2013-11-14T13:27:03-06:00 2012-12-31 ANDREWS HOOPER PAVLIK PLC 4295 OKEMOS RD STE 200 OKEMOS MI 488646201 990 2012-01-01 382356288 PHYSICIANS HEALTH PLAN PHYS 5173648400 PO BOX 30377 LANSING MI 48909 SCOTT WILKERSON 5173648400 2013-11-07 true MARK E HOOPER 5177060800 2013-11-07 2012 2016-02-25 16:41:14Z DENNIS SWAN 1215 E MICHIGAN AVENUE LANSING MI 48912 231421709 false X WWW.PHPMM.ORG X 1980 MI PHYSICIANS HEALTH PLAN'S MISSION IS TO IMPROVE THE HEALTH STATUS OF ITS MEMBERS BY FACILITATING QUALITY, COMPASSIONATE, ACCESSIBLE, COST EFFECTIVE HEALTHCARE. 15 11 108 0 0 174089102 215135024 1605378 715086 25000 175694480 215875110 0 159384334 199674863 6318529 5995642 0 0 8185177 10370093 173888040 216040598 1806440 -165488 79806013 86786890 23391547 27350374 56414466 59436516 X PHYSICIANS HEALTH PLAN'S MISSION IS TO IMPROVE THE HEALTH STATUS OF ITS MEMBERS BY FACILITATING QUALITY, COMPASSIONATE, ACCESSIBLE, COST EFFECTIVE HEALTHCARE. false false 160727586 167810609 PHYSICIANS HEALTH PLAN (PHP) IS OWNED BY SPARROW HEALTH SYSTEM (SPARROW) AND HOLDS A CERTIFICATE OF AUTHORITY AS AN HMO IN THE STATE OF MICHIGAN. PHP IS PRIMARILY A COMMERCIAL HMO AND ALSO OPERATES THREE SUBSIDIARIES, PHP INSURANCE COMPANY (PHPIC) A COMMERCIAL INSURANCE COMPANY, PHP FAMILYCARE (PHPFC) A MICHIGAN MEDICAID MANAGED CARE PLAN, AND PHP SERVICE COMPANY (TPA) A THIRD PARTY ADMINISTRATOR. ALL STAFFING FUNCTIONS AND REPORTING ARE ACCOMPLISHED THROUGH THE USE OF THE SAME STAFF AS PHP. UNLESS SPECIFICALLY NOTED, ALL REFERENCES TO PHP APPLY TO PHP, PHPIC, TPA, AND PHPFC. PHPS SERVICE AREA INCLUDES THE MICHIGAN COUNTIES OF INGHAM, EATON, CLINTON, SHIAWASSEE, MONTCALM, GRATIOT, IONIA, AND ISABELLA. PHPIC OFFERS PRODUCTS ACROSS MICHIGAN. THE FAMILYCARE PRODUCT IS AVAILABLE TO MEDICAID ENROLLEES IN EATON, CLINTON, INGHAM, IONIA, MONTCALM, AND SHIAWASSEE COUNTIES. THE MICHIGAN DEPARTMENT OF COMMUNITY HEALTH (MDCH) AND THE DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES (DIFS) APPROVED A SERVICE AREA EXPANSION OF PHPFC INTO ISABELLA COUNTY EFFECTIVE JANUARY 1, 2012. AS OF DECEMBER 31, 2012, THERE WERE APPROXIMATELY 34,000 ENROLLEES IN PHPS COMMERCIAL HMO, 12,000 IN TPA, 8,600 IN PHPIC, AND 18,000 ENROLLEES IN PHP. PHP ALSO OPERATES THE STATE OF MICHIGANS PRE-EXISTING CONDITION INSURANCE PLAN CALLED HIP MICHIGAN. PHP AND PHPFC CONTRACT DIRECTLY WITH PHYSICIANS HEALTH NETWORK (PHN), A WHOLLY OWNED SUBSIDIARY OF SPARROW. THE PHP NETWORK IS APPROXIMATELY 742 PRIMARY CARE PHYSICIANS, 1,269 SPECIALTY CARE PHYSICIANS, 333 ALLIED HEALTH PROFESSIONALS, AND 326 ORGANIZATIONAL PROVIDERS THAT INCLUDE 29 HOSPITALS. PHP CONTRACTS WITH VARIOUS HDNS WHO PROVIDE HEALTHCARE SERVICES TO MEMBERS. PHPS COMMITMENT IS TO DEVELOP AND DELIVER QUALITY MANAGED CARE PRODUCTS AT REASONABLE COSTS FOR ITS MEMBERS. PHPS SUCCESS IN MANAGING HEALTH CARE IS DUE IN PART TO THE EXTENSIVE NETWORK OF PARTICIPATING PROVIDERS IN THE HDN NETWORK. THE HMO/HDN CONTRACTUAL ARRANGEMENTS ALLOW PHP TO ARRANGE FOR HEALTHCARE TO PATIENTS COVERED BY THE STATE OF MICHIGANS MEDICAID BENEFIT PLAN. THIS ARRANGEMENT ALLOWS THE MEMBERS TO ACCESS A WIDE VARIETY OF INDEPENDENT PROVIDERS WITHIN EACH HDN INCLUDING PHYSICIANS, HOSPITALS, PHARMACIES, SKILLED NURSING FACILITIES, AND ALLIED HEALTH PROFESSIONALS. PHP MEMBERS MAY ALSO RECEIVE CARE FOR SERVICES FROM A NONPARTICIPATING PROVIDER IF SUCH REFERRAL IS RECOMMENDED BY AN HDN PARTICIPATING PHYSICIAN AND THE SERVICE REQUIRED FOR TREATMENT, AS DETERMINED BY HDN, IS NOT AVAILABLE WITHIN THE HDNS NETWORK. PHP OFFERS A VARIETY OF HEALTHCARE PROGRAMS, OR PRODUCTS TO GROUPS AND INDIVIDUALS. PHP OFFERS CHOICES THAT PROVIDE COVERAGE WITHIN THE NETWORK OF CONTRACTED HDN PROVIDERS, LIMITED COVERAGE OUTSIDE OF THE PHP NETWORK, VARIOUS LEVELS OF DEDUCTIBLES, CO-PAYMENTS, AND COVERAGE LIMITS, ALL OF WHICH ARE DESIGNED TO BE RESPONSIVE TO CUSTOMER NEEDS. PHP MEASURES THE QUALITY OF CARE PROVIDED TO ITS ENROLLEES THROUGH ANNUAL REVIEW OF INDICATORS SUCH AS: - DISEASE MANAGEMENT PROGRAM PARTICIPATION AND OUTCOMES, - QUALITY OF CARE CONCERNS, AND - HEDIS MEASURES: THE HEALTH PLAN EFFECTIVENESS DATA AND INFORMATION SET (HEDIS) IS A GROUP OF NATIONALLY RECOGNIZED MEASURES OF HEALTH PLANS PERFORMANCE IN A VARIETY OF CLINICAL AND NON-CLINICAL AREAS. PHP USES THE EFFECTIVENESS OF CARE MEASURES TO DETERMINE PROGRESS AND IMPROVEMENT IN AREAS SUCH AS: DIABETES, ASTHMA, DEPRESSION AND FOLLOW-UP AFTER MENTAL HEALTH ADMISSIONS, BREAST AND CERVICAL CANCER SCREENINGS, USE OF BETA-BLOCKERS AFTER HEART ATTACKS, CHILD AND ADOLESCENT IMMUNIZATIONS, CHOLESTEROL MANAGEMENT, CONTROLLING HIGH BLOOD PRESSURE, SMOKING CESSATION, PRENATAL AND POSTPARTUM CARE, AND TREATMENT OF CHILDHOOD RESPIRATORY INFECTIONS. PHP MEASURES THE QUALITY OF SERVICE PROVIDED TO ITS ENROLLEES BY THE REVIEW OF PERFORMANCE MEASURES RELATED TO: - ACCESS AND AVAILABILITY OF PROVIDERS, - ENROLLEE COMPLAINTS AND APPEALS, - CUSTOMER SERVICE TELEPHONE ACCESS PERFORMANCE, AND - MEMBER ASSESSMENT: THE CONSUMER ASSESSMENT OF HEALTHCARE PROVIDERS AND SYSTEMS (CAHPS) SURVEY GIVES A GENERAL INDICATION OF HOW WELL THE ORGANIZATION MEETS MEMBERS EXPECTATIONS. THE PHP QI PROGRAM IS ULTIMATELY ACCOUNTABLE TO THE BOARD OF DIRECTORS. PHP RECEIVED THE HIGHEST RATING OF EXCELLENT FROM THE UTILIZATION REVIEW ACCREDITATION COMMITTEE (URAC). THIS STATUS IS GRANTED TO HEALTH CARE PLANS THAT HAVE DEMONSTRATED CONTINUOUS QUALITY IMPROVEMENT IN THEIR PROGRAMS WHILE MEETING OR EXCEEDING URAC'S RIGOROUS ACCREDITATION STANDARDS. PHP FAMILYCARE RECEIVED AN "EXCELLENT" RATING. PHP AND PHP FAMILYCARE WERE REVIEWED BY URAC IN 2012. 47324415 47324415 PHYSICIANS HEALTH PLAN ESTABLISHED AND OPERATES A TEMPORARY HIGH RISK HEALTH INSURANCE POOL PROGRAM (PHP-HRPP) IN MICHIGAN TO PROVIDE AFFORDABLE HEALTH INSURANCE COVERAGE TO CURRENTLY UNINSURED INDIVIDUALS WITH PRE- EXISTING CONDITIONS. IT IS PART OF A FEDERAL PROGRAM ESTABLISHED BY THE UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS) IN RESPONSE TO THE AFFORDABLE CARE ACT. THE PROGRAM PROVIDES COVERAGE FOR ELIGIBLE INDIVIDUALS BEGINNING OCTOBER 1, 2010, THROUGH AND ENDING DECEMBER 31, 2013. AS OF DECEMBER 31, 2012, THERE WERE 2,240 MEMBERS ENROLLED IN THE PROGRAM. PHP HAS MANY INITIATIVES IN PLACE TO GROW MEMBERSHIP AND HAS SEEN SIGNIFICANT INCREASES SUBSEQUENT TO YEAR END. 208052001 false false false false false false false false true true false true false true false 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 true true true true false true 130 0 true 108 true false false false false false false X 15 11 false false false false true true true true true false false true true true true true true true true false MI X DENNIS REESE 5173648400 1400 E MICHIGAN AVENUE LANSING MI 48909 X DENNIS SWAN 1.00 40.00 X 0 1085357 32076 SCOTT WILKERSON 40.00 5.00 X X 0 430406 33985 LARRY RAWSTHORNE MD 1.00 40.00 X 0 299271 32681 DAWN SPRINGER MD 1.00 40.00 X 0 165728 12898 MARYLEE DAVIS PHD 2.00 2.00 X X 1338 0 0 WENDELL BARRON 1.00 1.00 X 1338 0 0 JAMES BUTLER III 1.00 1.00 X 1338 0 0 RANDOLPH RIFKIN 1.00 1.00 X 0 0 0 PATRICK GRIBBEN JR 1.00 2.00 X X 0 0 0 RICHARD BRUNER 1.00 2.00 X 0 0 0 DIANA RODRIGUEZ ALGRA 1.00 1.00 X X 0 0 0 BRADLEY HOOPINGARNER MD 1.00 1.00 X 0 0 0 KENNETH RUDMAN MD 1.00 1.00 X 0 0 0 KATHLEEN CONKLIN 1.00 1.00 X 0 0 0 THOMAS HOFMAN PHD 1.00 1.00 X 0 0 0 DEBORAH MUCHMORE 1.00 1.00 X 0 0 0 HOWARD BURGESS 40.00 5.00 X 0 291118 32028 DENNIS REESE 40.00 5.00 X 0 145112 34762 DAVID VIS 0.00 0.00 X 0 24916 461 GARY GONZALES 40.00 5.00 X 0 128689 24729 KEVIN ESSENMACHER 40.00 5.00 X 0 128109 24563 ANN HUNT-FUGATE RPH 40.00 5.00 X 126462 0 24422 PAULA HOWARD 40.00 5.00 X 118181 0 11089 MARY ANNE SESTI 40.00 5.00 X 0 107818 33968 THOMAS OSTRANDER 0.00 40.00 X 0 324208 37821 SANDRA WINCHELL 0.00 0.00 X 0 86766 15408 248657 3217498 350891 2 true true false MILLIMAN INC 15800 BLUEMOUND DR STE 100 BROOKFIELD WI 53005 ACTUARIAL/CONS 440561 ERNST & YOUNG LLP PO BOX 96550 CHICAGO IL 60693 AUDITING 204081 FOSTER SWIFT COLLINS & SMITH 313 S WASHINGTON SQUARE LANSING MI 48933 LEGAL 150219 3 PREPAID HEALTHCARE 621990 167810609 167810609 HHS HRPP REIMBURSEMENT 621990 47324415 47324415 215135024 698631 -146087 844718 15563054 15546599 16455 16455 16455 OTHER REVENUE 900099 25000 25000 25000 215875110 215013937 861173 199674863 199674863 996802 996802 3662210 2008034 1654176 304090 273681 30409 750865 675778 75087 281675 253507 28168 3446366 3446366 97902 88112 9790 296611 296611 62158 62158 383054 383054 720479 244963 475516 424453 144314 280139 605801 545221 60580 94156 94156 63456 63456 3203 3203 430021 430021 1803002 1803002 57758 57758 BROKER COMMISSONS 1324533 1324533 MISCELLANEOUS 557140 278570 278570 216040598 208052001 7988597 0 1750225 28075228 10195765 15323815 1222591 635168 21970449 16258868 7965080 5711581 41516283 19366195 16101246 16059158 1054823 1615745 79806013 86786890 21741751 26144589 615810 1016433 1033986 189352 23391547 27350374 X 56414466 59436516 56414466 59436516 79806013 86786890 -165488 3187538 X false true X true false 2641860 147795 149021 12000 2926676 1779759 796243 97691 30000 1833 2641860 1550687 163793 65279 1779759 1307182 134195 109310 1550687 1.00000 false true true 455895 455895 4369072 2960323 1408749 17145482 13298545 3846937 5711581 INVESTMENT IN PHP INSURANCE COMPANY 9539106 C INVESTMENT IN PHP FAMILYCARE 6805207 C INVESTMENT IN PHP SHARED SVCS 2351 C INVESTMENT IN PHP SERVICE COMPANY -287506 C 16059158 RELATED PARTY PAYABLE 189352 189352 219062648 3187538 3187538 215875110 215875110 216040598 216040598 216040598 INTENDED USES FOR ENDOWMENT FUNDS SCHEDULE D, PAGE 2, PART V, LINE 4 PHYSICIANS HEALTH PLAN DOES NOT HOLD ENDOWMENTS. THE ENDOWMENTS ARE HELD BY CLINTON MEMORIAL HOSPITAL AND SPARROW FOUNDATION. SPARROW HEALTH SYSTEM IS THE SOLE MEMBER OF PHYSICIANS HEALTH PLAN, CLINTON MEMORIAL HOSPITAL, AND SPARROW FOUNDATION. THE ENDOWMENTS ARE MAINTAINED TO PROVIDE A PERMANENT SOURCE OF INCOME WITH THE STIPULATION THE PRINCIPAL IS KEPT INTACT IN PERPETUITY AND THE INCOME GENERATED FROM INVESTMENTS OF THE ENDOWMENT FUNDS CAN BE USED FOR THE PURPOSE ESTABLISHED BY THE ENDOWMENT. SUPPLEMENTAL FINANCIAL INFORMATION SCHEDULE D, PAGE 4, PART XIII SCHEDULE D, PART XI SEPARATE AUDITED FINANCIAL STATEMENTS WERE PREPARED FOR PHYSICIANS HEALTH PLAN UNDER STATUTORY ACCOUNTING PRINCIPLES AS PERMITTED BY THE MICHIGAN DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES (DIFS). THE DIFS REQUIRES THAT INSURANCE COMPANIES DOMICILED IN THE STATE OF MICHIGAN PREPARE THEIR STATUTORY-BASIS FINANCIAL STATEMENTS IN ACCORDANCE WITH PRACTICES ESTABLISHED BY THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. THESE PRACTICES DIFFER IN SOME RESPECTS FROM U.S. GENERALLY ACCEPTED ACCOUNTING PRACTICES. CERTAIN ADJUSTMENTS ARE REQUIRED TO COMPLY WITH STATUTORY ACCOUNTING PRINCIPLES. PHYSICIANS HEALTH PLAN WAS INCLUDED AS PART OF THE CONSOLIDATED FINANCIAL STATEMENTS OF SPARROW HEALTH SYSTEM. SPARROW HEALTH SYSTEM IS THE SOLE MEMBER OF PHYSICIANS HEALTH PLAN. THE SPARROW HEALTH SYSTEM FINANCIAL STATEMENTS WERE PREPARED USING THE U.S. GENERALLY ACCEPTED ACCOUNTING PRACTICES. THE FORM 990 FOR PHYSICIANS HEALTH PLAN HAS BEEN PRESENTED USING U.S. GENERALLY ACCEPTED ACCOUNTING PRACTICES. X true true X X X X X X false false false true true true true true false DENNIS SWAN 767575 258277 59505 18500 13576 1117433 SCOTT WILKERSON 345271 82836 2299 18500 15485 464391 LARRY RAWSTHORNE MD 294569 4702 18500 14181 331952 DAWN SPRINGER MD 133484 29738 2506 12264 634 178626 HOWARD BURGESS 270745 20373 18923 13105 323146 DENNIS REESE 125112 20000 25035 9727 179874 GARY GONZALES 115407 13282 9737 14992 153418 KEVIN ESSENMACHER 109859 18250 10571 13992 152672 ANN HUNT-FUGATE RPH 119630 6832 9358 15064 150884 THOMAS OSTRANDER 284715 36930 2563 22350 15471 362029 SANDRA WINCHELL 72506 14260 8621 6787 102174 FRINGE OR EXPENSE EXPLANATION SCHEDULE J, PAGE 1, PART I, LINE 1A PHYSICIANS HEALTH PLAN PAYS SOCIAL DUES ON BEHALF OF SCOTT WILKERSON, CEO. THESE AMOUNTS ARE CONSIDERED TAXABLE COMPENSATION. COMPENSATION CONTINGENT UPON REVENUES OF ORGANIZATION SCHEDULE J, PAGE 1, PART I, LINE 5A THE 2012 INCENTIVE COMPENSATION PLAN PAYMENTS WERE ACCRUED IN 2012 AND WILL BE PAID IN 2013. THE INCENTIVE COMPENSATION PLAN IS BASED, IN PART, ON THE OPERATING MARGIN OF SPARROW HEALTH SYSTEM, WHICH INCLUDES PHYSICIANS HEALTH PLAN AS WELL AS AFFILIATED COMPANIES. COMPENSATION CONTINGENT UPON REVENUES OF RELATED ORG SCHEDULE J, PAGE 1, PART I, LINE 5B THE 2012 INCENTIVE COMPENSATION PLAN PAYMENTS WERE ACCRUED IN 2012 AND WILL BE PAID IN 2013. THE INCENTIVE COMPENSATION PLAN IS BASED, IN PART, ON THE OPERATING MARGIN OF SPARROW HEALTH SYSTEM, WHICH INCLUDES PHYSICIANS HEALTH PLAN AS WELL AS AFFILIATED COMPANIES. COMPENSATION CONTINGENT UPON NET EARNINGS OF ORGANIZATION SCHEDULE J, PAGE 1, PART I, LINE 6A THE 2012 INCENTIVE COMPENSATION PLAN PAYMENTS WERE ACCRUED IN 2012 AND WILL BE PAID IN 2013. THE INCENTIVE COMPENSATION PLAN IS BASED, IN PART, ON THE OPERATING MARGIN OF SPARROW HEALTH SYSTEM, WHICH INCLUDES PHYSICIANS HEALTH PLAN AS WELL AS AFFILIATED COMPANIES. COMPENSATION CONTINGENT UPON NET EARNINGS OF RELATED ORG SCHEDULE J, PAGE 1, PART I, LINE 6B THE 2012 INCENTIVE COMPENSATION PLAN PAYMENTS WERE ACCRUED IN 2012 AND WILL BE PAID IN 2013. THE INCENTIVE COMPENSATION PLAN IS BASED, IN PART, ON THE OPERATING MARGIN OF SPARROW HEALTH SYSTEM, WHICH INCLUDES PHYSICIANS HEALTH PLAN AS WELL AS AFFILIATED COMPANIES. NON-FIXED PAYMENTS PROVIDED SCHEDULE J, PAGE 1, PART I, LINE 7 COMPENSATION INCLUDES BOTH BASE AND VARIABLE COMPENSATION (NON-FIXED PAYMENTS). IN ACCORDANCE WITH ITS POLICIES, ALL ELEMENTS (BASE, VARIABLE, BENEFITS, AND PERQUISITES) ARE COMPARED TO MARKET. OTHER ADDITIONAL INFORMATION SCHEDULE J, PART III SCHEDULE J, PART I, LINE 3: SPARROW HEALTH SYSTEM IS THE SOLE MEMBER OF PHYSICIANS HEALTH PLAN. SPARROW HEALTH SYSTEM IS AN INTEGRATED NON-PROFIT ORGANIZATION THAT INCLUDES A NUMBER OF NON-PROFIT ENTITIES. THE METHODS SELECTED FOR DETERMINING THE COMPENSATION OF THE CEO/EXECUTIVE DIRECTOR ARE METHODS WHICH ARE BEING USED BY ALL SPARROW HEALTH SYSTEM RELATED ENTITIES. THOMAS OSTRANDER IS A FORMER BOARD MEMBER OF PHYSICIANS HEALTH PLAN. THE BOARD MEMBER IS BEING COMPENSATED BY SPARROW HEALTH SYSTEM AND AFFILIATES FOR SERVICES PROVIDED TO SPARROW HEALTH SYSTEM AND AFFILIATES IN POSITIONS OTHER THAN AS A BOARD MEMBER OF PHYSICIANS HEALTH PLAN. THE BOARD MEMBER IS NOT BEING COMPENSATED FOR ANY PAST SERVICES PROVIDED TO PHYSICIANS HEALTH PLAN. ADDITIONAL INFORMATION FORM 990 ALL LINES LEFT BLANK ARE NOT APPLICABLE TO THE ORGANIZATION. FIRST ACCOMPLISHMENT DESCRIPTION FORM 990, PAGE 2, PART III, LINE 4A PHPS SERVICE AREA INCLUDES THE MICHIGAN COUNTIES OF INGHAM, EATON, CLINTON, SHIAWASSEE, MONTCALM, GRATIOT, IONIA, AND ISABELLA. PHPIC OFFERS PRODUCTS ACROSS MICHIGAN. THE FAMILYCARE PRODUCT IS AVAILABLE TO MEDICAID ENROLLEES IN EATON, CLINTON, INGHAM, IONIA, MONTCALM, AND SHIAWASSEE COUNTIES. THE MICHIGAN DEPARTMENT OF COMMUNITY HEALTH (MDCH) AND THE DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES (DIFS) APPROVED A SERVICE AREA EXPANSION OF PHPFC INTO ISABELLA COUNTY EFFECTIVE JANUARY 1, 2012. AS OF DECEMBER 31, 2012, THERE WERE APPROXIMATELY 34,000 ENROLLEES IN PHPS COMMERCIAL HMO, 12,000 IN TPA, 8,600 IN PHPIC, AND 18,000 ENROLLEES IN PHP. PHP ALSO OPERATES THE STATE OF MICHIGANS PRE-EXISTING CONDITION INSURANCE PLAN CALLED HIP MICHIGAN. PHP AND PHPFC CONTRACT DIRECTLY WITH PHYSICIANS HEALTH NETWORK (PHN), A WHOLLY OWNED SUBSIDIARY OF SPARROW. THE PHP NETWORK IS APPROXIMATELY 742 PRIMARY CARE PHYSICIANS, 1,269 SPECIALTY CARE PHYSICIANS, 333 ALLIED HEALTH PROFESSIONALS, AND 326 ORGANIZATIONAL PROVIDERS THAT INCLUDE 29 HOSPITALS. PHP CONTRACTS WITH VARIOUS HDNS WHO PROVIDE HEALTHCARE SERVICES TO MEMBERS. PHPS COMMITMENT IS TO DEVELOP AND DELIVER QUALITY MANAGED CARE PRODUCTS AT REASONABLE COSTS FOR ITS MEMBERS. PHPS SUCCESS IN MANAGING HEALTH CARE IS DUE IN PART TO THE EXTENSIVE NETWORK OF PARTICIPATING PROVIDERS IN THE HDN NETWORK. THE HMO/HDN CONTRACTUAL ARRANGEMENTS ALLOW PHP TO ARRANGE FOR HEALTHCARE TO PATIENTS COVERED BY THE STATE OF MICHIGANS MEDICAID BENEFIT PLAN. THIS ARRANGEMENT ALLOWS THE MEMBERS TO ACCESS A WIDE VARIETY OF INDEPENDENT PROVIDERS WITHIN EACH HDN INCLUDING PHYSICIANS, HOSPITALS, PHARMACIES, SKILLED NURSING FACILITIES, AND ALLIED HEALTH PROFESSIONALS. PHP MEMBERS MAY ALSO RECEIVE CARE FOR SERVICES FROM A NONPARTICIPATING PROVIDER IF SUCH REFERRAL IS RECOMMENDED BY AN HDN PARTICIPATING PHYSICIAN AND THE SERVICE REQUIRED FOR TREATMENT, AS DETERMINED BY HDN, IS NOT AVAILABLE WITHIN THE HDNS NETWORK. PHP OFFERS A VARIETY OF HEALTHCARE PROGRAMS, OR PRODUCTS TO GROUPS AND INDIVIDUALS. PHP OFFERS CHOICES THAT PROVIDE COVERAGE WITHIN THE NETWORK OF CONTRACTED HDN PROVIDERS, LIMITED COVERAGE OUTSIDE OF THE PHP NETWORK, VARIOUS LEVELS OF DEDUCTIBLES, CO-PAYMENTS, AND COVERAGE LIMITS, ALL OF WHICH ARE DESIGNED TO BE RESPONSIVE TO CUSTOMER NEEDS. PHP MEASURES THE QUALITY OF CARE PROVIDED TO ITS ENROLLEES THROUGH ANNUAL REVIEW OF INDICATORS SUCH AS: - DISEASE MANAGEMENT PROGRAM PARTICIPATION AND OUTCOMES, - QUALITY OF CARE CONCERNS, AND - HEDIS MEASURES: THE HEALTH PLAN EFFECTIVENESS DATA AND INFORMATION SET (HEDIS) IS A GROUP OF NATIONALLY RECOGNIZED MEASURES OF HEALTH PLANS PERFORMANCE IN A VARIETY OF CLINICAL AND NON-CLINICAL AREAS. PHP USES THE EFFECTIVENESS OF CARE MEASURES TO DETERMINE PROGRESS AND IMPROVEMENT IN AREAS SUCH AS: DIABETES, ASTHMA, DEPRESSION AND FOLLOW-UP AFTER MENTAL HEALTH ADMISSIONS, BREAST AND CERVICAL CANCER SCREENINGS, USE OF BETA-BLOCKERS AFTER HEART ATTACKS, CHILD AND ADOLESCENT IMMUNIZATIONS, CHOLESTEROL MANAGEMENT, CONTROLLING HIGH BLOOD PRESSURE, SMOKING CESSATION, PRENATAL AND POSTPARTUM CARE, AND TREATMENT OF CHILDHOOD RESPIRATORY INFECTIONS. PHP MEASURES THE QUALITY OF SERVICE PROVIDED TO ITS ENROLLEES BY THE REVIEW OF PERFORMANCE MEASURES RELATED TO: - ACCESS AND AVAILABILITY OF PROVIDERS, - ENROLLEE COMPLAINTS AND APPEALS, - CUSTOMER SERVICE TELEPHONE ACCESS PERFORMANCE, AND - MEMBER ASSESSMENT: THE CONSUMER ASSESSMENT OF HEALTHCARE PROVIDERS AND SYSTEMS (CAHPS) SURVEY GIVES A GENERAL INDICATION OF HOW WELL THE ORGANIZATION MEETS MEMBERS EXPECTATIONS. THE PHP QI PROGRAM IS ULTIMATELY ACCOUNTABLE TO THE BOARD OF DIRECTORS. PHP RECEIVED THE HIGHEST RATING OF EXCELLENT FROM THE UTILIZATION REVIEW ACCREDITATION COMMITTEE (URAC). THIS STATUS IS GRANTED TO HEALTH CARE PLANS THAT HAVE DEMONSTRATED CONTINUOUS QUALITY IMPROVEMENT IN THEIR PROGRAMS WHILE MEETING OR EXCEEDING URAC'S RIGOROUS ACCREDITATION STANDARDS. PHP FAMILYCARE RECEIVED AN "EXCELLENT" RATING. PHP AND PHP FAMILYCARE WERE REVIEWED BY URAC IN 2012. CLASSES OF MEMBERS OR STOCKHOLDERS FORM 990, PAGE 6, PART VI, LINE 6 SPARROW HEALTH SYSTEM (SHS) IS THE PARENT AND SOLE MEMBER OF PHYSICIANS HEALTH PLAN AND HAS 100% OWNERSHIP. ELECTION OF MEMBERS AND THEIR RIGHTS FORM 990, PAGE 6, PART VI, LINE 7A THE NON-ENROLLEE MEMBERS OF THE BOARD OF DIRECTORS OF PHYSICIANS HEALTH PLAN ARE RATIFIED BY THE BOARD OF DIRECTORS OF SPARROW HEALTH SYSTEM. DECISIONS SUBJECT TO APPROVAL OF MEMBERS FORM 990, PAGE 6, PART VI, LINE 7B THE NON-ENROLLEE MEMBERS OF THE BOARD OF DIRECTORS OF PHYSICIANS HEALTH PLAN ARE RATIFIED BY THE BOARD OF DIRECTORS OF SPARROW HEALTH SYSTEM. THE DECISIONS OF THE PHYSICIANS HEALTH PLAN BOARD OF DIRECTORS MAY BE SUBJECT TO THE APPROVAL OF THE BOARD OF DIRECTORS OF SPARROW HEALTH SYSTEM. ORGANIZATION'S PROCESS USED TO REVIEW FORM 990 FORM 990, PAGE 6, PART VI, LINE 11B COPIES OF THE 2012 FORM 990 ARE REVIEWED BY MANAGEMENT. ONCE MANAGEMENT COMPLETED ITS REVIEW OF THE FORM 990 COPIES WERE PROVIDED AT THE SEPTEMBER 2013 BOARD MEETING FOR ALL BOARD MEMBERS TO REVIEW AND COMMENT ON. ENFORCEMENT OF CONFLICTS POLICY FORM 990, PAGE 6, PART VI, LINE 12C 1) CORPORATE COMPLIANCE SENDS OUT THE CONFLICT OF INTEREST POLICY AND QUESTIONNAIRES TO ALL VOTING BOARD MEMBERS AND THE EXECUTIVE TEAM ANNUALLY. 2) ALL DISCLOSURES ARE RECEIVED AND REVIEWED BY CORPORATE COMPLIANCE. 3) ALL DISCLOSURES ARE GIVEN A RESOLUTION CODE AND PRESENTED TO THE CEO AND GOVERNANCE COMMITTEE OF THE BOARD. 4) ALL BOARD/COMMITTEE LEVEL DISCLOSURES ARE PROVIDED TO THE RESPECTIVE BOARD CHAIR AND EXECUTIVE LIAISON TO ENSURE ISSUES CAN BE ADDRESSED ON A TRANSACTIONAL LEVEL (I.E. IF A VOTE IS REQUIRED ON A TRANSACTION INVOLVING AN INTERESTED PERSON). COMPENSATION PROCESS FOR TOP OFFICIAL FORM 990, PAGE 6, PART VI, LINE 15A THE PROCESS FOR DETERMINING COMPENSATION FOR THE CEO OF THE ORGANIZATION INVOLVED THE FOLLOWING: UTILIZING THE COMPENSATION COMMITTEE, INDEPENDENT CONSULTANTS, REVIEWING OTHER SIMILAR ORGANIZATIONS' 990S, COMPENSATION SURVEYS, AND FINAL APPROVAL BY THE SHS BOARD OF DIRECTORS, AS WELL AS FINALIZING THE SALARY PACKAGE WITH A WRITTEN EMPLOYMENT CONTRACT. COMPENSATION PROCESS FOR OFFICERS FORM 990, PAGE 6, PART VI, LINE 15B THE PROCESS FOR DETERMINING COMPENSATION FOR OFFICERS OR KEY EMPLOYEES OF THE ORGANIZATION INVOLVED THE FOLLOWING: UTILIZING THE COMPENSATION COMMITTEE, INDEPENDENT CONSULTANTS, REVIEWING OTHER SIMILAR ORGANIZATIONS' 990S, COMPENSATION SURVEYS, AND FINAL APPROVAL BY THE SHS BOARD OF DIRECTORS, AS WELL AS FINALIZING THE SALARY PACKAGE WITH A WRITTEN EMPLOYMENT CONTRACT. GOVERNING DOCUMENTS DISCLOSURE EXPLANATION FORM 990, PAGE 6, PART VI, LINE 19 THE GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY AND FINANCIAL STATEMENTS ARE MADE AVAILABLE TO THE PUBLIC AS FOLLOWS: THE GOVERNING DOCUMENTS OF PHP ARE SUBMITTED TO THE DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES (DIFS). THOSE ARE PUBLICLY AVAILABLE TO INTERESTED PARTIES. THE CONFLICT OF INTEREST IS AVAILABLE THROUGH SPARROW HEALTH SYSTEM BY REQUEST TO THE SPARROW COMPLIANCE OFFICER. RELATED ORGANIZATIONS FORM 990, PAGE 7, PART VII SPARROW HEALTH SYSTEM IS AN INTEGRATED NON-PROFIT ORGANIZATION AND IS THE PARENT CORPORATION FOR PHYSICIANS HEALTH PLAN AND OTHER RELATED ENTITIES - SEE SCHEDULE R. DENNIS SWAN IS THE PRESIDENT & CHIEF OPERATING EXECUTIVE OF SPARROW HEALTH SYSTEM AND THEREBY SERVES AS THE PRINCIPAL OFFICER WITH ULTIMATE RESPONSIBILITY FOR IMPLEMENTING THE DECISIONS OF THE GOVERNING BODY OR SUPERVISING THE MANAGEMENT, ADMINISTRATION, OR OPERATION OF ENTITIES WITHIN THE SYSTEM. PHP SHARED SERVICES LLP PO BOX 30377 LANSING MI 48909 383361367 CONTRACTS MI 38781 2351 PHP SPARROW HEALTH SYSTEM 1215 E MICHIGAN AVENUE LANSING MI 48912 382542859 PARENT MI 501C3 11A N/A false PHP FAMILYCARE 1400 E MICHIGAN AVENUE LANSING MI 48912 364497604 HMO MI 501C4 PHP true PHYSICIANS HEALTH NETWORK 1400 E MICHIGAN AVENUE LANSING MI 48912 382594856 HMO MI 501C4 SHS true SPARROW FOUNDATION 1110 E MICHIGAN AVENUE LANSING MI 48912 386100687 FUNDRAISE MI 501C3 11B SHS true SPARROW COMMUNITY CARE 2909 E GRAND RIVER LANSING MI 48912 382543305 HOME HLTH MI 501C3 9 SHS true CLINTON MEMORIAL HOSPITAL 805 S OAKLAND STREET ST JOHNS MI 48879 381358172 HLTH CARE MI 501C3 3 SHS true EDWARD W SPARROW HOSPITAL 1215 E MICHIGAN AVENUE LANSING MI 48912 381360584 HLTH CARE MI 501C3 3 SHS true IONIA COUNTY MEMORIAL HOSPITAL CORP 520 E WASHINGTON ST IONIA MI 48846 383218134 HLTH CARE MI 501C3 3 SHS true SPARROW SPECIALTY HOSPITAL 1210 W SAGINAW LANSING MI 48915 141885340 LT ACUTE MI 501C3 3 SHS true SPARROW CLINICAL RESEARCH INSTITUTE 1215 E MICHIGAN AVENUE LANSING MI 48912 383075242 RESEARCH MI 501C3 4 SHS true LANSING MEDICAL DENTAL BUILDING 2909 E GRAND RIVER LANSING MI 48909 382566150 RENTAL PRO MI N/A false false LANSING MEDICAL DENTAL BUILDING 2909 E GRAND RIVER LANSING MI 48909 382566150 RENTAL PRO MI N/A false false PHP INSURANCE COMPANY 1400 E MICHIGAN AVENUE LANSING MI 48912 205565219 INSURANCE MI PHP C CORP 554586 13688349 1.00000 true PHP SERVICE COMPANY 1400 E MICHIGAN AVENUE LANSING MI 48912 383344741 MED SVS MI PHP C CORP -791584 448015 1.00000 true SPARROW DEVELOPMENT INC 1215 E MICHIGAN AVENUE LANSING MI 48912 382595963 RENTAL PRO MI N/A true EAST LANSING ATHLETIC CLUB 2900 HANNAH BLVD EAST LANSING MI 48823 382886420 HLTH CLUB MI N/A true MAC RESTAURANT LLC 2900 HANNAH BLVD EAST LANSING MI 48823 205120690 RESTAURANT MI N/A true MEDICAL CENTER WEST CONDO ASSOC 1100 W SAGINAW ST LANSING MI 48915 382635630 CONDO ASSO MI N/A true CLINTON SERVICES CORPORATION 805 S OAKLAND ST JOHNS MI 48879 382494110 SERVICES MI N/A true PHP INSURANCE COMPANY 1400 E MICHIGAN AVENUE LANSING MI 48912 205565219 INSURANCE MI PHP C CORP 554586 13688349 1.00000 true PHP SERVICE COMPANY 1400 E MICHIGAN AVENUE LANSING MI 48912 383344741 MED SVS MI PHP C CORP -791584 448015 1.00000 true SPARROW DEVELOPMENT INC 1215 E MICHIGAN AVENUE LANSING MI 48912 382595963 RENTAL PRO MI N/A true EAST LANSING ATHLETIC CLUB 2900 HANNAH BLVD EAST LANSING MI 48823 382886420 HLTH CLUB MI N/A true MAC RESTAURANT LLC 2900 HANNAH BLVD EAST LANSING MI 48823 205120690 RESTAURANT MI N/A true MEDICAL CENTER WEST CONDO ASSOC 1100 W SAGINAW ST LANSING MI 48915 382635630 CONDO ASSO MI N/A true CLINTON SERVICES CORPORATION 805 S OAKLAND ST JOHNS MI 48879 382494110 SERVICES MI N/A true false true false false false false false false false false false false true false true true true true false PHP FAMILYCARE Q 5090190 COST PHYSICIANS HEALTH NETWORK M 145999673 COST EDWARD W SPARROW HOSPITAL O 266160 COST CLINTON MEMORIAL HOSPITAL M 3506591 COST