2011-08-12T08:24:18-05:00 2010-09-30 DIXON HUGHES GOODMAN LLP 500 Ridgefield Court Asheville NC 28806 990 2009-10-01 570342027 CANNON MEMORIAL HOSPITAL CANN 8648784791 123 WG ACKER DRIVE PICKENS SC 29671 MARY ARNETTE 8648784791 2011-08-12 1 Amy Bibby 8282542254 2009 2016-02-24 21:20:13Z NORMAN RENTZ 123 WG ACKER DRIVE PICKENS SC 29671 34414878 0 X WWW.CANNONHOSPITAL.ORG X 1950 SC PROVIDING QUALITY HEALTHCARE IN A SAFE, COMPETENT, AND COMPASSIONATE MANNER 12 11 354 95 0 0 202281 115224 31953160 33993183 67901 44499 224717 261822 32448059 34414728 0 0 12532965 12010326 0 55520 19898858 21116405 32431823 33126731 16236 1287997 15429207 16173472 8928203 8319106 6501004 7854366 THE MISSION OF CANNON MEMORIAL HOSPITAL IS TO PROVIDE QUALITY HEALTHCARE IN A SAFE, COMPETENT, AND COMPASSIONATE MANNER. 0 0 29939896 33993183 CANNON MEMORIAL HOSPITAL OFFERS A FULL RANGE OF STATE-OF-THE-ART MEDICAL TECHNOLOGY, EQUIPMENT, AND SERVICES TO MEET THE HEALTH CARE NEEDS OF THE COMMUNITY. THE EXPANDED SERVICES OF THE HOSPITAL INCLUDE A 24-HOUR EMERGENCY DEPARTMENT, A FULL SERVICE LABORATORY, PHYSICAL AND OCCUPATIONAL THERAPY, CRITICAL CARE UNIT, SLEEP CLINIC, WELLNESS PROGRAMS FOR BOTH CHILDREN AND ADULTS, AND DIAGNOSTIC IMAGING FOR BOTH INPATIENT AND OUTPATIENT TEST INCLUDING CT SCANS. FOR FISCAL YEAR 2010, THE HOSPITAL PROVIDED 3,928 PATIENT DAYS OF SERVICE.WE ALSO SPONSOR HEALTH FAIRS, FLU CLINICS, CPR TRAINING, FITNESS CLASSES, SUPPORT GROUPS, AND MANY OTHER COMMUNITY WELLNESS SERVICES THROUGH OUR WELLNESS CENTER LOCATED AT THE HOSPITAL. 29939896 1 1 0 1 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 0 1 0 0 1 1 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 1 1 0 0 1 45 0 1 354 1 0 0 0 0 0 0 0 0 0 12 11 0 1 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 1 0 SC X X MARY ARNETTE 8648784791 123 WG ACKER DRIVE PICKENS SC 29671 DR CALVIN SNIPES JR 1.00 X X 28450 0 0 FRANCES C STOKES 1.00 X X 0 0 0 DR WILLIAM W SPEARMAN 1.00 X X 0 0 0 KENNETH D ACKER 1.00 X X 0 0 0 GEORGE D ACKER 1.00 X 0 0 0 CHARLES E DALTON 1.00 X 0 0 0 BRIAN C DEESE 1.00 X 0 0 0 RANDALL P GRIFFIN 1.00 X 0 0 0 TIMOTHY E MORGAN 1.00 X 0 0 0 DR DONALD L MARLER 1.00 X 0 0 0 J FLETCHER PERRY 1.00 X 0 0 0 JOHN E SPARKS 1.00 X 0 0 0 Norman Rentz 40.00 X 103081 0 11125 Mary Arnette 40.00 X 62192 0 6334 Donna Anderson 40.00 X 87858 0 12170 Peter Schriver 40.00 X 244334 0 7448 BYRON MARSH 40.00 X 258342 0 570 Jake Holcombe 40.00 X 136400 0 0 Darius Divina 40.00 X 200918 0 3835 DANIEL DALHAUSEN 40.00 X 132268 0 7448 1253843 0 48930 13 0 1 0 MATRIX REHABILITATION 207 INTERSTATE PARK DRIVE MONTGOMERY AL 36109 PHYSICAL THERAPY 369177 MICHAEL DILLARD MD PO BOX 186 PICKENS SC 29671 PHYSICIAN 282209 JAMES CALDWELL MD 220 GLEN LAUREL DRIVE EASLEY SC 29642 PHYSICIAN 263559 MICHAEL DONALD MD 350 NORTH SUMMIT DRIVE SENECA SC 29672 PHYSICIAN 262241 ANMED HEALTH 800 NORTH FANT STREET ANDERSON SC 29621 MANAGMENT SERVICES 198107 7 105406 9818 115224 NET PATIENT SERVICE 621400 33993183 33993183 33993183 43899 43899 25800 25800 25800 25800 750 150 600 600 600 CAFETERIA & FOODSERVIC 722210 129538 129538 SALES TO EMPLOYEES 446110 62946 62946 MEDICAL TRANSCRIPTION 900099 24983 24983 18555 18555 236022 34414728 33993183 0 306321 282760 282760 9417517 8295888 1085712 35917 238200 203714 33604 882 1388357 1187353 195863 5141 683492 584537 96424 2531 431660 431660 81321 81321 2885022 2550106 330592 4324 43108 43108 4294461 3932615 355745 6101 10838 10838 295686 295686 67138 30648 35866 624 304872 304872 952249 952249 381733 233911 147822 BAD DEBT EXPENSE 11368317 11368317 33126731 29939896 3131315 55520 354586 1176147 2001155 1911820 8800 4317965 4680926 15733 15733 47778 31852 659381 665554 227937 221574 21666957 15074706 7094694 6592251 303699 455564 15010 391269 413251 15429207 16173472 1726442 1423104 5795000 5470000 1119508 983426 287253 442576 8928203 8319106 X 6118630 7230127 382374 624239 6501004 7854366 15429207 16173472 X 0 1 1 X 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 0 0 0 0 0 0 0 1 1401 1401 0 Part II-B, Line 1i: Explanation of Other Lobbying Activities: THE ORGANIZATION IS A MEMBER OF THE SOUTH CAROLINA HOSPITAL ASSOCIATION (SCHA). THIS ORGANIZATION ROUTINELY ENGAGES IN LOBBYING EFFORTS ON BEHALF OF ITS MEMBERSHIP BODIES, AND A PORTION OF THE DUES PAID TO THIS ORGANIZATIONS IS ALLOCATED TO THOSE EFFORTS EACH YEAR. FOR 2010, DUES PAID TO THIS ORGANIZATION ALLOCATED TO LOBBYING EFFORTS WERE APPROXIMATELY $1,401. 923554 923554 10623633 7723911 2899722 376747 273914 102833 9733695 7076881 2656814 9328 9328 6592251 INTEREST RATE SWAP AGREEMENT 325500 ESTIMATED THIRD-PARTY PAYOR SETTLEMENTS 117076 442576 34414728 33126731 1287997 65365 65365 1353362 34480093 141865 141865 34338228 76500 76500 34414728 33126731 0 33126731 0 33126731 Part X: Description of Uncertain Tax Positions Under FIN 48: THE HOSPITAL IS A TAX-EXEMPT ORGANIZATION UNDER INTERNAL REVENUE CODE SECTION 501 (C)(3) AND, ACCORDINGLY, NO PROVISION FOR INCOME TAX IS RECORDED IN THE ACCOMPANYING FINANCIAL STATEMENTS. THE HOSPITAL HAS DETERMINED THAT IT DOES NOT HAVE ANY MATERIAL UNRECOGNIZED TAX BENEFITS OR OBLIGATIONS AS OF SEPTEMBER 30, 2010. FISCAL YEARS ENDING ON OR AFTER SEPTEMBER 30, 2007 REMAIN SUBJECT TO EXAMINATION BY FEDERAL AND STATE TAX AUTHORITIES. Part XI, Line 8 - Other Adjustments: CHANGE IN VALUE OF INTEREST RATE SWAP AGREEMENT: -76500. CHANGE IN VALUE OF EQUITY IN FOUNDATION NET ASSETS: 141865. Part XII, Line 2d - Other Adjustments: CHANGE IN VALUE OF EQUITY IN FOUNDATION NET ASSETS: 141865. Part XII, Line 4b - Other Adjustments: CHANGE IN VALUE OF INTEREST RATE SWAP AGREEMENT: 76500. 1 1 1 X 110.000000000000 1 X 1 1 1 0 1 0 192340 192340 0.00880 3948689 2304769 1643920 0.07560 4141029 2304769 1836260 0.08440 116260 23868 92392 0.00420 116260 23868 92392 0.00420 4257289 2328637 1928652 0.08860 1 3442326 4487422 5269245 -781823 X 1 1 Cannon Memorial Hospital

123 WG Acker Drive Pickens SC 29671

X X X CANNON ORTHOPEDIC

123 WG Acker Drive Pickens SC 29671

X ORTHOPEDIC PRACTICE CANNON SURGICAL

123 WG Acker Drive Pickens SC 29671

X GENERAL SURGERY PRACTICE CANNON FAMILY PRACTICE - EASTSIDE

111 WEST ROPER ROAD EASLEY SC 29640

X RURAL HEALTH CLINIC CANNON FAMILY PRACTICE - PICKENS

123 WG Acker Drive PIckens SC 29671

X FAMILY PRACTICE CANNON FAMILY PRACTICE - LIBERTY

105 LIBERTY BLVD LIBERTY SC 29657

X FAMILY PRACTICE Part III, Line 4: THE ORGANIZATION'S FINANCIAL STATEMENTS DO NOT INCLUDE A FOOTNOTE ON BAD DEBT.WORKSHEET TWO OF THE 2009 SCHEDULE H INSTRUCTIONS WAS USED TO CALCULATE A COST-TO-CHARGES RATIO USED TO COMPUTE BAD DEBT AT COST. Part III, Line 9b: CANNON UTILIZES AN EXTENDED BUSINESS OFFICE SERVICE THROUGH A THIRD PARTY VENDOR TO MANAGE ALL OF ITS ACTIVE SELF-PAY ACCOUNTS. CANNON RECOGNIZES THREE ASSISTANCE/CHARITY PROGRAMS FOR ITS PATIENTS. THOSE PROGRAMS ARE: 1) MEDICALLY INDIGENT ASSISTANCE PROGRAM (MIAP), 2) CANNON MEMORIAL'S UNCOMPENSATED ASSISTANCE PROGRAM AND 3) PATIENTS REFERRED BY THE SAMARITAN HEALTH CLINIC OF PICKENS COUNTY. AT THE TIME OF DETERMINATION OF ELIGIBILITY, BILLING & COLLECTION EFFORTS ARE DISCONTINUED FOR THE ELIGIBLE ACCOUNTS. CANNON PROVIDES HELP TO ALL PATIENTS WHO NEED ASSISTANCE COMPLETING THE FINANCIAL AIDE APPLICATION. Part VI, Line 2: WE CURRENTLY USE DATA PROVIDED BY THE STATE TO ASSESS OUR COMMUNITY. THAT DATA INCLUDES INFORMATION ABOUT PATIENTS WHO USE OUR HOSPITAL, AS WELL AS PATIENTS FROM OUR SERVICE AREA WHO ACCESS HEALTHCARE AT OTHER HOSPITALS AND WHAT CHARGE CODE THAT CARE IS UNDER. THIS GIVES US AN IDEA OF THE HEALTH PROBLEMS IN OUR SERVICE AREA. Part VI, Line 3: THE ASSISTANCE/CHARITY PROGRAM POLICIES ARE POSTED ON CANNON'S WEBSITE AND THE PATIENT IS VERBALLY INFORMED DURING THE REGISTRATION PROCESS. Part VI, Line 4: CANNON MEMORIAL HOSPITAL SERVES GREATER PICKENS COUNTY, WITH THE PRIMARY COMMUNITY SERVED BY THE HOSPITAL CLASSIFIED AS RURAL. AS OF THE YEAR 2000, PICKENS COUNTYS POPULATION WAS A LITTLE OVER 110,000 AND IT IS EXPECTED TO GROW BY 37,000 RESIDENTS IN THE NEXT 14 YEARS. THE MEDIUM HOUSEHOLD INCOME IS $36,214 WITH 13% OF THE COMMUNITY RESIDENTS HAVING INCOMES BELOW THE FEDERAL POVERTY GUIDELINE. PICKENS COUNTY HAS A 9% UNEMPLOYMENT RATE AND AN ESTIMATED 34.6% OF THE WORKING-AGE ADULTS (18-64) LIVING IN PICKENS COUNTY LACK HEALTH INSURANCE. THIS NUMBER REPRESENTS APPROXIMATELY 6,862 RESIDENTS. Part VI, Line 6: CMH FURTHERS ITS EXEMPT PURPOSE BY PROMOTING THE HEALTH OF THE COMMUNITY IN SEVERAL WAYS. THE MAJORITY OF OUR BOARD IS COMPRISED OF INDIVIDUALS WHO RESIDE IN PICKENS WHO ARE NEITHER EMPLOYEES NOR CONTRACTORS OF CMH. CMH EXTENDS MEDICIAL STAFF PRIVILEGES TO ALL QUALIFIED PHYSICIANS IN THE AREA FOR ALL OF OUR DEPARTMENTS. ANY SURPLUS IS USED TO FUND IMPROVEMENTS IN PATIENT CARE. AS OF SEPTEMBER 30, 2010, CMH WAS IN THE PROCESS OF INSTALLING A DIGITAL MAMMOGRPAHY MACHINE, WHICH WAS NOT PREVIOUSLY AVAILABLE TO MEMBERS OF THE COMMUNITY. THE SERVICE WAS AVAILAIBLE TO THE PUBLIC STARTING IN 2011. THE HOSPITAL ALSO PROMOTES HEALTH WITHIN PICKENS COUNTY BY PROVIDING EMERGENCY ROOM CARE TO ALL INDIVIDUALS, REGARDLESS OF THEIR ABILITY TO PAY. CMH ALSO PARTICIPATES IN TRAINING OF STUDENTS FROM MULTIPLE CAREER CENTERS, TECHNICAL SCHOOLS AND UNIVERISTIES IN THE AREA. IN ADDITION, THE HOSPITAL PROVIDES VOLUNTEER OPPPORTUNITIES THROUGH THE AUXILIARY. Part VI, Line 7: X 1 0 X X X X 0 0 0 1 0 1 0 1 0 Peter Schriver 231466 0 12868 0 0 0 0 0 7448 0 251782 0 0 0 BYRON MARSH 224300 0 34042 0 0 0 0 0 570 0 258912 0 0 0 Darius Divina 200918 0 0 0 0 0 0 0 3835 0 204753 0 0 0 Part I, Line 1a The filing organization provides these benefits the CEO. No part of the benefit was treated as taxable compensation during FY2009. All personal use amounts are required to be paid back to the organization. Part I, Line 5 FULL TIME FAMILY PRACTICE PHYSICIANS ARE INCENTIVIZED THROUGH A BONUS DERVIED FROM A FORMULA THAT INCLUDES REVENUES. Part I, Line 6 FULL TIME FAMILY PRACTICE PHYSICIANS ARE INCENTIVIZED THROUGH A BONUS DERVIED FROM A FORMULA THAT INCLUDES NET EARNINGS. Part I, Line 7 THE CEO AND CFO RECEIVED DISCRETIONARY BONUSES FOR THE TAX YEAR. ANY MANAGEMENT POSITION IS ELIGIBLE FOR A BONUS BASED ON HIS EVALUATION AND PERFORMANCE AGAINST ESTABLISHED GOALS. THE TOTAL PAYOUT OF ALL BONUSES IS BASED ON THE ORGANIZATION'S PERFORMANCE AS A WHOLE. SOUTH CAROLINA JOBS-ECONOMIC DEVELOPMENT AUTHORITY 570960018 83703EHX6 2004-06-15 6250000 REFUNDING & NEW ACQUISITION 0 0 6250000 201836 1384824 2002 1 0 1 1 0 0 0 0 1 0.00000 0.00000 0.00000 1 0 1 1 NAT'L BANK OF SC 10.000000000000 0 0 0 NORMAN RENTZ CEO PERSONAL PORTION OF BENEFITS RECEIVED X 15733 15733 0 0 0 15733 Form 990, Part VI, Section A, line 3 ON OCTOBER 1, 2009, THE ORGANIZATION ENTERED INTO A MANAGEMENT SERVICES AGREEMENT WITH ANMED HEALTH, A SOUTH CAROLINA NON-PROFIT HEALTHCARE ORGANIZATION. ANMED HEALTH HAS BEEN APPOINTED AS THE MANAGER FOR THE HOSPITAL DURING THE TERM OF THE AGREEMENT. IN ADDITION TO GERERAL MANAGMENT RESPONSIBILITIES OUTLINED IN THE AGREEMENT, ANMED HEALTH IS REQUIRED TO HIRE AND EMPLOY ON A FULL-TIME BASIS A PRESIDENT AND CEO, CFO, AND OTHER EXECUTIVES AS ARE DESIGNATED AND AGREED UPON BY CANNON AND ANMED HEALTH. ANMED HEALTH IS GRANTED THE AUTHORITY AND RESPONSIBILITY FOR MANAGEMENT OF THE HOSPITAL, SUBJECT TO GENERAL APPROVAL OF THE BOARD OF DIRECTORS OF CANNON MEMORIAL HOSPITAL. THE BOARD SHALL REVIEW AND ACT PROMPTLY ON REQUESTS FOR APPROVAL SUBMITTED TO THE BOARD BY ANMED HEALTH FOR CERTAIN MATTERS OUTLINED IN THE MANAGEMENT AGREEMENT, INCLUDING LARGE CAPITAL EXPENDITURES, SALE OR OTHER DISPOSAL OF HOSPITAL ASSETS, AND BORROWING OTHER THAN IN THE ORDINARY COURSE OF CONDUCT OF HOSPITAL AFFAIRS. Form 990, Part VI, Section B, line 11 THE RETURN WAS PREPARED BY AN INDEPENDENT ACCOUNTANT WITH ASSISTANCE AND OVERSIGHT BY MANAGEMENT. UPON COMPLETION, THE RETURN WAS REVIEWED BY MANAGEMENT AND PRESENTED TO ALL VOTING MEMBERS OF THE BOARD OF DIRECTORS AT THE JULY 2011 MEETING OF THE BOARD. A PERIOD OF TIME WAS ALLOWED FOR QUESTIONS AND COMMENTS. FOLLOWING THE MEETING, THE RETURN WAS TIMELY FILED WITH THE IRS. Form 990, Part VI, Section B, line 12c THE ADMINISTRATION REQUIRES ALL MANAGEMENT, KEY OFFICIALS, AND BOARD MEMBERS TO COMPLETE A CONFLICT OF INTEREST QUESTIONNAIRE ON AN ANNUAL BASIS. ANY DUALITY OF INTEREST OR POSSIBLE CONFLICT OF INTEREST ON THE PART OF ANY GOVERNING BOARD MEMBER SHALL BE DISCLOSED TO THE OTHER MEMBERS OF THE BOARD AND MADE A MATTER OF RECORD THROUGH AN ANNUAL PROCEDURE AND ALSO WHEN THE INTEREST BECOMES A MATTER OF BOARD ACTION. ANY GOVERNING BOARD MEMBER HAVING A DUALITY OF INTEREST OR POSSIBLE CONFLICT OF INTEREST ON ANY MATTER SHALL NOT VOTE OR USE PERSONAL INFLUENCE ON THE MATTER, EVEN WHERE PERMITTED BY LAW. THE MINUTES OF THE MEETING SHALL REFLECT THAT A DISCLOSURE WAS MADE, THE ABSTENTION FROM VOTING, AND THE QUORUM SITUATION. THE FOREGOING REQUIREMENTS SHALL NOT BE CONSTRUED AS PREVENTING THE GOVERNING BOARD MEMBER FROM BRIEFLY STATING A POSITION IN THE MATTER, NOR FROM ANSWERING PERTINENT QUESTIONS OF OTHER BOARD MEMBERS SINCE THE BOARD MEMBER'S KNOWLEDGE MAY BE OF GREAT ASSISTANCE. ANY NEW MEMBER OF THE BOARD WILL BE ADVISED OF THIS POLICY UPON ENTERING INTO THE DUTIES OF BOARD MEMBERSHIP. Form 990, Part VI, Section B, line 15 A COMMITTEE OF FOUR CANNON BOARD MEMBERS KNOWN AS THE "CEO REVIEW COMMITTEE" MEETS ANNUALLY TO REVIEW THE PROGRESS OF THE CEO AGAINST GOALS DETERMINED THE PREVIOUS YEAR. THE COMMITTEE MAKES A RECOMMENDATION TO THE BOARD FOR A SALARY INCREASE AND/OR BONUS FOR THE CEO BASED UPON THAT PROGRESS. THE RECOMMENDATION IS VOTED ON BY THE FULL BOARD. THE BOARD APPROVES THE GOALS FOR THE CEO FOR THE UPCOMING YEAR IN ACCORDANCE WITH THE ORGANIZATION'S STRATEGIC GOALS. SALARY AND BONUS ARE REVIEWED AND COMPARED PERIODICALLY TO APPLICABLE COMPENSATION SURVEYS. THE CEO REVIEWS THE PROGRESS OF THE OTHER OFFICERS/KEY EMPLOYEES AGAINST THE ESTABLISHED GOALS FOR THE PRIOR YEAR AND DETERMINES THE ANNUAL SALARY INCREASE AND/OR BONUS BASED UPON THAT PROGRESS. SALARIES ARE REVIEWED AND COMPARED PERIODICALLY TO APPLICABLE COMPENSATION SURVEYS. THE CEO DETERMINES THE GOALS FOR THE UPCOMING YEAR IN ACCORDANCE WITH THE ORGANIZATION'S STRATEGIC GOALS. THE BOARD APPROVES THE ORGANIZATIONAL BUDGET WHICH INCLUDES THESE SALARY INCREASES. Form 990, Part VI, Section C, line 18 PHOTOCOPIES OF THE FORM 990 ARE AVAILABLE UPON REQUEST AT THE ORGANIZATION'S ADMINISTRATIVE OFFICE. IN ADDITION, RECENT FILINGS OF THE FORM 990 ARE AVAILABLE ONLINE AT WWW.GUIDESTAR.ORG. Form 990, Part VI, Section C, line 19 PHOTOCOPIES OF THE ORGANIZATION'S GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS ARE AVAILABLE UPON REQUEST AT THE ORGANIZATION'S ADMINISTRATIVE OFFICE. Schedule K Supplental Information SCHEDULE K, PART II, LINE 5: BOND ISSUANCE COSTS - $ 125,000 CREDIT ENHANCEMENT - 76,836 TOTAL TO PART II, LINE 5 - 201,836 FORM 990, PART VII, LINE 1: BOARD MEMBER COMPENSATION: COMPENSATION PAID TO CHAIRMAN OF THE BOARD, DR. CALVIN SNIPES, IS PAID FOR MEDICAL SERVICES PROVIDED TO THE HOSPITAL. NO PART OF THE COMPENSATION IS PAID FOR SERVICES IN HIS CAPACITY AS A BOARD MEMBER. CANNON MEMORIAL HOSPITAL FOUNDATION PO BOX 188 PICKENS SC 29671 570943822 SUPPORT/FUNDRAISING SC 501(C)(3) 7 N/A 1 0 1 0 0 0 0 0 1 0 0 1 1 1 0 0 0 0 CANNON MEMORIAL HOSPITAL FOUNDATION C 105406