2013-11-12T17:01:36-06:00 2012-12-31 910189318 MOSS ADAMS LLP PO BOX 22650 YAKIMA WA 989072650 990 2012-01-01 910655392 KADLEC REGIONAL MEDICAL CENTER KADL 5099464611 888 SWIFT BLVD RICHLAND WA 993523583 JULIE MEEK 5099464611 2013-11-12 1 CATHY STERBENZ P00737078 5092487750 2012 2016-02-24 21:20:13Z JULIE MEEK 888 SWIFT BLVD RICHLAND WA 993523583 334425921 0 X KADLEC.ORG X 1947 WA THE MISSION OF KADLEC REGIONAL MEDICAL CENTER IS TO PROVIDE QUALITY HEALTH CARE TO EVERY PATIENT. 11 11 2147 550 146826 -48760 2968199 856638 289273955 329910443 2022841 2381518 1972555 1044778 296237550 334193377 0 0 0 0 131295875 138943721 0 0 682219 164576613 181703397 295872488 320647118 365062 13546259 333568114 401270739 202094268 253597752 131473846 147672987 THE MISSION OF KADLEC REGIONAL MEDICAL CENTER IS TO PROVIDE QUALITY HEALTH CARE TO EVERY PATIENT. 0 0 267738364 324936848 THE PURPOSES OF KADLEC REGIONAL MEDICAL CENTER ARE TO OPERATE EXCLUSIVELY FOR CHARITABLE, SCIENTIFIC OR EDUCATIONAL PURPOSES,WITHIN THE MEANING OF SECTION 501(C) (3) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, INCLUDING WITHOUT LIMITATION, TO ENGAGE IN ACTIVITIES RELATING TO THE PROVISION OF HEALTHCARE SERVICES,TO ESTABLISH AND MAINTAIN A HOSPITAL OR HOSPITALS FOR THE CARE OF PERSONS SUFFERING FROM ILLNESSES OR DISABILITIES WHICH REQUIRE THAT THOSE PERSONS RECEIVE HOSPITAL CARE, TO PROMOTE THE HEALTH OF THE COMMUNITY, TO PROMOTE AND CARRY ON SCIENTIFIC RESEARCH RELATING TO THE CARE OF THE SICK AND INJURED, AND TO PROMOTE AND CARRY ON EDUCATIONAL ACTIVITIES RELATED TO RENDERING CARE TO THE SICK AND INJURED OR THE PROMOTION OF HEALTH. 267738364 1 1 0 1 0 0 0 0 0 0 1 0 0 1 1 1 1 1 0 0 0 0 0 0 0 0 1 1 0 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 1 283 1 1 2147 1 1 1 0 0 0 0 0 0 0 0 0 X 11 11 0 1 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 WA X JULIE L MEEK 5099464611 888 SWIFT BLVD RICHLAND WA 993523583 SUSAN KREID 2.00 2.00 X X 0 0 0 MICHELE DICKINSON 2.00 X X 0 0 0 DAVID MERKLEY MD 2.00 2.00 X X 0 0 0 SANDY GAMBLE 2.00 2.00 X 0 0 0 TOM COWAN 2.00 2.00 X 0 0 0 MARK GEHLEN 2.00 X 0 0 0 LARRY JECHA MD 2.00 X 0 0 0 STEVEN KING 2.00 2.00 X 0 0 0 WAYNE MARTIN PHD 2.00 2.00 X 0 0 0 JERRY ROACH 2.00 X 0 0 0 JOHN T SAMSELL MD 2.00 2.00 X 0 0 0 CHRIS RAVAGE MD 2.00 X 0 0 0 WILLIAM C BAKER 50.00 X 269938 0 25855 LARRY J CHRISTENSEN 50.00 X 174953 0 21907 JEFFREY A CLARK 50.00 2.00 X 234903 0 25245 KIRK W HARPER 50.00 X 186393 0 16940 JULIE L MEEK 50.00 2.00 X 319855 0 25295 DAVID R ROACH 50.00 2.00 X 276779 0 26326 LANE SAVITCH 50.00 X 328762 0 24767 WILLIAM T WINGO 50.00 2.00 X 284672 0 26882 RAND WORTMAN 4.00 56.00 X 563839 0 315219 MRYNA FORESTER 50.00 X 165577 0 14982 DOUGLAS HIGGINS 50.00 X 158600 0 0 DAVID PEARSON 50.00 X 157456 0 16622 ALEXANDER SCORTZARU 50.00 X 155603 0 25074 DARLA SOUTHERN 50.00 X 173717 0 20613 3451047 0 585727 167 0 1 0 BOUTEN CONSTRUCTION PO BOX 3507 SPOKANE WA 99220 CONSTRUCTION SERVICES 7751073 EPIC SYSTEMS CORPORATION PO BOX 88314 MILWAUKEE WI 58322 COMPUTER NETWORK SERVICES 5608697 KADLEC MEDICAL ASSOCIATES LLC 888 SWIFT BOULEVARD RICHLAND WA 99352 HOSPITALISTS 4735783 PREMIER ANESTHESIA OF RICHLAND 2655 NORTHWINDS PKWY ALPHARETTA GA 30009 ANESTHESIOLOGISTS 4105659 SANTA ROSA CONSULTING INC PO BOX 347747 PITTSBURGH PA 15251 COMPUTER NETWORK SERVICES 3820089 65 856638 856638 NET PATIENT REVENUE 621400 322501723 322501723 OTHER OPERATING REVENUES 561499 5501118 5501118 CAFETERIA REVENUE 722320 1760776 1760776 CLINICAL ENGINEERING REVENUE 811000 146826 146826 329910443 2005186 2005186 602973 232544 370429 370429 370429 376332 0 376332 376332 376332 TC HOME HEALTH 900099 593918 593918 TC REGIONAL SURGERY CA 900099 351416 351416 TC LABORATORY LLC 900099 346526 346526 -617511 -617511 674349 334193377 324936848 146826 8253065 3148531 2951671 196860 107955465 87249492 20435604 270369 3798036 2984846 797218 15972 16170463 12708236 3394225 68002 7871226 6221600 1621942 27684 684617 684617 87005 87005 12000 12000 18794458 17429549 1364909 805346 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1768053 133009521 79199568 53809953 13969131 1953244 12015887 185368920 INTEREST RATE SWAP CONTRACT 15944975 2006A BOND PREMIUM 583707 457B CONTRIBUTIONS 436921 MALPRACTICE INSURANCE 4591700 21557303 X 336219389 2393427 2393427 333825962 367415 367415 334193377 320647118 0 320647118 0 320647118 DESCRIPTION OF UNCERTAIN TAX POSITIONS UNDER FIN 48: PART X, LINE 2: EFFECTIVE JANUARY 1, 2009, THE MEDICAL CENTER ADOPTED ACCOUNTING FOR UNCERTAIN TAX POSITIONS. THE ACCOUNTING STANDARD PRESCRIBES A RECOGNITION THRESHOLD AND MEASUREMENT PROCESS FOR UNCERTAIN TAX POSITIONS. AS OF DECEMBER 31, 2012 AND 2011, THE MEDICAL CENTER HAD NO UNCERTAIN TAX POSITIONS REQUIRING ACCRUAL. PART XI, LINE 4B - OTHER ADJUSTMENTS: BOOK/TAX DIFFERENCE IN JOINT VENTURE INCOME 367,415. 1 1 X 1 X 1 X 1 1 1 0 1 1 9869 11285383 11285383 0.03720 25814 55598441 42103996 13494445 0.04450 35683 66883824 42103996 24779828 0.08170 206 279800 1499471 564848 934623 0.00310 323240 323240 0.00110 206 279800 1822711 564848 1257863 0.00420 206 315483 68706535 42668844 26037691 0.08590 0 17558187 0 70461880 79790408 -9328528 X 1 1 1 1 KADLEC REGIONAL MEDICAL CENTER

888 SWIFT BLVD RICHLAND WA 99352

KWEB.KADLEC.ORG X X X INPATIENT REHAB KADLEC REGIONAL MEDICAL CENTER 1 0 1 1 200.000000000000 1 300.000000000000 1 X 1 1 X X X X X 1 X 0 X X 1 X 0 0 PART I, LINE 3C: N/A PART I, LINE 6A: THE ORGANIZATION'S COMMUNITY BENEFIT REPORT IS NOT CONTAINED IN A REPORT PREPARED BY A RELATED ORGANIZATION. PART I, LINE 7: A COST-TO-CHARGE RATIO WAS USED TO COMPUTE FIGURES REPORTED ON LINES 7A-7C. FOR LINES 7E-7I ACTUAL COSTS WERE USED. PART I, LINE 7G: N/A PART I, L7 COL(F): BAD DEBT EXPENSE INCLUDED ON FORM 990, PART IX, LINE 25, COLUMN (A) AND SUBTRACTED FOR PURPOSES OF CALCULATING THE PERCENTAGE IN THIS COLUMN IS 17,558,187. PART II: N/A PART III, LINE 2: ACTUAL BAD DEBT WRITE OFFS LESS RECOVERIES ARE POSTED DAILY. AT THE END OF EACH MONTH, AN ACCRUAL IS BOOKED ESTIMATING THE AMOUNT OF BAD DEBT EXPENSES PENDING ASSOCIATED WITH SELF PAY ACCOUNTS RECEIVABLE BALANCES AND SEVERAL THIRD PARTY PAYORS WHICH HAVE A RELATIVELY SMALL ACCOUNTS RECEIVABLE BALANCE AT ANY GIVEN TIME. RESERVE PERCENTAGES ARE APPLIED AGAINST THE ACCOUNTS RECEIVABLE BALANCES BASED ON AGING, WITH ACCOUNTS OLDER THAN 180 DAYS BEING RESERVED FOR AT 100%.DISCOUNTS ARE POSTED ON A DAILY BASIS AND ARE CAPTURED AS AN "OTHER CONTRACTUAL ADJUSTMENT" TO GROSS CHARGES. BOTH DISCOUNTS AND PAYMENTS WOULD REDUCE THE AMOUNT OF OUTSTANDING ACCOUNTS RECEIVABLE, THUS REDUCING THE AMOUNT OF BAD DEBT EXPENSE ACCRUAL POSTED AT THE END OF EACH MONTH.FINANCIAL ASSISTANCE (CHARITY) POSTINGS ARE NOT ACCRUED. THESE ADJUSTMENTS ARE POSTED ON A DAILY BASIS ONCE IT HAS BEEN DETERMINED WHAT AMOUNT FOR WHICH THE PATIENT HAS QUALIFIED. PART III, LINE 3: N/A PART III, LINE 4: ACCOUNTS RECEIVABLE ARE REDUCED BY AN ALLOWANCE FOR DOUBTFUL ACCOUNTS. IN EVALUATING THE COLLECTIBILITY OF ACCOUNTS RECEIVABLE, THE MEDICAL CENTER ANALYZES ITS PAST HISTORY AND IDENTIFIES TRENDS FOR EACH OF ITS MAJOR PAYOR SOURCES OF REVENUE TO ESTIMATE THE APPROPRIATE ALLOWANCE FOR DOUBTFUL ACCOUNTS AND PROVISION FOR UNCOLLECTIBLE ACCOUNTS. MANAGEMENT REGULARLY REVIEWS DATA ABOUT THESE MAJOR PAYOR SOURCES OF REVENUE IN EVALUATING THE SUFFICIENCY OF THE ALLOWANCE FOR DOUBTFUL ACCOUNTS. FOR RECEIVABLES ASSOCIATED WITH SERVICES PROVIDED TO PATIENTS WHO HAVE THIRDPARTY COVERAGE, THE MEDICAL CENTER ANALYZES CONTRACTUALLY DUE AMOUNTS AND PROVIDES AN ALLOWANCE FOR DOUBTFUL ACCOUNTS AND A PROVISION FOR UNCOLLECTIBLE ACCOUNTS, IF NECESSARY (FOR EXAMPLE, FOR EXPECTED UNCOLLECTIBLE DEDUCTIBLES AND COPAYMENTS ON ACCOUNTS FOR WHICH THE THIRD-PARTY PAYOR HAS NOT YET PAID, OR FOR PAYORS WHO ARE KNOWN TO BE HAVING FINANCIAL DIFFICULTIES THAT MAKE THE REALIZATION OF AMOUNTS DUE UNLIKELY). FOR RECEIVABLES ASSOCIATED WITH SELF-PAY PATIENTS (WHICH INCLUDES BOTH PATIENTS WITHOUT INSURANCE AND PATIENTS WITH DEDUCTIBLE AND COPAYMENT BALANCES DUE FOR WHICH THIRD-PARTY COVERAGE EXISTS FOR PART OF THE BILL), THE MEDICAL CENTER RECORDS A SIGNIFICANT PROVISION FOR UNCOLLECTIBLE ACCOUNTS IN THE PERIOD OF SERVICE ON THE BASIS OF ITS PAST EXPERIENCE, WHICH INDICATES THAT MANY PATIENTS ARE UNABLE OR UNWILLING TO PAY THE PORTION OF THEIR BILL FOR WHICH THEY ARE FINANCIALLY RESPONSIBLE. THE DIFFERENCE BETWEEN THE STANDARD RATES (OR THE DISCOUNTED RATES IF NEGOTIATED) AND THE AMOUNTS ACTUALLY COLLECTED AFTER ALL REASONABLE COLLECTION EFFORTS HAVE BEEN EXHAUSTED IS CHARGED OFF AGAINST THE ALLOWANCE FOR DOUBTFUL ACCOUNTS. THE MEDICAL CENTER'S ALLOWANCE FOR DOUBTFUL ACCOUNTS FOR SELF-PAY PATIENTS DECREASED FROM 93% OF SELF-PAY ACCOUNTS RECEIVABLE AT DECEMBER 31, 2011, TO 71% OF SELF-PAY ACCOUNTS RECEIVABLE AT DECEMBER 31, 2012. IN ADDITION, SELF-PAY WRITE-OFFS INCREASED $1,608,360 FROM $552,147 FOR FISCAL YEAR 2011 TO $2,160,507 FOR FISCAL YEAR 2012. THESE CHANGES WERE THE RESULT OF NEGATIVE TRENDS EXPERIENCED IN THE COLLECTION OF AMOUNTS FROM SELF-PAY PATIENTS IN FISCAL YEAR 2012. THE MEDICAL CENTER HAS NOT CHANGED ITS CHARITY CARE POLICY DURING FISCAL YEARS 2012 OR 2011. DURING 2012, THE MEDICAL CENTER ADDED A POLICY FOR DISCOUNTS FOR UNINSURED PATIENTS. THE MEDICAL CENTER DOES NOT MAINTAIN A MATERIAL ALLOWANCE FOR DOUBTFUL ACCOUNTS FROM THIRD-PARTY PAYORS, NOR DID IT HAVE SIGNIFICANT WRITE-OFFS FROM THIRD-PARTY PAYORS. PART III, LINE 8: KADLEC REGIONAL MEDICAL CENTER IS NOT COVERING THE COST OF THE CARE PROVIDED. THE COSTING METHODOLOGY OF COST TO CHARGE RATIO IS DIRECTLY FROM THE MEDICARE COST REPORT. PART III, LINE 9B: IF A PATIENT QUALIFIES FOR 100% FINANCIAL ASSISTANCE, THE ACCOUNT IS NOT PLACED WITH A COLLECTION AGENCY. A PATIENT QUALIFYING FOR PARTIAL ADJUSTMENT IS RESPONSIBLE FOR THE REMAINING BALANCE AND THE ACCOUNT IS HANDLED ACCORDING TO OUR COLLECTION POLICY. KADLEC REGIONAL MEDICAL CENTER PART V, SECTION B, LINE 20D: MEDICARE COST-TO-CHARGE RATIO. PART VI, LINE 2: THROUGH A COALITION BETWEEN BENTON-FRANKLIN COMMUNITY HEALTH ALLIANCE, LOURDES HEALTH NETWORK, KADLEC REGIONAL MEDICAL CENTER, KENNEWICK GENERAL HOSPITAL, GROUP HEATLH COOPERATIVE, PROSSER MEMORIAL HOSPITAL AND BENTON FRANKLIN HEALTH DISTRICT. THE ASSESSMENT IS PRODUCED FROM DATA, STAKEHOLDER INTERVIEWS, SURVEYS AND FORUMS AND INTERESTED COMMUNITY REPRESENTATIVES. PART VI, LINE 3: INFORMATION ABOUT THE AVALIABILITY OF FINANCIAL ASSISTANCE IS PROMINENTLY POSTED IN PATIENT AREAS. IN ADDITON, INFORMATION IS AVALIABLE ON KADLEC'S WEBSITE AND ALSO INCLUDED ON PATIENT STATEMENTS. PART VI, LINE 4: KADLEC SERVES A DIVERSE POPULATION WITHIN ITS PRIMARY SERVICE AREA OF BENTON AND FRANKLIN COUNTIES. IN ADDITION, KADLEC SERVES A LARGE HISPANIC POPULATION. PART VI, LINE 5: N/A PART VI, LINE 6: N/A PART VI, LINE 7: WASHINGTON X X 1 1 X X X X 0 0 0 0 0 1 0 0 0 WILLIAM C BAKER 246733 0 20265 0 2940 0 12723 0 13132 0 295793 0 0 0 LARRY J CHRISTENSEN 163890 0 8123 0 2940 0 9107 0 12800 0 196860 0 0 0 JEFFREY A CLARK 218939 0 12993 0 2971 0 12139 0 13106 0 260148 0 0 0 KIRK W HARPER 183633 0 2146 0 614 0 9349 0 7591 0 203333 0 0 0 JULIE L MEEK 303389 0 13526 0 2940 0 12163 0 13132 0 345150 0 0 0 DAVID R ROACH 233990 0 38649 0 4140 0 13000 0 13326 0 303105 0 0 0 LANE SAVITCH 307212 0 15331 0 6219 0 11635 0 13132 0 353529 0 0 0 WILLIAM T WINGO 260352 0 21380 0 2940 0 13750 0 13132 0 311554 0 0 0 RAND WORTMAN 489694 0 66885 0 7260 0 173280 0 141939 0 879058 0 0 0 MRYNA FORESTER 164348 0 0 0 1229 0 7927 0 7055 0 180559 0 0 0 DOUGLAS HIGGINS 158600 0 0 0 0 0 0 0 0 0 158600 0 0 0 DAVID PEARSON 156135 0 0 0 1321 0 8516 0 8106 0 174078 0 0 0 ALEXANDER SCORTZARU 140930 0 10000 0 4673 0 7243 0 17831 0 180677 0 0 0 DARLA SOUTHERN 173717 0 0 0 0 0 7985 0 12628 0 194330 0 0 0 PART I, LINE 1A THE BOARD IS ALLOWED TO TAKE THEIR COMPANION ON THE ANNUAL BOARD RETREAT. RAND WORTMAN KHS PRESIDENT & CEO, KRMC CEO; LANE SAVITCH, KRMC PRESIDENT; LARRY CHRISTENSEN, VP RESOURCE DEVELOPMENT FOR KHS AND KADLEC FOUNDATION EXECUTIVE DIRECTOR; WILLIAM WINGO, VP, CORPORATE COUNSEL FOR KRMC AND KHS WILLIAM BAKER, VP, REGIONAL BUSINESS DEVELOPMENT FOR KRMC AND KHS; THEIR MEADOW SPRINGS COUNTRY CLUB DUES ARE PAID BY THE MEDICAL CENTER. PART I, LINE 6 THE KHS BOARD ESTABLISHED AN INCENTIVE COMPENSATION PROGRAM FOR SENIOR KHS AND KRMC EXECUTIVES TO ENSURE LEADERSHIP WAS FOCUSED ON KHS AND KRMC PRIORITIES; PATIENT SATISFACTION, EMPLOYEE SATISFACTION, QUALITY CARE, STRATEGIC GOALS, AND OPERATING INCOME. PERFORMANCE EXPECTATIONS ARE SET EACH YEAR WITH THE OPERATING BUDGET, CAPITAL BUDGET, AND BUSINESS PLAN. THE INCENTIVE GOALS ARE WEIGHTED ACCORDING TO THE PARTICIPANTS CONTRIBUTION. THE GOALS ARE ALL OR NOTHING AND THE PAYOUT OCCURS AFTER A FINAL REPORT IS PRESENTED TO THE BOARD EXECUTIVE COMMITTEE. A WASHINGTON HEALTHCARE FACILITIES AUTHORITY 911108929 93978ED25 2006-09-07 33165247 REFUNDING SERIES 1996 AND 2001 BONDS 0 0 0 B WASHINGTON HEALTHCARE FACILITIES AUTHORITY 911108929 93978ED33 2006-09-07 50000000 FINANCING MAJOR ADDITION 0 0 0 C WASHINGTON HEALTHCARE FACILITIES AUTHORITY 911108929 93978HAV7 2010-11-04 56114049 FINANCING MAJOR ADDITION 0 0 0 D WASHINGTON HEALTHCARE FACILITIES AUTHORITY 911108929 93978HGZ2 2012-08-30 60297918 FINANCING MAJOR ADDITION 0 0 0 A 7555000 33165247 2311890 1077687 933645 1828067 2002 1 1 1 1 B 2950000 50000000 3635295 1959100 1712033 44453250 2008 0 1 1 1 C 1070000 56114049 5306544 815575 43016585 34 2012 0 0 0 0 D 60297918 5594535 878700 12162403 41639468 0 0 0 0 A 0 0 0 0 0 0 0 B 0 0 0 0 0 0 0 C 0 0 0 0 0 0 0 D 0 1 0 1 1 0 0 0 A 1 0 0 0 0 0 B 1 1 1 PIPER JAFFRAY 28.500000000000 0 0 0 0 0 C 0 0 0 0 0 0 0 0 0 D 0 0 0 0 0 0 0 0 0 A 0 B 0 C 0 D 0 SCHEDULE K, PART IV, LINE 2C: (C) THE ORGANIZATION HAS NOT DONE A COMPUTATION AT THIS POINT IN TIME. (D) THE ORGANIZATION HAS NOT DONE A COMPUTATION AT THIS POINT IN TIME. FORM 990, PART VI, SECTION A, LINE 3 THE BOARD OF DIRECTORS HIRED QUORUM HEALTH RESOURCES AS A MANAGEMENT COMPANY TO OVERSEE DAY TO DAY OPERATIONS OF THE MEDICAL CENTER. THE CEO IS AN EMPLOYEE OF QUORUM HEALTH RESOURCES. FORM 990, PART VI, SECTION A, LINE 6 KADLEC HEALTH SYSTEM (KHS) IS THE SOLE VOTING MEMBER OF KADLEC REGIONAL MEDICAL CENTER(KRMC). KHS SHALL HAVE SUCH RIGHTS AND POWERS AS ARE SPECIFIED IN THE WASHINGTON NONPROFIT CORPORATION ACT, THE ARTICLES OF INCORPORATION OF KRMC AND THE BYLAWS. FORM 990, PART VI, SECTION A, LINE 7A THE ANNUAL MEETING OF THE SOLE VOTING MEMBER OF KADLEC REGIONAL MEDICAL CENTER(KRMC) TO RATIFY ELECTION AND RE-ELECTION OF DIRECTORS OF KRMC AND FOR THE TRANSACTION OF SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE SOLE VOTING MEMBER, SHALL BE HELD EACH YEAR AS SPECIFIED IN THE BYLAWS OF THE SOLE VOTING MEMBER. THE SOLE VOTING MEMBER MAY DELEGATE OR APPOINT AN OFFICER OF KADLEC HEALTH SYSTEM TO EXERCISE ANY OF THE RIGHTS AND POWERS OF THE SOLE VOTING MEMBER. FORM 990, PART VI, SECTION A, LINE 7B THE SOLE VOTING MEMBER HAS THE RIGHT: (1)TO RATIFY THE ELECTION OR APPOINTMENT OF EACH MEMBER OF THE BOARD OF DIRECTORS AND THE ELECTION OF OFFICERS (2) TO REMOVE ANY DIRECTOR (3) TO AMEND THE ARTICLES OF INCORPORATION OR BYLAWS OF KADLEC REGIONAL MEDICAL CENTER, AND TO APPROVE ANY AMENDMENTS TO THE ARTICLES OF INCORPORATION OF BYLAWS OF KRMC RECOMMENDED BY THE BOARD OF DIRECTORS (4) TO APPROVE ANY MERGERS OR CONSOLIDATION (5) TO APPROVE THE ANNUAL OPERATING AND CAPITAL BUDGETS AND DEVELOPMENT AND REVISION (6) TO APPROVE THE ENTRY INTO JOINT VENTURES OR PARTNERSHIPS (7) TO APPROVE THE ENCUMBRANCE, LEASE, SALE OR OTHER TRANSFER OF ASSETS WITH A VALUE OF $1,000,000 OR GREATER (8) TO APPROVE THE SELECTION OR REMOVAL KRMC'S INDEPENDENT AUDITOR OR LEGAL COUNSEL (9) TO APPROVE THE INITIATION OF LITIGATION OR SETTLEMENT OF MATERIAL LITIGATION IN WHICH KRMC IS THE PLAINTIFF OR DEFENDANT (10) TO APPROVE THE EXECUTION OF ANY MANAGEMENT AGREEMENT, OR ANY OTHER CONTRACT FORM 990, PART VI, SECTION B, LINE 11 ONCE THE 990 IS PREPARED BY A THIRD PARTY, ACCOUNTING STAFF REVIEWS THE DOCUMENTS TO VERIFY INFORMATION HAS BEEN PROVIDED AND INPUT ACCURATELY. ONCE THIS PROCESS HAS BEEN COMPLETED, THE 990 IS REVIEWED AND APPROVED BY THE EXECUTIVE COMMITTEE OF THE BOARD. THE 990 IS ALSO UPLOADED TO THE BOARD WEBSITE AND IS AVAILABLE FOR ALL BOARD MEMBERS TO REVIEW. FORM 990, PART VI, SECTION B, LINE 12C THE COMPLIANCE PROGRAM IS DIRECTED BY THE COMPLIANCE OFFICER AND THE CORPORATE COMPLIANCE COMMITTEE, WHO ARE CHARGED WITH ENSURING THAT THE HOSPITAL MAINTAINS AN EFFECTIVE COMPLIANCE PROGRAM. FORM 990, PART VI, SECTION B, LINE 15 AN INDEPENDENT THIRD PARTY IS USED TO DETERMINE APPROPRIATE COMPENSATION AND REVIEWED AND APPROVED BY THE COMPENSATION COMMITTE. FORM 990, PART VI, SECTION C, LINE 19 HARD COPIES OF THE AUDITED FINANCIAL STATEMENTS ARE KEPT IN THE ACCOUNTING DEPARTMENT AND ARE AVAILABLE UPON REQUEST. THE HOSPITAL'S "MISSION, VISION, VALUES" STATEMENT IS DISPLAYED IN NUMEROUS PUBLIC LOCATIONS THROUGHOUT THE FACILITY. CONFLICT OF INTEREST POLICY IS AVAILABLE TO PUBLIC UPON REQUEST. CHANGES IN NET ASSETS OR FUND BALANCES: FORM 990, PART XI, LINE 9: INTEREST RATE SWAP CONTRACT 650,379. BOOK/TAX DIFFERENCE IN JOINT VENTURE INCOME -367,415. FORM 990, PART XII, LINE 2C: NO CHANGE FROM PRIOR YEAR. KADLEC CLINIC LLC 945 GOETHALS SUITE 220 RICHLAND WA 99352 204265899 PRIMARY CARE PHYSICIAN SERVICES WA KADLEC HEALTH SYSTEM KADLEC MEDICAL ASSOCIATES LLC 888 SWIFT BLVD RICHLAND WA 993523583 203980865 INPATIENT HOSPITALISTS SERVICES WA KADLEC HEALTH SYSTEM KADLEC NEUROSCIENCE CENTER LLC 800 SWIFT BLVD SUITE 300 RICHLAND WA 993523583 201613946 NEUROLOGICAL RELATED PHYSICIAN SERVICES WA KADLEC HEALTH SYSTEM TRICITIES NEPHROLOGY LLC 309 BRADLEY SUITE 109 RICHLAND WA 99352 271041915 NEPHROLOGY PHYSICIAN SERVICES WA KADLEC HEALTH SYSTEM THE NEUROLOGICAL RESOURCE CENTER 712 SWIFT BLVD SUITE 1 RICHLAND WA 993523583 911266345 EDUCATION ON NEUROLOGICAL DISORDERS WA 501(C)(3) LINE 7 KADLEC HEALTH SYSTEM 0 KADLEC HEALTH SYSTEM 888 SWIFT BLVD RICHLAND WA 993523583 911266346 HOSPITAL & PHYSICIAN SERVICES WA 501(C)(3) LINE 3 N/A 0 KADLEC FOUNDATION 800 SWIFT BLVD RICHLAND WA 993523583 237005501 FUNDRAISING WA 501(C)(3) LINE 11A, I KADLEC HEALTH SYSTEM 0 KADLEC ENTERPRISES INC 888 SWIFT BOULEVARD RICHLAND WA 99352 911323736 ENGAGE IN BUSINESS RELATED TO HEALTHCARE AND TO SUPPORT KHS WA N/A C 0 0 0 1 1 0 0 0 0 0 1 1 0 1 0 1 0 0 1 0 KADLEC FOUNDATION C 856638 KADLEC FOUNDATION D 1400000 KADLEC HEALTH SYSTEM J 513618 KADLEC HEALTH SYSTEM K 16498 KADLEC HEALTH SYSTEM M 7133055 KADLEC HEALTH SYSTEM O 1287734 KADLEC HEALTH SYSTEM R 14013150 THE NEUROLOGICAL RESOURCE CENTER J 74677 THE NEUROLOGICAL RESOURCE CENTER O 204647