2018-05-14T11:03:02-05:00 2017-06-30 390859910 Baker Tilly Virchow Krause LLP 221 W Philadelphia Street Suite 200 York PA 17401 990 2016-07-01 251709054 PINNACLE HEALTH MEDICAL SERVICES PINN 7172318245 409 south second street po box 8700 harrisburg PA 171058700 william H Pugh CFO 7172318245 2018-05-11 1 JULIUS GREEN CPA P00350393 7178467000 X 2016 2022-09-23 18:48:47Z William H Pugh 409 south second street po box 8700 harrisburg PA 171058700 92823951 0 X www.pinnaclehealth.org X 1993 PA PINNACLE HEALTH MEDICAL SERVICES IS ENGAGED IN THE PROVISION of PHYSICIAN SERVICES. 21 16 1191 22 0 0 0 0 75577816 77783761 -931 -21026 17607311 14462983 93184196 92225718 11000 6090 0 0 90652952 95508265 0 0 0 33465138 34549076 124129090 130063431 -30944894 -37837713 49610307 35942288 21796213 19274887 27814094 16667401 X PINNACLE HEALTH MEDICAL SERVICES IS A TAX EXEMPT ENTITY THAT IS ENGAGED IN THE PROVISION OF BOTH PRIMARY AND SPECIALTY CARE PHYSICIAN SERVICES. 0 0 45930132 5090 27009872 PINNACLEHEALTH MEDICAL SERVICES (PHMS) IS A TAX EXEMPT ENTITY THAT IS PRIMARILY ENGAGED IN THE PROVISION OF PHYSICIAN SERVICES. THE PHYSICIAN SERVICES PROVIDED WITHIN PHMS SUPPORT AND ENHANCE THE SERVICES OF PINNACLEHEALTH HOSPITALS AND THE PINNACLEHEALTH SYSTEM, WHILE PROVIDING FIRST CLASS PREVENTATIVE CARE TO THE COMMUNITY, AS WELL AS COLLABORATING WITH EACH OTHER, AND THE SPECIALTY SITES, TO IMPROVE THE QUALITY OF HEALTHCARE, AND THE PATIENT'S EXPERIENCE.PHMS ALSO HAD VOLUNTEERS THAT PROVIDED VARIOUS DONATED SERVICES. DURING THE YEAR ENDED JUNE 30, 2017, THERE WERE 5 VOLUNTEERS WHO PROVIDED 490 DONATED HOURS VALUED AT $11,829. PHMS PROVIDED FREE CARE DURING THE YEAR TO 853 PATIENTS IN THE AMOUNT OF $465,594.51.BASED ON TOTAL EXPENSES, THE THREE LARGEST PHYSICIAN SERVICES INCLUDED WITHIN PHMS ARE:PINNACLE SPECIALTIES PRACTICE - THE SPECIALTIES PRACTICE IS THE SECOND LARGEST SEGMENT OF PHMS, COMPRISING 37% OF THE TOTAL PROGRAM EXPENSES OF PHMS. THE SPECIALTY PRACTICES CURRENTLY OPERATE 23 SPECIALTY SITES THROUGHOUT CENTRAL PENNSYLVANIA. DURING THE FISCAL YEAR ENDED JUNE 30, 2017, SPECIALTY SITE VISITS TOTALED 194,866. MANAGEMENT CONSIDERS THE INVESTMENT IN SPECIALTY SERVICES CRITICAL IN MAINTAINING AN INTEGRATED DELIVERY SYSTEM AND TO THE FUTURE SUCCESS OF PINNACLE HEALTH SYSTEM. THE SPECIALTY PHYSICIAN PRACTICES INCLUDE THE FOLLOWING:SURGICAL ASSOCIATES - ON APRIL 1, 2010, PINNACLE HEALTH SURGICAL ASSOCIATES CAME TO FRUITION WHEN THE GENERAL SURGEONS AND STAFF OF CAPITAL AREA SURGICAL ASSOCIATES AND SUSQUEHANNA SURGEONS JOINED THE PINNACLE HEALTH NETWORK. EXCELLENT SURGICAL CARE DOESN'T JUST HAPPEN. IT'S THE COMBINATION OF SKILLED SURGEONS, THE LATEST TECHNOLOGY AND EQUIPMENT AND THE EXPERTISE OF THE OPERATING ROOM TEAM WORKING TOGETHER. THE MORE ADVANCED, THE MORE PRECISE, THE BETTER OUTCOME FOR THE PATIENT. PINNACLE HEALTH HAS A LONG HISTORY OF PROVIDING THE FINEST SURGICAL CARE IN CENTRAL PENNSYLVANIA, DATING TO THE OPENING OF OUR FIRST OPERATING ROOM IN 1900. TODAY, OUR OUTSTANDING TEAM OF GENERAL SURGEONS AT PINNACLE HEALTH SURGICAL ASSOCIATES CONTINUES THE TRADITION OF EXCELLENCE BY PERFORMING A WIDE RANGE OF OPEN AND MINIMALLY INVASIVE PROCEDURES. THE TEAM INCLUDES BOARD CERTIFIED AND FELLOWSHIP TRAINED PHYSICIANS WHO PROVIDE SUPERIOR SURGICAL SKILL AND CARE. WOUND & HYPERBARIC PROGRAM - THIS PROGRAM OPENED IN JANUARY 2010. IT PROVIDES EXPERT MEDICAL CARE FOR CHRONIC WOUNDS THAT HAVE FAILED PREVIOUS METHODS OF TREATMENT. THE USE OF SPECIALIZED INTENSIVE WOUND THERAPIES AND, IN SPECIFIC CIRCUMSTANCES, THE APPROVED USE OF HYPERBARIC OXYGEN THERAPY ENHANCES THE HEALING PROCESS IN AN ATTEMPT TO RETURN PATIENTS TO THE HIGHEST LEVEL OF DAILY FUNCTIONING AND HEALING. ALSO, THE IMPLEMENTATION OF AN IN-PATIENT CONSULTATION PROGRAM AT BOTH HOSPITALS ALLOWS FOR OPTIMAL PATIENT FOLLOW-UP AND REFERRALS. THE PROGRAM ALSO PROVIDES FOR INCREASED EDUCATIONAL PROGRAMS FOR AREA PHYSICIANS, RESIDENTS AND MEDICAL STUDENTS IN THIS SPECIALTY. RHEUMATOLOGY - OPENING FOR BUSINESS ON MARCH 1, 2010, PINNACLE HEALTH'S RHEUMATOLOGY OFFICE WAS FOUNDED TO DIAGNOSE AND TREAT THE SURROUNDING COMMUNITY THAT EXPERIENCED CONSTANT PAIN WITH RHEUMATIC DISEASES. WHETHER FACED WITH AN INFLAMMATION OF THE JOINTS, TENDONS OR MUSCLES, OR CONSTANT PAIN, PINNACLE HEALTH'S RHEUMATOLOGY DOCTORS HELP DIAGNOSE THE CONDITION AND FIND THE COURSE OF TREATMENT SUITABLE FOR EACH INDIVIDUAL. MANY TYPES OF RHEUMATIC DISEASES ARE NOT EASILY IDENTIFIED IN THE EARLY STAGES AND BECAUSE SOME ARE MORE COMPLEX THAN OTHERS, MORE THAN ONE VISIT MAY BE NECESSARY. AS SUCH, OUR RHEUMATOLOGISTS WORK CLOSELY WITH PATIENTS TO DESIGN INDIVIDUALIZED TREATMENTS THAT MEET THEIR NEEDS.PINNACLE HEALTH NEUROLOGISTS AND NEUROSURGERY - THIS PROGRAM WAS ESTABLISHED TO MEET THE EMERGENT NEED FOR NEUROLOGISTS IN THE HARRISBURG AREA. COVERAGE FOR INPATIENT PHYSICIAN COVERAGE AT PINNACLE HEALTH HOSPITALS IS ITS PRIMARY FOCUS, AS WELL AS ESTABLISHING AND GROWING OUTPATIENT SERVICES TO ADDRESS COMMUNITY NEEDS. THIS DEPARTMENT ALSO PROVIDES THE EMERGENT NEED IN THE HARRISBURG AREA OF SKILLED NEUROSURGEONS. PENNSYLVANIA NEUROSURGERY AND NEUROSCIENCES INSTITUTE JOINED THIS PRACTICE IN SEPTEEMBER 2013 AND PA NEUROLOGICAL ASSOCIATES JOINED IN NOVEMBER 2013.PINNACLE HEALTH ENDOCRINOLOGISTS - THIS PROGRAM WAS ESTABLISHED IN JANUARY 2005 AND PROVIDES BOTH INPATIENT AND OUTPATIENT SERVICES. PINNACLE HEALTH ENDOCRINOLOGY ASSOCIATES PROVIDES COMPREHENSIVE CARE FOR ALL ENDOCRINOLOGY DISORDERS, ESPECIALLY COMPLEX PATIENTS WITH DIABETES. WE SPECIALIZE IN INSULIN PUMPS, CONTINUOUS GLUCOSE MONITORING, THYROID DISORDERS INCLUDING THYROID BIOPSIES, THYROID CANCERS, COMPREHENSIVE CARE FOR OSTEOPOROSIS WITH SPECIALIZED NURSE CARE, AND ALL THE OTHER ENDOCRINE DISORDERS INCLUDING POLYCYSTIC OVARY SYNDROME, ADRENAL, AND PITUITARY DISEASES.PINNACLE HEALTH INFECTIOUS DISEASE ASSOCIATES - THIS PROGRAM WAS ESTABLISHED IN JANUARY 2005. PINNACLE HEALTH INFECTIOUS DISEASE ASSOCIATES SPECIALIZES IN THE TREATMENT OF ANY ORGAN INFECTION AND INFECTIOUS DISEASES INCLUDING, BUT NOT LIMITED TO, OSTEOMYELITIS, LYME DISEASE, MENINGITIS, HIV, AND HEPATITIS C. BOTH INPATIENT AND OUTPATIENT SERVICES ARE PROVIDED, WHICH INCLUDES A TRAVEL CLINIC.PINNACLE HEALTH PALLIATIVE CARE - THE FOCUS OF THIS PROGRAM IS ON THE INPATIENT CARE OF PATIENTS DURING THE FINAL MONTHS OR DAYS OF THEIR LIFE, SEEKING TO IMPROVE BOTH THE BALANCE OF CARE VIA COMFORT AND DIGNITY AND THE QUALITY OF PAIN RELIEF TREATMENT. IN THE ROLE AS THE PAIN TEAM OF THE SYSTEM, THE PALLIATIVE CARE SPECIALIST WILL BE AVAILABLE TO ANY PATIENT WHO IS IN NEED OF SPECIALIZED ASSESSMENT AND TREATMENT OF DIFFICULT OR INTRACTABLE PAIN. THIS DOVETAILS NICELY WITH THE CANCER CENTER PROGRAM. END-OF-LIFE CARE HAS BEEN IDENTIFIED NATIONALLY AS A MOMENT OF TIME WHICH TAKES UP AN INORDINATE AMOUNT OF HEALTH CARE RESOURCES, WITH GREAT VARIATION GEOGRAPHICALLY AND LITTLE IN THE WAY OF DEMONSTRABLE VALUE; DYING WITH DIGNITY IS AN OPTION THAT ALL OF US SHOULD HAVE AT THE END OF LIFE.BREAST CANCER CENTER - THIS PROGRAM HAS BEEN ESTABLISHED TO PROVIDE PATIENTS WITH EAST AND WEST SHORE LOCATIONS FOR THEIR BREAST CARE NEEDS, INCLUDING BREAST HEALTH SURGEONS, BREAST HEALTH NURSE SPECIALISTS, CERTIFIED MAMMOGRAPHERS, RADIOLOGISTS, PATHOLOGISTS AND PHYSICAL THERAPISTS, ALL OF WHOM ARE COMMITTED TO PROVIDing THE MOST UP-TO-DATE TECHNOLOGY AND CARE FOR COMPLETE BREAST HEALTH.THE WOMEN'S CANCER CENTER IS A UNIQUE PRACTICE, SERVING PATIENTS ON BOTH THE EAST AND WEST SHORES, ADDRESSING THE PREVENTIVE, DIAGNOSTIC, SURGICAL, MEDICAL, AND CHEMOTHERAPY NEEDS OF WOMEN WITH GYNECOLOGIC CANCER AND OTHER COMPLICATED CONDITIONS OF THE FEMALE REPRODUCTIVE SYSTEM. RADIATION ONCOLOGY - THIS PRACTICE OPENED IN JUNE OF 2013, GIVING PATIENTS THE MOST ADVANCED TECHNOLOGY IN CENTRAL PA. OUR SUPERIOR TREATMENT CAPABILITIES ALLOW US TO PROVIDE THE PATIENT WITH SHORTER TREATMENT TIMES AND FEWER SIDE EFFECTS WHILE ELIMINATING THEIR CANCER CELLS. WE MAINTAIN A HIGH LEVEL OF SKILL AND EXPERTISE WHILE PAYING CAREFUL ATTENTION TO THE PATIENT'S COMFORT AND CONCERNS.HEMATOLOGY ONCOLOGY - LOCATED IN THE MEDICAL SCIENCES PAVILION ON THE COMMUNITY CAMPUS, this practice SPECIALIZEs IN THE USE OF MEDICATIONS, SUCH AS CHEMOTHERAPY, HORMONES, AND PAIN MEDICATIONS IN THE MANAGEMENT OF CANCER. THE practice HAs ALSO OPENED A SECOND LOCATION ON THE WEST SHORE FOR PATIENT CONVENIENCE.PSYCHOLOGICAL ASSOCIATES - this practice IS STAFFED BY LICENSED, MASTERS LEVEL, PSY.D. AND PH.D. CLINICIANS WHO PROVIDE INDIVIDUAL, FAMILY OR MARITAL EVALUATIONS, THERAPY, AND MEDICATION MANAGEMENT AS NEEDED TO ALL AGES. WE ALSO OFFER GROUP THERAPY SHOULD YOU AND YOUR THERAPIST DETERMINE IT WOULD BE HELPFUL. GROUPS INCLUDE THE ANGER MANAGEMENT GROUP, MOM'S NAVIGATING THROUGH LIFE GROUP, AND ADOLESCENT GROUPS.PINNACLEHEALTH OBSTETRICS AND GYNECOLOGY SPECIALISTS - this practice OPENED in OCTOBER 2013 AND IS COMMITTED TO PROVIDING EXCEPTIONAL MEDICAL CARE TO WOMEN THROUGHOUT THEIR LIVES. THis TEAM OF CULTURALLY SENSITIVE PROVIDERS USES THE MOST UP-TO-DATE INFORMATION AND PROCEDURES TO DELIVER THE BEST OBSTETRIC AND GYNECOLOGIC HEALTH CARE TO THEIR PATIENTS. WHETHER A PREGNANCY IS PROGRESSING NORMALLY OR A PATIENT NEEDS SPECIALIZED CARE, PINNACLE HEALTH'S TEAM OF DOCTORS, NURSES, SPECIALISTS, AND EDUCATORS PROVIDE THE HIGHEST LEVEL OF CARE WHILE ALSO FOCUSING ON MAKING THE BIRTH EXPERIENCE AS POSITIVE AS POSSIBLE. PINNACLEHEALTH DELIVERS MORE BABIES THAN ANY OTHER HOSPITAL IN CENTRAL PENNSYLVANIA, WELCOMING MORE THAN 4,000 BABIES INTO THE WORLD EVERY YEAR AND MAKING US THE SIXTH IN THE STATE FOR DELIVERIES.MATERNAL FETAL MEDICINE OF CENTRAL PENNSYLVANIA, IS A PRACTICE DEDICATED TO CARING FOR WOMEN WITH HIGH-RISK PREGNANCIES IF THEY AND THEIR BABIES NEED SPECIAL CARE. SERVICES INCLUDE: -PERINATAL/PRECONCEPTION CONSULTATION -FETAL ECHOCARDIOGRAPHY 52135254 1000 45329087 Family Care Services- Primary care is the largest segment of PHMS, comprising 42% of the total program expenses of PinnacleHealth Medical Services. Primary care services are currently provided through 23 family care centers located in surrounding central Pennsylvania communities. During the fiscal year ended June 30, 2017, primary care patient visits totaled 367,752, of which 24,683 were due to three new family care practices.Family Care Spring Road, Fisher Road Family practice, and Chambers HIll Family Practice, are three full-service primary care practices which joined PinnacleHealth Medical Services in fiscal year 2017. The addition of these primary care locations supports pinnaclehealth's local focus and commitment to the community while giving patients increased access to the PinnacleHealth family for specialty care and advanced technology for diagnosis and treatment. 10156253 5344982 Pinnacle Health Clinics - The clinics comprise 8% of the total program expenses of PHMS. There are 6 clinic facilities throughout Central Pennsylvania that provide patient care to the surrounding communities. During the fiscal year ended June 30, 2017, clinics had visits that totaled 56,176. The clinics mainly serve an un-insured, under-insured, and large medical assistance community, as living out its mission statement to be a charitable organization dedicated to maintaining and improving the health and quality of life. The clinics include the following:Kline Health Center - This program provides primary and specialty care to a largely urban population. While the practice does see private patients, much of the population served is of low income and/or underinsured. Since many of our patients rely on public transportation, Kline is able to meet many of the patient's needs at one location. Resident physicians, under the supervision of board certified physician faculty as well as specialty physicians, come to Kline to see patients for their orthopedic, endocrine, neurological, infectious disease, and surgical needs. The office is managed by a full-time RN who oversees a staff of medical assistants and other office support staff to meet the needs of the patients and providers.Children's and Teen Center - This program provides primary, acute, and preventative care plus some specialty services for children newborn through 18 years of age. Specialty services include neonatal developmental care, lead poisoning diagnosis and follow-up, pediatric neurology, and care for children infected with HIV.Women's Inpatient Services - This program provides comprehensive inpatient obstetrical and gynecological services to a patient population consisting largely of a managed care medical assistance patient base. This program was established in 2007. Women's Outpatient Health Center - This program provides comprehensive outpatient obstetrical and gynecological services to a largely managed care medical assistance patient population.PH Resource Education and Comprehensive Care for HIV (REACCH) - This program was established to provide primary and specialty medical care for people (including pregnant women and their exposed infants) who are HIV-positive as well as provide support services for these patients. Additional services provided to this patient population include nutritional counseling, transportation to medical appointments, vision care, assistance with medication co-payments, and assistance with mental health counseling and psychiatric care. The program is partially grant funded and also provides reimbursement to Pinnacle Health System for services rendered to patients who are HIV-positive and are either uninsured or underinsured.FastCare Retail clinic sites are the smallest portion of PHMS, consisting of 3% of the total program expenses in 2017. As part of our mission to provide access to care and to accommodate those patients who need care at times when our primary care offices cannot assist them, two additional Retail Clinics opened in Lebanon and Lemoyne in fiscal year 2017. With access to patients' medical records from their recent primary care visits, the clinics provide seamless follow up care. The Retail Clinics are open seven days a week with evening hours and no appointments are necessary. Total patient visits were 32,210 at the five sites. 79156 0 99820 West Shore Surgery Center (WSSC) - The West Shore Surgery Center is a limited partnership in which Pinnacle Health Medical Services is the general partner with a 2% controlling interest and Pinnacle Health Hospitals is a limited partner with a 49% interest. The remaining 49% interest is held by various physicians from the area. 79156 0 99820 108300795 1 0 0 0 0 0 0 0 0 0 1 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 1 0 0 0 0 0 0 1 0 0 0 1 X 0 0 1191 1 0 0 0 0 0 0 0 0 0 0 X 21 16 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 PA X William H Pugh CFO 7172318245 409 SOUTH SECOND ST PO BOX 8700 HARRISBURG PA 171058700 GEORGE GRODE diRECTOR 0.10 X 0 0 0 MICHAEL YOUNG President & CEO (Res. 3/17) 1.00 39.00 X X 0 1455902 30401 CLARENCE ASBURY dIRECTOR 0.10 0.30 X 0 0 0 BONY DAWOOD DIRECTOR 0.10 0.60 X 0 0 0 MICHAEL FERNANDEZ DIRECTOR 0.10 0.40 X 0 0 0 FELIX GUTIERREZ DIRECTOR 0.10 39.90 X 0 526259 41769 JOHN HICKEY vice Chairman 0.10 0.70 X X 0 0 0 BARRY KAIN dirECTOR 0.10 0.40 X 0 0 0 DANIEL KAMBIC dirECTOR 0.10 39.90 X 0 111706 20962 STEVE KUSIC chairMAN 0.10 0.80 X X 0 0 0 ROGER LEVIN diRECTOR 0.10 0.50 X 0 0 0 DEBORAH MILLER dIRECTOR 0.10 0.50 X 0 0 0 MICHAEL MUnCHIE dirECTOR 0.10 0.30 X 0 0 0 KENNETH OKEN dirECTOR 0.10 0.70 X 0 83751 0 CYNTHIA TOLSMA DIRECTOR 0.10 0.80 X 0 0 0 DENNIS WALSH dirECTOR 0.10 0.20 X 0 0 0 E GERALD WOODWARD diRECTOR 0.10 0.30 X 0 0 0 CAROLYN KREAMER DIRECTOR 0.10 0.80 X 0 0 0 Doug Neidich DiRECTOR 0.10 0.80 X 0 0 0 Harold Yang DIRECTOR 0.10 0.20 X 0 527532 34361 philip w guarneschelli president & CEO 1.00 39.00 X X 0 815680 34675 yvonne hollins direcTOR 0.10 0.40 X 0 0 0 William H Pugh Treasurer/ SR VP CORP. FIN 3.20 36.80 X 0 779764 23671 Christopher P Markley Esq SEC'Y/SR VP STAT SVCS/GEN counsel 6.00 34.00 X 0 521542 30401 Timothy Crowley PHMS CEO (RES. 11/16) 40.00 X 649875 0 14116 john delorenzo asst. secretary/VP Dev. 8.00 32.00 X 0 176693 24690 Prashant Desai PHYSICIAN 40.00 X 532513 0 12166 Gregory Willis PHYSICIAN 40.00 X 597781 0 34676 JOSE MISAS PhySICIAN 40.00 X 610172 0 30221 Ed Podczaski PhySICIAN 40.00 X 606924 0 30402 francis martinez phySICIAN 40.00 X 538596 0 34663 3535861 4998829 397174 168 0 1 0 The milton s hershey medical center po box 853 Hershey PA 17033 Physician staffing 1341259 Weatherby Locums Inc PO BOX 972633 Dallas TX 75397 TEMP. PHYSICIAN STAFFING 640812 barton associates inc po box 417844 Boston MA 02241 tEMP. PHYSICIAN STAFFING 343846 Allied Maintenance Systems Inc 45 fairview rd new cumberland PA 17040 cleaning services 270510 ayode Ji bakare md 2151 linglestown rd harrisburg PA 17110 physician coverage 189735 8 Patient Revenue, Net 621110 77487476 77487476 Physician services/coverage 621110 226579 226579 West Shore Partnership 621400 41087 41087 PHPA Therapists 621110 28619 28619 77783761 15512 15512 635378 561695 73683 73683 73683 36538 -36538 -36538 -36538 I/C LOSS REIMBURSEMENT 900099 8596840 8596840 highmark incentive/Rev 900099 2295000 2295000 PMPM INSUR. CO. REV. 900099 1090624 1090624 2406836 2406836 14389300 92225718 77783761 0 14441957 6090 6090 387399 387399 80386412 72693760 7692652 2963868 2669833 294035 7155982 6440702 715280 4614604 4153144 461460 10703308 1070331 9632977 605 605 37548 37548 4309954 3566801 743153 173751 139001 34750 1019055 836512 182543 213330 170664 42666 8216421 7323927 892494 113069 101762 11307 530023 514759 15264 180692 180692 2068941 1862047 206894 60800 60800 MEDICAL SUPPLIES 6690662 6690662 Dues and Subscriptions 230917 230917 130063431 108300795 21762636 0 6472 6699 19427120 13108547 8073567 3711500 268025 245864 563379 708513 938418 737414 21897630 11590582 13099736 10307048 26973 15816 7206617 7100887 49610307 35942288 17661866 15448760 4134347 3826127 21796213 19274887 X 27814094 16667401 27814094 16667401 49610307 35942288 X -37837713 26691020 X 0 1 X 1 0 X 5774761 2879039 2895722 7793141 4024284 3768857 8329728 4687259 3642469 10307048 X 119440885 26653472 26653472 92787413 -561695 -561695 92225718 130587578 561695 561695 130025883 37548 37548 130063431 Part X, Line 2: The System evaluates uncertain tax positions using a two-step approach for recognizing and measuring tax benefits taken or expected to be taken in an unrelated business activity tax return and disclosures regarding uncertainties in tax positions. Increases to expenses of $391,000 and $356,000 were recorded in the consolidated financial statements for the fiscal years ended June 30, 2017 and June 30, 2016, respectively. Part XI, Line 2d - Other Adjustments: Intercompany Transfers 25,325,976. BANKING FEES RECLASS -37,548. transfer from hospital temp restricted 1,365,044. Part XI, Line 4b - Other Adjustments: rental expenses recorded net of revenue on 990 -561,695. Part XII, Line 2d - Other Adjustments: Rental expenses recorded net of revenue on 990 561,695. Part XII, Line 4b - Other Adjustments: BANKING FEES RECLASS 37,548. X X X X 0 1 0 0 0 0 0 0 0 MICHAEL YOUNG President & CEO (Res. 3/17) 0 840420 0 372617 0 242865 0 15900 0 14501 0 1486303 0 0 FELIX GUTIERREZ DIRECTOR 0 401027 0 103456 0 21776 0 29815 0 11954 0 568028 0 0 Harold Yang DIRECTOR 0 507076 0 17614 0 2842 0 15900 0 18461 0 561893 0 0 philip w guarneschelli president & CEO 0 480377 0 196280 0 139023 0 15900 0 18775 0 850355 0 0 William H Pugh Treasurer/ SR VP CORP. FIN 0 509998 0 189370 0 80396 0 15900 0 7771 0 803435 0 0 Christopher P Markley Esq SEC'Y/SR VP STAT SVCS/GEN counsel 0 328827 0 120443 0 72272 0 15900 0 14501 0 551943 0 0 Timothy Crowley PHMS CEO (RES. 11/16) 409032 0 173394 0 67449 0 13250 0 866 0 663991 0 0 0 john delorenzo asst. secretary/VP Dev. 0 145434 0 30560 0 699 0 7550 0 17140 0 201383 0 0 Prashant Desai PHYSICIAN 397029 0 135063 0 421 0 4730 0 7436 0 544679 0 0 0 Gregory Willis PHYSICIAN 493186 0 87500 0 17095 0 15900 0 18776 0 632457 0 0 0 JOSE MISAS PhySICIAN 567592 0 39008 0 3572 0 15900 0 14321 0 640393 0 0 0 Ed Podczaski PhySICIAN 495243 0 87500 0 24181 0 15900 0 14502 0 637326 0 0 0 francis martinez phySICIAN 482182 0 50000 0 6414 0 15900 0 18763 0 573259 0 0 0 Part I, Line 4b MICHAEL YOUNG PARTICIPATEd IN A SPLIT INTEREST LIFE INSURANCE POLICY WHEREBY THE ORGANIZATION PAid THE PREMIUMS AND MR. YOUNG REPORTed THE PREMIUMS AS OTHER REPORTABLE COMPENSATION. UPON MR. YOUNG'S DEATH, THE ORGANIZATION Would have RECOVERed ITS PREMIUMS BEFORE ANY PROCEEDS could be RELEASED TO THE BENEFICIARIES. Felix Gutierrez, a director and Pinnacle Health Cardiovascular Institute employee, also participates in a nonqualified plan. Pinnacle Health contributed $13,915 to the plan during the fiscal year. DANIEL PUGH RELATIVE OF OFFICER WILLIAM PUGH 107079 DANIEL PUGH IS A RELATIVE OF WILLIAM PUGH AND IS COMPENSATED BY PINNACLE HEALTH AS AN EMPLOYEE. WILLIAM PUGH DOES NOT SUPERVISE DANIEL PUGH NOR DOES HE PARTICIPATE IN DISCUSSIONS ON DANIEL PUGH'S COMPENSATION. 0 MICHAEL HESS RELATIVE OF OFFICER PHILIP GUARNASCHELLI 41844 MICHAEL HESS IS A RELATIVE OF PHILIP GUARNASCHELLI AND IS COMPENSATED BY PINNACLE HEALTH AS AN EMPLOYEE. PHILIP GUARNESCHELLI DOES NOT SUPERVISE MICHAEL NOR DOES HE PARTICIPATE IN DISCUSSIONS ON MICHAEL HESS' COMPENSATION. 0 MATT MCKASKEY RELATIVE OF OFFICER WILLIAM PUGH 20805 MATT MCKASKEY IS A RELATIVE OF WILLIAM PUGH AND IS COMPENSATED BY PINNACLE HEALTH AS AN INDEPENDENT CONTRACTOR. WILLIAM PUGH DOES NOT SUPERVISE MATT MCKASKEY NOR DOES HE PARTICIPATE IN DISCUSSIONS ON MATT MCKASKEY'S COMPENSATION. 0 FORM 990, PART III, LINE 4A: -ULTRASOUND ASSESSMENT OF THE CERVIX -4D ultrasound imaging -Genetic counseling services -Amniocentesis/Chorionic Villus Sampling -First trimester screening -In-utero procedures -Advanced obstetrical surgery PinnacleHealth Sports Medicine Center provides comprehensive treatment for patients with injuiries or other medical conditions that affect their ability to exercise, participate in sports, or maintain an active lifestyle. The practice sees all levels of athletes and can evaluate and manage all soft tissue/musculoskeletal injuries up to the point of surgery. They have two offices, East & West Shore. PinnacleHealth Spine Care Center opened in July 2015. From diagnosis to treatment to recovery, the Spine Center provides advance care for a range of back, neck, & spine conditions. They have offices on the East and West Shore. Form 990, Part V, line 1a: Pinnacle Health System, the parent entity of a group comprised of taxable and tax-exempt organizations, is the common reporting agent for the group and files all 1099 forms for Pinnacle Health Medical Services. Form 990, Part VI, Section A, line 6 The sole member of the corporation is Pinnacle HEalth System, a nonprofit corporation (EIN 25-1778658). Form 990, Part VI, Section A, line 7a As sole member of the organization, Pinnacle health system shall elect the Board of Directors. Form 990, Part VI, Section A, line 7b THE FOLLOWING POWERS ARE RESERVED TO THE SOLE MEMBER, PINNACLE HEALTH SYSTEM: TO APPROVE AND AUTHORIZE: ANNUAL OPERATING AND CAPITAL BUDGETS STRATEGIC PLANS BORROWINGS OR EXTENSIONS OF CREDIT EQUAL TO OR GREATER THAN ONE MILLION DOLLARS VOLUNTARY DISSOLUTION, MERGER, OR CONSOLIDATION THE SALE, PLEDGING, LEASING OR TRANSFER OF ASSETS IN EXCESS OF $500,000 THE CREATION OR ACQUISITION OR ANY SUBSIDIARY OR AFFILIATE ADDITION OR DELETION OF CLINICAL CENTERS OF EMPHASIS ANY CONTRACT WITH AN UNRELATED PARTY FOR ManagemenT OF SUBSTANTIALLY ALL ACTIVITIES INVESTMENT POLICIES UNBUDGETED CAPITAL EXPENDITURES TO SELECT THE CERTIFIED PUBLIC ACCOUNTANTS TO ESTABLISH AN OBLIGATED GROUP FOR FINANCING PURPOSES TO ADOPT EMPLOYEE BENEFIT PLANS Form 990, Part VI, Section B, line 11b The authority and responsibility for review of the Form 990 for Pinnacle Health System and subsidiaries is delegated to the Finance and Audit Committee of the Pinnacle Health System Board. In order to accomplish this, all members of the Finance and Audit Committee are provided with a reasonable opportunity to review and comment to executive leadership on the IRS Forms 990 of the Pinnacle Health System and its subsidiaries, including Pinnacle Health Hospitals, Pinnacle Health Medical Services, Pinnacle Health Foundation, and Community Life Team before they are filed with the Internal Revenue Service. In addition, each member of each respective Board of Directors will be given access to view their individual Form 990 via a shared, password-protected website. Form 990, Part VI, Section B, line 12c In the performance of their duties to Pinnacle Health System and subsidiaries (collectively referred to as "PHS"), covered persons shall seek to act in the best interests of PHS, and shall exercise good faith, loyalty, diligence and honesty. A covered person is any individual who serves in a fiduciary capacity to, or who has legal authority to represent or obligate, the Pinnacle Health System or any of its affiliated organizations including, but not limited to, directors, officers, employees, and agents. Covered persons also include a) immediate families (spouses, children, siblings, parents, or spouse's parents), b) any organization in which they or their immediate families directly or indirectly i) have a material financial or beneficial interest, or ii) serve as a director, officer, employee, agent, attorney or similar capacity. A covered person shall disclose any business or personal interests or relationships which may be in conflict with the interest of PHS, including, but not limited to (a) engaging in or seeking to be engaged in (i) the delivery of health care services or (ii) the delivery of goods or services to PHS, or (b) any transaction or arrangement with PHS which would result in benefit to covered persons. The Governance Committee of the PHS Board reviews all conflict of interest statements annually and determines whether each director on the Board is independent. Covered persons who are Directors must comply with the Pinnacle Health System Guidelines for determining director independence and applying director independence requirements. Covered persons with a conflict of interest shall not vote on the matter, and the PHS Board or committee must approve, authorize, or ratify the transaction or arrangement by a majority vote of the non-interested directors or committee members present at a meeting that has a quorum. Violations of this statement of policy may subject covered persons to appropriate sanctions, including removal from their positions with PHS. Form 990, Part VI, Section B, line 15 The compensation committee of the Pinnacle Health System ("PHS") Board of Directors has the authority to develop and maintain executive and physician compensation to be approved by the Pinnacle Health System Board. The compensation committee will follow a diligent process that meets regulatory requirements for a rebuttable presumption of reasonableness and promotes effective governance of executive compensation, consistent with the PHS compensation philosophy. 1. Follow a process that establishes and maintains a rebuttable presumption of reasonableness for all executives and physicians potentially subject to intermediate sanctions. 2. Prepare minutes for each meeting to record the terms of the committee's decisions and the process followed in reaching those decisions. These minutes must include indications that the committee is following good practices in dealing with conflicts of interest and in obtaining and relying on appropriate comparability data on total compensation. 3. Select and directly engage and supervise any consultant hired by PHS to advise the committee on executive and physician compensation. 4. Periodically evaluate the appropriateness of this charter and the effectiveness of the process the committee uses in governing executive and physician compensation and report this evaluation to the board. 5. Provide the Board with an annual report on the committee's actions. 6. Monitor changes in laws and regulations pertaining to executive compensation and benefits to see that PHS complies with them. 7. Seek outside review of committee operations to ensure compliance with the IRS rebuttable presumption of reasonableness. 8. Review actual executive compensation and benefits provided to confirm consistency with compensation and benefits approved by the committee. Form 990, Part VI, Section C, line 19 The organization makes its governing documents and conflict of interest policy available for public inspection upon request. The organization includes a copy of its financial statements with the state registration filed with the Pennsylvania Department of State, Bureau of Charitable Organizations. These documents are a matter of public record and can be viewed at the bureau office. Form 990, Part XI, line 9: Intercompany Transfers 25,325,976. TRANSFER FROM HOSPITAL TEMP RESTRICTED 1,365,044. Pinnacle Health System 409 South Second Street PO Box 8700 Harrisburg PA 171058700 251778658 Management and consultative services for related exempt orgs PA 501(c)(3) Line 12b, II N/A 0 Pinnacle Health Foundation 409 South Second Street PO Box 8700 harrisburg PA 171058700 222691718 investment and fundraising activities for related tax-exempt organizations PA 501(c)(3) Line 12b, II Pinnacle Health System 0 Community Life Team 409 South Second Street PO Box 8700 harrisburg PA 171058700 231890444 medical transport services PA 501(c)(3) Line 10 Pinnacle Health System 0 Pinnacle Health Hospitals 409 South Second Street PO Box 8700 harrisburg PA 171058700 251778644 Inpatient and outpatient healthcare services PA 501(c)(3) Line 3 Pinnacle Health System 0 West Shore Surgery Center Ltd 409 South Second Street PO Box 8700 harrisburg PA 171058700 251821415 surgical care - medical services PA Pinnacle Health Medical Services related 49523 95768 0 1 0.02000 United Central PA Risk retention Group 76 St Paul Street Suite 500 bulington VT 054014477 134224033 captive insurance VT N/A C 0 United Health Risk Ltd PO Box 2450 Hamilton HM JX BD captive insurance BD N/A C 0 pinnacle health cardiovascular institute PO Box 8700 harrisburg PA 17105 320321362 Physician services PA N/A C 0 PINNACLE HEALTH VENTURES INC PO Box 8700 HARRisburg PA 17105 611677624 HOLDING COMPANY PA N/A C 0 PINNACLE HEALTH IMAGING INC PO Box 8700 HARRisburg PA 17105 231718571 IMAGING SERVICES PA N/A C 0 0 0 0 0 0 0 0 0 0 0 1 1 1 0 1 1 1 1 1