2018-11-09T15:50:51-06:00 2017-12-31 ERNST & YOUNG US LLP 155 N WACKER DRIVE 20 FLOOR CHICAGO IL 60606 990 2017-01-01 351536132 BEACON MEDICAL GROUP INC % JEFFREY COSTELLO BEAC 5746473549 615 N MICHIGAN STREET SOUTH BEND IN 46601 JEFFREY COSTELLO CFO 5746473549 2018-11-09 true JACOB J ZEHNDER P01564049 3128792702 164.57.159.254 36964520183135000008 2018-11-09 P 9A3A797ABB38F04A58BFFC3441F1C093BB348504 277A2553AC5F9787DA5E6FE751E73415AFB5A6AE 2017 2019-02-21 02:37:17Z Kreg Gruber 615 N MICHIGAN STREET SOUTH BEND IN 46601 127223964 false X BEACONHEALTHSYSTEM.ORG X 1981 IN BEACON MEDICAL GROUP, INC. IS COMMITTED TO IMPROVING THE QUALITY OF LIFE OF THE PEOPLE IN OUR COMMUNITY. 8 8 1547 0 1062469 0 2237470 1808363 116791631 123424353 -81078 -171973 1025313 824246 119973336 125884989 0 0 0 0 135235326 140488254 0 0 0 51084245 52583531 186319571 193071785 -66346235 -67186796 86428893 92832921 53141045 20048343 33287848 72784578 X BEACON MEDICAL GROUP, INC. IS COMMITTED TO IMPROVING THE QUALITY OF LIFE OF THE PEOPLE IN OUR COMMUNITY. false false 168817975 123798675 BEACON MEDICAL GROUP, INC. (BMG) OPERATES A MULTI-SPECIALTY CARE NETWORK OF PHYSICIANS AND ALSO INCLUDES THE MED-POINT IMMEDIATE CARE CENTERS. IN ADDITION TO THE PHYSICIAN PRACTICES, BMG OPERATES A HIGH COMPLEXITY CORE LABORATORY FOR THE SUPPORT OF ITS EMPLOYED PHYSICIANS. BMG ALSO OPERATES MED-POINT URGENT CARE CENTERS TO SUPPLEMENT THE SERVICES OF THE MEDICAL GROUP. IN ADDITION TO THE CORPORATION'S PRIMARY CARE NETWORK, BMG MANAGES THE OPERATION OF SEVERAL HOSPITAL-BASED PRACTICES FOR THE HOSPITALISTS, TRAUMA ORTHOPEDIC SURGEONS, AND PEDIATRIC INTENSIVISTS. 274690 221339 BEACON MEDICAL GROUP, INC. (BMG) OPERATES A MULTI-SPECIALTY CARE NETWORK, AND ALSO OPERATES THE BEACON MEDICAL GROUP CLINICAL RESEARCH INSTITUTE ("CLINICAL RESEARCH"). CLINICAL RESEARCH IS CURRENTLY FOCUSED ON PHARMACOLOGY STUDIES. THE PHARMACOLOGY STUDIES INVOLVE PATIENTS WITH SPECIFIC CONDITIONS OR DISEASES. CLINICAL RESEARCH HAS BROUGHT THE FOLLOWING POSITIVE BENEFITS TO BMG: IMPROVED PATIENT CARE - BRINGS BMG PHYSICIANS AND NURSES CLOSER TO LEADING-EDGE MEDICINE. CORPORATE POSITIONING - CLINICAL RESEARCH CAN ENHANCE BMG'S IDENTITY AND BRAND, IT CAN PROVIDE A MEANS TO MEET PHYSICIANS' ACADEMIC NEEDS AND ENHANCE PHYSICIAN RECRUITMENT. 169092665 true true false true false false false false false true true false true false true true false true false false false false false false false false false false false true false false false false false false false false false false false false false true true true false false true 125 0 true 1547 true true true false false false false false false false false false X 8 8 false false false false true true true true true false false true true true true true true false false true true IN X JEFFREY COSTELLO 5746473549 615 N MICHIGAN STREET SOUTH BEND IN 46601 X PETER BARANAY DIRECTOR-Chair through 3/31/17 2.0 2.0 X X 2473 0 0 SAM BORRELLI MD CHAIR 2.0 0.0 X X 0 0 0 RAYMOND DUSMAN MD DIRECTOR 2.0 0.0 X 24250 0 0 JAMES DAN MD VICE CHAIR 2.0 0.0 X X 26250 0 0 THOMAS R VIDIC MD DIRECTOR 2.0 0.0 X 1792 0 0 ROB BARTELS DIRECTOR 2.0 0.0 X 539 0 0 ANITA KNUDTSON SECRETARY/TREASURER 2.0 0.0 X X 1493 0 0 RAJ SHAHMD DIRECTOR 2.0 0.0 X 553 0 0 VINCENT HENDERSON MD PRESIDENT/ASST SECRTARY 40.0 0.0 X 483194 0 96589 JEFFREY P COSTELLO CFO/Asst. Treasurer 2.0 46.0 X 0 597602 178765 PHILIP A NEWBOLD CEO-THROUGH 10/31/17 2.0 46.0 X 0 1710953 233242 KREG R GRUBER CEO 2.0 46.0 X 0 640757 180512 STEPHEN SMITH EMPLOYED PHYSICIAN 40.0 0.0 X 1329448 0 34813 NEAL B PATEL EMPLOYED PHYSICIAN 40.0 0.0 X 1842222 0 34444 WALTER LANGHEINRICH EMPLOYED PHYSICIAN 40.0 0.0 X 1565338 0 34813 JOHN GILBERT EMPLOYED PHYSICIAN 40.0 0.0 X 1154451 0 34913 WALTER HALLORAN EMPLOYED PHYSICIAN 40.0 2.0 X 1248034 0 31563 GREG CONRAD ASST SECRETARY THRU MAR 2013 0.0 40.0 X 0 205810 127407 MICHAEL GORDON EXECUTIVE DIRECTOR 40.0 0.0 X 274499 0 33300 CINDY D HAYES EXECUTIVE DIRECTOR 40.0 0.0 X 235184 0 24502 8189720 3155122 1044863 258 true true false ELKHART CLINIC LLC PO BOX 2968 ELKHART IN 46515 MEDICAL BILLING 4380256 WOODCOX BLDG CONTRACTORS 51175 PRESCOTT AVE SOUTH BEND IN 46637 CONSTRUCTION MANAGER 617197 COMPHEALTH MEDICAL STAFFING INC PO BOX 972651 DALLAS TX 75397 TEMPORARY STAFFING 263690 WEATHERBY LOCUMS INC PO BOX 972633 DALLAS TX 75397 TEMPORARY STAFFING 1030155 MAJORITY BUILDERS INC 62900 US 31 SOUTH SOUTH BEND IN 46614 CONSTRUCTION MANAGER 532943 15 1532273 276090 1808363 NET PATIENT REV 621111 119709776 119709776 CLINICAL TRIAL REV 621511 221339 221339 MEDICAL DIRECTORSHIP 621111 1131593 1131593 MED SVCS FOR AFFILIATES 621111 624964 582525 42439 BMG MGMT/ADMIN SERVICES 561499 1274049 522186 751863 462632 194465 268167 123424353 40172 40172 0 0 471192 242607 228585 0 228585 228585 884223 1096368 -212145 -212145 -212145 0 0 0 0 0 0 0 0 0 EMR / MEANINGUL USE INCENTIVE 621111 386272 386272 VENDOR REBATES 621111 201507 201507 MEDICAL RECORDS FEES 621111 6716 6716 1166 1166 595661 125884989 122957545 1062469 56612 0 0 0 0 637133 637133 567487 567487 116986602 112218473 4768129 3887948 3729320 158628 12598905 12084870 514035 5810179 5086685 723494 0 0 49656 49656 5482 5482 0 0 7871303 6387818 1483485 30693 28936 1757 1879059 1668456 210603 70008 11222 58786 0 5557435 4681001 876434 160043 67674 92369 0 752296 742516 9780 4175 4175 0 5450510 3260442 2190068 2438067 1874111 563956 BHS/BMG ADMIN FEES 11013316 0 11013316 0 MEDICAL SUPPLIES 10673373 10673065 308 0 BAD DEBT EXPENSE 5246158 5246158 0 0 PHYSICIAN RECRUITMENT 704259 704259 0 0 677698 618002 59696 193071785 169092665 23979120 0 14033 12346 4437042 6994967 66785 88626 14506380 16889942 0 0 0 0 476651 543560 0 0 397907 1132533 84245618 35103809 49381107 49141809 19603 19471 0 0 16350564 16921797 353509 307676 425312 780194 86428893 92832921 15411298 16587507 0 0 -10 0 0 0 0 0 0 0 0 0 0 0 37729757 3460836 53141045 20048343 X 33287848 72784578 0 0 0 0 33287848 72784578 86428893 92832921 X -67186796 -212 106683738 X false true X true false X 2248343 2137912 2205829 2237470 1808363 10637917 62029993 101699707 108811164 116319577 122756038 511616479 0 0 0 64278336 103837619 111016993 118557047 124564401 522254396 0 0 0 522254396 529669 623478 518279 508290 511364 2691080 0 529669 623478 518279 508290 511364 2691080 0 387809 910200 69337 136558 201507 1705411 65195814 105371297 111604609 119201895 125277272 526650887 0.99165 0.95132 0.00511 0.00958 X false false false false false false false false true 5482 5482 false SCH C, PART II-B BEACON MEDICAL GROUP, INC PAYS FOR THE MEMBERSHIP FEES TO SEVERAL NATIONAL ORGANIZATIONS FOR ITS EMPLOYEES. THESE NATIONAL ORGANIZATIONS INDICATE A PORTION OF THE MEMBERSHIP FEES ARE USED FOR LOBBYING PURPOSES. THE MEMBERSHIP FEES PAID WERE FOR THE FOLLOWING ORGANIZATIONS: - MEDICAL GROUP MANAGEMENT ASSOCIATION - AMERICAN ACADEMY OF FAMILY PHYSICIANS - AMERICAN MEDICAL ASSOCIATION - INDIANA STATE MEDICAL SOCIETY 33854961 2155261 2479263 4284345 34205140 26556021 9605449 339397 2645907 33854960 29619029 4093832 -1367472 5789368 26556021 27642755 2833644 -142883 714487 29619029 24661171 2180336 1785965 984717 27642755 0.79860 0.00220 0.19920 false true true 3882909 3882909 46078279 15956127 30122152 181412 172069 9343 34103018 18975613 15127405 49141809 INVESTMENT IN HOME CARE 12366886 C INVESTMENT IN VHA 200000 C INVESTMENT IN STRATUM MEDICAL 95000 C LAPORTE MEDICAL GROUP SURGICAL 476496 C MEMORIAL SPINE & NEUROSCIENCE 622916 C VALPARAISO MEDICAL DEVELOPMENT 3160499 C 16921797 0 ACCRUED PENSION 3336280 CAPITAL LEASES 124556 3460836 X SCH D, PART V, LINE 4 THE BEACON HEALTH FOUNDATION, INC. BOARD HAS DISCRETION TO UTILIZE EACH YEAR THE INCOMES, REVENUES AND PROFITS ARISING AND ACCRUING FROM THE ENDOWMENTS IN DEFRAYING COSTS ASSOCIATED WITH THE TRUST AND THE REMAINDER FOR SUPPORT, BETTERMENT, IMPROVEMENT, UPKEEP, EXPANSION AND REPLACEMENT OF BEACON HEALTH SYSTEM, INC, AND ITS CORPORATE AFFILIATES. TERM ENDOWMENTS, WHICH ARE THE TEMPORARILY RESTRICTED NET ASSETS, ARE USED AS DESIGNATED BY THE DONOR. THE PERMANENT ENDOWMENT PROVIDES INCOME TO BE USED FOR HEALTH CARE EDUCATIONAL PURPOSES AND PATIENT CARE. SCH D, PART X, LINE 2 ASC 740, INCOME TAXES, REQUIRES THAT REALIZATION OF AN UNCERTAIN INCOME TAX POSITION IS MORE LIKELY THAN NOT (i.e., GREATER THAN 50% LIKELIHOOD OF RECEIVING BENEFIT) BEFORE IT IS RECOGNIZED IN THE FINANCIAL STATEMENTS AS THE AMOUNT MOST LIKELY TO BE REALIZED ASSUMING A REVIEW BY TAX AUTHORITIES HAVING ALL RELEVANT INFORMATION AND APPLYING CURRENT CONVENTIONS. THIS INTERPRETATION ALSO CLARIFIES THE FINANCIAL STATEMENT CLASSIFICATION OF TAX-RELATED PENALTIES AND INTERST AND SET FORTH NEW DISCLOSURES REGARDING UNRECOGNIZED TAX BENEFITS. NO AMOUNT WAS RECORDED FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016. X X X true true true true false false false false false true false VINCENT HENDERSON MD PRESIDENT/ASST SECRTARY 382409 100100 685 78596 0 17993 0 579783 0 0 0 JEFFREY P COSTELLO CFO/Asst. Treasurer 459929 108072 29601 0 159176 0 19589 0 776367 0 0 PHILIP A NEWBOLD CEO-THROUGH 10/31/17 807254 215000 688699 0 217827 0 15415 0 1944195 0 135543 MICHAEL GORDON EXECUTIVE DIRECTOR 237946 34563 1990 14464 0 18836 0 307799 0 0 0 STEPHEN SMITH EMPLOYED PHYSICIAN 1328548 900 10800 0 24013 0 1364261 0 0 0 NEAL B PATEL EMPLOYED PHYSICIAN 1801525 25197 15500 10800 0 23644 0 1876666 0 0 0 WALTER LANGHEINRICH EMPLOYED PHYSICIAN 1562758 2580 10800 0 24013 0 1600151 0 0 0 JOHN GILBERT EMPLOYED PHYSICIAN 1120651 17888 15912 10800 0 24113 0 1189364 0 0 0 CINDY D HAYES EXECUTIVE DIRECTOR 205361 28523 1300 9480 0 15022 0 259686 0 0 0 KREG R GRUBER CEO 515723 111282 13752 0 159087 0 21425 0 821269 0 0 GREG CONRAD ASST SECRETARY THRU MAR 2013 197967 0 7843 0 111528 0 15879 0 333217 0 0 WALTER HALLORAN EMPLOYED PHYSICIAN 1228679 15395 3960 10800 0 20763 0 1279597 0 0 0 SCH J, PART I, LINE 1A BEACON MEDICAL GROUP, INC. REIMBURSES DIRECTORS FOR THE TAX EFFECT OF THE 1099 REPORTABLE BENEFITS FOR HEALTH CLUB MEMBERSHIP, WITH BEACON HEALTH SYSTEM'S HEALTH AND LIFESTYLE CENTER. BEACON HEALTH SYSTEM ALSO REIMBURSES FOR DIRECT EXPENSES RELATED TO ANY TRAVEL ON THE ORGANIZATION'S BEHALF. HEALTH OR SOCIAL CLUB DUES FOR THE FOLLOWING INDIVIDUAL WAS INCLUDED IN TAXABLE COMPENSATION: PETER BARANAY, ANITA KNUDTSON, THOMAS VIDIC, MD, ROB BARTELS AND RAJ SHAH, MD. TAX INDEMNIFICATION AND GROSS-UP PAYMENTS FOR THE FOLLOWING INDIVIDUAL WAS INCLUDED IN TAXABLE COMPENSATION: PETER BARANAY, ANITA KNUDTSON, THOMAS VIDIC, MD, ROB BARTELS AND RAJ SHAH, MD. SCH J, PART I, LINE 3 BEACON MEDICAL GROUP, INC. USES A RELATED ORGANIZATION'S (BEACON HEALTH SYSTEM, INC.) COMPENSATION REVIEW PROCESS. THIS REVIEW PROCESS INCLUDES AN EXTENSIVE EXAMINATION USING COMPARABLE MARKET DATA THAT 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 4A - SEVERANCE SEVERANCE WAS ACCRUED FOR IN 2017 FOR THE FOLLOWING INDIVIDUALS: GREG CONRAD, $102,060 SCH J, PART I, LINE 4B - EXECUTIVE RETENTION PLAN BEACON HEALTH SYSTEM IMPLEMENTED AN EXECUTIVE RETENTION PLAN TO ATTRACT AND RETAIN KEY EMPLOYEES BY PROVIDING ADDITIONAL DEFERRED COMPENSATION. THE CHIEF EXECUTIVE OFFICER WILL PARTICIPATE IN THE PLAN AND WILL SELECT OTHER PARTICIPANTS PURSUANT TO THE GUIDELINES SET BY THE EMPLOYER'S BOARD OF DIRECTORS. THE EMPLOYER MAY MAKE CONTRIBUTIONS UNDER THE PLAN AND HAS SOLE DISCRETION OVER WHETHER TO MAKE A CONTRIBUTION. VESTING OCCURS ON JANUARY 1 OF THE FIFTH YEAR FOR WHICH SUCH CONTRIBUTIONS ARE MADE FOR PARTICIPANTS WHO HAVE BEEN CONTINUOUSLY EMPLOYED. THE PLAN ALSO ALLOWS VESTING TO OCCUR IF THE PARTICIPANT ATTAINS THE AGE OF 62. THE FOLLOWING INDIVIDUALS RECEIVED VESTED PAYMENTS IN 2017, REFLECTED IN COLUMN (B)(III): PHIL NEWBOLD $135,543 THE FOLLOWING INDIVIDUALS RECEIVED DEFFERED PAYMENTS IN 2017 THAT WILL VEST IN FUTURE YEARS, WHICH ARE REFLECTED IN COLUMN C: PHIL NEWBOLD, $197,348 JEFFREY COSTELLO, $77,367 VINCENT HENDERSON, $63,905 KREG GRUBER, $83,287 BEACON HEALTH SYSTEM IMPLEMENTED AN EXECUTIVE LONGEVITY BONUS PLAN FOR THE PURPOSE OF PROVIDING A LONGEVITY BONUS FOR ITS DESIGNATED EXECUTIVES. THIS UNFUNDED PLAN WAS EFFECTIVE APRIL 1, 2014. THE PARTICIPANTS MUST REMAIN IN AN ACTIVE EMPLOYMENT STATUS WITH BEACON FOR A PERIOD OF 5 CONSECUTIVE YEARS FROM THE EFFECTIVE DATE TO BE ELIGIBLE TO RECEIVE THE FULL LONGEVITY BONUS AMOUNT AT WHICH TIME VESTING IS 100%. VESTING PRIOR TO THE 5 YEARS IS AT 0%. THE MAXIMUM BONUS AWARD AT 100% VESTING IS $325,000. THE FOLLOWING INDIVIDUALS RECEIVED DEFFERED PAYMENTS IN 2017. THESE PAYMENTS WILL VEST IN FUTURE YEARS, AND ARE REFLECTED IN COLUMN C: JEFFREY COSTELLO, $65,000 KREG GRUBER, $65,000 SCH J, PART I, LINE 7 - INCENTIVE PLANS THE ORGANIZATION HAS THREE INCENTIVE PLANS (EMPLOYEE, MANAGEMENT, AND EXECUTIVE) 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-MANAGEMENT EMPLOYEES FOR BEACON HEALTH SYSTEM, INC. AND THE AFFILIATED ENTITIES. THE EMPLOYEE INCENTIVE HAS A MAXIMUM CAP OF $4,500,000. THE PAYOUT AND AMOUNT OF THE PAYOUT FOR THE EMPLOYEE INCENTIVE PLAN IS MADE AT THE DISCRETION OF THE BOARD. 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. THE PAYOUT OF THE MANAGEMENT INCENTIVE PLAN IS MADE AT THE DISCRETION OF THE BOARD. EXECUTIVES ARE COVERED UNDER THE BEACON HEALTH SYSTEM EXECUTIVE SHORT-TERM INCENTIVE PLAN (ESTIP). THE ESTIP PLAN PAYS A SLIDING PERCENTAGE OF BASE COMPENSATION IF THE NET OPERATING INCOME IS EQUAL TO OR GREATER THAN 80% OF THE BUDGETED NET INCOME. THE SLIDING SCALE CAPS, WHEN OPERATING INCOME REACHES 120% OF THE BUDGETS OPERATING INCOMES.THE PAYOUT OF THE ESTIP IS MADE AT THE DISCRETION OF THE BOARD. THE ORGANIZATION ALSO PROVIDES A FACULTY INCENTIVE PLAN FOR FAMILY PRACTICE RESIDENCY CLINICS WHICH PROVIDES FOR AN INCENTIVE PAYMENT WHEN COLLECTIONS FOR PERSONALLY RENDERED SERVICES EXCEED A THRESHOLD. THESE INCENTIVES ARE CAPPED. PHYSICIAN RELATIONS INCENTIVE PLAN PROVIDES FOR AN INCENTIVE PAYMENT TO EMPLOYEES IN A PHYSICIANS RELATIONS POSITION BASED UPON ATTAINMENT OF SATISFACTION SCORES PAID AS A PERCENTAGE OF BASE PAY UP TO 5%. HOSPITALISTS ARE ELIGIBLE FOR AN INCENTIVE PAYMENT BASED UPON ATTAINMENT OF QUALITY MEASURES AND TENURE. THE INCENTIVE IS A COMPONENT OF THE HOSPITALIST PHYSICIAN COMPENSATION PLAN. HOSPITALIST NURSE PRACTITIONER / PHYSICIAN ASSISTANTS ARE ELIGIBLE FOR AN INCENTIVE BASED UPON ATTAINMENT OF QUALITY MEASURES. THE INCENTIVE IS A COMPONENT OF A QUALITY BONUS PLAN. FORM 990, PART VI, SECTION A, LINE 6: BEACON HEALTH SYSTEM, INC. IS THE SOLE CORPORATE MEMBER OF BEACON MEDICAL GROUP, INC. FORM 900, PART VI, SECTION A, LINE 7A: THE CORPORATE MEMBER SHALL APPOINT THE BOARD OF DIRECTORS OF BEACON MEDICAL GROUP, INC., AND SHALL HAVE SUCH POWERS OF ADVANCE APPROVAL REGARDING CORPORATE ACTIONS AS ARE DELINEATED IN THE BY-LAWS OF BEACON MEDICAL GROUP, INC. FORM 990, PART VI, SECTION A, LINE 7B: DECISIONS OF THE BOARD OF DIRECTORS MUST BE APPROVED BY THE CORPORATE MEMBER. THE CORPORATE MEMBER HAS SUCH RIGHTS AND POWERS AS: A. TO MAKE AND APPROVE CHANGES TO THE CORPORATION'S ARTICLES AND BYLAWS B. TO APPOINT AND REMOVE THE MEMBERS OF THE CORPORATION'S GOVERNING BOARD C. TO APPROVE THE INCURRENCE OF DEBT D. TO APPROVE SALES, TRANSFERS, DISSOLUTION OR SUBSTANTIAL CHANGE IN USE OF CORPORATE ASSETS E. TO APPROVE THE FORMATION OR DISSOLUTION OF A SUBSIDIARY ORGANIZATION F. TO APPROVE THE MATERIAL TRANSFER OR ENCUMBRANCE OF THE CORPORATE ASSETS G. TO APPROVE THE ANNUAL OPERATING BUDGET, CAPITAL PLAN, STRATEGIC PLAN AND BUSINESS PLAN H. TO APPROVE THE MISSION AND VISION STATEMENTS I. TO APPROVE ANY MATERIAL TRANSACTIONS NOT INCLUDED IN THE APPROVED OPERATING BUDGET OR CAPITAL PLAN J. TO RESOLVE ANY ISSUES BETWEEN THE CORPORATION AND ANY OF THE CORPORATE MEMBER'S OTHER SUBSIDIARY ORGANIZATIONS K. TO APPROVE ANY MANAGEMENT AGREEMENT FOR THE MANAGEMENT OF ALL OR ANY SUBSTANTIAL PART OF THE CORPORATION FORM 990, 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. SOME FORMS AND SCHEDULES ARE REVIEWED BY THE CONTROLLER. SUBSEQUENT TO THOSE STEPS, THE ORGANIZATION ENGAGED ERNST & YOUNG TO REVIEW THE COMPLETED FORM 990 AND APPROPRIATE SCHEDULES. PRIOR TO FILING THE RETURN, THE CFO, THE COMPENSATION COMMITTEE OF THE ORGANIZATION, AND THE CEO, CONDUCT A GENERAL OVERVIEW OF THE FORM 990, INCLUDING APPLICABLE COMPENSATION SCHEDULES. IN ADDITION, EACH BOARD MEMBER RECEIVES NOTIFICATION OF THE IRS FORM 990 PLACEMENT ON THE ORGANIZATION'S BOARD PORTALS WHICH ALLOWS FOR BOARD MEMBER REVIEW PRIOR TO FILING THE RETURN. FORM 990, 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 FOR THE PREVIOUS YEAR ACTIVITIES AND WE PURSUE THE REPLIES TO GET A 100% RESPONSE RATE. IN THE CURRENT YEAR WE SENT OUT OVER 320 STATEMENTS AND ARE WORKING TO ACHIEVE A 100% RESPONSE RATE. EACH RESPONSE IS REVIEWED BY THE DIRECTOR OF INTERNAL AUDIT AND THE RESULTS ARE REPORTED TO THE CEO OF BEACON HEALTH SYSTEM, INC., THE AUDIT COMMITTEE CHAIRMAN, 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, AND OTHER KEY EMPLOYEES. THE DUALITY OF INTEREST STATEMENT IS SENT USING A WEB BASED SURVEY TOOL PROVIDED BY ERNST & YOUNG. THE REPLIES ARE REVIEWED BY THE DIRECTOR OF INTERNAL AUDIT. THE RESULTS OF THE SURVEYS ARE SUMMARIZED USING THE WEB BASED TOOL, AND ARE REVIEWED BY ERNST & YOUNG IN COMPLETING THE 990. The RESULTS ARE REPORTED TO THE CEO OF BEACON HEALTH SYSTEM, INC., THE AUDIT COMMITTEE CHAIMAN, 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 BEACON HEALTH SYSTEM, INC.'S KEY FINANCIAL EMPLOYEES THAT BEACON'S FINANCIAL INFORMATION IS TO THE BEST OF THEIR KNOWLEDGE TRUE AND ACCURATE. THIS STATEMENT WAS SENT OUT IN EARLY JANUARY, 2018 AND THE SIGNED ACKNOWLEDGEMENTS ARE KEPT BY THE DIRECTOR OF INTERNAL AUDIT. IN 2018, 17 DESIGNATED EMPLOYEES WERE REQUESTED TO SIGN THE FORM AND WE HAD A 100% COMPLIANCE RATE. ANY POTENTIAL CONFLICTS OF INTERESTS ARE REVIEWED BY INDEPENDENT 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 WOULD BE EXCLUDED FROM ALL REVIEW PROCEEDINGS. FORM 990, PART VI, SECTION B, LINE 15A & 15B: BEACON HEALTH SYSTEM, INC., THE PARENT COMPANY OF BEACON MEDICAL GROUP, INC., CONDUCTS THE REVIEW OF ALL COMPENSATION. VICE PRESIDENT AND HIGHER COMPENSATION IS DETERMINED AFTER AN EXTENSIVE EXAMINATION IS CONDUCTED USING COMPARABLE MARKET DATA AND THEN REVIEWED BY AN INDEPENDENT CONSULTANT HIRED BY, AND REPORTING TO, THE BOARD OF DIRECTORS. HUMAN RESOURCES CONDUCTS THE ANALYSIS AND MAKES RECOMMENDATIONS TO THE CEO WHO THEN MAKES THE RECOMMENDATIONS FOR ALL OTHER EXECUTIVES/OFFICERS TO THE BOARD FOR APPROVAL. THE INDEPENDENT CONSULTING GROUP SEPARATELY MAKES THE RECOMMENDATIONS REGARDING THE CEO'S COMPENSATION TO THE BOARD FOR APPROVAL. RECOMMENDATIONS ARE PRESENTED TO THE COMPENSATION COMMITTEE OF THE BEACON HEALTH SYSTEM, INC. BOARD FOR DELIBERATION AND FINAL DECISION. DELIBERATION AND FINAL DECISION ARE PERFORMED BY THE INDEPENDENT MEMBERS OF THE BOARD. VICE PRESIDENT AND HIGHER COMPENSATION IS PAID BY BEACON HEALTH SYSTEM, INC. EXCEPT AS NOTED BELOW. COMPENSATION OF THE EXECUTIVE DIRECTOR AND KEY EMPLOYEES IS PAID BY BEACON MEDICAL GROUP, INC. THE WAGES FOR BEACON MEDICAL GROUP PRESIDENT, VINCENT HENDERSON, WERE PAID BY BEACON MEDICAL GROUP, INC. 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 BEACON HEALTH SYSTEM, INC. BONDS. FORM 990, PART XI, LINE 9 WRITE OFF INTER COMPANY BEACON HEALTH SYSTEM $101,028,246 CHANGE IN PENSION LIABILITY $5,418,287 BOOK TAX DIFFERENCE ON JV REVENUE $237,205 TOTAL $106,683,738 MEMORIAL HOSPITAL OF SOUTH BEND INC 615 N MICHIGAN ST SOUTH BEND IN 46601 350868132 HOSPITAL IN 501(C)(3) 3 BHS true BEACON HEALTH FOUNDATION INC 615 N MICHIGAN ST SOUTH BEND IN 46601 351536129 FINANCIAL SUP IN 501(C)(3) 7 BHS true ELKHART GENERAL HOSPITAL INC 600 EAST BOULEVARD ELKHART IN 46514 350877574 HOSPITAL IN 501(C)(3) 3 BHS true BEACON HEALTH SYSTEM INC 615 N MICHIGAN ST SOUTH BEND IN 46601 453864076 PARENT ORG IN 501(C)(3) 12A NA false MEMORIAL ENDOWMENT FUND FOR MEMORIAL HOS PO BOX 1602 SOUTH BEND IN 46634 356068581 ENDOWMENT IN 501(c)(3) 12D MHSB true BEACON HEALTH VENTURES INC 615 N MICHIGAN ST SOUTH BEND IN 46601 351901068 HOME MEDICAL IN NA C BEACON HEALTH VENTURES MICHIGAN INC 615 N MICHIGAN ST SOUTH BEND IN 46601 208259773 HOME MEDICAL MI NA C true false true false false false false true true true false false true true true true true true ELKHART GENERAL HOSPITAL INC I 816406 ACTUAL CHARGES BEACON HEALTH VENTURES INC r 382030 ACTUAL CHARGES BEACON HEALTH VENTURES INC q 124680 ACTUAL CHARGES BEACON HEALTH VENTURES INC p 490471 ACTUAL CHARGES ELKHART GENERAL HOSPITAL INC s 180061 CASH ELKHART GENERAL HOSPITAL INC k 913078 ACTUAL CHARGES ELKHART GENERAL HOSPITAL INC q 599352 ACTUAL CHARGES ELKHART GENERAL HOSPITAL INC r 347712 ACTUAL CHARGES BEACON HEALTH FOUNDATION INC c 8697 ACTUAL CHARGES MEMORIAL HOSPITAL OF SOUTH BEND INC c 1523576 GRANT REVENUE MEMORIAL HOSPITAL OF SOUTH BEND INC P 5699460 ACTUAL CHARGES MEMORIAL HOSPITAL OF SOUTH BEND INC s 110337 CASH MEMORIAL HOSPITAL OF SOUTH BEND INC Q 2332952 ACTUAL CHARGES