2017-11-14T21:11:35-06:00 2016-12-31 ERNST & YOUNG US LLP 155 N WACKER DRIVE 20 FLOOR CHICAGO IL 60606 990 2016-01-01 453864076 Beacon Health System Inc % JEFFREY COSTELLO BEAC 5746473549 615 N MICHIGAN ST SOUTH BEND IN 46601 JEFFREY COSTELLO CFO 5746473549 2017-11-13 true JACOB J ZEHNDER P01564049 3128792702 73.247.118.182 36964520173185000076 2017-11-14 P E9B9FD86DD932DD478E79EFBE252C72B247A13CF AA66391A3EB419599D985CB7941CE455993313B6 2016 2017-02-10 21:41:12Z PHILIP NEWBOLD 615 N MICHIGAN ST SOUTH BEND IN 46601 152300271 false X BEACONHEALTHSYSTEM.ORG X 2011 IN BEACON HEALTH SYSTEM, INC. IS COMMITTED TO ENHANCING THE PHYSICAL, MENTAL, EMOTIONAL AND SPIRITUAL WELL-BEING OF THE COMMUNITIES WE SERVE. 14 13 472 13 3426506 46610 620066 61191711 72152624 11953490 34943646 1501484 3044423 74693295 110760759 827813 919043 0 0 30110074 39336957 0 0 0 37042635 40257068 67980522 80513068 6712773 30247691 638045691 691884285 14654102 63165469 623391589 628718816 X BEACON HEALTH SYSTEM, INC. IS COMMITTED TO ENHANCING THE PHYSICAL, MENTAL, EMOTIONAL AND SPIRITUAL WELL-BEING OF THE COMMUNITIES WE SERVE AS THE COMMUNITY'S PROVIDER OF OUTSTANDING QUALITY, SUPERIOR VALUE AND COMPREHENSIVE HEALTH CARE SERVICES. true false 80186242 919043 73459949 BEACON HEALTH SYSTEM, INC.(BEACON) IS THE PARENT OF ELKHART GENERAL HOSPITAL, INC., BEACON MEDICAL GROUP, INC., MEMORIAL HOSPITAL OF SOUTH BEND, INC., BEACON HEALTH FOUNDATION, INC., AND BEACON HEALTH VENTURES, INC. BEACON PROVIDES COORDINATION FOR THE ORGANIZATIONS WITHIN THE SYSTEM IN SUCH MATTERS AS APPROVING BUDGETS, STRATEGIC PLANNING, MARKETING, ALLOCATING RESOURCES, SECURING TAX-EXEMPT BOND FINANCING AND PROVIDING COMMUNITY EDUCATION. 80186242 true true false true false false false false false true true true false false true true false true false false true false false false false false false true true true true false false false false false false false false false false false false false false true true true true false false true 221 0 true 472 true true true false false false false false false false false false X 14 13 false false false false false true false true true false false true true true true true true true true true true IN X JEFFREY COSTELLO 5746473549 615 N MICHIGAN STREET SOUTH BEND IN 46601 WALTER HALLORAN MD DIRECTOR 2.0 40.0 X 0 1239394 31363 LARRY D HARDING DIRECTOR 2.0 0.0 X 2731 0 0 DANIEL A MORRISON VICE CHAIR 2.0 0.0 X X 2223 0 0 VIVIAN SALLIE DIRECTOR 2.0 0.0 X 5398 0 0 J SCOTT TROEGER DIRECTOR 2.0 0.0 X 480 0 0 DAVID VAN RYN MD SECRETARY 2.0 10.0 X X 0 18625 0 JOHN HILER CHAIR 2.0 0.0 X X 4221 0 0 BIPIN DOSHI TREASURER 2.0 0.0 X X 0 0 0 DONALD ANDERSON DIRECTOR 2.0 0.0 X 0 0 0 RON FENECH DIRECTOR 2.0 0.0 X 0 0 0 JESSE HSIEH MD DIRECTOR 2.0 0.0 X 767 0 0 JOHN MARTIN DIRECTOR 2.0 0.0 X 0 0 0 TOM CASSADY JR DIRECTOR 2.0 2.0 X 0 6004 0 TRACY GRAHAM DIRECTOR 2.0 2.0 X 0 6280 0 PHILIP A NEWBOLD CEO 40.0 8.0 X 1207517 0 172549 JEFFREY P COSTELLO CFO/Asst. Treasurer 40.0 8.0 X 575784 0 176531 MICHAEL O'NEIL Chief Administrative Officer 40.0 0.0 X 393390 0 142250 KREG GRUBER COO 30.0 10.0 X 647771 0 186157 DANIELLE GAGLIANO CHIEF STRATEGY & PLANNING 40.0 0.0 X 312889 0 280487 STEVEN ELLER VICE PRESIDENT 40.0 0.0 X 346900 0 69234 LORI TURNER CHIEF MARKETING & INNOVATION 40.0 0.0 X 297916 0 64693 MARK WARLICK VICE PRESIDENT 40.0 0.0 X 328829 0 67732 SHELLY HARKINS CHIEF MEDICAL OFFICER 40.0 0.0 X 391439 0 355066 4518255 1270303 1546062 59 false true false Cerner Corporation 2800 ROCKCREEK PARKWAY KANSAS CITY MO 64117 IS Sftwr Maintenance 9143013 MCKESSON TECHNOLOGIES INC 5995 WINDWARD PARKWAY ALPHARETTA GA 19087 IS Sftwr Maintenance 3569093 SOFTWARE INFORMATION SYSTEMS LLC 165 BARR STREET SUITE 200 LEXINGTON KY 40507 IS Sftwr Maintenance 2546113 CDW GOVERNMENT 75 REMITTANCE DRIVE SUITE 1515 CHICAGO IL 60675 IS SFTWR MAINTENANCE 1642501 CRIPE DESIGN LLC 430 BALDWIN STREET SUITE 10 ELKHART IN 46514 CONSTRUCTION MANAGER 905668 67 620066 620066 MANAGEMENT ADMIN SERVICES 561499 63225208 60475307 2749901 NET PATIENT SERVICE REVENUE 621399 6484219 6484219 AFFILIATE RENT 622110 2623316 2623316 JOINT VENTURE ACTIVITY 621399 -180119 -180119 72152624 10710889 -32453 10743342 0 0 1108450 80410 1028040 0 1028040 1028040 63298668 2393191 39066815 2392287 24231853 904 24232757 24232757 0 0 0 0 0 0 0 0 0 CHA PAY FOR PERFORMANCE 621300 429000 429000 SURPLUS OF FLEXIBLE BENEFIT PLAN 561499 64000 64000 MANAGED CARE ACTIVITIES 561499 683634 2808 680826 839749 811517 28232 2016383 110760759 70710048 3426506 36004139 X 142962 142962 776081 776081 0 0 3516201 3516201 0 26259322 26259322 666325 666325 7010050 7010050 1885059 1885059 0 313010 313010 13814 13814 18691 18691 0 77534 77534 24156056 24156056 1579929 1579929 2726618 2726618 375125 375125 0 1428594 1428594 702375 702375 0 102734 102734 0 0 3871656 3871656 457288 457288 GENERAL DUES & SUBSCRIPTIONS 1271806 1271806 0 0 RECRUITMENT 656172 656172 0 0 MEDICAL SUPPLIES 233326 233326 0 0 LAB SUPPLIES 139319 139319 0 0 2133021 2133021 80513066 80186242 326824 0 1494 1619 502710 0 0 0 921686 1372297 0 0 0 0 0 0 0 0 6359177 12686723 64491451 26662282 34632123 37829169 417412042 445675383 168794306 182776088 8522452 11056374 103840 103840 795861 382792 638045691 691884285 12872906 11306655 0 0 0 0 0 49718563 0 0 0 0 0 0 0 0 1781196 2140251 14654102 63165469 X 623391589 628718816 0 0 0 0 623391589 628718816 638045691 691884285 X 30247693 6669497 -31589963 X false true X true false X X X 4 BEACON MEDICAL GROUP INC 351536132 10 true 17798551 0 ELKHART GENERAL HOSPITAL INC 350877574 3 true 32924173 0 MEMORIAL HOSPITAL OF SOUTH BEND INC 350868132 3 true 102342540 0 MEMORIAL HEALTH FOUNDATION 351536129 7 false 2041670 0 4 155106934 false false false false false true false false false false false false false false false true true SCHEDULE A, PART I, LINE 11e BEACON HEALTH SYSTEM, INC. RECEIVED A WRITTEN DETERMINATION LETTER THAT IT IS A TYPE III, FUNCTIONALLY INTEGRATED SUPPORTING ORGANIZATION, HOWEVER, THE CONTROL PROVISIONS IN ITS BYLAWS FIT THE TECHNICAL REQUIREMENTS FOR A TYPE I SUPPORTING ORGANIZATION, AS INDICATED IN PART IV OF THIS SCHEDULE, THUS BEACON HEALTH SYSTEM IS CURRENTLY REPORTING AS A TYPE I SUPPORTING ORGANIZATION. SCHEDULE A, PART IV, SECTION A, LINE 1 BEACON HEALTH SYSTEM'S ARTICLES OF INCORPORATION STATE THAT IT IS ORGANIZED TO CONTROL AS A SOLE MEMBER OF AN INTEGRATED REGIONAL HEALTH CARE SYSTEM COMPRISED OF ONE OR MORE SUBSIDIARY ORGANIZATIONS, INCLUDING ELKHART GENERAL HOSPITAL, INC. ("EGH"), MEMORIAL HEALTH SYSTEM, INC. (NOW BEACON MEDICAL GROUP) ("BMG"), AND ALL OTHER RESPECTIVE AFFILIATES, WHICH INCLUDES MEMORIAL HOSPITAL OF SOUTH BEND ("MHSB"). EGH, BMG, AND MHSB ARE SPECIFICALLY DESIGNATED BY NAME, AND BEACON HEALTH FOUNDATION IS DESIGNATED BY CLASS, AS IT IS A RESPECTIVE AFFILIATE WITH BEACON HEALTH SYSTEM AS ITS SOLE MEMBER. SCHEDULE A, PART IV, QUESTION 6 BEACON HEALTH SYSTEM (BHS) PROVIDED A SMALL NUMBER OF GRANTS TO SELECT COMMUNITY ORGANIZATIONS WHICH FURTHER THE CHARITABLE PURPOSES OF ITS SUPPORTED ORGANIZATIONS. AS BHS IS THE PARENT OF AN INTEGRATED HEALTH SYSTEM, ITS SUPPORTED ORGANIZATIONS ARE AWARE AND APPROVE OF THESE GRANTS. THE HEALTH SYSTEM IS CONTINUING TO RE-ALIGN ITS GRANTMAKING ACTIVITY IN 2017 TO DIRECT ALL GRANTS THROUGH ITS AFFILIATED FOUNDATION AND HOSPITAL ORGANIZATIONS. SCHEDULE A, PART IV, SECTION B, LINE 2 BEACON HEALTH SYSTEM IS CONTROLLED BY ITS AFFILITATED HOSPITALS, ELKHART GENERAL HOSPITAL AND MEMORIAL HOSPITAL OF SOUTH BEND. SEE THE DISCLOSURE IN SCHEDULE O FOR THE CORE FORM 990, PART VI, SECTION A, LINE 7a. CONSISTENT WITH ITS EXEMPT PURPOSES AS STATED IN ITS ARTICLES OF INCORPORATION, BEACON HEALTH SYSTEM ALSO SUPPORTED OTHER AFFILIATES WITHIN THE INTEGRATED REGIONAL HEALTH CARE SYSTEM, INCLUDING BEACON MEDICAL GROUP AND BEACON HEALTH FOUNDATION, WHICH DID NOT SHARE IN THE CONTROL OF BEACON HEALTH SYSTEM. BEACON HEALTH FOUNDATION PROVIDES FUNDRAISING AND ENDOWMENT SUPPORT TO BOTH HOSPITALS. BEACON MEDICAL GROUP PROVIDES SUPPORT THROUGH THE OPERATION OF PHYSICIAN PRACTICES. RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED false false false false false false false false true 18691 18691 false false Other Activities Part II-B BEACON HEALTH SYSTEM, 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. 26556021 9605449 339397 2645907 33854960 29619029 4093832 -1367472 5789367 26556022 27642755 2833644 -142883 714487 29619029 24661171 2180336 1785965 984717 27642755 22198822 1501904 1884305 923860 24661171 0.73730 0.00780 0.25490 false true true 15753384 15753384 3686754 1500593 2186161 679604 644559 35045 39204545 24517130 14687415 5167164 5167164 37829169 ALTERNATIVE INVESTMENTS 182776088 F 182776088 0 DEFERRED LIABILITY EXEC SERP 2140251 2140251 X SCH D, PART V, LINE 4 THE 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 XIII 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 A 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 INTEREST AND SETS FORTH NEW DISCLOSURES REGARDING UNRECOGNIZED TAX BENEFITS. NO AMOUNT WAS RECORDED FOR THE YEARS ENDED DECEMBER 31, 2016 OR 2015. Central America and the Caribbean 0 0 Investments 80730232 Europe (Including Iceland and Greenland) 0 0 Investments 5203114 0 0 0 0 85933346 85933346 true false true true true false true Chamber of Commerce St Joe County 401 E COLFAX AVE SOUTH BEND IN 46617 350153330 501(C)(6) 5150 CASH GENERAL SUPPORT ECONOMIC DEVELOPMENT CORP OF ELKHART 300 NIBCO PKWY STE 201 ELKHART IN 46516 351973845 501(c)(3) 10250 CASH GENERAL SUPPORT PROJECT LEAD THE WAY 3939 PRIORITY WAY SOUTH DR STE 400 INDIANAPOLIS IN 46530 141816385 501(C)(3) 70000 CASH GENERAL SUPPORT UNITED HEALTH SERVICES 6910 N MAIN STREET UNIT 10 GRANGER IN 46530 351118647 501(C)(3) 15000 CASH GENERAL SUPPORT 3 1 SCHOLARSHIPS/TUITION REIMBURSEMENT 456 776081 SCHEDULE I, PART I LINE 2 DONATIONS AND GRANTS GIVEN TO ORGANIZATIONS THAT IMPROVE THE HEALTH AND WELL-BEING OF OUR COMMUNITY ARE MONITORED THROUGH OUTCOME MEASUREMENT REPORTS THAT ARE PROVIDED TO BEACON HEALTH SYSTEM BY THE VARIOUS ORGANIZATIONS. THESE REPORTS INFORM US OF HOW THE DONATIONS AND GRANTS WERE USED. SCHEDULE I, PART II CHARITABLE DONATIONS PART OF THE ORGANIZATION'S MISSION IS TO IMPROVE THE HEALTH OF OUR COMMUNITY. IN ORDER TO FULFILL THIS GOAL, OUR ADMINISTRATORS HAVE THE ABILITY TO MAKE DONATIONS TO ORGANIZATIONS THAT IMPROVE THE HEALTH AND WELL BEING OF OUR COMMUNITY. SCHEDULE I, PART III SCHOLARSHIPS/ TUITION REIMBURSEMENT FOR SCHOLARSHIPS THE INDIVIDUAL MUST MEET SEVERAL REQUIREMENTS TO QUALIFY. IN ORDER TO QUALIFY FOR A SCHOLARSHIP THE INDIVIDUAL MUST (1) APPLY ON-LINE (INTRANET) AND WITHIN THE ACCEPTABLE TIME PARAMETERS FOR THE SEMESTER OF FUNDS BEING REQUESTED, (2) MAINTAIN A GRADE OF C OR BETTER, (3) PAY FOR TUITION/BOOKS AND SUBMIT CORRESPONDING ORIGINAL RECEIPTS FOR REIMBURSEMENT, REIMBURSED UP TO THE AMOUNT AWARDED BY THE SCHOLARSHIP COMMITTEE. (4) MEET ANY ADDITIONAL REQUIREMENTS OF THE SPECIFIC SCHOLARSHIP FUND, AND (5) MEET ELIGIBILITY REQUIREMENTS WHICH INCLUDE: (A) eMPLOYED BY BEACON HEALTH SYSTEM, INC. (B) ENROLLED IN A QUALIFIED PROGRAM, (C) SUBMITTED A POSITIVE RECOMMENDATION EACH SEMESTER FROM THE IMMEDIATE SUPERVISOR, AND (D) SUBMITTED A POSITIVE RECOMMENDATION EACH SEMESTER FROM THE SCHOOL. X X X true true X X X X X true true false false false false false true false WALTER HALLORAN MD DIRECTOR 1167624 69165 2605 10600 20763 1270757 0 PHILIP A NEWBOLD CEO 770868 235000 201649 157077 15472 1380066 142540 JEFFREY P COSTELLO CFO/Asst. Treasurer 438769 107800 29215 156942 19589 752315 0 MICHAEL O'NEIL Chief Administrative Officer 300494 69365 23531 129249 13001 535640 0 KREG GRUBER COO 439513 194395 13863 159767 26390 833928 0 DANIELLE GAGLIANO CHIEF STRATEGY & PLANNING 232041 48540 32308 256461 24026 593376 0 STEVEN ELLER VICE PRESIDENT 272687 56800 17413 45976 23258 416134 0 LORI TURNER CHIEF MARKETING & INNOVATION 238011 52625 7280 41155 23538 362609 0 MARK WARLICK VICE PRESIDENT 251801 51100 25928 44269 23463 396561 0 SHELLY HARKINS CHIEF MEDICAL OFFICER 334044 57395 337503 17563 746505 0 PART I, LINE 1A BEACON HEALTH SYSTEM, INC. REIMBURSES DIRECTORS FOR THE TAX EFFECT OF THE 1099 REPORTABLE BENEFITS RELATED TO THE FREE MEMBERSHIP AT BEACON HEALTH SYSTEM'S HEALTH AND LIFESTYLE CENTER, AS WELL AS, THE TAXABLE BENEFITS OF SPOUSAL TRAVEL. BEACON HEALTH SYSTEM ALSO REIMBURSES FOR DIRECT EXPENSES RELATED TO ANY TRAVEL ON THE ORGANIZATION'S BEHALF. SPOUSAL TRAVEL FOR THE FOLLOWING SIX EMPLOYEES WAS INCLUDED IN TAXABLE COMPENSATION: PHILIP NEWBOLD, DANIEL MORRISON, VIVIAN SALLIE, J. SCOTT TROEGER, TOM CASSADY, JR, AND TRACY GRAHAM. HEALTH OR SOCIAL CLUB DUES FOR THE FOLLOWING 6 WAS INCLUDED IN TAXABLE COMPENSATION: JOHN HILER, VIVIAN SALLIE, LARRY HARDING, JESSE HSIEH, MD, TOM CASSADY, JR, AND TRACY GRAHAM. TAX INDEMNIFICATION AND GROSS-UP PAYMENTS FOR THE FOLLOWING 8 WAS INCLUDED IN TAXABLE COMPENSATION: JOHN HILER, DANIEL MORRISON, VIVIAN SALLIE, J. SCOTT TROEGER, LARRY HARDING, JESSE HSIEH, MD, TOM CASSADY, JR, AND TRACY GRAHAM. PART I, LINE 4A SEVERANCE WAS PAID AND/OR ACCRUED FOR IN 2016 FOR THE FOLLOWING TWO HIGHLY-COMPENSATED INDIVIDUALS: SHELLY HARKINS, $375,003 DANIELLE GAGLIANO, $255,694 PART 1, LINE 4B 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 INDIVIDUAL RECEIVED VESTED PAYMENTS IN 2016, REFLECTED IN COLUMN (B)(III): PHIL NEWBOLD $143,631 IN MARCH 2016. THE FOLLOWING INDIVIDUALS RECEIVED DEFFERED PAYMENTS IN 2016 THAT WILL VEST IN FUTURE YEARS, WHICH ARE REFLECTED IN COLUMN C: PHIL NEWBOLD, $135,317 JEFFREY COSTELLO, $74,414 KREG GRUBER, $84,167 MICHAEL ONEIL, $50,321 STEVEN ELLER, $35,376 LORI TURNER, $30,555 MARK WARLICK, $33,669 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 2016 THAT WILL VEST IN FUTURE YEARS, WHICH ARE REFLECTED IN COLUMN C: JEFFREY COSTELLO, $65,000 KREG GRUBER, $65,000 MICHAEL ONEIL, $65,000 PART I, LINE 7 THE ORGANIZATION HAS FOUR INCENTIVE PLANS (EMPLOYEE, MANAGEMENT, EXECUTIVE, AND FOUNDATION) WHICH HAVE A NET OPERATING INCOME TO BUDGET MEASUREMENT FOR THE PAYOUT THRESHOLD. THE EMPLOYEE PLAN SHARES THE EXCESS OVER BUDGET NET OPERATING INCOME WITH THE NON-MANAGMENT EMPLOYEES FOR 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 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 FOUNDATION INCENTIVE PLAN IS FOR ASSOCIATES WHO WORK IN A GRANT-WRITING OR FUND-RAISING ROLE ON BEHALF OF THE BEACON HEALTH FOUNDATION. THE FOUNDATION PLAN PAYS A PERCENTAGE OF BASE COMPENSATION IF THE NET OPERATING INCOME IS EQUAL TO OR GREATER THAN 80% OF THE BUDGETED NET OPERATING INCOME. THE PERCENTAGE CAPS WHEN OPERATING INCOME REACHES 120% OF THE BUDGETED OPERATING INCOME. THE PAYOUT OF THE FOUNDATION INCENTIVE IS MADE AT THE DISCRETION OF THE BOARD. A HOSPITAL AUTHORITY OF SAINT JOSEPH COUNTY 356311914 000000000 2016-08-18 50000000 CONSTRUCT CHILDREN'S HOSPITAL false false false A 0 0 50005721 0 0 0 285000 0 0 37134749 0 12585972 2017 false false false true A false false false false 0.00000 0.00000 0.00000 false false false true A false true false false true false 0 false 0 false true A true PART II, LINE 3, COLUMN A THE DIFFERENCE BETWEEN THE TOTAL PROCEEDS OF THE ISSUE AND THE ISSUE PRICE IS INVESTMENT EARNINGS. FORM 990, PART III, QUESTION 2 IN 2016, BEACON HEALTH SYSTEM, INC. (BHS) CONSOLIDATED ADDITIONAL DEPARTMENTS INTO CORPORATE SERVICES TO BETTER ALIGN WITH THE WORK THE DEPARTMENTS ARE PERFORMING. AS PART OF THE CONSOLIDATION ALL ACTIVITIES RELATED TO FACILITIES MANAGEMENT ARE NOW INCLUDED ON BHS, WHEREAS IN THE PAST THESE WERE SEPARATE DEPARTMENTS ON THE AFFILATED ENTITIES. THE ADDITION OF THE FACILITIES MANAGEMENT ACTIVITIES CAUSED AN INCREASED IN INCOME IN 2016 COMPARED TO 2015. OTHER NEW DEPARTMENTS INCLUDED: CORPORATE PATIENT ACCOUNTING, CORPORATE CODING AND CORPORATE HIM. FORM 990, PART VI, SECTION A, LINE 7A THE 14 MEMBERS OF BOARD OF DIRECTORS OF BEACON HEALTH SYSTEM WERE INITIALLY APPOINTED 50% BY ELKHART GENERAL HOSPITAL, INC. AND 50% BY BEACON MEDICAL GROUP, INC. THE REPRESENTATION WILL CONTINUE FOR A PERIOD OF 7 YEARS FROM THE DATE OF BEACON HEALTH SYSTEM'S FORMATION. SUCCESSOR APPOINTEES TO THE BOARD ARE RECOMMENDED FROM THE RESPECTIVE HOSPITALS, OR A COMMITTEE APPOINTED BY THE RESPECTIVE HOSPITALS TO THE NOMIMATING AND GOVERNANCE COMMITTEE OF THE BOARD, THEN APPOINTED TO THE BOARD. AT THE EXPIRATION OF THIS 7 YEAR TERM, THE BEACON HEALTH SYSTEM BOARD OF DIRECTORS WILL BE APPOINTED BY THE NOMINATING AND GOVERNANCE COMMITTEE. FORM 990, PART VI, SECTION A, LINE 7B SEE PART VI, SECTION A, LINE 7A DISCLOSURE 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 US, LLP TO REVIEW THE COMPLETED FORM 990 AND APPROPRIATE SCHEDULES. PRIOR TO FILING THE RETURN THE COMPENSATION COMMITTEE OF THE ORGANIZATION AND 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 425 STATEMENTS AND ACHIEVED 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, 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 THE WEB BASED SURVEY TOOL PROVIDED BY ERNST & YOUNG LLP. 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 FORM 990. THE RESULTS ARE REPORTED TO THE CEO OF BEACON HEALTH SYSTEM, THE AUDIT COMMITTEE CHAIRMAN, 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 ACKNOWLEDGMENT FORM TO BE SIGNED BY BEACON HEALTH SYSTEM, INC'S KEY FINANCIAL EMPLOYEES THAT BEACON HEALTH SYSTEMS, INC'S FINANCIAL INFORMATION IS TO THE BEST OF THEIR KNOWLEDGE TRUE AND ACCURATE. THIS STATEMENT WAS SENT OUT IN JANUARY, 2016 AND THE SIGNED ACKNOWLEDGEMENTS ARE KEPT BY THE DIRECTOR OF INTERNAL AUDIT. IN 2016, 22 DESIGNATED EMPLOYEES WERE REQUESTED TO SIGN THE FORM AND 100% COMPLIED WITH THIS REQUEST. 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. HAS AN EXTENSIVE EXAMINATION THAT IS CONDUCTED FOR VICE PRESIDENT AND HIGHER COMPENSATION. VICE PRESIDENT AND HIGHER COMPENSATION IS DETERMINED AFTER AN 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. 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 MEMORIAL HOSPITAL OF SB $ -29,594,921 WRITE OFF INTER COMPANY BEACON HEALTH FOUNDATION $ -381,505 WRITE OFF INTER COMPANY ELKHART GENERAL HOSPITAL $ 573,056 WRITE OFF INTER COMPANY BEACON MEDICAL GROUP $ 2,407,754 WRITE OFF INTER COMPANY BEACON HEALTH VENTURES $ -4,594,354 VARIANCE DUE TO ROUNDING $7 TOTAL $ -31,589,963 FORM 990 PART IX LINE 11G DESCRIPTION:CONSULTING TOTAL FEES:1291774 FORM 990 PART IX LINE 11G DESCRIPTION:EQUIPMENT RENTAL & MAINTENANCE TOTAL FEES:13210810 FORM 990 PART IX LINE 11G DESCRIPTION:RADIOLOGY FEES TOTAL FEES:43566 FORM 990 PART IX LINE 11G DESCRIPTION:LAB READING FEES TOTAL FEES:277769 FORM 990 PART IX LINE 11G DESCRIPTION:CONTRACT LABOR TOTAL FEES:3810729 FORM 990 PART IX LINE 11G DESCRIPTION:OTHER PURCHASED SERVICES TOTAL FEES:5521408 Community Occupational Medicine 22818 Old US 20 Elkhart IN 46516 352073758 Medical Cent IN 6294301 2625759 BHS CHA ACO LLC 53842 Generations Dr South Bend IN 46635 462860087 ACO IN 0 151191 BHS 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 BLVD ELKHART IN 46514 350877574 HOSPITAL IN 501(C)(3) 3 BHS true BEACON MEDICAL GROUP INC 615 N MICHIGAN ST SOUTH BEND IN 46601 351536132 PHY PRACTICES IN 501(C)(3) 10 BHS true MEMORIAL ENDOWMENT FUND FOR MEMORIAL HOS PO BOX 1602 SOUTH BEND IN 46634 356068581 ENDOWMENT IN 501(C)(3) 12D III-O MHSB true BEACON HEALTH VENTURES INC 615 N MICHIGAN ST SOUTH BEND IN 46601 351901068 HOME MEDICAL IN BHS C 28227332 14374581 1.00000 true BEACON HEALTH VENTURES MICHIGAN INC 615 N MICHGIAN ST SOUTH BEND IN 46601 208259773 HOME MEDICAL MI BHS C 543322 3270561 1.00000 true true true true false false false false false false true true true true true true true true true true Elkhart General Hospital c 573056 WriteoffInterco Beacon Health Foundation b 381505 WriteoffInterco Beacon Health Ventures b 4594354 WriteoffInterco Beacon Medical Group c 2407754 WriteoffInterco Memorial Hospital South Bend b 29594921 WriteoffInterco Memorial Hospital South Bend j 1178276 Actual Charges Memorial Hospital South Bend l 30070860 Actual Charges Beacon Health Ventures l 2749901 Actual Charges Beacon Medical Group l 10879504 Actual Charges Beacon Health Foundation l 199549 Actual Charges Elkhart General Hospital l 19325394 Actual Charges Beacon Health Foundation n 813719 Actual Charges Memorial Hospital South Bend r 72300000 Actual Charges Elkhart General Hospital r 50300000 Actual Charges Elkhart General Hospital p 32924173 Actual Charges Beacon Medical Group p 17798551 Actual Charges Beacon Health Foundation p 503248 Actual Charges Beacon Health Ventures p 4866427 Actual Charges Memorial Hospital South Bend p 101164264 Actual Charges Memorial Hospital South Bend q 29762806 Actual Charges Elkhart General Hospital q 2522503 Actual Charges Beacon Health Ventures q 4269204 Actual Charges Beacon Health Foundation q 1211564 Actual Charges Beacon Medical Group q 30319973 Actual Charges Beacon Health Foundation c 620066 WriteoffInterco Beacon Medical Group k 96288 Actual Charges Memorial Hospital of South Bend k 673836 Actual Charges