2011-11-10T15:30:46-06:00 2010-12-31 DELOITTE TAX LLP 50 SOUTH SIXTH STREET MINNEAPOLIS MN 55402 990 2010-01-01 411754276 CHILDREN'S HEALTH CARE CHIL 6128136000 2525 Chicago Avenue South Minneapolis MN 554041844 JERRY MASSMANN 6128136000 2011-11-09 1 Kristina Rasmussen 6123974000 2010 2016-03-07 17:11:31Z Children's Hospitals And Clinics Of Jerry Massmann 2525 Chicago Avenue South Minneapolis MN 554041844 603447337 0 X www.childrensmn.org X 1995 MN Children's Hospitals and Clinics of Minnesota champions the special health needs of children. 23 20 4749 1731 86378 21338 29889469 34049233 545511514 533758861 -11440103 32667649 1456864 2322913 565417744 602798656 341745 345688 0 0 328709457 332518318 0 0 0 214770180 226806362 543821382 559670368 21596362 43128288 835818044 916808405 369497389 416355035 466320655 500453370 X Children's Hospitals and Clinics of Minnesota champions the special health needs of children and their families. We are committed to improving children's health by providing family centered pediatric services. We advance these efforts through research and education. 0 0 471885938 345688 533758861 Hospital program services: Families look to Children's Hospitals and Clinics of Minnesota for the finest in pediatric care. With two pediatric hospital facilities and 339 staffed beds, we champion the special health needs of children and their families and are committed to providing high-quality, family centered pediatric services.The Leapfrog Group's annual list of top hospitals named Children's Hospitals and Clinics of Minnesota's Minneapolis and St. Paul hospitals as two of the top seven pediatric hospitals in the country for quality and efficiency. This is the second year in a row Children's has been recognized by the Leapfrog Group. Children's was the only pediatric hospital in the five-state-region to receive a 2010 Leapfrog award. See Schedule O.For the fifth year in a row, Children's Hospitals and Clinics of Minnesota has been named one of the top pediatric hospitals in the nation according to the 2011-2012 U.S. News Media Group's Best Children's Hospitals rankings. This year Children's ranked in four categories - cancer, cardiology and heart surgery, neonatology and pulmonology. The U.S. News rankings give Children's high marks for patient volumes, safety, and overall outcomes in each of the clinical areas. Children's also received high marks for nurse-to-patient staffing levels that continue to be among the nation's highest, and for its designation as a Magnet hospital for excellence in nursing, bestowed by the American Nurses Credentialing Center.We are Minnesota's largest provider of care to children with complex surgical conditions, heart disease, cancer, diabetes, and extreme pre-maturity. In 2010, Children's cared for 12,484 inpatient admissions representing 79,769 patient days, performed 20,276 surgical cases, treated 80,094 emergency room visits and cared for 129,932 outpatient clinic visits, many of which provided to inner city Minneapolis and St. Paul residents. Children's continues to serve a diverse population with 57,702 family encounters for language interpretation utilizing 45 different languages interpreted.Children's designates certain major programs as a "Cornerstone program." These programs meet rigorous criteria for excellence, including outstanding use of evidence-based practices, clinical research, and advanced technologies. These Cornerstone programs include:Cardiovascular - Children's pediatric cardiovascular program is one of the largest in the region with some of the most impressive outcomes in the U.S. Team members care for thousands of the region's sickest children with heart conditions, including fetuses, newborns, infants, children, adolescents, and adult, long-term patients with pediatric cardiovascular conditions. Neonatal Intensive Care - Children's specializes in caring for multiples, babies with congenital anomalies, very premature and very low birth weight babies, and infants born with other complex diagnoses. We offer exceptional tertiary and quaternary care for babies, with survival outcomes among the best in the world. Children's neonatal program is the fourth-largest in the U.S., with more than 1,900 neonatal admissions per year. Our neonatal team includes highly-trained and experienced professionals from a full spectrum of medical specialties. Hematology/Oncology - The hematology/oncology program at Children's is the largest in the upper Midwest with treatment outcomes that consistently rank Children's as one of the top ten programs in the U.S. In our nationally unique model, your child's or teen's care is spearheaded and coordinated by a board-certified hematologist/oncologist, who leads a highly experienced team of multidisciplinary professionals.Cystic Fibrosis - The Cystic Fibrosis (CF) Center at Children's of Minnesota diagnoses and treats children in all stages of CF. Our dedication to family-centered care and education helps children and their families learn to live with CF. Care at Children's for patients with CF ranks among the top 10 programs nationally in key outcomes measured by the National Cystic Fibrosis Registry. Children's provides a continuum of care through coordinated inpatient and outpatient services, from diagnosis through long-term follow-up. The Cystic Fibrosis Center of Children's provides state-of-the art comprehensive care for children with CF.Diabetes/Endocrinology - The McNeely Pediatric Diabetes Center is the only diabetes center in the region to specialize in working solely with children and teens. The staff provide expert health care to help maintain a child's targeted blood sugar ranges. Most children seen in the diabetes center have Type 1 diabetes. A small but growing number have Type 2. In addition to diabetes, the clinic provides diagnostic services and treatment for children with disorders of growth, advanced or delayed sexual development, pituitary disorders, thyroid abnormalities, disorders of calcium balance, adrenal disorders, and hypoglycemia. The McNeely Pediatric Diabetes Center has received recognition for its diabetes education program from the American Diabetes Association, by meeting the association's high educational standards.In addition to the Cornerstone programs, Children's provides other high quality programs such as Surgery. Children's surgery teams deliver next-generation care in an award-winning environment that is exclusively dedicated to pediatrics. Health professionals of many disciplines work together to provide children with the best possible surgery experience. Children's bodies are different than adult's. For example, they often require specially-sized surgical equipment. They react differently to anesthesia and to pain. Their bodies respond differently to illness and treatment, in part because they are still growing. That's why children benefit from our highly accomplished, pediatric-specific surgery teams. At Children's, over 20,000 surgeries are performed each year on fetuses, newborns, children, adolescents, and young adults from throughout the Upper Midwest. Surgical treatment results rank Children's among the top hospitals in the U.S. in pediatric surgical care. Children's has some of the lowest rates in the U.S. of post-surgery complications and some of the highest rates of patient and family satisfaction. As a charitable organization, Children's Hospitals & Clinics of Minnesota also provides a broad spectrum of benefits to the communities we serve. These services and donations account for a measureable portion of the hospitals' costs and help to promote healthy lifestyles, community development, health education, and affordable access to care. Please see IRS Form 990, Schedule H for a summary of these community benefits. 3801192 2395766 Research: In 2010 Children's conducted 457 research projects, 186 of which were clinical trials to examine the effectiveness of diagnostic, therapeutic, and preventive services. In addition 70 peer-reviewed manuscripts were published. Children's was awarded more than $10 million in funding from government, industry, foundation, and academic sub-awards for its research initiatives. See Schedule O. In the past year we have seen a 38 percent increase in research funding at Children's. We continue to participate in multiple prestigious national collaborations and clinical trials. We are also generating landmark investigator-initiated research, aimed at novel ways to deliver life-saving treatments, manage pain and symptoms and develop new methods for preventing or treating childhood diseases. Every day, Children's researchers express their commitment to building better outcomes for our children. These outcomes will have both immediate and lasting impact for children receiving state of the science care at our specialty centers. Children with cardiac disease, cancer, genetic and blood disorders, diabetes, cystic fibrosis, and other life-impacting conditions all have benefited from research at Children's. The vision and strategic innovation of our research leaders have brought us to impressive milestones in the past year. We continue to take steps toward advancing our research and committed to thriving into the future with our children and families. 4722623 1442044 Education: Many efforts to improve the health and well being of children and youth require long-term investment in their future. Children's provides education and training programs for providers, health care students, and other health professionals in the following areas:i. Community medical education for community physicians: During the 2010 calendar year, Children's provided training and education to 44.6 full time equivalent (FTE) residents, and 6.1 FTE fellows. These FTE numbers result from 380 individual residents and 35 individual fellows who performed one or more rotations at Children's - Minneapolis, Children's St. Paul, or both locations. See Schedule O. The rotations were performed in Children's Emergency Departments, inpatient medical/surgical, PICU and neonatal inpatient care units, surgery and anesthesia, ENT surgery, urology, and subspecialty clinics. The residents and fellows came from 36 different medical educational programs: 27 from the University of Minnesota, 3 from Mayo Clinic, 2 from Regions Hospital, 1 from United Hospital, 1 from HCMC, 1 from Rapid City Regional Hospital, and 1 from UW Eau Claire. Additionally, 380 medical students rotated to Children's - Minneapolis, Children's - St Paul, or both locations.ii. Education and training of health care and other providers of services to children:1. The Midwest Regional Children's Advocacy Center at Children's is a leader in improving the care of abused and neglected children whose goal is to improve services for abused children in local communities throughout the region. The Center offers information, consultation, technical assistance, and training to physicians, nurses, and non-medical members of community child abuse teams, including law enforcement personnel, attorneys and child protection workers.2. Recognized, as the nation's leader in palliative care education, Children's Institute for Palliative Care (CIPC) developed a model for a regional training and consultation center. CIPC develops and leads training seminars using recognized curriculum for pediatric palliative care, provides hospital-based consultation to children who are in need of hospice or palliative care while they are hospitalized, offers a regional 24/7 telephone consultation program providing education, support, and guidance to families and professional providers, and serves as a resource center for pediatric palliative care. 3. The Minnesota Sudden Infant Death Syndrome (SID) Center is a statewide program that provides information, counseling, and support to anyone experiencing a sudden and unexpected infant death from any cause. The SID Center is the state's resource for information on Sudden Infant Death Syndrome (SIDS) and SIDS risk reduction. The Center conducts training and educational programs for health care providers, child-care workers, and other professional and community groups. The Center also tracks and reports infant mortality trends in Minnesota and participates in local, state, and national initiatives to reduce the risk of sudden, unexpected infant death. The Minnesota SID Center collaborates with the Minnesota Department of Health, county public health nurses, and medical examiners in every county throughout Minnesota.4. The Emergency Medical Services for Children (EMSC) Resource Center housed at Children's creates awareness regarding the special needs of children in emergency medical situations. EMSC educational programs are designed to train pre-hospital personnel, first responders, physicians, nurses, and school nurses in the unique needs of infants and children in emergency situations. The EMSC Resource Center also provides technical assistance, participates in statewide pediatric emergency/disaster preparedness planning, develops and disseminates pediatric emergency are guidelines, and conducts mortality reviews and research.ii. Education and employment - Because disparities in child health are so closely associated with low educational attainment and poor job skills, Children's is engaged in several key community partnerships to improve educational success and earning potential among youth and adults. Examples include the Roosevelt High School Health Careers Program that provides students interested in health care careers the opportunity to receive health care specific education and obtain internships with health care organizations, the Achieve Minneapolis/Step-up Summer Jobs Program that places youth in supervised summer internships at participating companies and organizations, and a partnership with Project for Pride in Living that recognizes that a healthy, sustainable community requires residents with well-paying jobs. 480409753 1 1 0 1 0 0 0 0 0 1 1 1 0 1 1 1 0 1 0 0 1 0 0 0 0 0 1 0 1 0 1 1 0 0 0 0 0 1 0 0 0 1 1 0 0 0 1 1 1 1 0 0 1 440 0 4749 1 1 1 1 CJ 0 0 0 0 0 0 0 0 X 23 20 0 0 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 1 0 MN X Jerry Massmann CFO 6128136113 2525 Chicago Avenue S Minneapolis MN 55404 X Alan Goldbloom 50.00 X X 1030029 0 220409 Raymond L Barton 1.00 X X 0 0 0 Russell Becker 1.00 X 0 0 0 Pamela Gigi Chawla MD 50.00 X 246397 0 24344 Michael V Ciresi 1.00 X 0 0 0 Molly Culligan 1.00 X 0 0 0 Kelly Delahunty MD 1.00 X 0 0 0 Michael B Fiterman 1.00 X 0 0 0 Andrea Kmetz-Sheehy 1.00 X 0 0 0 Cynthia L Lesher 1.00 X 0 0 0 Chad M Lindbloom 1.00 X 0 0 0 Matt Majka 1.00 X 0 0 0 Gaye Adams Massey 1.00 X 0 0 0 Richard J Migliori MD 1.00 X 0 0 0 David J Miller 1.00 X 0 0 0 Michael J Ott 1.00 X 0 0 0 Timothy J Pabst 1.00 X X 0 0 0 Octavio Portu Jr 1.00 X 0 0 0 Ryan D Robinson 1.00 X 0 0 0 Patrick G Ryan 1.00 X X 0 0 0 Sandra Sackett MD 1.00 X 0 0 0 James D Sidman MD 1.00 X 0 0 0 Colin Smith 1.00 X 0 0 0 Maria Christu 50.00 X 384425 0 42624 Phil Kibort 50.00 X 630941 0 51345 Jerry Massmann 50.00 X 585809 0 50301 David Brumbaugh 50.00 X 327556 0 42222 Theresa Pesch 25.00 X 188226 188227 34199 Virginia Malone 50.00 X 403384 0 30649 David Overman 50.00 X 520163 0 36295 Gloria Drake 50.00 X 180348 27786 44450 Pamala VanHazinga 50.00 X 168264 0 36166 Becky Bedore 50.00 X 162804 0 32369 Richard Rittenhouse MD 50.00 X 441999 0 39120 John Nicotra MD 50.00 X 513298 0 21624 Karen Blumberg 50.00 X 598140 0 27965 Richard Patterson MD 50.00 X 551992 0 39120 William Mize MD 50.00 X 546718 0 39120 7480493 216013 812322 456 0 1 0 Cerner Corp PO Box 412702 Kansas City MO 64141 Hardware & Software Maintenance 6010921 Childrens Respiratory & Critical Care 2530 Chicago Avenue South Suite 400 Minneapolis MN 55404 Physician Services 3493411 Perot Systems Corp 12020 Collections Center Drive Chicago IL 60693 Patient Billing 2939339 Weber Shandwick Worldwide PO Box 7247-6593 Philadelphia PA 191706593 Public Relations 1847539 Children's Heart Clinic 2530 Chicago Avenue South Suite 500 Minneapolis MN 55404 Physician Services 1502117 60 20544746 13504487 1437458 34049233 Patient Service Revenu 621400 368289666 368289666 Medicare/Medicaid paym 621400 161854164 161854164 Parking 812930 2174520 -19501 2194021 Pharmacy Revenue 621400 610588 610588 Lab Revenue 621500 263886 105879 158007 566037 566037 533758861 15480913 15480913 1194118 606756 587362 587362 587362 16968125 260536 41925 16968125 218611 17186736 17186736 Cafeteria 722210 1509053 1509053 Marketplace 453220 177910 177910 Vending Machines 722210 24865 24865 23723 23723 1735551 602798656 530709867 86378 37953178 345688 345688 5827764 1619758 4208006 251452589 230055944 21396645 23470249 21029343 2440906 33730592 27606958 6123634 18037124 16151700 1885424 6021077 5364060 657017 619053 61785 557268 323501 323501 104775 104775 1407455 1407455 52506466 45169216 7337250 2595608 285493 2310115 7598306 4972426 2625880 10615580 10615580 13116017 12045204 1070813 1347460 1084328 263132 1332446 1063210 269236 9902673 9902673 35064107 22970197 12093910 2974065 2842670 131395 Medical Supplies 47473004 47473004 0 0 MNCare Tax 9833563 9833563 0 0 Bad Debt 9022620 9022620 0 0 Medicaid Surcharge 7327919 7327919 0 0 Temp Labor 2288842 1798598 490244 0 5331825 2383396 2948429 559670368 480409753 79260615 0 9652108 5521505 13964040 12719564 1459130 1311922 62233034 63818408 834256 215411 4237559 4378644 4126881 3489161 602093696 233196618 302441404 368897078 302460247 291468734 6415742 47929926 18008977 18138521 109984666 98919531 835818044 916808405 83204508 81273100 3133679 1296309 233570347 284510281 2648719 397672 46940136 48877673 369497389 416355035 X 394811150 432934479 45045312 40704791 26464193 26814100 466320655 500453370 835818044 916808405 X 43128288 -8995573 X 0 1 1 X 0 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 1 0 0 0 0 1 194734 0 1 3395 198129 0 Explanation of Other Lobbying Activities: Part II-B, Line 1i: Children's retains a lobbyist to assist directly with lobbying efforts at the state level. Children's Director of Child Health Policy also occasionally will meet with state legislators, provide testimony on child health issues, or otherwise provide information to state lawmakers and their staffs. With respect to federal lobbying efforts, Children's Director of Child Health Policy and CEO will occasionally travel to Washington to meet with federal lawmakers. This is generally done in collaboration with industry organizations, such as NACHRI, who indirectly provide federal lobbying support on behalf of Children's. Children's is a member of the National Association of Children's Hospitals (NACH). $3,395 of membership dues paid to NACH relate to lobbying activities. 28645602 371730 2991850 1127532 30881650 23511131 1160044 4333957 359530 28645602 35160520 819502 -10484516 1984375 23511131 0.13000 0.87000 1 1 1 10968672 10968672 377316451 87767563 289548888 1923396 1176048 747348 206462539 140959714 65502825 5422638 3293293 2129345 368897078 Brandywine 42280198 F Artio Global Investors 5649728 F 47929926 Assets of executive benefit plans 11293341 Unamortized bond insurance and deferred finance costs 5583093 Investment in land for possible expansion 3240298 Intercompany receivable 2041311 Nursing education loans receivable 176493 Pharmaceutical services deposit 1319219 Physician relocation loans receivable 257540 Facility deposit 134000 United shared service arrangement 4919992 Beneficial interest in net assets of foundation 69333483 Other 2830 Investment in laundry cooperative 617931 98919531 MN Care tax payable 1986774 Self-insurance reserve 881796 RSVP retirement plan 31268238 Executive benefits liability 7288387 Post retirement benefits 4105890 Workers comp liability 1977709 Self-insurance equipment reserve 138100 Accrual VERP 1230779 48877673 602798656 559670368 43128288 4746436 -13742009 -8995573 34132715 597008171 4746436 -10925066 -6178630 603186801 -388145 -388145 602798656 557791054 388145 388145 557402909 2267459 2267459 559670368 Description of Intended Use of Endowment Funds: Part V, Line 4: The majority of endowment funds are held by Children's Health Care Foundation, a related organization. The intended use of the funds is to support the programs at Children's Health Care. There are also two endowment funds that are held and administered by US Bank, an unrelated organization, which are also used to support the programs at Children's Health Care. Refer to Part III, Line 4 for a description of the programs of Children's Health Care. Description of Uncertain Tax Positions Under FIN 48: Part X: The Internal Revenue Service has determined that Children's and its subsidiaries are exempt organizations as described in Section 501(C)(3) of the Internal Revenue Code ("IRC"). Children's believes that it continues to meet the requirements of the IRC to sustain its tax-exempt status. There are no federal income tax expenses, penalties, or interest in the consolidated statements of operations and no unrecognized tax benefits for the years ended December 31, 2010 and 2009. Part XI, Line 8 - Other Adjustments: Change in beneficial interest in net assets of Foundation(5,357,191) RSVP Retirement plan-related changes (2,179,183) Change in value of interest rate swap valuation (6,478,424) Unrealized Swap earnings 272,789 Part XII, Line 2d - Other Adjustments: Investment expense (1,407,455) Amortization expense (860,004) RSVP retirement plan-related changes (2,179,183) Change in unrealized interest rate swap valuation (6,478,424) Part XII, Line 4b - Other Adjustments: Gain on sale of assets 218,611 Rental expense (606,756) Part XIII, Line 2d - Other Adjustments: Gain on sale of assets (218,611) Rental expense 606,756 Part XIII, Line 4b - Other Adjustments: Investment expense 1,407,455 Amortization expense 860,004 Central America & the Caribbean Self-Insurance for medical claims 88079 Central America & the Caribbean Investments 5765805 0 0 0 5853884 0 5853884 0 0 1 0 0 0 1 1 X 1 X 1 X 1 1 0 1 1 7837024 51948 7785076 0.01410 204475625 159639106 44836519 0.08140 212312649 159691054 52621595 0.09550 9292915 304225 8988690 0.01630 6338830 1442044 4896786 0.00890 48748559 33882451 14866108 0.02700 4908271 2871 4905400 0.00890 312385 312385 0.00060 69600960 35631591 33969369 0.06170 281913609 195322645 86590964 0.15720 50000 50000 0.00010 1751513 123067 1628446 0.00300 21800 21800 0.00000 35000 35000 0.00010 1858313 123067 1735246 0.00320 1 4109419 1027355 167191 372038 -204847 X 1 1 2 1 Children's - Minneapolis

2525 Chicago Avenue South Minneapolis MN 55404

X X X X X X 2 Children's - St Paul

345 North Smith Avenue St Paul MN 55102

X X X X X X NA 1 Part I, Line 3c: FPG is the primary measurement used to determine eligibility for charity care. However, policy exceptions may be granted for families who either have income exceeding the guidelines established or who with the sliding scale discount continue to have insufficient means to pay. Asset tests and other thresholds can be used.Part I line 6a: Children's Hospitals and Clinics of Minnesota prepares an annual community benefits report. The community benefits report is available to the public. Part I, Line 7: Subsidized health services benefits include the subsidized costs of two physician clinics. A clinic is located on both the Minneapolis and St. Paul campuses. These clinics serve the local communities that include a high percentage of minorities and low-income families. Net community benefit expenses related to these clinics were $1,119,000 for the twelve months of 2010.Part I, line 7, column (f): Bad debt expense of $9,022,620 was subtracted for purposes of calculating the percentage in Schedule H, Part I, line 7, column (f).Part I, line 7: : A ratio of patient care cost to charges, as calculated using Form 990, Schedule H, Worksheet 2 - Ratio of Patient Care Cost to Charges, was used to calculate community benefit costs for Schedule H, Part I, Line 7, rows (a)(c). Community benefit costs for rows (b)(e)(f)(g)(h)(i)(j) were calculated using a full-absorption costing model that combines direct costing and the allocation of indirect costs through an activity-based costing methodology. Part III, Line 4: Bad debt is defined as the unpaid obligation for care provided to patients who have been determined to be able to pay, but have not demonstrated a willingness to pay. The amounts attributable to patients eligible under the organizations charity care policy are determined by a patient's willingness to pay with a documented inability to pay per measures established by our policy. Both amounts are estimated by applying the ratio of patient care cost to charges, as calculated on Form 990, Schedule H, Worksheet 2, to the actual patient charges. The organization estimates that twenty-five percent of bad debt expenses are attributable to patients who likely would qualify for financial assistance under the organization's charity care policy if sufficient information had been available to make a determination of their eligibility. The estimate of twenty-five percent is based on historical trends and the experience of area supervisors. Footnote from 2010 audited financials:Patient Accounts Receivable - Patient accounts receivable represent amounts due from federal and state agencies, managed health care plans, commercial insurance companies, employers, and patients. Children's grants credit to patients, most of whom are insured under third-party payer agreements, without collateral or any other security to support amounts due. Children's determines an allowance for doubtful accounts by considering a number of factors, including, but not limited to, the length of time accounts receivable are past due, its previous loss history, the existence of a third-party payer, reimbursement trends, and other collection indicators. Accounts are written off when all reasonable internal and external collection efforts have been performed and payments subsequently received on such receivables are credited to the allowance. Children's recognizes that revenues and receivables from government agencies are significant to its operations, but do not believe there are significant credit risks associated with these government agencies. In 2010, net revenue from the top four third-party payers accounted for 42%, 25%, 14%, and 8% of net patient service revenue. In 2009, net revenue from the top four third-party payers accounted for 39%, 24%, 14%, and 9% of net patient service revenue. Part III, Line 8: The organization primarily serves pediatric patients and does not generate significant Medicare revenues. As a result, a low utilization Medicare cost report is filed. Form 990, Schedule H, Worksheet 3 - Unreimbursed Medicaid and Other Means-Tested Government Programs was used to calculate the costs associated with Medicare charges reported in Part III, Line 6. The organization does not report any amounts from Part III, Line 7 as community benefit. Part III, Line 9b: When collecting medical debt, Children's Hospitals and Clinics of Minnesota treats its patient families with honor, dignity, and courtesy; demonstrate compassion; and be good stewards of health care resources. There is a zero tolerance for abusive, harassing, oppressive, false, deceptive, or misleading language or collections conduct by Children's employees who collect medical debt from patient families. This policy applies broadly to all patient families we serve. Components of Children's collection policy include:During the pre-registration, registration, or admission process, Children's attempts to identify and inform patient families who may be eligible for charity care or discounted care through the uninsured discount or charity care policy.All Children's employees and contracted staff who have direct contact with patients will be educated on an annual basis of Children's financial assistance policies. The education informs staff of programs available and how a patient family may obtain more information and submit an application for financial assistance.A financial assistance application is sent with the initial letter explaining the process for obtaining financial assistance to all self pay patient families or patient families who indicate at registration an inability to pay.All correspondence seeking collection of medical debts contains a reference to the availability of financial assistance.Minnesota hospital providers have jointly developed consistent collection guidelines set out in formal agreements with the Minnesota Attorney General's Office. This agreement is consistent with Children's collection policy. The Audit Committee of our Board of Directors annually reviews this policy and all policies concerning collection of medical debt, uninsured discount, and charity care. The Audit Committee also reviews the results of an annual audit related to these areas in accordance with the Minnesota Attorney General's Agreement. Part V, Section A: Children's also operates specialty and rehabilitation clinics in the following locations: Woodbury,MN; Maple Grove, MN; Minnetonka, MN and Roseville, MN and operates pediatric clinics in Eagan, MN, West St. Paul, MN and Vadnais Heights, MN. These clinics are operated under the Children's hospital license. Part VI, Line 1: Community building activities: Children's provided the following community building activities in 2010:- STEP-UP and Health Careers at Roosevelt High School: the mission of this program is to provide educational opportunities to a diverse body of students from the local community who are interested in preparing for a career in health care.- Project for Pride in Living: this is a nonprofit agency working with lower-income individuals and families throughout the Twin Cities metro area to achieve greater self-sufficiency through housing, employment training, education, and support services.- Midwest Regional Outreach: The Midwest Children's Resource Center (MCRC) is a regional center providing specialty services for children who are possibly abused, their families, and the professionals who work with them. MCRC brings together a multi-disciplinary team of child abuse specialists who provide a broad range of services, including medical and psychological consultation. The center works as an advocate for the children who have been abused, seeking to significantly advance protection, treatment, and healing of these children. Part VI, Line 2: Needs Assessment: The health care needs of the community served by Children's Hospitals & Clinics of Minnesota are determined as follows: a. Board of Directors: the organization's governing body, comprised of community members who reside locally, provides governance that includes the health care services provided to the local community.b. Children's employed physicians, independent physicians who provide care at Children's, and numerous clinical care providers assess community needs daily through the pediatric care provided throughout the community.c. The Family Advisory Council: a diverse group of families whose children are present or past patients of Children's provide input as to Children's services. Council members represent a wide range of inpatient and outpatient experiences to help enhance the quality of child and family care experiences at Children's. Council responsibilities include:- Develop, implement, and evaluate service and facility standards.- Communicate to management the recommendations and concerns expressed by parents, family members, parent associations, and others.- Advise on policy review, promote family-centered care, and support program development.d. Community partnerships: partnerships with groups such as the Minnesota Hospital Association Policy and Advocacy Committee and the Hennepin County Health Department Community Advisory Group helps the organization identify community needs. Children's also partners with Raise it for Health, a tobacco cessation coalition, as well as with the Minnesota Prematurity Coalition, a group devoted to increasing awareness of the unique health and development issues premature infants face through advocating for access to quality health care, and identification, consolidation, and dissemination of resources for parents and families.e. Youth Advisory Council (YAC): is a dedicated group of patients, ages 10 to 18, who help hospital staff, leaders, doctors, and parents understand what is important to children, teens, and siblings during hospital stays, clinic visits, and emergency care. YAC brings a valuable perspective and voice to Children's by participating in activities that promote discussion and thought about health care services for pediatric and young adult patients. The council also brings great perspective to let other children know how to make their stay at Children's a more comfortable and positive experience.f. Children's maintains an advocacy department that is responsible for identifying community health needs and leading efforts that advocate for pediatric health needs. Children's advocacy department maintains an advocacy database of over 400 members, all of whom can share advocacy input with the Children's Advocacy team. The advocacy department is also currently partnering with Minneapolis/St. Paul metro public health departments and statewide health care providers to potentially create a strategically-aligned community health needs assessment. The assessment is in its planning stages, and will be complete by the IRS deadline.g. Other methods include and are not limited to: partnerships and projects with third party-payers and other community physicians and hospitals, monitoring and reporting of infectious disease data, disaster readiness efforts, research and education, support groups, and others. Part VI, Line 3: Patient Education of Eligibility for Assistance: Components of Children's collection policy include:During the pre-registration, registration, or admission process, Children's will attempt to identify and inform patient families who may be eligible for charity care or discounted care through the uninsured discount or charity care policy.All Children's employees and contracted staff who have direct contact with patients will be educated on an annual basis of Children's financial assistance policies. The education will inform staff of programs available and how a patient family may obtain more information and submit an application for financial assistance.A financial assistance application will be sent with the initial letter explaining the process for obtaining financial assistance to all self pay patient families or patient families who indicate at registration an inability to pay.All correspondence seeking collection of medical debts will contain a reference to the availability of financial assistance.Minnesota hospital providers have jointly developed consistent collection guidelines set out in formal agreements with the Minnesota Attorney General's Office. This agreement is consistent with Children's collection policy. The Board of Directors (Audit Committee) performs an annual review of this policy and all policies concerning collection of medical debt, uninsured discount, and charity care. The Audit Committee shall also review the results of an annual audit related to these areas in accordance with the Minnesota Attorney General's Agreement. Part VI, Line 4: Community information (communities we serve):Children's Hospitals & Clinics of Minnesota serves the five state area of the upper Midwest (Minnesota, North Dakota, South Dakota, Iowa, and Wisconsin). Approximately eighty percent of inpatient admissions are from the three-million individuals residing in the eleven county metropolitan areas of the Twin Cities. The remaining twenty percent of inpatient admissions are from outstate Minnesota and the surrounding states. These patients represented one-hundred percent of Minnesota counties and fifty-nine percent of total counties in the five state area. The age of patients reflects the pediatric health services provided with seventy-five percent of patients under the age of ten and ninety percent under the age of fifteen. Patient diversity at Children's significantly exceeds the diversity of the local population with non-white patients representing over fifty percent of patients served as compared to less than twenty percent for the local community. Children's provides interpreter services for forty-five languages with the most frequent languages being Spanish, Somali, and Hmong. Children's also serves a disproportionate share of economically disadvantaged patients with forty-two percent of patient revenues from government programs. The Minneapolis campus is located within the Phillips-Powderhorn neighborhood (MUA), home to one of the most ethnically diverse communities in Minnesota. Part VI, Line 6: Other Information:As a charitable organization, Children's provides a broad spectrum of benefits to the communities it serves that would otherwise be unavailable or insufficient to meet patient demand for the express purpose of improving the health status of children in the community. These include programs such as free clinics, health screenings, support counseling for patients and families, crisis intervention, disaster readiness and the cost of providing community health partnerships and educations. These services and donations account for a measurable portion of the hospital's costs and help to promote healthy lifestyles, community development, health education, and affordable access to care. Example programs include:- Children's is one of the local hospitals and health plans in the Twin Cities that advises Portico Healthnet on issues related to program services and provides funding for medical services to participants. Portico Healthnet, a nonprofit health and human services organization, serves the community by assisting children, parents, and individuals who are uninsured with applications to health care programs and by offering a primary and preventive health care access program for people ineligible for public programs. Since 1995, 9,000 uninsured children and adults have enrolled in Portico's safety-net coverage program, and another 14,000 have been enrolled in public coverage programs with assistance from Portico Healthnet.- Women, Infants & Children (WIC) Program. WIC is a nutrition program provided by Children's that helps eligible pregnant women, new mothers, babies and young children eat well, learn about nutrition, and stay healthy. An important component of this funding is that it will provide health care to underserved populations in Minneapolis, particularly those in the Latino and Somali communities.- The EMSC Resource Center provides technical assistance to agencies to improve pediatric emergency care. The EMSC works to reduce child morbidity and mortality due to trauma and critical illness and is the only statewide program that focuses on improving pediatric components of medical care.- The Sudden Infant Death Center provides support to families and promotes awareness within both the medical and lay communities of SIDS and other causes of sudden infant death. The center works to identify causes of sudden, unexpected infant death throughout Minnesota; reaches out with information and support to families; educates professionals and the public; and participates in research.- The Simulation Center is a motor coach outfitted with simulation equipment and staffed with Children's trainers, travels throughout the Midwest to train staff from hospitals in the best practices when responding to pediatric or neonatal medical emergencies. Part VI, Line 7: Reports Filed With States Part VI, Line 7 MN 0 Camp Odayin PO Box 2068 Stillwater MN 55082 412014358 501(c)(3) 6300 Sponsorship of Have A Heart benefit & Whole Heart benefit. Children's Hospital Association 2525 Chicago Ave S Minneapolis MN 55404 410711605 501(c)(3) 16200 Storybook Ball fundraiser tickets. Make-A-Wish Foundation 615 First Ave NE Minneapolis MN 55413 411422893 501(c)(3) 6000 Sponsorship of Wish Ball fundraiser tickets. March of Dimes 5233 Edina Industrial Blvd Edina MN 55439 131846366 501(c)(3) 18000 Sponsorship of various fundraisers. Peoples Center Health Services 425 20th Ave S Minneapolis MN 55454 410982430 501(c)(3) 35000 Teenage medical center Portico Healthnet 2610 University Ave WSuite 550 St Paul MN 551142007 411814659 501(c)(3) 108333 Help familes to get Medical Assistance coverage. Project for Pride in Living 1035 E Franklin Ave Minneapolis MN 55406 237232208 501(c)(3) 75000 Support Project for Pride in Livings health careers job training program. Ronald McDonald House 818 Fulton St SE Minneapolis MN 55414 411313107 501(c)(3) 6200 Sponsorship of Fam Glam benefit & golf benefit. Roosevelt HS Health Careers Program 4029 28th Ave S Minneapolis MN 55406 410851980 501(c)(3) 10000 Support Roosevelt HS Health Careers Program. Smith Partners 400 Second Ave S Minneapolis MN 55401 203663831 21800 Support Phillips Partnership. 9 1 Procedure for Monitoring Grants in the U.S.: Part I, Line 2: Schedule I, Part I, Line 2: From time to time, Children's grants monies to other organizations conducting programs and/or research that will benefit the children that Children's serves. Children's also occasionally provides monetary support to organizations that promote careers in the health care field and community organizations that support the economic development of the area surrounding the Children's Minneapolis campus. Childrens receives periodic updates regarding the use of the funds. X 1 0 X X X X X 0 1 0 0 0 0 0 1 0 Alan Goldbloom 635004 0 379378 0 15647 0 204508 0 15901 0 1250438 0 83276 0 Pamela Gigi Chawla MD 222800 0 23565 0 32 0 21906 0 2438 0 270741 0 0 0 Maria Christu 256101 0 87546 0 40778 0 22125 0 20499 0 427049 0 18240 0 Phil Kibort 424222 0 196171 0 10548 0 30600 0 20745 0 682286 0 81369 0 Jerry Massmann 377196 0 194701 0 13912 0 34400 0 15901 0 636110 0 80578 0 David Brumbaugh 236504 0 88638 0 2414 0 22028 0 20194 0 369778 0 24394 0 Theresa Pesch 135665 135666 43354 43353 9207 9208 9244 9244 7856 7855 205326 205326 0 0 Virginia Malone 173057 0 130314 0 100013 0 21744 0 8905 0 434033 0 72476 0 David Overman 381394 0 137829 0 940 0 18375 0 17920 0 556458 0 0 0 Gloria Drake 150515 23189 27323 4210 2510 387 24628 3794 13888 2140 218864 33720 0 0 Pamala VanHazinga 142161 0 26103 0 0 0 17807 0 18359 0 204430 0 0 0 Becky Bedore 137330 0 25474 0 0 0 24695 0 7674 0 195173 0 0 0 Richard Rittenhouse MD 397599 0 44400 0 0 0 18375 0 20745 0 481119 0 0 0 John Nicotra MD 437435 0 75121 0 742 0 18375 0 3249 0 534922 0 0 0 Karen Blumberg 467544 0 126566 0 4030 0 18375 0 9590 0 626105 0 39016 0 Richard Patterson MD 433491 0 118501 0 0 0 18375 0 20745 0 591112 0 34880 0 William Mize MD 424756 0 121962 0 0 0 18375 0 20745 0 585838 0 38342 0 Part I, Line 1a Alan Goldbloom is reimbursed for his membership fees for the Minneapolis Club, which is used solely for business purposes. Part I, Line 4b Certain employees of Children's Health Care are provided the opportunity to participate in the Supplemental Executive Retirement Plan (the SERP). The SERP requires that the employee have an agreement in order to be eligible to participate in the SERP. Payments from the SERP occur at retirement and are based on years of service and percentage of salary. The following amount represents the amount deferred under the SERP in 2010. Alan Goldbloom $181,998 Certain employees of Children's Health Care are provided the opportunity to participate in the Capital Accumulation Plan (the Capital Plan). The Capital Plan requires that the employee is a physician or executive and is a .5 FTE or more in order to be eligible to participate in the Capital Plan. Payments from the Capital Plan occur at vesting and are based on percentage of salary. The following amount represents the amount paid under the Capital Plan in 2010. Alan Goldbloom $83,276 Jerry Massmann $62,603 Phil Kibort $81,369 David Brumbaugh $24,394 Virginia Malone $72,476 Maria Christu $18,240 Certain employees of Children's Health Care are provided the opportunity to participate in the Deferral Account Pay Plan (the Deferral Plan). The Deferral Plan requires that the employee is a physician or executive and is a .5 FTE or more in order to be eligible to participate in the Deferral Plan. Payments from the Deferral Plan occur at vesting and are based on percentage of salary. The following amount represents the amount paid under the Deferral Plan in 2010. Jerry Massmann $17,975. Part I, Line 5 Part I, Line 7 Certain executives and physicians are eligible for participation in the Executive Incentive Plan (EIP)or Physician Incentive Plan (PIP). The EIP and PIP provide eligible participants with the opportunity to receive an incentive payment based on attainment of established organization and individual goals. 1995B2004A - See Part V 416005375 603695FG7 2004-08-24 77550000 Health Care Equipment & Buildings & Refunding of Bonds Issued on 10/2/95 0 0 0 2004B - See Part V 416005375 603695FH5 2005-05-25 51550000 Refunding of Taxable Bond Issued 8/24/04 0 0 0 2007A - See Part V 416005375 603695FP7 2007-11-15 103000000 Facility Expansion and Upgrade 0 0 0 1995B2004A-12010A - See Part V 416005375 603695GQ4 2010-03-25 97051274 Facility Expansion and Upgrade and Refunding of Bond Issued 8/24/04 0 0 0 54525000 77550000 330 810064 1239936 50000000 25500000 2004 1 0 1 1 10850000 51550000 583 51550000 1 0 1 1 106148383 465 862000 1582951 103703432 2009 0 0 1 1 97071507 1243 51120684 45950468 355 1 0 0 1 0 1 1 1 1 0.00000 0.00000 0.00000 1 0 0 1 1 1 0.00000 0.00000 0.00000 1 0 0 1 1 1 0.00000 0.00010 0.00010 1 0 0 1 1 1 0.00000 0.00000 0.00000 1 0 1 1 PIPER JAFFREY 30.200000000000 0 0 0 0 1 0 1 1 PIPER JAFFREY 20.200000000000 0 0 0 0 1 0 1 1 PIPER JAFFREY 29.800000000000 0 0 0 0 1 0 0 0 0 0 1 Schedule K Supplental Information The report periods selected for all four bond issues recorded on Schedule K are not the same as the fiscal year end for the rest of Form 990. Schedule K uses the bond year ending August 15, 2011. Schedule K, Part II, Line 5 Issuance Costs: A. Credit Enhancement $1,239,936 Other Issuance Costs $810,064 C. Credit Enhancement $1,582,951 Other Issuance Costs $862,000 Schedule K, Part II, Line 8 Year of Substantial Completion: B. As this bond issue consists entirely of refunding bonds, it is Children's understanding that the concept of "year of substantial completion" does not apply to this issue. Schedule K, Part III, Column B: B. Part III is not required for these bonds, but information is entered anyway, due to software limitations. Schedule K, Part III, Line 4 Private Use: The project financed by the 2004A bond issue shows a one-year private use percentage that is an aberration which is supported by bond counsel opinion that the percentage will reduce to acceptable ranges over the lives of the bonds as calculated under the regulations. Schedule K, Part III, Line 5 Private Use: C. A small portion of Children's laboratory department is financed with bond proceeds. A portion of some laboratory services are provided to outside organizations, not for direct patient care, of which Children's is reporting as UBI. Schedule K, Supplemental Information The report periods selected for all four bond issues recorded on Schedule K are not the same as the fiscal year end for the rest of the Form 990. Schedule K uses the bond year ending of August 15, 2011. Part I, Column (g) A. Though these bonds are not defeased, a portion of the bonds was currently refunded by a reissuance on 3/25/2010. Part II, Line 3 Differences between Part I, ,column (e) and Part II, line 3 are due to investment earnings. Schedule K, Part II, Line 13 Year of Substantial Completion B. As this bond issue consists entirely of refunding bonds, it is Children's understanding that the concept of "year of substantial completion" does not apply to this issue. Schedule K, Part III, Column B: Part III is not required for these bonds, but information is entered anyway, due to software limitations. Schedule K, Part III, Line 5: C. A small portion of Children's laboratory department is financed with bond proceeds. A portion of some laboratory services are provided to outside organizations, not for direct patient care, of which Children's is reporting as UBI. Schedule K, Part I, Line 1 Column A Health Care Facilities Revenue Bonds 1995B/2004A - Issuer of the bond is City of Minneapolis, MN (41-6005375) and Housing and Redevelopment Authority of the City of St. Paul, MN (41-6005521). Schedule K, Part I, Line 2 Column A Health Care Facilities Revenue Bonds 2004B - Issuer of the bond is City of Minneapolis, MN (41-6005375) and Housing and Redevelopment Authority of the City of St. Paul, MN (41-6005521). Schedule K, Part I, Line 3 Column A Health Care Facilities Revenue Bonds 2007A - Issuer of the bond is City of Minneapolis, MN (41-6005375) and Housing and Redevelopment Authority of the City of St. Paul, MN (41-6005521). Schedule K, Part I, Line 4 Column A Health Care Facilities Revenue Bonds 1995B/2004A-1/2010A - Issuer of the bond is City of Minneapolis, MN (41-6005375) and Housing and Redevelopment Authority of the City of St. Paul, MN (41-6005521). Jerry Massmann Split Dollar Life Insurance X 215411 215411 0 0 1 215411 Pediatric ENT Association James Sidman, President of Pediatric ENT Association 109437 Medical Payment to Pediatric ENT Association for Medical Director services. 0 X 1 7000 Cost or selling price X 17358 Cost or Selling price X 343284 Cost or selling price X 52 133978 Cost or selling price X Other: 5 662343 Cost or selling price X Entertainment 33 182794 Cost or selling price X Building Materials 6 90700 Cost or selling price 0 1 0 Form 990, Part VI, Section B, line 11 Children's senior management reviews the draft Form 990 with the Audit and Compliance Committee of the governing body prior to filing of the Form. This review includes an overview of the Form and discussion related to key sections. Copies of the final Form 990 are made available to members of the Committee and all directors prior to the Form being filed. The Audit and Compliance Committee has been delegated the authority to oversee the completion and filing of the Form 990 by the full board, and the Committee reports the results of its review and approval to the full board at a regularly scheduled board meeting. Form 990, Part VI, Section B, line 12c Management of Children's ensure that conflict of interest disclosure forms are completed by all members of the governing body and board committees at least annually. Forms are completed at the beginning of the year, and directors and committee members are instructed to provide additional disclosures if necessary during the course of the year. The Governance Committee of the governing body, along with senior management (CEO and General Counsel) review all disclosures provided by governing board members. The results of this review and any concerns, limitations, etc., are reported by the Governance Committee to the full board. If conflicts are identified, the Governance Committee and management work to ensure that directors do not participate in discussion or voting on the affected matter. Form 990, Part VI, Section B, line 15 Children's follows the requirements set forth in the IRS rebuttable presumption of reasonableness in determining compensation for the CEO and other officers and executive leaders of Children's. This function is performed by the Compensation Committee of the governing board, which is composed of only independent directors. The process includes review of comparability data, retention of an outside compensation consultant and contemporaneous substantiation of the deliberation and decision through detailed minutes of the Compensation Committee and full board meetings where executive compensation is considered. Form 990, Part VI, Section C, line 19 Children's makes financial statement information public through a summary of financial performance in its annual report. In addition, financial statements are provided to Children's bond trustee, who therefore make this information publicly available. Children's governing documents and conflict of interest policy are not available to the public. Form 990, Part VII The following individuals held positions at both Children's Health Care and Children's - Minnetonka. The hours listed on Part VII are the average hours per week these individuals devoted to Children's Health Care during the year. In addition, these individuals also devoted the following average hours per week to Children's - Minnetonka. Phil Kibort 1.5 hours Jerry Massmann 1.5 hours Gloria Drake 6.0 hours The following individuals held positions at both Children's Health Care and Children's Health Care Foundation. The hours listed on Part VII are the average hours per week these individuals devoted to Children's Health Care during the year. In addition, these individuals also devoted the following average hours per week to Children's Health Care Foundation. Alan Goldbloom 1.0 hour Maria Christu 1.0 hour Jerry Massmann 1.0 hour Pamela Gigi Chawla, MD 1.0 hour Theresa Pesch 25.0 hours Raymond Barton 1.0 hour Russell Becker 1.0 hour Michael Ciresi 1.0 hour Molly Culligan 1.0 hour Kelly Delahunty 1.0 hour Michael Fiterman 1.0 hour Andrea Kmetz-Sheehy 1.0 hour Cynthia Lesher 1.0 hour Chad Lindbloom 1.0 hour Matt Majka 1.0 hour Gaye Adams Massey 1.0 hour Richard Migliori 1.0 hour David Miller 1.0 hour Timothy Pabst 1.0 hour Octavio Portu, Jr. 1.0 hour Ryan Robinson 1.0 hour Patrick Ryan 1.0 hour Sandra Sackett 1.0 hour James Sidman 1.0 hour Colin Smith 1.0 hour Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: Net unrealized gains on investments: 4,746,436. Change in beneficial interest in net assets of Foundation(5,357,191) RSVP Retirement plan-related changes (2,179,183) Change in value of interest rate swap valuation (6,478,424) Unrealized Swap earnings 272,789 Children's Health Insurance Network LTD PO Box 30600 Grand Cayman, Catman Islands CJ KY1-1203 Insurance CJ 363616 5765805 Children's Health Care Children's Health Care Services Inc DBA Minnetonka 2525 Chicago Ave S Minneapolis MN 55404 411756478 Healthcare MN 501(c)(3) Line 3: 170(b)(1)(a) N/A 1 Children's Health Care Foundation 2525 Chicago Ave S Minneapolis MN 554021844 411814223 Healthcare MN 501(c)(3) Line 7: 170(b)(1)(a) N/A 1 0 0 1 0 0 0 0 0 1 0 0 1 0 1 1 1 0 1 Children's Health Care Foundation C 20544746 COST Children's Health Care Foundation L 4264095 COST Children's Health Care Foundation O 3967823 COST Children's Health Care Foundation R 20230748 COST Children's Health Care Services Inc d b a Children's - Minnetonka I 41860 COST Children's Health Care Services Inc d b a Children's - Minnetonka L 274814 COST Children's Health Care Services Inc d b a Children's - Minnetonka N 287278 COST Children's Health Care Services Inc d b a Children's - Minnetonka O 9306196 COST Children's Health Care Services Inc d b a Children's - Minnetonka P 7202041 COST