2011-11-15T13:18:00-05:00 2010-12-31 ERNST & YOUNG US LLP 111 MONUMENT CIRCLE SUITE 2600 INDIANAPOLIS IN 46204 990 2010-01-01 351536129 MEMORIAL HEALTH FOUNDATION INC MEMO 5746473549 615 N Michigan Street South Bend IN 46601 JEFFREY COSTELLO 2011-11-15 3176817000 2010 2016-02-24 21:20:13Z Philip Newbold 615 N Michigan Street South Bend IN 46601 1640655 false X www.qualityoflife.org X 1982 IN MEMORIAL IS COMMITTED TO IMPROVING THE QUALITY OF LIFE OF THE PEOPLE IN OUR COMMUNITY. 26 24 12 0 0 0 1334217 1436553 121288 3 181715 101731 41347 97 1678567 1538384 2049899 4223295 0 0 1110895 606847 0 0 513522 1253647 899097 4414441 5729239 -2735874 -4190855 22804189 22902442 48680 1176625 22755509 21725817 X MEMORIAL IS COMMITTED TO IMPROVING THE QUALITY OF LIFE OF THE PEOPLE IN OUR COMMUNITY. true true 4560347 4220691 100 Memorial Health System, Inc. (the "Corporation") was established as the parent corporation of Memorial Hospital of South Bend, Inc. (the "Hospital") in 1981 to develop a full spectrum of health-related services for North Central Indiana and Southwestern Michigan. The Corporation is community-owned and not-for-profit. Along with its subsidiaries, the Corporation serves the greater community throughout the continuum of care from health promotion and sickness prevention to diagnosis, inpatient, outpatient and home health services. It controls the Hospital, Memorial Health Foundation, the Hospital's philanthropic arm, and Memorial Home Care, Inc., collectively referred to as the "System". Memorial Health Foundation, Inc., a tax-exempt foundation, was established in 1982 to provide philanthropic support to the Hospital and the Corporation through contributions and management of endowment funds. Memorial Health Foundation's Mission is to, "support the work of Memorial Health System, Inc. and Memorial Hospital of South Bend, Inc. by seeking innovative partnerships and creating new resources, with special emphasis on today's children and tomorrow's healthy, fulfilled citizens". Memorial Health Foundation (MHF) fulfills that mission through activities that center around three Key Roles: Community Development Fund Development Fund Management Community Development: Throughout 2010, MHF staff served in various roles as part of Memorial's many Creating Healthier Communities initiatives. Historically, Memorial Health Foundation staff members have participated in various advisory roles, implementing Memorial's Community Benefit (Tithing) Policy, under the oversight of the Community Health Enhancement Committee. That committee is composed of board members of Memorial Health System, Memorial Hospital, and MHF. A considerable portion of operating budget and other resources are devoted to this work in the community. The Community Health Enhancement operation of Memorial Hospital is the primary leader in such work. Further, the "R&D" Committee of the MHF Board of Directors is a convener and facilitator of dialogues involving many community organizations and experts on various "quality of life" issues, seeking to discover and collectively launch new concepts to address and resolve those issues. These dialogue models have also driven the emergence of various relationships that are significant to the work. These works in community building are of a collaborative nature, seeking to build both awareness and ownership across the regional community for addressing multiple "quality of life" issues, with special focus on children and young families. Such collaborating partners include a range of social services organizations, community development organizations, other healthcare organizations, K-12 education, and higher education. Fund Development: In 2010, the fund raising focus of Memorial Health Foundation focused upon the following areas: The development of a direct mail campaign The development of Memorial Health Foundation's grant writing effort, focused upon corporate, private and family foundations The addition of a Corporate Relations fund raising position Major gift fund raising focused upon raising funds for the following areas: Community Health Enhancement The Memorial Central Clinic at the South Bend Center for the Homeless Memorial Children's Hospital Family support programs, including Chaplaincy and Child Life Memorial Regional Cancer Center Staff continuing and formal education funding Temporarily restricted net assets as December 31, 2010 available for Memorial's mission are: Community Services $ 425,916 Hospital support services $ 113,397 Quality initiatives $ 539,442 People development/education $ 1,183,807 Financial support services $ 1,924 Growth initiatives $ 1,474,369 Fund Management: Total fund distributions of $4,122,082 made in 2010, went to such projects as: Creating Healthier Communities $ 601,032 Supporting World-Class Service $ 55,719 Supporting Clinical Excellence $ 1,366,965 Investing in a World Class Memorial Team $ 209,906 Investing in Memorial's Growth $ 1,887,660 Distributions to endowment and insurance $ 800 4560347 true true false false false false false false true true false false false false true false true false false true false false false false false false true true true false false false false false false false false true false false false false true true true false false true X 0 0 12 false false false false false false false false false false false X 26 24 false false false false true true true true true false false true false false false true true false IN X JEFFREY COSTELLO 5746473549 615 N MICHIGAN STREET South Bend IN 46601 X George B Friend MD 2.0 X 0 0 0 Leland R Kaiser PhD 2.0 X 0 0 0 Carmi Murphy 2.0 X 0 0 0 Olubunmi A Okanlami MD 2.0 X 0 421952 26923 Jan R Reineke MD 2.0 X 2073 0 0 James F Keenan 2.0 X X 2073 0 0 John C Kerr 2.0 X X 0 0 0 Najeeb A Khan 2.0 X X 0 0 0 Terri T Kosik 2.0 X 0 0 0 Mary E Lowe 2.0 X 0 0 0 John T Phair 2.0 X 2073 0 0 Peter Veldman 2.0 X 1780 0 0 Rev R Mark Beeson 2.0 X 0 0 0 Gladys Muhammed-Ward 2.0 X 0 0 0 Louis M Nanni 2.0 X 2073 0 0 Julia Schwartz 2.0 X 0 0 0 Silvia Schweizer 2.0 X X 0 0 0 Barbara Shields-Byrum 2.0 X 0 0 0 Kurt Simon 2.0 X 3052 0 0 Christopher Chocola 2.0 X 0 0 0 Gayle Rosencrantz 2.0 X 0 0 0 James Laing 2.0 X 0 0 0 Michael Vogel 2.0 X 0 0 0 Mary Jo Halbritter 2.0 X 0 0 0 William Schmuhl Jr 2.0 X 1819 0 0 Maggie Kernan 2.0 X 2562 0 0 Leigh Morris 2.0 X 0 0 0 Timothy Griffin 2.0 X 0 216405 20977 Charles Simon 2.0 X 0 0 0 Deborah Barton-Grant 2.0 X 3052 0 0 Deborah Cafiero 2.0 X 0 0 0 Deloris Wilmoski 2.0 X 0 0 0 Otha Reese 2.0 X 1213 0 0 Sandra Brown MD 2.0 X 3011 0 0 Shannon Cullinan 2.0 X 2289 0 0 Philip A Newbold 2.0 X 0 1001875 229464 Reginald Wagle 40.0 X 185932 0 41759 Jeffrey Costello 2.0 X 0 469348 99022 213002 2109580 418145 1 false true false 0 1436553 80604 1436553 SPECIAL PROGRAM REVENUE 611600 3 3 3 113552 113552 0 0 90450 102271 -11821 -11821 -11821 0 0 0 OTHER INCOME - TIMELESS SETTLEMENT 611600 97 97 97 1538384 100 0 101731 4142691 4142691 80604 80604 0 0 213002 60649 85174 67179 0 339702 119637 87547 132518 0 23449 13811 702 8936 30694 10012 9592 11090 0 0 1564 1564 0 0 0 74911 68192 6719 0 52611 29632 22979 44758 44758 0 35688 16551 19137 27480 16752 10728 0 27330 12675 14655 18259 18259 0 45685 45685 27658 27658 CORPORATE ALLOCATION 407562 132943 127363 147256 OTHER DIRECT EXPENSES 61119 28346 32773 CIRCLES OF EXCELLENCE 51412 23844 27568 DUES/SUBSCRIPTIONS 17977 8337 9640 LICENSES/TAXES 3120 1447 1673 1963 1292 671 5729239 4560347 655370 513522 500 0 4007064 3718038 1412584 88300 3995 1925 386064 248212 343000 137852 17037046 18956327 22804189 22902442 48680 8967 1057398 110260 48680 1176625 X 16256663 17986961 6498846 3738856 22755509 21725817 22804189 22902442 X -4190855 3161163 X false true true X false X 2354428 1695500 1532816 1334217 1436553 8353514 333445 207590 142561 127810 100 811506 2687873 1903090 1675377 1462027 1436653 9165020 1333125 984449 121124 133141 67601 2639440 0 0 1333125 984449 121124 133141 67601 2639440 6525580 752888 1922402 402683 201715 113552 3393240 13960 18314 10410 42684 752888 1936362 420997 212125 113552 3435924 3440761 3839452 2096374 1674152 1550205 12600944 0.51786 0.60466 0.27267 0.22170 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 22665989 1296194 1929600 4122082 21769701 20595396 1076924 3137353 2143683 22665990 28741974 1278996 -6927657 2497917 20595396 0.82830 0.17170 false false 386064 248212 137852 137852 0 0 INTENDED USE OF ENDOWMENT FUNDS Sch. D, Part V, Line 4 Board Designated Endowment - The second amendment, dated July 27, 1995, provides Board direction to utilize each year the income, revenues, and profits arising and accruing from the endowment, in defraying cost associated with the trust and the remainder for support, betterment, improvement, upkeep, expansion, and replacement of Memorial Health System, Inc. and its corporate affiliates. Term endowments, which are the Temporarily restricted net assets are used as designated by the donor. false Central America and the Caribbean Investments 5319235 5319235 5319235 true false true false false false true Memorial Hospital of South Bend Inc 615 N Michigan Street South Bend IN 46601 350868132 501(c)(3) 3450860 General Support Memorial Health System Inc 615 N Michigan Street South Bend IN 46601 351536132 501(c)(3) 629455 General support Ronald McDonald House Charities Indiana Michiana 118 S Mill St PO Box 783 Mishawaka IN 46546 351831691 501(C)(3) 48578 General support 3 Grants for Children 1885 80604 FMV gift cards GRANT MONITORING PROCEDURES Schedule I, Part I The organization has numerous temporarily restricted funds, from which the distributions are considered grants. In general the grants are to provide scholarships and/or are distributions for the purpose of the specific fund. All distributions of the funds are supported by evidence that the expenditure meets the donor's intent. For scholarships the individual must meet several requirements to qualify. In order to qualify for a scholarship the individual must (1)Apply on-line (intranet) and within the acceptable time parameters for the semester of funds being requested, (2) Maintain a grade of C or better,(3)Pay for tuition/books and submit corresponding original receipts for reimbursement. Reimbursed up to the amount awarded by the scholarship committee. (4) Meet any additional requirements of the specific scholarship fund, and (5) Meet eligibility requirements which include: (A) Employed by Memorial Health System, Inc. (B) Enrolled in a qualified program; (C) Submitted a positive recommendation each semester from the immediate supervisor; and (D) Submitted a positive recommendation each semester from the school. X X X X true true false true false false false true true false false Philip A Newbold 0 556903 0 304355 0 140617 0 210175 0 19289 0 1231339 0 140555 Olubunmi A Okanlami MD 0 394473 0 25725 0 1754 0 13977 0 12946 0 448875 0 0 Reginald Wagle 143231 0 26394 0 16307 0 27046 0 14713 0 227691 0 0 0 Jeffrey Costello 0 273186 0 106000 0 90162 0 84363 0 14659 0 568370 0 0 Timothy Griffin 0 166117 0 25725 0 24563 0 9588 0 11389 0 237382 0 0 PART I, LINE 1A HEALTH CLUB AND SPOUSAL TRAVEL MEMORIAL HEALTH SYSTEM, INC. REIMBURSES TRUSTEES FOR THE TAX EFFECT OF THE 1099 REPORTABLE BENEFITS FOR HEALTH CLUB MEMBERSHIP, WITH MEMORIAL HEALTH SYSTEM'S HEALTH AND LIFESTYLE CENTER AND SPOUSAL TRAVEL. THIS REPORTING IMPACTS 12 CURRENT BOARD MEMBERS. MEMORIAL HEALTH SYSTEM ALSO REIMBURSES FOR DIRECT EXPENSES RELATED TO ANY TRAVEL ON MEMORIAL HEALTH SYSTEM'S BEHALF. SPOUSAL TRAVEL INCLUDED IN TAXABLE COMPENSATION -1 EMPLOYEE (PHILIP NEWBOLD) CHARTER TRAVEL FOR INVESTMENT COMMITTEE MEMBERS TO TRAVEL TO INVESTMENT ADVISOR, LOCATED IN MINNEAPOLIS. CHARTER TRAVEL ALLOWED THE ORGINIZATION TO REDUCE THE OVERALL COST OF TRAVEL, BY ELIMINATING THE NEED FOR OVER NIGHT ACCOMIDATIONS. THE CHARTER TRAVEL ALSO REDUCED THE TIME UNPAID BOARD MEMBERS HAD TO COMMIT. (2 INDIVIDUALS LISTED ON PART VII, SECTION LINE 1A - JEFFREY COSTELLO, AND JAMES KEENAN) PART 1, LINE 3 COMPENSATION REVIEW PROCESS MEMORIAL HEALTH FOUNDATION, INC. USES A RELATED ORGANIZATION'S (MEMORIAL HEALTH SYSTEM, INC.) COMPENSATION REVIEW PROCESS. IN WHICH, AN EXTENSIVE EXAMINATION IS CONDUCTED USING COMPARABLE MARKET DATA AND IT IS THEN REVIEWED BY AN INDEPENDENT CONSULTANT HIRED BY, AND REPORTING TO, THE BOARD OF DIRECTORS. RECOMMENDATIONS ARE PRESENTED TO THE BOARD FOR DELIBERATION AND FINAL DECISION. PART I, LINE 4B SUPPLEMENTAL EXECUTIVE RETIREMENT PROGRAM (457(F)) RELATED ORGANIZATION (MEMORIAL HEALTH SYSTEM, INC.) EMPLOYEE 2010 EARNED VESTED 457(f) PHILIP NEWBOLD $108,930 JEFFREY COSTELLO $ 66,001 MEMORIAL HEALTH SYSTEM PROVIDES A NON-QUALIFIED SUPPLEMENTAL EXECUTIVE RETIREMENT PROGRAM (SERP) TO CERTAIN EXECUTIVES. THE PLAN PROVIDES FOR AN ADDED RETIREMENT BENEFIT OVER THE QUALIFIED RETIREMENT PROGRAM. QUALIFIED INDIVIDUALS ARE ELIGIBLE TO RECEIVE A BENEFIT, IN THE FORM OF AN AFTER TAX LUMP SUM WHICH IS THE ACTUARIAL EQUIVALENT OF AN ANNUITY, EQUAL TO 65% OF THE AVERAGE OF THEIR LAST FIVE YEARS OF PRERETIREMENT EARNINGS, OR 70% WITH MORE THAN 25 YEARS OF SERVICE, WITH OFFSETS FOR THE VALUE OF SOCIAL SECURITY AND QUALIFIED RETIREMENT PLAN BENEFITS. PARTICIPANTS VEST INTO THE SERP AFTER FIVE YEARS OF SERVICE. THE INCREASE IN VALUE OF THE BENEFIT EACH YEAR IS INCLUDED IN THE TAXABLE COMPENSATION OF VESTED SERP PARTICIPANTS. SUCH AMOUNTS ARE INCLUDED IN PART II COLUMN(b)(iii). THE ANNUAL VALUE OF THE BENEFIT IS CONVERTED TO A LUMP SUM AND PAID TO THE PARTICIPANT AFTER FULFILLING THE TERMS OF THEIR NON-COMPETE AGREEMENT. PART I, LINE 6A & 6B COMPENSATION CONTINGENT ON NET EARNINGS THE RELATED ORGANIZATION HAS TWO INCENTIVE PLANS (EMPLOYEE AND MANAGEMENT) WHICH HAVE A NET OPERATING INCOME TO BUDGET MEASUREMENT FOR THE PAYOUT THRESHOLD. THE EMPLOYEE PLAN SHARES THE EXCESS OVER BUDGET NET OPERATING INCOME WITH THE NON-MANAGMENT EMPLOYEES FOR MEMORIAL HEALTH SYSTEM, INC AND THE AFFILIATED ENTITIES, WHICH INCLUDES MEMORIAL HOSPITAL OF SOUTH BEND, INC. THE EMPLOYEE INCENTIVE HAS A MAXIMUM CAP OF $2,500,000. THE MANAGEMENT INCENTIVE PLAN PAYS A SLIDING PERCENTAGE OF BASE COMPENSATION IF THE NET OPERATING INCOME IS EQUAL TO OR GREATER THAN 80% OF THE BUDGETED NET OPERATING INCOME. THE SLIDING SCALE CAPS WHEN OPERATING INCOME REACHES 120% OF THE BUDGETED OPERATING INCOME. X 6773 Cost Donated Propert X Toys, stuffed animals, books and electronics 145 26544 Cost Donated Propert X Hosting/sponsoring events 28 16663 Cost Donated Propert X Gift cards, coupons, etc. 12 30624 Cost Donated Propert 0 false false false GIFT ACCEPTANCE AND REVIEW Sch. M, Question 31 Memorial Health Foundation has a written process for review of all gifts, it does not speak specifically to non-standard gifts, however there is a review process in place. HEALTHWORKS! KIDS MUSEUM Core Form, Part III, Questions 2 & 3 HealthWorks! Kids Museum and all related activities were transferred to Memorial Hospital of South Bend, Inc. (MHSB), effective January 1, 2010, to better align services within Memorial Health System and its affiliates. EMPLOYEES OF THE ORGANIZATION Core Form, Part V, Question 2a Employees are paid by Memorial Health System, Inc.(EIN 35-1536132) and expensed to Memorial Health Foundation through contract labor. MEMBERS OF THE ORGANIZATION Core Form, Part VI, Section A, Question 6 Membership in the Corporation shall be divided into two classes: Corporate and Personal. The Corporate Member shall be the Memorial Health System, Inc. The Personal Members shall be the directors of the Corporation. ELECTION OF BOARD MEMBERS Core Form, Part VI, Section A, Question 7a The Corporate Member shall appoint the Board of Directors of the Corporation and shall have such powers of advance approval regarding Corporate actions as are delineated in the By-laws of the Corporation. DECISIONS OF THE BOARD OF DIRECTORS Core Form, Part VI, Section A, Question 7b Decisions of the Board of Directors must be approved by the Corporate Member. FORM 990, PART VI, SECTION B THE ORGANIZATION HAS WRITTEN POLICIES AND PROCEDURES THAT COVER NUMEROUS TOPICS. THESE POLICIES AND PROCEDURES WERE NOT APPROVED BY THE GOVERNING BOARD IN THE CURRENT TAX YEAR, BUT WILL BE REVIEWED AND APPROVED BY THE GOVERNING BOARD IN FUTURE YEARS. A FEW OF THE TOPICS COVERED BY THE CURRENT POLICIES AND PROCEDURES OF THE ORGANIZATION ARE: - LOCAL CHAPTERS, BRANCHES AND AFFILIATES - CONFLICT OF INTEREST - WHISTLEBLOWER - DOCUMENT RETENTION AND DESTRUCTION - JOINT VENTURES REVIEW PROCESS Core Form, Part VI, Section B, Line 11B The organization incorporates numerous parties in the production and review of the Form 990 and associated schedules. Senior accounting staff and management, complete the Form 990 and schedules. The forms and schedules are reviewed by the Accounting Manager, Controller and CFO. Subsequent to those steps, the organization engaged Ernst & Young to review the completed Form 990 and appropriate schedules. Prior to filing the return, the compensation committee of the organization and the CEO conduct a general overview of the form 990, including applicable compensation schedules. In addition, the Board of Directors and the audit committee will receive a copy of the 990 prior to filing. CONFLICT OF INTEREST STATEMENTS Core Form, Part VI, Section B, Line 12c There are three separate forms that are sent out through the Internal Audit Department to Key Employees or Board Members regarding Conflict of Interest. They are as follows: 1. The first is a Conflict of Interest Statement that is sent to Senior level Administration, Management, and select staff such as Purchasing Department employees. The purpose of the Statement is to require these employees to disclose any potential conflict of interests they may have. The Statements are sent in January of each year and we pursue the replies to get a 100% response rate. In the current year we sent out over 250 Statements and did achieve a 100% response rate. Each response is reviewed by the Director of Internal Audit and the results are reported to the CEO of Memorial as well as the Audit Committee of the Board of Directors. 2. The second Statement is the Board Duality of Interest Statement that is sent to current Board Members, former Board Members from the last five years, the five highest compensated employees from the previous year, employees that are on Grant and Scholarship Committees, and Other Key Employees. The Duality of Interest Statement was sent out in May, 2010. The replies are reviewed by the Director of Internal Audit who summarizes the results, which are reviewed by an independent party. results are reported to the CEO of Memorial and the Audit Committee of the Board of Directors. 3. The third Statement is entitled "Code of Ethics for Senior Financial Officers". The Statement requires an acknowledgement form to be signed by Memorial's Key Financial Employees that Memorial's financial information is to the best of their knowledge true and accurate. This Statement was sent out in early January, 2010 and the signed acknowledgements are kept by the Director of Internal Audit. In 2010, fourteen designated employees were requested to sign the form and we had a 100% compliance rate. Any potential conflicts of interests are reviewed by independant parties both internal and external to the organization, and if necessary, corrective action would be taken to resolve a true conflict. The individual with the potential conflict of interest is excluded from all review proceedings. COMPENSATION REVIEW Core Form, Part VI, Line 15a & 15b An extensive examination is conducted using comparable market data and it is then reviewed by an independant consultant hired by, and reporting to, the Board of Directors. Recommendations are presented to the Board for deliberation and final decision. Deliberation and final decision are performed by the independent members of the Board. AVAILABILITY OF GOVERNING DOCUMENTS Core Form 990, Part VI, Section C, Line 19 The governing documents and conflict of interest policy are not made available to the public. The financial statements are distributed quarterly to the Electronic Municipal Market Access (EMMA) website as part of the continuing disclosures for the Memorial Health System, Inc. bonds. CHANGE IN FUND BALANCE Core Form, Part XI, Line 5 Other changes in fund balance: Transfers from MHSB & MHS $1,191,452 Unrealized gains on investments 1,903,813 Change in Grube Trust 65,898 Total 3,161,163 BUSINESS RELATIONSHIPS Form 990, Schedule L, Part IV John Phair is president of Holladay Properties from which Memorial Health Foundation, Inc. rents property for values less than the reporting thresholds. HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Olubunmi A. Okanlami, MD TITLE:Director, Physician HOURS:40 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Timothy Griffin TITLE:Director, Physician HOURS:38 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Philip A. Newbold TITLE:CEO/President HOURS:40 HOURS DEVOTED FOR RELATED ORGANIZATION FORM 990 PART VII NAME:Jeffrey Costello TITLE:CFO/Asst. Treasurer HOURS:40 Memorial Health System Inc 615 N Michigan St South Bend IN 46601 351536132 Corp Services IN 501c(3) 9 NA Memorial Hospital of South Bend Inc 615 N Michigan St South Bend IN 46601 350868132 Hospital IN 501c(3) 3 MHS Memorial Home Care Inc 615 N Michigan St South Bend IN 46601 351901068 Home Medical IN NA C false true true false false false false true false false true true true true true true true true Memorial Hospital of South Bend Inc B 175884 Memorial Hospital of South Bend Inc H 163004 Memorial Hospital of South Bend Inc K 3450860 Memorial Hospital of South Bend Inc P 77061 Memorial Hospital of South Bend Inc R 82427 Memorial Home Care Inc R 130739 Memorial Home Care Inc Q 125000