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THESE SERVICES ARE PROVIDED IN AMBULATORY PRACTICES, INPATIENT SETTINGS, AND TEACHING ENVIRONMENTS. 52670182 true false false false false false false false false true false true false false false false false false false false false false false true false false false false false false false true false false false false true true true true false true 62 0 true 628 true false false false false false false false false false 11 0 false false false false true true true true true false false true true true true true true true true false X X MR BRUCE SHIVELY 6164866703 665 SEWARD NE GRAND RAPIDS MI 49506 RICHARD BREON 2.00 X 0 2249338 464041 JAMES TUCCI 50.00 X X 765882 0 187924 KENNETH FAWCETT JR 50.00 X X 628109 0 38810 PHILLIP HENDERSON 50.00 X X 504134 0 39549 CALVIN LEAZENBY 50.00 X 395975 0 34743 LAURA ZUIDEMA 50.00 X 392589 0 29240 STEVEN BLAU 50.00 X 368502 0 17576 KEVIN MCCORMICK 50.00 X X 269015 0 29069 PAUL WASIELEWSKI 50.00 X 225771 0 22050 DAVID DOBBIE 50.00 X 222556 0 33643 DUDLEY E WILEY 50.00 X 137370 0 10780 M ASHRAF MANSOUR 50.00 X 103976 0 6318 PAULINE KRYWANSKI 50.00 X 321542 0 87877 MARK KADLEC 50.00 X 158206 0 26641 JERRY WITTINGEN 50.00 X 456947 0 38338 JOHN HESLIP 50.00 X 402610 0 32362 LEE BEGROW 50.00 X 392518 0 34162 RICHARD HAGELBERG 50.00 X 373180 0 25107 ROBERT MACKINDER 50.00 X 335905 0 30600 MATTHEW VAN VRANKEN X 0 1138968 280010 JOHN MOSLEY X 0 743371 138713 JOSEPH FIFER X 0 741280 154033 JOHN BYRNES X 0 711976 160623 MARC CHIRCOP X 0 668959 164176 BRIAN PHILLIPS X 0 588744 33843 LISA SHANNON X 0 373426 107996 GERALD LEE X 0 213672 28367 MARK BEVERSLUIS X 185136 0 29427 JAMES RANTA X 163555 0 25607 6803478 7429734 2311625 71 true true false EPIC SYSTEMS COPORATION PO BOX 88314 MILWAUKEE WI 432883014 CONSULTING 2168270 MCKINSEY & COMPANY INC PO BOX 7247-7255 PHILADELPHI PA 191707255 CONSULTING 1444950 IMPACT ADVISORS 931 W 75TH ST NAPERVILLE IL 60565 CONSULTING 1096897 DEARBOARN ADVISORS LLC 105 S YORK ST ELMHURST IL 60126 CONSULTING 863459 CAMBIA MANAGEMENT LLC PO BOX 2832 ORLAND PARK IL 60462 CONSULTING 659654 14 802 802 PATIENT SERVICE REVENUE 621110 30659292 30659292 CLINICAL, TEACHING, & MGMT SV 621110 12500000 12500000 MANAGEMENT FEE 621110 12000000 12000000 TECHNOLOGY SERVICES 621110 9000094 9000094 OTHER PROFESSIONAL SERVICES 621110 4337055 4337055 7250270 7250270 75746711 3674 3363 311 311 311 59133 -59133 -59133 -59133 75688691 75687578 311 4493626 3459643 1033983 348691 268457 80234 32298204 24866386 7431818 1657113 1275811 381302 4030964 3103439 927525 2325970 1790764 535206 1170302 1170302 260730 260730 4249002 4198243 50759 814968 814968 3446917 3178132 268785 349789 314810 34979 2946204 2598987 347217 256491 243666 12825 290982 245589 45393 36182 36182 2911418 2037993 873425 927093 927093 TIS SHARED SERVICES 2856750 404516 2452234 MMPC SHARED SERVICES 2622092 371288 2250804 MISCELLANEOUS 1065700 150902 914798 EPIC SHARED SERVICES 1053305 149148 904157 BAD DEBTS 825620 825620 881100 238243 642857 72119213 52670182 19449031 0 2915 4339 26709 2338015 3309466 3906 154915 95220 34231297 5532925 9421617 28698372 3357 6428309 11951434 38535706 3153101 9007836 15896223 33056282 19049324 42064118 X -7097890 -3528412 -7097890 -3528412 11951434 38535706 X false true true X false X false false false false false false false false false false 670195 670195 3525993 776708 2749285 3831616 904800 2926816 13301193 1145782 12155411 12902300 2705635 10196665 28698372 DUE FROM AFFILIATES 6428309 6428309 DUE TO AFFILIATES 33056282 33056282 X true true X X X X X false true false false false false false false false RICHARD BREON 946511 1276492 26335 295997 168044 2713379 970982 JAMES TUCCI 497368 255271 13243 113355 74569 953806 115418 KENNETH FAWCETT JR 434395 193714 17150 21660 666919 PHILLIP HENDERSON 329277 174857 16683 22866 543683 CALVIN LEAZENBY 325832 70143 19600 15143 430718 LAURA ZUIDEMA 388577 4012 19600 9640 421829 STEVEN BLAU 343408 20000 5094 3233 14343 386078 KEVIN MCCORMICK 268326 689 12258 16811 298084 PAUL WASIELEWSKI 223910 1861 2654 19396 247821 DAVID DOBBIE 218768 3788 16298 17345 256199 PAULINE KRYWANSKI 267887 52038 1617 53071 34806 409419 MARK KADLEC 125200 32077 929 2763 23878 184847 JERRY WITTINGEN 453405 3542 22033 16305 495285 JOHN HESLIP 222333 180277 13207 19155 434972 LEE BEGROW 390407 2111 17150 17012 426680 RICHARD HAGELBERG 369621 3559 4900 20207 398287 ROBERT MACKINDER 308432 27473 12957 17643 366505 MATTHEW VAN VRANKEN 663894 458771 16303 186411 93599 1418978 279183 JOHN MOSLEY 342300 385443 15628 85366 53347 882084 292260 JOSEPH FIFER 341760 397092 2428 93148 60885 895313 334100 JOHN BYRNES 361527 335837 14612 94516 66107 872599 236697 MARC CHIRCOP 373870 283501 11588 113177 50999 833135 211553 BRIAN PHILLIPS 514480 74264 17150 16693 622587 LISA SHANNON 238584 131037 3805 61330 46666 481422 93143 GERALD LEE 185640 28032 11994 16373 242039 MARK BEVERSLUIS 183462 1674 15474 13953 214563 JAMES RANTA 158999 4556 10485 15122 189162 FRINGE OR EXPENSE EXPLANATION SCHEDULE J, PAGE 1, PART I, LINE 1A TAXPAYER PAYS HEALTHCLUB DUES ON BEHALF OF SOME INDIVIDUALS LISTED IN PART VII OF THIS TAX RETURN. OTHER ADDITIONAL INFORMATION SCHEDULE J, PART III SCHEDULE J, PART II, COLUMN B(III) GRANDFATHERED SPLIT-DOLLAR ARRANGEMENTS WERE DISCONTINUED AND AN ELECTION TO LIQUIDATE ACCOUNTS WAS OFFERED TO PARTICIPANTS. WHERE APPLICABLE, THE ONE-TIME LIQUIDATED VALUE OF THESE PLANS ARE INCLUDED AS "REPORTABLE COMPENSATION" IN THE CORE FORM 990, PART VII AND "OTHER REPORTABLE COMPENSATION" IN SCHEDULE J OF THIS TAX RETURN. SCHEDULE J, PART I, LINE 4B THIS QUESTION IS ANSWERED "YES" BECAUSE CERTAIN INDIVIDUALS, WHOSE SALARY AND BENEFITS ARE PAID BY THE REPORTING ORGANIZATION OR A RELATED ORGANIZATION, DO "PARTICIPATE IN" A SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN. HOWEVER, NONE OF THESE PARTICIPANTS "RECEIVED PAYMENT FROM" THESE PLANS DURING THE TAX YEAR. HUGHES MANAGEMENT BUSINESS 14000 REAL ESTATE LEASE false CLASSES OF MEMBERS OR STOCKHOLDERS FORM 990, PAGE 6, PART VI, LINE 6 THE TAXPAYER HAS ONE MEMBER(S)/STOCKHOLDER(S) AS FOLLOWS: "SPECTRUM HEALTH SYSTEM (EIN 38-3382353), A MICHIGAN NONPROFIT CORPORATION. ELECTION OF MEMBERS AND THEIR RIGHTS FORM 990, PAGE 6, PART VI, LINE 7A THE SOLE MEMBER (SEE FORM 990, PART VI, LINE 6) OF THE TAXPAYER APPOINTS ALL MEMBERS OF THE BOARD OF DIRECTORS. DECISIONS SUBJECT TO APPROVAL OF MEMBERS FORM 990, PAGE 6, PART VI, LINE 7B THE SOLE MEMBER (SEE FORM 990, PART VI, LINE 6) OF THE TAXPAYER HAS THE RESERVED POWERS SET FORTH BELOW, AND SHALL NOT BE DEEMED AUTHORIZED UNLESS AND UNTIL APPROVED BY THE SOLE MEMBER(S): "APPOINTMENT AND/OR REMOVAL OF THE DIRECTORS AND THE CHAIRPERSON OF THE TAXPAYER BOARD, PURSUANT TO THE NOMINATION, ELECTION AND REMOVAL PROCESSES SET FORTH IN THE BYLAWS; "HIRING, DISCHARGE AND EVALUATION OF THE TAXPAYER'S PRESIDENT FOLLOWING CONSULTATION WITH THE BOARD OF DIRECTORS, AS DELEGATED BY THE SYSTEM BOARD TO THE MEMBER'S CHIEF EXECUTIVE OFFICER; "THE ADOPTION OF AMENDMENTS TO THE ARTICLES OF INCORPORATION OR BYLAWS OF THE TAXPAYER; "THE ADOPTION OF STRATEGIC PLANS FOR THE TAXPAYER; "THE ADOPTION OF THE ANNUAL OPERATING AND CAPITAL BUDGETS OF THE TAXPAYER AND ANY AMENDMENTS TO SUCH BUDGETS IN EXCESS OF THE AMOUNT SPECIFIED IN THE BUDGET ADOPTED BY THE MEMBER, AS AMENDED BY THE MEMBER FROM TIME TO TIME; "APPROVAL OF ALL TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER) CAPITAL EXPENDITURES IN EXCESS OF CERTAIN PRESET SPENDING LIMITS; "APPROVAL OF ALL BORROWING BY THE TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER) FOR CAPITAL OR OPERATING PURPOSES, AND ALL GUARANTEES OF INDEBTEDNESS; "APPROVAL OF ALL LOANS IN EXCESS OF CERTAIN PRESET LENDING AMOUNTS BY THE TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER) TO PERSONS OTHER THAN SPECTRUM HEALTH OR AN ENTITY CONTROLLED BY SPECTRUM HEALTH; "APPROVAL OF TAXPAYER INVESTMENTS OF CASH AND/OR RESERVES, WHETHER AT THE INDIVIDUAL TAXPAYER LEVEL OR AS PART OF A POOLED INVESTMENT STRATEGY; "APPROVAL OF COMPENSATION PAID TO PHYSICIANS PRACTICING MEDICINE AS EMPLOYEES OR INDEPENDENT CONTRACTORS OF THE TAXPAYER, TO THE EXTENT SUCH APPROVAL IS DEEMED BY THE SYSTEM BOARD TO BE REQUIRED BY APPLICABLE TAX LAWS AND/OR REGULATIONS; "MERGER OR CONSOLIDATION OF THE TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER), ANY OTHER CHANGE IN CONTROL, OWNERSHIP PERCENTAGES OR CAPITAL STRUCTURE OF THE TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER), OR THE CREATION OR ACQUISITION OF ANY ENTITY CONTROLLED BY THE TAXPAYER; "SALE OR TRANSFER OF MORE THAN TEN PERCENT (10%) OF THE ASSETS OF THE TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER) TO ANY PERSON OR ENTITY NOT CONTROLLED BY THE MEMBER; "DISSOLUTION OF THE TAXPAYER; "THE SELECTION, RETENTION AND OVERSIGHT OF AUDITORS FOR THE TAXPAYER (OR ANY ENTITY CONTROLLED BY THE TAXPAYER); "ELIMINATION OF A DEPARTMENT; AND "ANY OTHER APPROVAL REQUIRED BY LAW OR AS PROVIDED IN THE BYLAWS. ORGANIZATION'S PROCESS USED TO REVIEW FORM 990 FORM 990, PAGE 6, PART VI, LINE 11 A COPY OF THE FORM 990 IS PROVIDED TO THE BOARD OF DIRECTORS PRIOR TO FILING. THE REVIEW PROCESS FOR THIS FORM 990 IS AS FOLLOWS: 1. PREPARATION OF THE RETURN IS SUPERVISED AND REVIEWED BY THE TAXPAYER'S CORPORATE TAX MANAGER. 2. A SECOND REVIEW IS PERFORMED BY AN EXTERNAL CPA FIRM WITH EXPERTISE IN TAX-EXEMPT RETURN PREPARATION. 3. THE RETURN IS REVIEWED BY THE TAXPAYER'S FINANCE AND LEGAL DEPARTMENTS (INCLUDING THE VICE PRESIDENT OF FINANCE OR CHIEF FINANCIAL OFFICER) AND SHARED WITH THE MEMBERS OF THE BOARD OF DIRECTORS. 4. THE TAXPAYER'S VICE PRESIDENT OF FINANCE OR CHIEF FINANCIAL OFFICER REVIEWS COMMENTS OR QUESTIONS RECEIVED BY MEMBERS OF THE BOARD OF DIRECTORS, IF ANY, TO ADDRESS OR TO INCORPORATE, AS APPROPRIATE, INTO THE RETURN PRIOR TO FILING. ENFORCEMENT OF CONFLICTS POLICY FORM 990, PAGE 6, PART VI, LINE 12C BOARD OF DIRECTORS 1.CONFLICTS OF INTEREST MUST BE DISCLOSED, BOTH VIA A DISCLOSURE FORM PROCESS AS WELL AS VERBALLY AT A BOARD MEETING PRIOR TO DISCUSSION OF ANY AGENDA ITEM WITH REGARD TO WHICH A BOARD MEMBER HAS A CONFLICT. 2.A PERSON HAVING A FINANCIAL INTEREST IN A PROPOSED TRANSACTION OR ARRANGEMENT MAY MAKE A PRESENTATION AT A MEETING OF THE BOARD OF DIRECTORS OR COMMITTEE CONSIDERING THAT TRANSACTION OR ARRANGEMENT, BUT AFTER THAT PRESENTATION HE OR SHE SHALL LEAVE THE MEETING DURING DISCUSSION AND VOTING ON THAT PROPOSED TRANSACTION OR ARRANGEMENT. THE PERSON HAVING THE FINANCIAL INTEREST SHALL NOT BE COUNTED IN DETERMINING WHETHER A QUORUM IS PRESENT. 3.THE CHAIRPERSON OF THE BOARD OF DIRECTORS OR COMMITTEE SHALL, IF APPROPRIATE, APPOINT A DISINTERESTED PERSON OR COMMITTEE (INCLUDING OUTSIDE ADVISORS) TO INVESTIGATE ALTERNATIVES TO THE PROPOSED TRANSACTION OR ARRANGEMENT, AND TO ADVISE WHETHER THE PROPOSED TRANSACTION OR ARRANGEMENT IS IN SPECTRUM HEALTH'S BEST INTEREST. 4.THE BOARD OF DIRECTORS OR COMMITTEE SHALL EXERCISE DUE DILIGENCE TO DETERMINE WHETHER SPECTRUM HEALTH CAN, WITH REASONABLE EFFORTS, OBTAIN A MORE ADVANTAGEOUS TRANSACTION OR ARRANGEMENT THAT WOULD NOT GIVE RISE TO A CONFLICT OF INTEREST. 5.IF A MORE ADVANTAGEOUS TRANSACTION OR ARRANGEMENT IS NOT REASONABLY ATTAINABLE UNDER CIRCUMSTANCES THAT WOULD NOT GIVE RISE TO A CONFLICT OF INTEREST, THE BOARD OF DIRECTORS OR COMMITTEE SHALL DETERMINE BY A MAJORITY VOTE OF THE DISINTERESTED DIRECTORS AND MEMBERS WHETHER THE PROPOSED TRANSACTION OR ARRANGEMENT IS IN SPECTRUM HEALTH'S BEST INTEREST AND FOR ITS OWN BENEFIT AND WHETHER THE TRANSACTION IS FAIR AND REASONABLE TO SPECTRUM HEALTH, AND SHALL MAKE ITS DECISION AS TO WHETHER TO ENTER INTO THE TRANSACTION OR ARRANGEMENT IN CONFORMITY WITH SUCH DETERMINATION. 6.THE MINUTES OF THE MEETINGS OF THE BOARD OF DIRECTORS AND ALL SPECTRUM HEALTH COMMITTEES SHALL SET FORTH: A)THE NAMES OF THE PERSONS WHO DISCLOSED A FINANCIAL INTEREST IN A PROPOSED TRANSACTION OR ARRANGEMENT INVOLVING SPECTRUM HEALTH OR ANY OF ITS SUBSIDIARIES AND THE NATURE OF THE FINANCIAL INTEREST; AND B)THE NAMES OF THE PERSONS WHO WERE PRESENT FOR DISCUSSIONS AND VOTES RELATING TO SUCH TRANSACTION OR ARRANGEMENT, INCLUDING ANY DISCUSSION OF ALTERNATIVES TO THE PROPOSED TRANSACTION OR ARRANGEMENT, AND A RECORD OF ANY VOTES TAKEN IN CONNECTION WITH THAT MATTER. THE VOTES OF INDIVIDUAL MEMBERS NEED NOT BE RECORDED UNLESS OTHERWISE DIRECTED BY THE BOARD OF DIRECTORS OR COMMITTEE MANAGEMENT 1.EACH MEMBER OF THE MANAGEMENT TEAM SHALL COMPLETE A CONFLICT OF INTEREST DISCLOSURE FORM UPON ACCEPTANCE OF AN EMPLOYMENT OFFER AND AT ANY POINT THEREAFTER IF A NEW POTENTIAL CONFLICT OF INTEREST HAS ARISEN. THE CONFLICT OF INTEREST DISCLOSURE FORM SHOULD BE FULLY COMPLETED AND SIGNED. IF THE STAFF MEMBER DISCLOSES ANY POTENTIAL CONFLICT OF INTEREST, THE FORM SHALL BE SUBMITTED IMMEDIATELY TO THE SYSTEM'S ORGANIZATIONAL INTEGRITY DEPARTMENT. A COPY OF THE COMPLETED FORM SHOULD BE MAINTAINED IN THE STAFF MEMBER'S PERSONNEL FILE. 2.EACH MEMBER OF THE MANAGEMENT TEAM SHALL COMPLETE AN ELECTRONIC CONFLICT OF INTEREST DISCLOSURE FORM ON AN ANNUAL BASIS. THE CONFLICT OF INTEREST DISCLOSURE FORM SHOULD BE COMPLETED AND ELECTRONICALLY SIGNED WITHIN THE GIVEN TIMEFRAME. THE SYSTEM'S ORGANIZATIONAL INTEGRITY DEPARTMENT WILL MANAGE THE ANNUAL PROCESS AND WILL MAINTAIN ELECTRONIC COPIES OF THE COMPLETED FORMS. 3.THE SYSTEM'S ORGANIZATIONAL INTEGRITY DEPARTMENT SHALL REVIEW EACH FORM THAT IS SUBMITTED. ADDITIONAL INFORMATION WILL BE GATHERED AS NEEDED. WHETHER ANY ITEMS DISCLOSED MAY BE PERCEIVED AS AN ACTUAL OR POTENTIAL CONFLICT OF INTEREST WILL BE REVIEWED. IN ADDITION, STEPS THAT CAN BE TAKEN TO REDUCE THE RISK OF A CONFLICT OF INTEREST WILL BE IDENTIFIED. 4.IF THE SYSTEM'S ORGANIZATIONAL INTEGRITY DEPARTMENT BELIEVES THAT A DISCLOSURE HAS BEEN MADE THAT COMPRISES AN ACTUAL OR PERCEIVED CONFLICT OF INTEREST, THE SYSTEM CONFLICT OF INTEREST COMMITTEE OR MEMBERS THEREOF WILL BE CONSULTED AS NEEDED. THE STAFF MEMBER'S SUPERVISOR AND/OR HUMAN RESOURCES GENERALIST MAY BE CONSULTED AS WELL. REASONABLE STEPS SHOULD BE TAKEN AS NEEDED TO MINIMIZE THE RISK OF A CONFLICT OF INTEREST. A WRITTEN MEMO SUMMARIZING THESE STEPS SHOULD BE SENT TO THE STAFF MEMBER'S SUPERVISOR AND BE MAINTAINED IN THE STAFF MEMBER'S FILE. COMPENSATION PROCESS FOR TOP OFFICIAL FORM 990, PAGE 6, PART VI, LINE 15A PROCESS FOR ESTABLISHING EXECUTIVE COMPENSATION THE SPECTRUM HEALTH BOARD OF DIRECTORS (EXECUTIVE COMMITTEE) USES THE FOLLOWING PROCESS FOR DETERMINING COMPENSATION OF EXECUTIVES AT ALL ENTITIES: LABOR MARKET DATA REFLECTING COMPARABLE ORGANIZATIONS AND JOBS (PREPARED BY INDEPENDENT FIRMS) ARE RELIED UPON. COMPETITIVE ASSESSMENT REPORTS ARE PROVIDED IN ADVANCE OF EXECUTIVE COMMITTEE MEETINGS. THE COMPETITIVE ASSESSMENT REPORT IS PREPARED BY A NATIONALLY KNOWN INDEPENDENT EXECUTIVE COMPENSATION FIRM AND, FOR FY 2010 (7/1/09-6/30/10), WAS BASED ON THE FOLLOWING INDEPENDENT SURVEYS OF HEALTH CARE EXECUTIVES AT COMPARABLE HEALTH SYSTEMS: SULLIVAN, COTTER AND ASSOCIATES, INC.: 2009 SURVEY OF MANAGER AND EXECUTIVE COMPENSATION IN HOSPITALS AND HEALTH SYSTEMS INTEGRATED HEALTHCARE STRATEGIES: 2009 HEALTHCARE EXECUTIVE COMPENSATION SURVEY MERCER HUMAN RESOURCES CONSULTING: 2009 INTEGRATED HEALTH NETWORKS COMPENSATION SURVEY WATSON WYATT DATA SERVICES: 2009/2010 HOSPITAL AND HEALTHCARE MANAGEMENT COMPENSATION REPORT THESE SOURCES ARE CONSISTENT WITH THOSE USED IN LAST YEAR'S ANALYSIS. COMPENSATION ADJUSTMENTS ARE APPROVED BY INDEPENDENT EXECUTIVE COMMITTEE MEMBERS, CONSISTENT WITH THE SPECTRUM HEALTH COMPENSATION PHILOSOPHY DESCRIBED BELOW. MINUTES OF COMMITTEE DISCUSSIONS AND DECISIONS ARE PREPARED TO MEMORIALIZE EXECUTIVE COMMITTEE DECISIONS BASED UPON THE ABOVE DATA. CASH COMPENSATION DATA RELIED UPON BY THE EXECUTIVE COMMITTEE ARE NATIONAL AND REFLECT THE COMPENSATION PAID TO EXECUTIVES IN COMPARABLE JOBS IN COMPARABLY-SIZED HEALTHCARE ORGANIZATIONS. SPECTRUM HEALTH RECRUITS NATIONALLY FOR ITS EXECUTIVES. BENEFITS DATA REFLECT NATIONAL HEALTHCARE MARKET PRACTICES. GEOGRAPHIC PAY DIFFERENTIAL AND COST OF LIVING DATA INDICATE CONSISTENCY WITH NATIONAL DATA. THIS PROCESS IS INTENDED TO ASSIST SPECTRUM HEALTH IN QUALIFYING FOR THE REBUTTABLE PRESUMPTION OF REASONABLENESS (INTERMEDIATE SANCTIONS REGULATIONS) AND THE SPECTRUM HEALTH EXCESS BENEFIT TRANSACTION POLICY FOR THOSE INDIVIDUALS IN THE GROUP WHO ARE DISQUALIFIED PERSONS. THE OPINION SUBMITTED FROM THE THIRD PARTY INDEPENDENT CONSULTING FIRM IS IN ACCORDANCE WITH THE PROVISIONS OF TREASURY REGULATIONS SECTION 53.4958-6(C)(2) AND IS ALSO INTENDED TO SATISFY THE PROFESSIONAL ADVICE REQUIREMENT OF TREASURY REGULATIONS SECTION 53.4958-1(D)(4)(III). COMPENSATION PROCESS FOR OFFICERS FORM 990, PAGE 6, PART VI, LINE 15B SEE EXPLANATION PROVIDED FOR FORM 990, PART VI, LINE 15A. GOVERNING DOCUMENTS DISCLOSURE EXPLANATION FORM 990, PAGE 6, PART VI, LINE 19 THE ORGANIZATION'S ARTICLES OF INCORPORATION HAVE BEEN PROVIDED TO THE STATE OF MICHIGAN AND ARE AVAILABLE TO THE PUBLIC ON THE STATE'S WEBSITE. THE ORGANIZATION'S BYLAWS AND INTERNAL POLICIES ARE GENERALLY NOT MADE AVAILABLE TO THE PUBLIC. THE OVERALL SYSTEM CONSOLIDATED FINANCIAL STATEMENTS ARE PROVIDED AT WWW.SPECTRUM-HEALTH.ORG IN THE SECTION TITLED "ABOUT US." FINANCIAL PERFORMANCE, IS DISCUSSED AT AN ANNUAL PUBLIC MEETING HELD AND POSTED TO WWW.SPECTRUM-HEALTH.ORG ANNUALLY (UNDER THE SECTION TITLED "ABOUT US"). ADDITIONAL INFORMATION SCHEDULE O FORM 990, PART I, LINE 5 AND FORM 990, PART V, LINE 2A - NUMBER OF EMPLOYEES TAXPAYER MAY HAVE INDIRECT EMPLOYEES. COMPENSATION FOR THESE EMPLOYEES ARE PAID BY A RELATED ORGANIZATION. AN ALLOCATION OF AMOUNTS PAID FOR INDIRECT EMPLOYEES IS PURSUANT TO A MANAGEMENT SERVICES CONTRACT AND IS INCLUDED ON LINES 5-10 OF PART IX. FORM 990, PART IV, LINE 28C AND SCHEDULE L, PART IV - BUSINESS TRANSACTIONS INVOLVING INTERESTED PERSONS DR. M. ASHRAF MANSOUR, A MEMBER OF TAXPAYER'S BOARD OF DIRECTORS, HAS A GREATER THAN 5% INTEREST IN A TAXABLE ORGANIZATION THAT PROVIDES SERVICES TO THE TAXPAYER. THROUGH OUR ANNUAL CONFLICT OF INTEREST AND TAX REPORTING PROCESSES, CERTAIN INDIVIDUALS LISTED IN SCHEDULE L HAVE REPORTED THAT THEY, OR COMPANIES THEY WORK FOR, HAVE BUSINESS OR FAMILY RELATIONSHIPS WITH THE REPORTING ORGANIZATION THAT EXCEED THRESHOLDS PROVIDED IN THE INSTRUCTIONS TO THE FORM 990. IF AN AMOUNT IS NOT LISTED IN SCHEDULE L, A STATEMENT IS PROVIDED ABOVE EXPLAINING THE NATURE OF THE TRANSACTION(S). FORM 990, PART IV, LINE 33 AND SCHEDULE R - IDENTIFICATION OF DISREGARDED ENTITIES THE ORGANIZATION DOES NOT OWN A WHOLLY OWNED DISREGARDED ENTITY. HOWEVER, THE HEALTH SYSTEM HAS WHOLLY OWNED DISREGARDED ENTITIES. THE ORGANIZATION IS REPORTING INDIRECT CONTROL FOLLOWING THE CONSTRUCTIVE OWNERSHIP RULES UNDER SECTION 318 OF THE INTERNAL REVENUE CODE. OTHER ENTITIES REPORTED ON SCHEDULE R ARE REPORTED BASED ON THE SAME APPLICATION OF THE CONSTRUCTIVE OWNERSHIP RULES OF SECTION 318. FORM, PART VII, LINE 1A - COMPENSATION OF OFFICERS, DIRECTORS, TRUSTEES, KEY EMPLOYEES, HIGHEST COMPENSATED EMPLOYEES, AND INDEPENDENT CONTRACTORS CONSISTENT WITH PRIOR YEARS, THE COMPENSATION REPORTED FOR THESE INDIVIDUALS IS NOT FOR SERVICES IN THEIR CAPACITY AS MEMBERS OF THE BOARD OF DIRECTORS BUT FOR SERVICES AS EMPLOYEES OF THE ORGANIZATION OR A RELATED ORGANIZATION. CONSISTENT WITH PRIOR YEARS, COMPENSATION AND BENEFITS ARE REPORTED USING THE MOST RECENT CALENDAR YEAR COMPENSATION DATA. THE COMPENSATION FIGURES REPORTED IN THESE SECTIONS IS FOR THE YEAR ENDED DECEMBER 31, 2009. INDIVIDUALS WITH COMPENSATION REPORTED IN PART VII WORK A COMBINED AVERAGE OF 50 HOURS PER WEEK FOR THE REPORTING ORGANIZATION AND/OR A RELATED TAX-EXEMPT ORGANIZATION. SCHEDULE R - DIRECT CONTROLLING ENTITY PART IV THE FORM 990 LIMITS THIS COLUMN TO TEN CHARACTERS AND THEREFORE ACRONYMS ARE USED TO DEFINE THE CONTROLLING ENTITY. THESE ACRONYMS ARE DEFINED AS FOLLOWS: NA - NOT APPLICABLE MMPC - MICHIGAN MEDICAL PATIENT CARE PH - PRIORITY HEALTH SHCC - SPECTRUM HEALTH CONTINUING CARE SHH - SPECTRUM HEALTH HOSPITALS SHI - SPECTRUM HEALTH INNOVATIONS, LLC SHS - SPECTRUM HEALTH SYSTEM SHU - SPECTRUM HEALTH UNITED WMH - WEST MICHIGAN HEART PHMB PROPERTIES LLC PHMB PROPERTIES LLC 1231 EAST BELTLINE NE 1231 EAST BELTLINE NE GRAND RAPIDS MI 49525 382715520 PROP. MGMT MI 5062443 PH PH WEST MICHIGAN CVCT LLC WEST MICHIGAN CVCT LLC 2900 BRADFORD STREET NE 2900 BRADFORD STREET NE GRAND RAPIDS MI 49525 382125186 DORMANT MI WMH WMH MMPC REAL ESTATE LLC MMPC REAL ESTATE LLC 4100 LAKE DR SE STE 300 4100 LAKE DR SE STE 300 GRAND RAPIDS MI 49525 382851295 DORMANT MI MMPC MMPC SPECTRUM HEALTH INNOVATIONS LLC SPECTRUM HEALTH INNOVATIONS LLC 100 MICHIGAN AVE NE 100 MICHIGAN AVE NE GRAND RAPIDS MI 49503 272868213 IP DEVELOP MI SHS SHS SPECTRUM HEALTH SYSTEM SPECTRUM HEALTH SYSTEM 100 MICHIGAN AVE NE 100 MICHIGAN AVE NE GRAND RAPIDS MI 49503 383382353 MANAGEMENT MI 501 11C NA N/A SPECTRUM HEALTH HOSPITALS SPECTRUM HEALTH HOSPITALS 100 MICHIGAN AVE NE 100 MICHIGAN AVE NE GRAND RAPIDS MI 49503 381360529 HEALTHCARE MI 501 3 SHS SHS SPECTRUM HEALTH PRIMARY CARE PTNRS SPECTRUM HEALTH PRIMARY CARE PTNRS 100 MICHIGAN AVE NE 100 MICHIGAN AVE NE GRAND RAPIDS MI 49503 381358164 HEALTHCARE MI 501 3 SHS SHS WEST MICHIGAN REGIONAL LABORATORY WEST MICHIGAN REGIONAL LABORATORY 1726 KNOLLCREST CIRCLE SE 1726 KNOLLCREST CIRCLE SE GRAND RAPIDS MI 49546 383414862 TEACH/RSCH MI 501 9 SHH SHH SH-SM SHARED TECHNOLOGY SERVICES SH-SM SHARED TECHNOLOGY SERVICES 100 MICHIGAN AVE NE 100 MICHIGAN AVE NE GRAND RAPIDS MI 49503 364528474 MED. 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SVCS MI SHH SHH C CORP 388481 9443961 1.00000 CAMPUS TOWNE CENTER CONDO ASSC CAMPUS TOWNE CENTER CONDO ASSC 4868 LAKE MICHIGAN DRIVE 4868 LAKE MICHIGAN DRIVE ALLENDALE MI 49401 382910067 MGMT MI SHH SHH C CORP 19081 20334 0.75000 PRIORITY HEALTH INSURANCE COMPANY PRIORITY HEALTH INSURANCE COMPANY 1231 EAST BELTLINE NE 1231 EAST BELTLINE NE GRAND RAPIDS MI 49525 201529553 INSURANCE MI PH PH C CORP 130757283 41936138 1.00000 PRIORITY HEALTH MANAGED BENEFITS PRIORITY HEALTH MANAGED BENEFITS 1231 EAST BELTLINE NE 1231 EAST BELTLINE NE GRAND RAPIDS MI 49525 383085182 ADMIN MI SHS SHS C CORP 114304478 25950943 1.00000 MONTCALM PRIMARY CARE PHYSICIANS MONTCALM PRIMARY CARE PHYSICIANS 615 S BOWER 615 S BOWER GREENVILLE MI 48838 202544762 MED. SVCS MI SHU SHU C CORP 1.00000 BLODGETT ASSURANCE COMPANY BLODGETT ASSURANCE COMPANY 100 MICHIGAN AVE NE 100 MICHIGAN AVE NE GRAND RAPIDS MI 49503 INSURANCE CJ SHS SHS C CORP 1.00000 MICHIGAN MEDICAL PATIENT CARE MICHIGAN MEDICAL PATIENT CARE 4100 LAKE DR SE STE 300 4100 LAKE DR SE STE 300 GRAND RAPIDS MI 49546 382851295 MEDICAL MI SHS SHS C CORP 160318069 59260928 1.00000 WEST MICHIGAN HEART WEST MICHIGAN HEART 2900 BRADFORD STREET NE 2900 BRADFORD STREET NE GRAND RAPIDS MI 49525 382125186 PHYSICIANS MI SHS SHS C CORP 42634602 9048196 1.00000 MHEALTH INNOVATIONS INC MHEALTH INNOVATIONS INC 425 NORTH MAIN STREET 425 NORTH MAIN STREET ANN ARBOR MI 48104 611613614 PROD DEVL MI SHI SHI C CORP 0.99000 false false true false false false false false false true true true false false false false true true PRIORITY HEALTH K 100173 SPECTRUM HEALTH HOSPITALS J 2535123 SPECTRUM HEALTH HOSPITALS L 6671182 PRIORITY HEALTH L 3770854 SPECTRUM HEALTH HOSPITALS K 5819114 SPECRUM HEALTH HOSPITALS C 33500000 PRIORITY HEALTH K 7629729 SPECTRUM HEALTH HOSPITALS Q 25750000 SPECTRUM HEALTH HOSPITALS R 1332981 SPECTRUM HEALTH CONTINUING CARE K 477283