2012-05-12T10:20:58-05:00 2011-06-30 990 2010-07-01 751844139 Baylor Medical Center at Waxahachie BAYL 2148204135 2001 Bryan Street No 2200 Dallas TX 752013005 Jay Fox 2148204135 2012-05-11 2010 2016-02-24 21:20:13Z Jay Fox 1405 W Jefferson Waxahachie TX 75165 101567127 0 X www.BaylorHealth.com X 1982 TX Faith based acute care hospital providing exemplary patient care to Waxahachie, Texas and the surrounding communities. 7 6 505 120 0 0 72192 107822 89230616 86088240 1249866 2268681 0 0 90552674 88464743 573828 507675 0 0 30140162 28473116 0 0 0 52017867 55139538 82731857 84120329 7820817 4344414 68302886 78926779 4007014 5682541 64295872 73244238 X Founded as a Christian ministry of healing, Baylor Medical Center at Waxahachie exists to serve all people through exemplary health care, education, research, and community service. 0 0 75587307 507675 85829965 See Schedule OBaylor Medical Center at Waxahachie (Baylor Waxahachie) is a faith-based, non-profit, 57-bed acute care hospital providing exemplary patient care to residents of Ellis County and surrounding rural communities of North Texas. Baylor Waxahachie is an affiliate of Baylor Health Care System (BHCS), a nationally acclaimed network of acute care hospitals and related health care entities providing quality patient care, medical education, medical research and other community services. Baylor Waxahachie provides inpatient and outpatient medical services to treat individuals with diseases, illness and injuries of varying complexities. These services include, but are not limited to, asthma care, cancer care, diabetes and endocrinology, fitness and wellness, heart and vascular, men's health, neuroscience, orthopedics, spine care, scoliosis care, sleep disturbances, pulmonology, palliative care, physical medicine, digestive diseases, metabolic diseases, emergency care, surgical services, intensive care services, urology, urogynecology, weight management and weight surgery, and women's services. Some of these services are provided despite a financial loss to Baylor Waxahachie. During the fiscal year ended June 30, 2011, Baylor Waxahachie admitted 2,988 inpatients resulting in 11,572 days of care, treated 28,454 outpatients, and had 39,646 emergency department visits. As part of its charitable mission, Baylor Waxahachie is committed to providing free and/or subsidized care to both financially and medically indigent patients in the community. During the year, Baylor Waxahachie reported community benefits (as reported to the Texas Department of State Health Services and in accordance with the State of Texas Statutory methodology) of $19,028,043. Baylor Waxahachie provided community benefits (as reported on the IRS Form 990, Schedule H) of $2,533,652 during the tax year. The Texas Annual Statement of Community Benefit Standard includes approximately $14,000,000 of unreimbursed cost of Medicare that is not included in the IRS Form 990, Schedule H.Baylor Waxahachie also is committed to promoting the healthy well-being of individuals and families beyond the health activities of the traditional hospital or clinic setting, through its community outreach programs. Baylor Waxahachie also supports the Ellis County Coalition for Health Options (Hope Clinic), a Federally Qualified Health Service Center. Hope Clinic is dedicated to enhancing the provision of primary care services in Ellis County. The unreimbursed cost of supporting and/or providing these programs is $237,213. Baylor Waxahachie also provided supervisory education programs for the training of future nurses in an effort to increase the supply of health care professionals nationwide. Assisting with the preparation of future nurses at entry levels of nursing is critical to establishing a workforce of qualified nurses. During the year, Baylor Waxahachie invested 16,540 hours in the training of 377 undergraduate nurses. Total unreimbursed cost of this nursing education program is $262,957. 75587307 1 1 0 1 0 0 0 0 0 1 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 1 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 0 0 1 109 0 1 505 1 0 0 0 0 0 0 0 0 X 7 6 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 0 1 1 0 X Cheryl McMullan 9729238056 1405 West Jefferson Waxahachie TX 75165 X Ron Carter 1.00 X 0 0 0 Roy Lamkin 1.00 X 0 315 0 Paul Madeley MD 1.00 X 0 733749 81205 George McCleskey 1.00 X 0 0 0 Timothy Owens 1.00 X 0 0 0 Mark Dyer 1.00 X 0 0 0 Walker Harman 1.00 X 0 4683 0 Cindy Murray 40.00 X 215458 0 21418 Jay Fox 40.00 X 365229 0 51575 Stephen Roussel 40.00 X 194067 0 19055 William Boyd 1.00 X 0 971758 220513 Cheryl McMullan 40.00 X 0 167640 20022 Marva Goins 40.00 X 160922 0 24972 Donna Drain 40.00 X 154378 0 7093 Jodiann Phillips 40.00 X 120082 0 24089 Douglas Coffey 40.00 X 125373 0 19156 Elizabeth Ortiz 40.00 X 131443 0 17421 Jerri Garison X 0 443688 67238 Preshie Wilson X 0 247558 24043 1466952 2569391 597800 31 1 1 0 Baylor Health Care System 2001 Bryan St Ste 2200 Dallas TX 75201 Management Services 100774944 Aramark Services Inc P O Box 651009 Charlotte NC 282651009 Engineering/Food Serv 1470402 HealthTexas Provider Network 2001 Bryan St Ste 2200 Dallas TX 75201 Clinical/Administrative 739652 Medco Construction 2001 Bryan St Ste 2200 Dallas TX 75201 Construction 474010 Baylor University Medical Center 2001 Bryan St Ste 2200 Dallas TX 75201 Clinical Services 429021 14 98936 8886 107822 Patient Care Revenue 621990 84370763 84370763 Rent 531120 745260 745260 Electronic Health Reco 900099 369589 369589 Fitness Center 713940 270471 270471 Cafeteria 722210 246705 246705 85452 73882 11570 86088240 903236 903236 14443784 24045 13097646 4738 1346138 19307 1365445 1365445 88464743 85829965 0 2526956 507675 507675 977316 977316 22162512 21860156 302356 774743 725942 48801 2938813 2930672 8141 1619732 1558814 60918 14222 14222 31884 31884 14925485 8564453 6361032 443900 553 443347 9139315 9027842 111473 2464190 2464190 3470455 3470455 73215 41413 31802 38082 22862 15220 3781000 3781000 2192972 2162009 30963 Bad Debt 18330161 18330161 Special Functions 83326 67201 16125 Recruiting 57518 518 57000 Dues & Memberships 33031 23096 9935 Meals & Entertainment 13639 3280 10359 47143 30793 16350 84120329 75587307 8533022 0 24349 10969 147965 150614 5583748 3588162 1177988 1314099 23113 36441 65275905 44685100 21808318 20590805 38120064 51617666 1417341 1618023 68302886 78926779 2890940 4520096 1116074 1162445 4007014 5682541 X 62794479 71540839 1142654 1343336 358739 360063 64295872 73244238 68302886 78926779 X 4344414 4603952 X 0 1 1 X 1 1 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 1 0 0 0 1 3048 1 20049 0 0 23097 0 Part IV, Supplemental Information: Statement Regarding Legislative Activity Health care policy is critical to all Americans, and Baylor Medical Center at Waxahachie ("Baylor") believes that health care providers must participate in forming health care policy by interacting with national, state and local representatives and their staff members to help them better understand the complexities and ramifications of key health care policies including, without limitation, those related to uninsured and indigent patient needs as well as the legislative and regulatory needs to assure the delivery of cost-efficient, quality health care. Baylor has established relationships with persons and industry associations that often communicate Baylor's positions on major health care issues. These contacts may include direct contact, telephone conversations and/or letters. Also, Baylor may attempt to educate the local community on certain legislative initiatives that may impact Baylor's ability to provide quality health care services to the community through direct mailings, media advertising or broadcast statements. The amount of resources (time and money) involved in these activities is insubstantial. Baylor has not intervened in any political campaign. 1248518 1248518 37799455 24719620 13079835 26227932 19965480 6262452 20590805 Description of Uncertain Tax Positions Under FIN 48: Part X: Part X, Line 2: The filing organization does not have separate individual audited financial statements; however, the organization is included in Baylor Health Care System's combined audited financial statements (System). The System follows the provisions of ASC 740 "Income Taxes." As of June 30, 2011 and 2010, the System had no material gross unrecognized tax benefits. 1 1 X 1 X 1 X 500.000000000000 1 1 1 0 1 1 2179001 0 2179001 0.03310 4587542 5224530 -636988 0.00000 218220 234426 -16206 0.00000 6984763 5458956 1525807 0.02320 114823 0 114823 0.00170 262957 0 262957 0.00400 0 0 0.00000 0 0 0.00000 630065 0 630065 0.00960 1007845 1007845 0.01530 7992608 5458956 2533652 0.03850 1 5512348 551235 16449232 22016945 -5567713 X 1 1 1 1 Baylor Medical Center at Waxahachie

1505 W Jefferson Waxahachie TX 75165

X X X NA 1 4 Baylor Imaging & Diag Ctr at Red Oak

305 E Ovilla Rd Red Oak TX 75154

Radiology & Pain Center Baylorworx Waxahachie

507 N Hwy 77 Waxahachie TX 75165

O/P Rehabilitation, Diabetes, Bariatrics, Fitness Ctr Sleep Center at Baylor Waxahachie

1510 W Jefferson Waxahachie TX 75165

Sleep Center Baylorworx Midlothian

1441 S Midlothian Parkway Midlothian TX 76065

O/P Rehabilitation Part I, Line 3c: and Line 3b: In addition to providing free care to financially indigent patients at 200% of the federal poverty guidelines ("FPG"), the organization provides discounted care to the medically indigent which is based on both the FPG (up to 500%) and the percentage of the patient's total bills from all providers in relation to the patient's annual income. Pursuant to the charity care policy, a patient's total balance due will not exceed 10% of total annual income if the patient qualifies as medically indigent. The organization also provides discounted care to those individuals whose amount of total bills, after all payments from third parties, exceeds 50% of the patient's annual income (regardless of the level of income) if the patient is unable to pay the remaining bill. Part I, Line 6a: The organization prepares and files an Annual Report of Community Benefit Plan with the Texas Department of State Health Services. These reports are made available through the organization's website at www.baylorhealth.com. Part I, Line 7: A ratio of patient care cost to charges, as determined in Worksheet 2, was used to report the amounts in Part I, Lines 7a - 7d. For amounts reported on lines 7e - 7k, actual expenses for each community benefit activity are tracked and reported using both community benefit software and/or the organization's cost accounting system.Part I, Line 7b, column (d): Includes payments from the State Medicaid Private Hospital Upper Payment Limit Program, which funds are to be used to expand indigent care.Part I, Line 7i, column (f): The tax software used to prepare and file electronically the Form 990 for the organization may not properly print the percentages in Part I, Lines 7a-7k, column (f) if the product results in a negative percentage. Part I, Line 7i, Column (c): Includes charity care payments of $507,675 that are made directly to or on the behalf of a local public hospital and/or other nonprofit organizations for the treatment of indigent patients of those organizations. Part I, L7 Col(f): The amount of bad debt expense included on Form 990, Part IX, line 25, but removed for Schedule H, Part I, Line 7, Column (f) totaled $18,330,161. Part III, Line 4: As stated in the combined audited financial statements, the organization maintains allowances for uncollectible accounts for estimated losses resulting from a payor's inability to make payments on accounts. The organization assesses the reasonableness of the allowance account based on the historical write-offs, cash collections, and the aging of the accounts. Accounts are written off when collection efforts have been exhausted. Management continually monitors and adjusts its allowance associated with its receivable. Bad debt does not include amounts for patients who are known to qualify under the organizations charity care policy. The amount of bad debt at cost was calculated using Worksheet A from Schedule H instructions. The amount of bad debt attributable to patient's accounts is net of contractual allowances, payments received and recoveries of bad debt previously written off. Based on prior experience and certain demographics and other information obtained during admission, the organization believes a portion of the bad debt expenses at cost would be attributable to patients that would otherwise qualify for charity care. Despite all of the effort and ways the organization educates patients about qualifying for its charity care program as demonstrated in Part IV, question 3 below, many uninsured patients either refuse or fail to complete a charity care application or provide sufficient information at the time of admission, during their stay or after being discharged to qualify for assistance under the organization's charity care policy. The amount reported on Part III, Line 3 was estimated by reviewing the average acceptance rate for charity care applications received at certain facilities during the year multiplied by the number of denials that were attributable to those facilities due to insufficient information. Part III, Line 8: The amount reported on Part III, Section B, line 6 was calculated in accordance with the Schedule H instructions utilizing the organization's allowable cost reported in the Medicare cost report based on a cost to charge ratio. However, the allowable costs in the Medicare cost report do not reflect the actual cost of providing care to patients since the Medicare cost report excludes many direct patient care costs that are essential to providing quality care to these patients. For example, certain coverage fees to physicians, cost of Medicare C and D, and other similar direct patient care expenses are specifically excluded as allowable cost in the cost reports. Using the same methodology to calculate the unreimbursed cost of providing charity care and Medicaid (using applicable Schedule H Worksheets) would result in a shortfall of $7,178,345, which is $1,610,632 higher than the shortfall reported on Part III, Section B, Line 7. The organization believes that all of the shortfall should be considered as a community benefit for the following reasons. First, the IRS Community Benefit Standard includes the provision of care to the elderly and Medicare patients. IRS Revenue Ruling 69-545 provides, in part, that hospitals serving patients with governmental health benefits, including for example Medicare, is an indication that the hospital operates for the promotion of health in the community. Second, the organization provides care to Medicare patients regardless of this shortfall, i.e., loss, and thereby relieves the state and federal government of the burden of paying the full cost for the care of Medicare beneficiaries. Medicare does not provide sufficient reimbursement to cover the entire cost of providing care to these patients causing the organization to use other surplus funds to cover the shortfall. It is expected that reimbursement under the Medicare program will continue to decline and therefore may further limit access to care due to the anticipated reduction of participating Medicare providers in the community. As a result, the care for these patients will likely increase at, and rest on the shoulders of, nonprofit hospitals or county hospital districts. Third, many of the Medicare participants have low fixed incomes and therefore would qualify for charity care or other means tested government programs absent being enrolled in the Medicare program. Fourth, Texas nonprofit hospitals must provide a minimum level of community benefit in order to obtain exemption from state and local taxes. According to the current Texas Health and Safety Code, the unreimbursed cost of Medicare is considered to be a community benefit in determining these state statutory requirements as it helps relieve a governmental burden of providing this care that would otherwise be provided through the county hospital system in Texas. Part III, Line 9b: The organization's debt collection policy and procedures prohibit any collection efforts for the portion of the patient account balance that qualifies for financial assistance under the organization's charity care policy. Part VI, Line 2: Like many other nonprofit hospitals in the 12 county North Texas region, the organization elected to base their service area needs on a community health needs report generated by the local county hospital district. Our Community Health Checkup 2008 for the Dallas/Fort Worth Combined Metropolitan Statistical Area ("Checkup") was a collaborative effort of 16 member hospitals of the Dallas Fort Worth Hospital Council ("DFWHC"). The preparation (including support, research and analysis) of the report was provided by the staffs of the Strategic Planning and Population Medicine Department of the Parkland Health & Hospital System (also known as the Dallas County Hospital District), Baylor Health Care System and other health care providers. The Checkup was developed to address issues relative to the health of individuals, families, and communities for use by the residents of the community and the institutions serving them. The Checkup provided a framework by which health needs could be joined with the assets or investments made by the community in its social and physical infrastructure. Overall coordination of this collaboration was under the auspices of the DFWHC. These documents can be found online at www.dfwhc.org. Part VI, Line 3: The organization is committed to promoting health in the community including providing or finding financial assistance programs to assist patients. Patients who may qualify for financial assistance through the organization's charity care program or other federal, state and local government programs are informed and educated about their eligibility in several ways including, but not limited to, the following: 1) posting signs and notices regarding the charity care policy in the emergency departments, admitting areas and business offices located throughout the organization: 2) annual posting regarding the organization's charity care program in the local newspapers: 3) information regarding financial assistance, including the organization's charity care policy, is posted on the organization's website: 4) notices about the organization's financial assistance policies are posted on each bill sent to patients including providing a phone number to access the customer service unit dedicated to answering patients billing questions, as well as provide information regarding financial assistance: and 5) the organization provides free financial counselors to help patients determine how to meet their financial obligations for services provided. Specifically financial counselors assist patients in applying for government assistance programs such as Medicaid or the organization's charity care program. Any patient may request to speak to a financial counselor when being treated at the organization. Uninsured patients who are admitted to the hospital will automatically receive help from a financial counselor. These services are provided in writing and through interpretation services in the primary language of the patient requesting assistance. Though the most often needed alternate language is Spanish, the organization can accommodate multiple languages including American Sign Language. Part VI, Line 4: The organizations primary service area includes all of Ellis County and the secondary area includes cities in Southern Dallas County, Navarro County and Hill County. The population of Ellis County was estimated at 151,179 in 2009 with a projected rate of 15.1% between 2009 & 2014 according to the Nielsen/Claritas report. The 2000 census reports the median income for a household in the county as $50,350, and the median income for a family was $55,358. The per capita income for the county was $20,212. About 6.80% of families and 8.60% of the population were below the federal poverty level, including 11.10% of those under age 18 and 10.40% ages 65 and over. During the FY 2011 year, approximately 34% of the total patient encounters were uninsured or Medicaid recipients.As of the 2000 census, there were 37,020 households, and 29,653 families residing in the county. The ethnic makeup of the county was reported as 80.63% White, 18.42% Hispanic and 8.63% Black. In the county, the population comprised 30.20% under the age of 18, 9.30% from 18-24, 29.8% from 25-44, 21.50% from 45-64, and 9.2% who were 65 or older. As indentified in the Checkup referenced above in Question #2, the five primary areas of community health were identified as cardiovascular (heart disease and stroke), cancer, chronic pulmonary disease, and Alzheimer's disease, flue, and pneumonia. Part VI, Line 6: With the oversight of an independent volunteer community board and Baylor Health Care System, the organization's sole member, the organization has promoted health and benefited the community by providing access to more than 20 specialty centers designed to treat a range of medical conditions. The organization's governing body is comprised of volunteer community representatives that provide leadership and governance for the organization. The members of the governing body contribute their wisdom, insights, and expertise to ensure the organization is fulfilling its mission and charitable purpose while providing efficient administrative support services and direction for the System. The members are well respected residents and/or own businesses in the organization's primary or secondary service area and understand the needs of the community. The medical staff of the organization is open to all physicians in the community who meet membership and clinical privileges requirements. Surplus funds are continuously utilized to maintain access to limited patient services or expand access points of care to patients throughout the community including, but not limited to, the following: The organization operates an emergency department accepting all patients without the regard for the ability to pay. In order to keep up with the growth of the community and the need for emergency services, the organization recently expanded the emergency department in FY 2010 by adding 9 beds and new equipment. This included the addition of the minor emergency E-clinic that provides patients quick access to minor emergency care with a private waiting area resulting in an average patient turnaround time just over one hour. The organization is committed to promoting an environment of wellness in its community and coaches residents to intentionally adopt healthier lifestyles to reduce the number of deaths associated with chronic disease. Throughout the year the organization offers free preventive health services to the community such as health screenings, health fairs, immunizations and community education. These efforts are targeted to meet the community health needs identified in the Checkup and during the fiscal year over 8,000 individuals benefitted through these efforts. The organization is one of only five health organizations to be selected by the Advantage division of the American Society of Health System Pharmacists (ASHP) to participate in a national institutional impact venous thromboembolism (VTE) mentored quality initiative. VTE occurs when a blood clot forms in a vein. The organizations' pharmacist led a multidisciplinary team focused on preventing VTE, which is considered the most preventable cause of mortality in hospitalized patients. Experts recommend integrated, system wide, inter-professional approaches that include interventions along the continuum of care, extensive education of health care providers, measuring performance and providing feedback. The organization was selected after a competitive application process and their work resulted in remarkable gains including very significant increases in the percentage of patients who had a documented VTE risk assessment and who received an appropriate prophylactic strategy within the 24 hour period prior to chart audit. In addition, the organization has committed significant funding to aid the operation of the Hope Clinic, a local community health clinic serving the medically underserved population. The Hope Clinic, operates as a community need driven, primary care clinic providing diagnostic laboratory & radiologic services, preventive health services, dental services, transportation assistance, pharmaceutical services, mental health and substance abuse services, patient case management services, health education and outreach . The clinic began with the identification of access to care needs for uninsured and indigent residents of Ellis County. In March 2009, Hope Clinic became a Federally Qualified Health Service Center for the provision of primary health care services in underserved and rural communities. Ellis County is one of the fastest growing areas in North Central Texas measured at a rate of 3.4% in 2009. To meet the growing health needs of the community, the organization recently purchased 83 acres at the northwest corner of the intersection of I-35 and Hwy. 287 earmarked for future expansion to meet the needs of the community. Identified as a medically underserved area, providing medical education is a crucial part of the organization's mission. During a nurses training, clinical skills and professional competencies are developed to provide the nurse with the ability to take on increasing responsibility for patient care. Quality teaching programs add many dimensions to the organization's ability to serve patients. In fiscal year 2011, the organization provided education for 377 preceptored and non preceptored nursing students and allied health students attracted from across the area to help improve the level of medical care for the entire community. Teaching programs also aid attending teaching nurse staff in keeping their own knowledge current. Upon completion of their education programs at the organization, many nurses and allied health professionals remain in North Texas, providing a continuous supply of well-trained medical professionals for the region. Part VI, Line 7: The organization is part of a large faith based integrated health care delivery system ("System") serving the health care needs of the twelve county Dallas-Fort Worth metroplex area. The System exists to serve all people through exemplary health care, education, research and community service. Community benefits are provided through the provision of charity care, governmental sponsored programs (such as Medicaid and Medicare), medical research, medical education, community health improvement services, donations to other nonprofit health care providers, and many other community service activities. During the year, the affiliated nonprofit hospitals reported community benefits (as reported to the Texas Department of State Health Services, and in accordance with the State of Texas Statutory methodology) in excess of $502,800,000. The System's nonprofit hospitals provided community benefits (as reported on the IRS Form 990, Schedule H) in excess of $151,000,000 during the tax year. The Texas Annual Statement of Community Benefit Standard includes approximately $302,000,000 of unreimbursed cost of Medicare that is not included in the IRS Form 990, Schedule H. The System is comprised of separate legal entities including philanthropic foundations, a research institute, a physician network, acute care hospitals, short-stay hospitals, specialty hospitals, ambulatory surgery centers and other health care providers all which fall under the common control of Baylor Health Care System, the organization's sole member. As part of the System, certain affiliates make grants and/or contributions to other related nonprofit affiliates to help financially support and/or fund worthy community benefits activities. The System has also established a patient transfer system among the affiliated hospitals allowing patients needing a particular level of care to be transferred as needed to a related hospital that can provide that service in an efficient and effective manner. As part of the System, all hospitals and other affiliated health care providers are required to adhere to high standards for medical quality, patient safety and patient satisfaction. These standards are set forth by Baylor Health Care System, the organization's sole member, which helps ensures consistency across the System. Reports Filed With States Part VI, Line 7 TX 1 Dallas Academy of Medicine dba Project Access Dallas 140 E 12th Street Dallas TX 75203 750223610 501(c)(3) 28565 N/A N/A Indigent Care Dallas County Indigent Care Corporation PO Box 655999 Dallas TX 75265 260610562 501(c)(3) 479110 N/A N/A Indigent Care 2 Procedure for Monitoring Grants in the U.S.: Part I, Line 2: Schedule I, Part I, Line 2: Monitoring Grants & Other Assistance As part of its mission, the organization provides grants and other assistance to related organizations and/or unrelated not-for-profit organizations which are religious, charitable, scientific, or educational in nature, within the meaning of Internal Revenue Code Section 501(c)(3), when the use will further one or more tenets of Baylor's charitable mission and one of the following criteria for use of these funds is met: (1)Fulfills a need identified by a community needs assessment conducted by Baylor Health Care System (BHCS) or a third party (such as Community Health Check Up or by the United Way) and adopted as a priority by BHCS's Community Service Advisory Council, (2) Serves an under-served community or group of people through medical mission work to improve their health status. For related organizations, all grants and other assistance are subject to the policies and procedures set forth by BHCS which ensures all funds are used in accordance with the guidelines set forth above and in accordance with the related organization's exempt purpose. Grants and other assistance provided to unrelated organizations are typically monitored by personal inspection. Examples include providing assistance to entities where the filing organization's employee serves as a Board Member for the recipient organization or through attendance at community events where the filing organization employees work as volunteers or to help coordinate these events. X X X 1 1 X X X X 0 1 0 0 0 0 0 1 0 Paul Madeley MD 0 503357 0 0 0 230392 0 67185 0 14020 0 814954 0 226611 Cindy Murray 165299 0 46049 0 4110 0 8396 0 13022 0 236876 0 0 0 Jay Fox 249831 0 96318 0 19080 0 39691 0 11884 0 416804 0 6382 0 Stephen Roussel 150626 0 39887 0 3554 0 7586 0 11469 0 213122 0 0 0 William Boyd 0 538151 0 409474 0 24133 0 197632 0 22881 0 1192271 0 0 Cheryl McMullan 0 125844 0 39804 0 1992 0 6453 0 13569 0 187662 0 0 Marva Goins 139686 0 20901 0 335 0 7347 0 17625 0 185894 0 0 0 Donna Drain 144362 0 3100 0 6916 0 6954 0 139 0 161471 0 0 0 Jerri Garison 0 290647 0 109442 0 43599 0 47758 0 19480 0 510926 0 28706 Preshie Wilson 0 193335 0 53888 0 335 0 9855 0 14188 0 271601 0 0 Part I, Line 1a Discretionary spending account - The organization provides eligible employees who travel frequently in their personal vehicle an auto expense allowance in lieu of reimbursement for business mileage under the organization's business travel and expense reimbursement policy. All auto expense allowances are treated as taxable compensation. One person listed in the Form 990, Part VII, Section A, received this benefit during the tax year. Part I, Line 1a Health or social club dues or initiation fees - The organization may reimburse eligible employees for dues for a health club and/or a social club where there is a bona fide business need for the membership. For example, as part of the organization's promotion of health, the organization will cover a portion of any employees' fitness center club membership dues paid to an affiliated entity that owns and operates a fitness center. All employees are eligible for this benefit. Such reimbursements are treated as taxable compensation to the extent any part of the membership is used for personal use. One person listed in the Form 990, Part VII, Section A, received this benefit during the tax year. Part I, Line 1a Tax indemnification and gross up payments - The organization provides tax indemnification where an authorized member of management determines there is justification to reimburse an individual for the tax impact on certain taxable, non-cash benefits provided to them. All tax indemnification payments provided are treated as taxable compensation. Four of the persons listed in the Form 990, Part VII, Section A, received this benefit during the tax year. Part I, Line 4b In order to recruit and retain key talent, Baylor Health Care System ("BHCS") offers a supplemental non qualified retirement plan to eligible employees. The plan provides an annual benefit (based on a percentage of compensation) to the employee that is paid to the employee on a future date upon vesting in the plan. The following individual(s) participated in and/or received payments (noted in parenthesis) from BHCS' supplemental non qualified retirement plan during the tax year: Jay Fox ($6,382), Jerri Garison ($28,706), Paul Madeley, M.D. ($226,611), and William Boyd. Also, select certain officers, as designated by BHCS's governing body, are eligible to participate in a Long Term Incentive Plan that is designed to recognize the key senior leaders value and contribution to BHCS as well as align their compensation to the long term strategy of the BHCS. Performance targets are based upon a percentage of the participants base salary and are developed by independent third party expert(s) using market competitive data within the guides of reasonableness. The plan is based on BHCS's three-year performance against its peers, determined based on peer rankings or percentile rankings in quality, patient satisfaction and financial performance. At the end of three years, awards are determined by BHCS's governing body for participants. Payouts are partially made in cash and the remainder vests over an additional two year period. The following individual participated in and/or received payments (noted in parenthesis) from this plan during the tax year: William Boyd. Part I, Line 7 The organization has adopted and implemented BHCS's, the organization's sole member, Performance Award Program to provide a market competitive total cash compensation incentive program that is designed to attract and retain key leaders and establish greater individual accountability and alignment to business performance. Payout targets are based upon a percentage of base pay and are developed by independent third party expert(s) using comparable market competitive data within the bounds of reasonableness and that are reviewed and approved by BHCS's governing body. Payout levels are based upon a combination of system, entity, and individual performance using various metrics related to quality, patient satisfaction, employee retention, and financal stewardship. BHCS's governing body may approve modifications to annual incentive awards provided under the program consistent with market comparability data. Supplemental Information Part III Supplemental Information: Governing body compensation The members of the governing body serve on a voluntary basis and receive no cash compensation from the organization for these duties as a member of the governing body. Some, but not all, members have received modest benefits incident to their service on the board and/or multiple board committees or received compensation as an employee of a related organization. These benefits include reimbursement for certain reasonable expenses paid on behalf of the member's spouse while accompanying the member on business travel on behalf of the related organization and/or a wellness physical. All such benefits are treated as taxable compensation to the extent required by law and are reported in the Form 990 where applicable. Form 990, Part VI, Section A, line 6 Members or stockholders: The organization is a Texas nonprofit membership organization in which Baylor Health Care System ("BHCS"), a tax exempt, Texas nonprofit corporation, is the sole member. Form 990, Part VI, Section A, line 7a Election of members of governing body by members, stockholders, or other persons: The sole member, BHCS, elects and removes the members of the governing body. Form 990, Part VI, Section A, line 7b Governing body decisions subject to approval: All rights and powers are reserved to the sole member, BHCS, except only those rights and powers expressly set forth in the bylaws, required by state or federal law, or to meet the requirements and standards promulgated by Joint Commission. For example, the member's reserved rights and powers include, without limitation, approval of the organization's articles of incorporation and bylaws and amendments thereto, appointment and removal of members of the organization's governing body, approval of dissolutions and mergers, and other similar decisions over the organization. Form 990, Part VI, Section B, line 11 Process used to review the Form 990: The Form 990 is prepared and reviewed by BHCS's tax department. During the return preparation process the tax department works with other functional areas including finance, accounting, treasury, legal, human resources, and corporate compliance for advice, information and assistance to prepare a complete and accurate return. Upon completion, the Form 990 is reviewed by the organization's President, financial officer and/or other key officers. A complete final copy of the return is provided to the organization's governing body prior to filing with the IRS. Form 990, Part VI, Section B, line 12c Process used to monitor and enforce compliance with the organization's conflict of interest policy: Persons with the actual or perceived ability to influence the organization have the duty to disclose annually and otherwise promptly as potential conflicts are identified, any familial, professional or financial relationships with entities or individuals that do, or seek to do business with the organization or that compete with the organization. These individuals include the organization's officers, governing body, management, physicians with administrative services agreements and other key personnel who interact with outside organizations or businesses on behalf of the organization. The BHCS Board of Trustees Audit and Compliance Committee and the BHCS Corporate Compliance Committee review all relevant disclosures submitted by these individuals to determine whether a conflict of interest exists and to determine an appropriate resolution, if necessary. The BHCS Compensation and Governance Committee also reviews all relevant disclosures by individuals serving on BHCS's governing body. Any individual with a perceived or potential conflict is prohibited from voting or participating in the decision making process regarding such transaction with that individual. Form 990, Part VI, Section B, line 15 Process for determining compensation: The organization, a controlled affiliate of BHCS, recognizes that those chosen to lead the organization are vital to its ongoing success and growth. Thus, it must attract, retain and engage the highest quality officers and key employees to lead the organization and help BHCS maintain its national reputation for achieving high targets for medical quality, patient safety, and patient satisfaction. A significant portion of the organization's officers' and key employees' total compensation is based on significant performance achievements. This strategy, known as the Performance Award Program, works to put a greater emphasis on the importance of the organization achieving targeted improvements in the areas of People, Quality, Patient Satisfaction and Financial Stewardship, annually. Total executive compensation is part of an integrated talent management strategy developed by the BHCS Board of Trustees and its Compensation and Governance Committee (Committee) to attract, motivate, and retain the best leadership resources for the organization. Executive compensation is determined pursuant to guidelines outlined in the intermediate sanction rules under IRC Section 4958 including taking steps to meet the rebuttable presumption standard of reasonableness under Treasury Regulation 53.4958-6, as summarized below. When making compensation decisions, the organization compares itself to similar-sized, and structured businesses including other integrated health care service systems and other similar-sized organizations, both locally and nationally. The BHCS Board of Trustees and Committee, on behalf of the organization, work directly with independent compensation expert(s) to identify reasonable and competitive market rates as well as provide an annual review of the total compensation of the organization's top management officials and key employees. The Committee is made up of members of the BHCS Board of Trustees, who are independent, community volunteers. Guided by the information provided by the independent compensation expert(s), the Committee approves and recommends to the BHCS Board of Trustees salary increases, earned incentives, and benefit offerings for the organization's President, other officers and/or key employees to be comparable to similar organizations for similar services and/or positions. Furthermore, the Committee is charged with the responsibility of reviewing annually the major elements of the executive compensation program to assure designs remain consistent with the business needs, market practices, and compensation philosophy. As part of the decision making process, the Committee will often meet in executive session to discuss and review recommendations made by the independent compensation expert(s). During the executive session no officer or key employee whose compensation is being reviewed is present during these discussions. All decisions are contemporaneously documented in the Committee minutes which are timely reviewed and approved by the Committee. Form 990, Part VI, Section C, line 19 Process for making governing documents, conflict of interest policy, & financial statements available to the public: The organization's articles of incorporation and amendments thereto are made available to the public by the filing of those documents with the Texas Secretary of State. Also, the organization is included within the combined financial statements of BHCS that are made available to the public by the posting of those documents through DAC Bond and are attached to this return. The organization's other governing documents and conflicts of interest policy are not made available to the public. Form 990, Part VI, Question 14: Document Retention and Destruction Policy: The organization has been following a written Document Retention and Destruction Policy since April 2003 that was approved by management at Baylor Health Care System, the organization's sole member. As a controlled affiliate of Baylor Health Care System, system wide policies are put in place to promote best governance practices and to implement consistent policies among controlled affiliates. Form 990, Part VII: Hours devoted to related organizations: The persons listed below also serve either as a voluntary member of the governing body, an employed officer, or an employee of a related organization. The average hours per week devoted to the related organizations are listed below: William Boyd (40 Hours) Walker Harman (10 Hours) Roy Lamkin (10 Hours) Jerri Garison (40 Hours) Paul Madeley, M.D. (40 Hours) Preshie Wilson (40 Hours) Cheryl McMullan transferred from a related organization during the year. She worked an average of 40 hours per week both before and after the transfer. Changes in Net Assets or Fund Balances: Form 990, Part XI, line 5: Net unrealized gains on investments: 4,447,341. Transfers Between Entities Under Common Control -44,071. Change in Net Assets Held at BHCS Foundation 200,682. Total to Form 990, Part XI, Line 5: 4,603,952. IRC Section 6038 Statement: Baylor Waxahachie is controlled by BHCS, employer identification number 75-1812652. BHCS also owns Health Care Insurance Company of Texas, Ltd. (HCIC). HCIC is a controlled foreign corporation. BHCS furnishes all information required of Baylor Waxahachie by IRC Section 6038 and the regulations thereunder with respect to HCIC. Therefore, pursuant to Treasury Regulation Sec. 1.6038-2(j)(2), Baylor Waxahachie is excepted from providing such information. BHCS files its Return of Organization Exempt from Income Tax in Ogden, Utah. Baylor Health Care System 2001 Bryan Street Suite 2200 Dallas TX 75201 751812652 Management Services TX 501(c)(3) 11, Type III N/A 0 Baylor University Medical Center 2001 Bryan Street Suite 2200 Dallas TX 75201 751837454 Acute Care Hospital TX 501(c)(3) 3 Baylor Health Care System 1 Baylor Medical Centers at Garland and McKinney 2001 Bryan Street Suite 2200 Dallas TX 75201 751037591 Acute Care Hospital TX 501(c)(3) 3 Baylor Health Care System 1 Baylor Medical Center at Irving 2001 Bryan Street Suite 2200 Dallas TX 75201 752586857 Acute Care Hospital TX 501(c)(3) 3 Baylor Health Care System 1 Baylor Regional Medical Center at Plano 2001 Bryan Street Suite 2200 Dallas TX 75201 820551704 Acute Care Hospital TX 501(c)(3) 3 Baylor Health Care System 1 Baylor Regional Medical Center at Grapevine 2001 Bryan Street Suite 2200 Dallas TX 75201 751777119 Acute Care Hospital TX 501(c)(3) 3 Baylor Health Care System 1 Baylor Institute for Rehabilitation at Gaston Episcopal Hospital 2001 Bryan 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