUEST. OFFICERS, DIRECTORS, TRUSTEES, KEY EMPLOYEES, AND HIGHEST COMPENSATED EMPLOYEES FORM 990, PART VII, SECTION A THE FOLLOWING OFFICERS AND KEY EMPLOYEES DEVOTE APPROXIMATELY 8 HOURS PER WEEK TO ALVERNO CLINICAL LABORATORIES, LLC, A RELATED PARTNERSHIP: CHERYL L. VANCE (PRESIDENT/CEO); STEVEN G. WOJNICKI (CFO); SAMUEL C. TERESE, JR. (COO); BERNARD HENRY (VP OF HUMAN RESOURCES); AND MARSHA COOPER (VP OF HOSPITALS). Other changes in net assets or fund balances Form 990, Part XI, Line 5 NET UNREALIZED GAINS (LOSSES) ON INVESTMENTS - 296662; DISTRIBUTION OF PATRONS' EQUITY - -600000; ALVERNO CLINICAL LABORATORIES LLC 2434 INTERSTATE PLAZA DRIVE HAMMOND IN 46324 203240648 MEDICAL LAB IN NA RELATED 0 0 false 0 false 0 false false false false false false false false false false true true false true false false false false