2015-11-09T18:05:02-06:00 2014-12-31 BDO USA LLP 3200 BRISTOL ST 4TH FLOOR COSTA MESA CA 92626 990 2014-01-01 731729007 SCAN HEALTH PLAN ARIZONA % VIRGINIA HAVAI SCAN 5629895100 3800 KILROY AIRPORT WAY SUITE 100 LONG BEACH CA 908065616 NANCY MONK CRO 5629895100 1999-11-29 true WALTER H HICK JR P01070437 7149573200 2014 2016-04-25 22:37:26Z CHRISTOPHER WING 3800 KILROY AIRPORT WAY 100 LONG BEACH CA 90806 209771362 false X WWW.SCANHEALTHPLAN.COM/ARIZONA/MEDICARE/ X 2006 AZ TO SERVE AND TO IMPROVE THE LIVES OF THE FRAIL, ELDERLY AND DISABLED RESIDENTS OF ARIZONA. 3 0 17 0 0 0 0 131834861 159090188 105354 75286 -520938 50025148 131419277 209190622 0 0 0 0 3892964 1535288 0 0 0 121507403 165171838 125400367 166707126 6018910 42483496 35603522 27766641 57013010 6693469 -21409488 21073172 X TO SERVE AND IMPROVE THE LIVES OF THE FRAIL, ELDERLY AND DISABLED RESIDENTS OF ARIZONA BY PROVIDING MEDICAL AND PHARMACY SERVICES, COORDINATED CARE, SOCIAL SERVICES AND OTHER SERVICES TO A GERIATRIC POPULATION THAT IS UNDERSERVED AND AT RISK. false false 150099365 159155336 Program Services Description provided in Schedule O 150099365 false false false false false false false false false true false false false true true true 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 true 395 0 true 17 true false false false false false false false false false false X 3 0 false false false false true true false true true false false true true true true true true true true false AZ X VIRGINIA HAVAI 5629898300 3800 KILROY AIRPORT WAY SUITE 100 LONG BEACH CA 90806 X CHRISTOPHER WING DIRECTOR/CHAIRMAN 3.0 37.0 X X 0 980319 547891 CATHERINE BATTEER DIRECTOR/PRESIDENT/CEO 20.0 20.0 X X 0 463703 185539 WILLIAM ROTH DIRECTOR 3.0 37.0 X 0 646670 372915 WALTER R STONE OUTGOING CFO 3.0 37.0 X 0 1244603 40673 VINOD MOHAN CHIEF FINANCIAL OFFICER 3.0 37.0 X 0 339703 63378 NANCY MONK SECRETARY 3.0 37.0 X 0 407835 199752 DOUGLAS JAQUES OUTGOING LEGAL COUNSEL 3.0 37.0 X 0 779252 13996 JANET KORNBLATT LEGAL COUNSEL 3.0 37.0 X 0 259699 111469 WENDY KARSTEN VP, GENERAL MANAGER 15.0 25.0 X 0 269038 32978 RICHARD PEITZMEIER VP - SALES 40.0 0.0 X 238619 0 70523 BRIAN GOUZIOU SALES REPRESENTATIVE 40.0 0.0 X 132938 0 26310 JUSTIN HUEBACH BROKER REPRESENTATIVE 40.0 0.0 X 113697 0 35411 485254 5390822 1700835 3 false true false HEALTHCARE PARTNERS ARIZONA LLC 19191 S VERMONT AVENUE STE 200 TORRANCE CA 90502 MEDICAL SERVICES 125141288 EXPRESS SCRIPTS INC 21653 NETWORK PLACE CHICAGO IL 606731216 MEDICAL SERVICES 38874183 WESTERN ASSETS PROTECTION 4550 E BELL RD STE 136 BLDG 4 PHOENIX AZ 85032 MEDICAL SERVICES 1092759 ENGLE MURPHY 236 E 3RD STREET LONG BEACH CA 90802 CONSULTING SERVICES 839734 LOGISTICARE SOLUCTIONS LLC P O BOX 116006 LOCKBOX 116006 ATLANTA GA 30353 CONSULTING SERVICES 798993 18 0 MEDICARE PREMIUMS 900099 159090188 159090188 159090188 85026 85026 0 0 0 0 0 571000 580740 -9740 -9740 -9740 0 0 0 GAIN FROM WRITEOFF 900099 25148 25148 CANCELLATION OF DEBT 900099 50000000 50000000 50025148 209190622 159115336 50075286 X 0 0 0 0 336243 0 336243 0 0 879366 879366 89195 89195 134756 134756 95728 95728 6007158 6007158 956 956 79800 79800 24000 24000 0 0 155655978 150099365 5556613 2186050 2186050 765575 765575 4177 4177 0 183957 183957 99373 99373 0 2793 2793 0 0 87419 87419 0 OTHER EXPENSES 74602 74602 166707126 150099365 16607761 0 507977 110147 29036471 18480186 0 0 3583010 7187902 0 0 0 0 0 0 0 0 310474 29878 852848 778020 162246 74828 1640990 1613273 0 0 0 0 0 0 362354 270427 35603522 27766641 6638212 6367343 0 0 15710 14881 0 0 0 0 0 0 0 0 0 0 50359088 311245 57013010 6693469 X -21409488 21073172 0 0 0 0 -21409488 21073172 35603522 27766641 X 42483496 -1899 1063 X false true X true false 38649 18953 19696 253561 223534 30027 560638 535533 25105 74828 0 DEFERRED EXECUTIVE TRUST FUNDS 250553 DEFERRED RENT 60692 311245 X 157702210 -1898 -510243 -512141 158214351 50976271 50976271 209190622 165299647 -25147 -25147 165324794 1382332 1382332 166707126 FORM 990 - SCHEDULE D - PART X, LINE 2 Under FASB ASC 740, Income taxes, the Company is required to recognize a liability for each uncertain tax position at the amount estimated to be required to settle the issues. As of December 31, 2014 and 2013, there were no liabilities recorded for uncertain tax positions. FORM 990 - SCHEDULE D - RECONCILIATION OF REVENUE - PART XI The organization's separate financial statements were prepared on a statutory basis in conformity with the manual and accounting practices prescribed and permitted by the DOI (NAIC SAP). The following adjustments were required: Line 2d - Additional revenue recognized on the financial statements <$510,243>; <$510,918> statutory audit adjustment for reversal of prior year risk adjustment; <$25,147> represents a reclassification for stop loss reinsurance which was classified as revenue on the financial statements and an expense on Form 990; $25,821 adjustment for bonds difference in market value vs amortized cost. Line 4b - Additional revenue recognized on the form 990 of $50,976,271; $976,271 of Premium Deficiency Reserve (PDR) Revenue classified as revenue on the form 990 and as an expense on the financial statements, the adjustment nets to zero with the adjustment in Part XII line 4b. $50,000,000 of cancellation of debt income on the 990 treated as an equity transfer on the financial statements. FORM 990 - SHEDULE D - RECONCILIATION OF EXPENSES - PART XII The organization's separate financial statements were prepared on a statutory basis in conformity with the manual and accounting practices prescribed and permitted by the DOI (NAIC SAP). The following adjustments were required: Line 2d - Additional expenses recognized on form 990 of $25,147 represents a reclassification of expenses which were classified as revenue on the financial statements. Line 4b - Additional expenses on the financial statements of $1,382,332; $976,271 of Premium Deficiency Reserve (PDR) Revenue classified as an expense on the financial statement and as revenue on form 990, the adjustment nets to zero with the adjustment in Part XI line 4b; $406,061 represents statutory audit adjustment to reverse a prior year adjustment relating to the IBNR over reserve. X X true true true true false false false false false false false CHRISTOPHER WING DIRECTOR/CHAIRMAN 0 626966 0 331820 0 21533 0 522786 0 25105 0 1528210 0 331820 CATHERINE BATTEER DIRECTOR/PRESIDENT/CEO 0 333779 0 108712 0 21212 0 185539 0 0 0 649242 0 108712 WILLIAM ROTH DIRECTOR 0 428181 0 194463 0 24026 0 306018 0 66897 0 1019585 0 194463 WALTER R STONE OUTGOING CFO 0 294585 0 287324 0 662694 0 18100 0 22573 0 1285276 0 287324 VINOD MOHAN CHIEF FINANCIAL OFFICER 0 121598 0 200000 0 18105 0 59385 0 3993 0 403081 0 0 NANCY MONK SECRETARY 0 284809 0 103535 0 19491 0 180187 0 19565 0 607587 0 103535 DOUGLAS JAQUES OUTGOING LEGAL COUNSEL 0 11220 0 140659 0 627373 0 10237 0 3759 0 793248 0 140659 JANET KORNBLATT LEGAL COUNSEL 0 236784 0 10000 0 12915 0 110167 0 1302 0 371168 0 0 WENDY KARSTEN VP, GENERAL MANAGER 0 217716 0 36892 0 14430 0 14799 0 18179 0 302016 0 36892 RICHARD PEITZMEIER VP - SALES 184126 0 32395 0 22098 0 46750 0 23773 0 309142 0 32395 0 BRIAN GOUZIOU SALES REPRESENTATIVE 31617 0 3500 0 97821 0 9127 0 17183 0 159248 0 0 0 FORM 990 - SCHEDULE J - PART I, LINE 1A At the Company's request, spouses/guests of certain SCAN Group, SCAN Health Plan and SCAN Health Plan Arizona executives attended a Company business event in 2014. The business purpose of the event was informing our distribution partners regarding the Company's upcoming Annual Enrollment Period (AEP) and soliciting input on how to best position SCAN for increased enrollment. Because the Company requested that spouses and guests attend this meeting for the purpose of creating deeper and more productive relationships between SCAN and important third party business partners, the Company reimbursed these travel expenses. Additionally, the Company reimbursed travel expenses for spouses/guests of members of the Board of Directors of SCAN Group and SCAN Health Plan who attended an offsite Board meeting in 2014. SCAN Health Plan approved and paid for first class travel for CEO Chris Wing on 6 occasions where the flight was 4 hours or longer; as Mr. Wing is 6'5" tall and a regular airplane seat is extremely uncomfortable for flights of 4 hours duration or longer. The Company reimbursed apartment rental fees of its newly hired CFO who was relocating to facilitate an immediate start date. FORM 990 - SCHEDULE J - PART I, LINE 3 COMPENSATION FOR THE PRESIDENT WAS ESTABLISHED AND PAID BY A RELATED ORGANIZATION. THE RELATED ORGANIZATION USED THE FOLLOWING TO ESTABLISH THE PRESIDENT'S COMPENSATION: (1) COMPENSATION COMMITTEE; (2) INDEPENDENT COMPENSATION CONSULTANT; (3) WRITTEN EMPLOYMENT CONTRACT; (4) COMPENSATION SURVEY OR STUDY; (5) APPROVAL BY THE BOARD OF DIRECTORS. FORM 990 - SCHEDULE J - PART I, LINE 4A During 2014 the employment relationship of the following employee of SCAN Group and SCAN Health Plan and SCAN Arizona ended. In connection with the termination of their respective employment, SCAN Group negotiated and paid severance to the employee. The severance payment was in accordance with the terms of highly compensated employees' then existing employment agreement. Douglas Jaques, Outgoing General Counsel - SCAN Group, $313,404 Walter Stone, Outgoing CFO - SCAN Health Plan, $446,349 FORM 990 - SCHEDULE J - PART I, LINE 4B The Company provides a supplemental non-qualified retirement plan to only officers and senior vice presidents in the Section 457(f) plan. The following individuals participated in the company's section 457(F) during the year 2014: Christopher Wing, Walter R. Stone, Peter Begans, Douglas Jaques, Sherry Stanislaw, Catherine Bateer, Nancy J. Monk, William H. Roth, Gilbert J. Miller, Moon Kwan-Leung, Eve Gelb, Janet Kornblatt, Vinod Mohan and David Milligan. Pursuant to the terms and conditions of the Section 457(F) Plan, a participant becomes 100% vested in the employer contribution upon the occurrence of any of the following while the participant is an employee. 1) The participant has ten year of continuous employment, counting only service after December 31, 2005. 2) The participant reaches the age of 62 and has five years of continuous employment; 3) The participant's involuntary termination; 4) The participant's disability; or 5) The participant's death. Deferred compensation for 2014 reported on Schedule J, Part II, Column C consists of the following; 1. 457(F) EMPLOYER CONTRIBUTIONS SUBJECT TO VESTING TERMS AND CONDITIONS AS NOTED IN ITEMS (1) THROUGH (5) ABOVE. BASED ON THESE VESTING TERMS AND CONDITIONS, THERE IS SUBSTANTIAL RISK OF FORFEITURE. 2. THE COMPANY PROVIDES AN INCENTIVE PLAN TO VICE PRESIDENTS, AND SENIOR EXECUTIVES. THERE ARE TWO COMPONENTS OF THE COMPANY INCENTIVE PLAN (ICP): A. ANNUAL ICP AWARD - REPRESENTS 2/3 OF THE TOTAL AWARD. B. DEFERRED ICP AWARD - REPRESENTS 1/3 OF THE TOTAL AWARD. BASED ON THE VESTING TERMS AND CONDITIONS FOR THIS COMPONENT, THERE IS SUBSTANTIAL RISK OF FORFEITURE. 3. 403(B) QUALIFIED RETIREMENT PLAN CONTRIBUTIONS (EMPLOYER MATCH AND SAFE HARBOR). Douglas Jaques, outgoing General Counsel, participated in the 457(f) plan until his employment ended on 1/1/2014; he received 457(f) distributions $253,550 in 2014. Walter Stone, outgoing Chief Financial Officer, upon his DEPARTURE, received 457(f) distributions of $144,680. The following individual participated in SCAN Health Plan's Keysop Plan during the taxable year: Timothy Schwab. The plan has been frozen since May 2002 and no employees have been added as participants. In 2014, Timothy Schwab received a distribution of $321,152 from the Keysop Plan. FORM 990 - PROGRAM SERVICE ACCOMPLISHMENTS - PART III, LINE 4A SCAN Health Plan Arizona began program operations as a Medicare Advantage contractor effective January 1, 2007. It is responsible for arranging and monitoring the full range of Medicare health services for plan enrollees. The plan began offering a Medicare advantage special needs plan (SNP) for beneficiaries who are dually eligible and enrolled in both the Medicare and ALTCS programs. Beginning January 1, 2009, the Plan expanded its Medicare advantage participation to other Medicare beneficiary populations, through a Medicare advantage prescription drug (MAPD) plan. In January 2008 SCAN launched the SCAN Connections community resource center designed to link SCAN members, their caregivers and others in the Maricopa county communities with knowledgeable staff who can assist in navigating a complex health care system. The resource center staff build bridges into other community organizations, governmental agencies and health advocacy groups to provide to the community health education and support services focused on geriatric, chronic illness and physically disabled challenges. Services and resources are provided at the SCAN Connections resource center in SCAN's office. SCAN Health Plan Arizona has grown from no membership at December 31, 2006 and currently serve more than 18,556 enrollees. The addition of the SCAN Classic, Heart First and Balance programs allow SCAN personnel, especially the case management team, to more effectively coordinate the needed health care services required by SCAN members. FORM 990 - GOVERNANCE, MGMT & DISCLOSURE - PART VI, SECTION A, LINE 6 The Sole Member of the organization is SCAN Group, A California Nonprofit Corporation. FORM 990 - GOVERNANCE, MGMT & DISCLOSURE - PART VI, SECTION A, LINE 7A The sole member has the power to appoint the members of the Board of Directors. FORM 990 - POLICIES - PART VI, SECTION B, LINE 11B The Form 990 is prepared by BDO USA, LLP, working in conjunction with SCAN's finance department. SCAN Health Plan's Director-Statutory and financial reporting has direct responsibility for this effort, subject to supervision by the SCAN Health Plan's Finance Controller. After an initial draft of the Form 990 is prepared, it is circulated for review and comment by relevant members of the executive team who have responsibility and/or knowledge about the various matters disclosed and/or described in the Form. The General Counsel, in particular, reviews the Form 990 and ensures accuracy of descriptions and that disclosure is complete. The draft Form 990 is reviewed by the compensation committee, the Audit and Compliance Committee of the Board of Directors of SCAN Group, and is shared with all members of the Board of Directors after it is ready for filing but before it is filed. FORM 990 - POLICIES - PART VI, SECTION B, LINE 12C SCAN Health Plan Arizona regularly and consistently monitors and enforces compliance with its conflict of interest policy through annual circulation of a conflict of interest questionnaire which is required to be answered by all members of the Board of Directors, officers and members of executive management. In addition, there is regular education and enforcement through oversight of such policy and the SCAN Health Plan Arizona Gift and Business Courtesies Policy with respect to each department by members of the senior executive team with responsibility for such department. The Legal Department of SCAN Group reviews all contractual relationships entered into by the organization and the General Counsel of SCAN Group is responsible for monitoring conflicts of interest through the annual circulation and review of the conflict of interest questionnaire. Accordingly, the Legal Department of SCAN Group through the General Counsel is in a position to monitor and enforce compliance with the policy on an ongoing basis. FORM 990 - POLICIES - PART VI, SECTION B, LINE 15A The process for determining the compensation of the President of SCAN Health Plan Arizona is conducted by the Compensation Committee of the Board of Directors of SCAN Group, all of the voting members of which are independent persons. In determining the President's compensation, the Compensation Committee works with and relies upon the counsel and expertise of Ernst & Young, a consultant with well-established experience and expertise in the area of nonprofit organization executive compensation and compliance with the intermediate sanctions requirements applicable to such compensation. Ernst & Young provides an "Executive Compensation Report" to the Compensation Committee each year which furnishes the basis for the establishment of the President's compensation package during the following year. The Ernst & Young Executive Compensation Report is based on a review of the executive compensation practices of a variety of organizations that are considered comparable to SCAN Health Plan Arizona based on various metrics. The Compensation Committee deliberates on the issue of the President's compensation package in light of the Ernst & Young Executive Compensation Report and questions are asked of, and answered by Ernst & Young, regarding such report and other matters relevant to such package. Based on such deliberations, the Compensation Committee makes a recommendation to the Board of Directors of SCAN Health Plan Arizona regarding the compensation package for the following year. The Board of Directors of SCAN Health Plan Arizona deliberates on and then votes on such recommendation; the President is recused for the entirety of such deliberations and vote. The minutes of the Compensation for these meetings are prepared substantially contemporaneously and substantiate such deliberations and decisions. FORM 990 - POLICIES - PART VI, SECTION B, LINE 15B The process for determining the compensation of officers or other key employees of SCAN Group is conducted by the Human Resources Department and Chief Executive Officer of SCAN Group, with the approval of the Compensation Committee of the Board of Directors of SCAN Group; all of the voting members of such committee are independent persons. In determining such employee's compensation, the Human Resources Department and Compensation Committee works with and relies upon the counsel and expertise of Ernst & Young, a consultant with well-established experience and expertise in the area of nonprofit organization executive compensation and compliance with the intermediate sanctions requirements applicable to such compensation. Ernst & Young provides an "Executive Compensation Report" to the Human Resources Department and Compensation Committee each year which furnishes the basis for the establishment of such employees' compensation package during the following year. The Ernst & Young Executive Compensation Report is based on a review of the executive compensation practices of a variety of organizations that are considered comparable to SCAN Group based on various metrics. The Chief Executive Officer makes a recommendation to the Compensation Committee with respect to each of such employees' compensation package in light of the Ernst & Young Executive Compensation Report. At the Compensation Committee meeting addressing such matters, questions are asked of, and answered by Ernst & Young, regarding such report and other matters relevant to such package. Based on such deliberations, the Compensation Committee makes a decision regarding the compensation package for such employees for the following year. The minutes of the Compensation Committee for this meeting are prepared substantially contemporaneously and substantiate such deliberations and decisions. FORM 990 - DISCLOSURE - PART VI, SECTION C, LINE 19 SCAN Health Plan Arizona's governing documents and conflict of interest policy are not made available to the public. SCAN Health Plan Arizona's audited financial statements are publicly available from the Arizona Department of Insurance for a nominal fee. FORM 990 - RECONCILIATION OF NET ASSETS - PART XI, LINE 9 NET ASSETS TRANSFERRED FROM SCAN LONG TERM CARE 1,063 FORM 990 PART IX LINE 11G DESCRIPTION:OTHER EXPENSES TOTAL FEES:135920 FORM 990 PART IX LINE 11G DESCRIPTION:BROKERS COMMISSION TOTAL FEES:5420693 FORM 990 PART IX LINE 11G DESCRIPTION:MEDICAL EXPENSES FOR ELDERLY TOTAL FEES:XXX-XX-XXXX SCAN GROUP 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 953826037 ADMIN SUPPORT CA 501(C)(3) 11, TYPE II NA false SCAN HEALTH PLAN 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 953858259 MEDICARE ADVA CA 501(C)(3) 9 SCAN GROUP true SCAN LONG TERM CARE 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 204607594 MEDICARE MGT. AZ 501(C)(4) N/A SCAN HP AZ true THE SCAN FOUNDATION 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 450552845 GRANT MAKING CA 501(C)(3) 11, TYPE II SCAN GROUP true SCAN 360 CARE 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 352443412 MEDICARE SVCS CA 501(C)(3) 9 SCAN GROUP true SCAN MANGAGEMENT SERVICES COMPANY 3800 KILROY AIRPORT WAY LONG BEACK CA 90806 900860955 MANAGEMENT CA SCAN GROUP C CORPORATION 0 0 0.00000 false SCAN WELLNESS CENTER PC 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 900860971 HEALTHCARE CA SCAN GROUP C CORPORATION 0 0 0.00000 false SCAN HEALTH CHECK ASSESSMENT CENTERS 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 462962358 HEALTHCARE CA N/A C COPRORATION 0 0 0.00000 false SCAN CALIFORNIA MANAGEMENT COMPANY 3800 KILROY AIRPORT WAY LONG BEACH CA 90806 462951831 MANAGEMENT CA SCAN GROUP C CORPORATION 0 0 0.00000 false false false false false false false false false false false false false false false false true false false true FORM 990 - TRANSACTIONS WITH RELATED ORGANIZATIONS - SCHEDULE R, PART V The percentage of allocation to affiliated companies is determined based on estimated percentage of time worked, percentage of headcounts, the percentage of SCAN membership, and the percentage of bid submissions, as appropriate based on the nature of the expense.