2011-11-09T10:44:38-06:00 2010-12-31 Deloitte Tax LLP 200 Renaissance Center Suite 3900 Detroit MI 48243 990 2010-01-01 382242827 HEALTH ALLIANCE PLAN OF MICHIGAN HEAL 3136648559 2850 WEST GRAND BOULEVARD DETROIT MI 48202 Ronald W Berry 3136648559 2011-11-09 1 3133963000 2010 2016-03-07 17:11:31Z Ronald W Berry 2850 WEST GRAND BOULEVARD DETROIT MI 48202 1909475475 0 X www.hap.org X 1979 MI Provide access to quality health care coverage 17 15 667 0 12405 0 0 0 1711676041 1726430562 11596750 7760872 91692 62143 1723364483 1734253577 0 0 1588039784 1591824877 62522198 68139553 0 0 0 46197451 50689215 1696759433 1710653645 26605050 23599932 427399843 471543918 173944567 190098386 253455276 281445532 X Enhancing the Health and Well-Being of the Lives We Touch by providing personalized service to our customers, making access to healthcare easier and improving the health status of our members. 0 0 1695271877 1726480300 Program Service: Health Alliance Plan (HAP) is a non-profit health plan offering commercial products and government programs to members who enroll with HAP. HAP contracts with various healthcare providers to provide healthcare services to members. Approximately 92% of HAP's revenues is paid to the contracted healthcare providers for administering care to HAP's members. HAP members rated HAP "Highest in Member Satisfaction among Commercial Health Plans in Michigan" four years in a row in the J.D. Power & Associates 2011 Member Health Insurance Plan study. To compare HAP's performance with other Michigan health plans, view the Power Circle ratings at www.jdpower.com. The healthcare was administered by approximately 8,500 physicians affiliated with over 52 hospitals.These provider stats reflect the HMO product only. Additionally, HAP contracted with 69 urgent care centers, over 2,000 pharmacies, and over 1,000 other ancillary providers such as mental health, labs, and nursing homes to service its membership. At the end of 2010, HAP's member count was 342,635 and on a cumulative basis, HAP serviced 4,085,888 member months. These members worked with their chosen healthcare provider(s) to maintain a healthy life experience. These members utilized the access to healthcare provided in many different ways. Some major utilization of the access to providers was through hospital admissions. HAP's members incurred 18,316 hospital stay admissions during 2010 for medical and surgical procedures. Additionally, HAP's members incurred 1,652 hospital stay admissions for behavioral health related issues. Also, the members, as urged by their care providers, and by HAP through various correspondences, received care for routine and preventive services to ensure that they are leading a healthy lifestyle. This type of care is received at their physician offices. HAP spends a considerable amount of resources in communicating with its members for several different reasons. Examples of types of communications with members include:1) Preventive Care and Wellness:HAP provides its members with state-of-the-art wellness tools to help them manage their health. HAP reaches out to its members through a Website, hap.org which has links to programs for smoking cessation and weight loss activities, among other helpful programs as well. Some examples include: Worksite wellness and health promotion experts deliver results-oriented programs and services: Health screenings, health risk appraisals, disease management coordinated through the Clinical Care Management department, worksite wellness workshops, flu shots, walking programs, physical activity and nutrition programs. In 2010, HAP expanded its worksite wellness programs to more than 171 employer groups; implemented Weight Wise at Work and Hypertension Management programs; and conducted diabetic retinal and HgA1c screenings at worksites. HAP hosts quarterly forums, bringing area employers of all sizes together to share best practices in worksite wellness programs and to learn about innovative worksite wellness programs and trends. HAP's weight management program provides educational programs and special discounts to inspire people to lose weight and covers nutritional counseling, weight loss medications, doctor supervised clinical weight loss programs and bariatric surgery for members meeting specific criteria. Online tools and supportive information are available through HAP's Web site. HAP is a steward of the surrounding local community: HAP supports the Southeast Michigan region by getting involved directly with the citizens to support several causes. Some examples include: HAP executives serve on the board of directors for a variety of community organizations, such as Alternatives for Girls, Big Brothers Big Sisters of Greater Detroit, 100 Black Men of Detroit, Greater Detroit Area Health Council and Coalition on Temporary Shelter(COTS). After learning that residents of Southeastern Michigan, Detroiters in particular, were not taking advantage of available recreational centers, HAP's leaders launched HAP's signature water aerobics classes, Moms in Motion and Senior Splash Bash, which are free and open to the public; Top Chef Cooking Academy with area Boys and Girls Clubs, and POWERSIT exercise classes for seniors. More than 40 HAP volunteers read to children on Saturdays throughout the summer to promote early childhood health and literacy among African-American children through the Reading and Educational Achievement and Development Program(READ). HAP's employees raised more than $29,300 in donations for the American Heart Association. A total of 76 HAP employees participated.HAP provides ongoing education for its members on ways they can access good quality healthcare from properly credentialed healthcare providers. HAP also strives to consistently educate its members, and the community on preventive care and other wellness activities. HAP consistently reaches out to its members through publications sent to their homes regarding healthy lifestyles.2) Customer Service: HAP staffs a department dedicated to offering online, written and telephone service to resolve any issues a member may have as they are seeking medical services. The "Client Services" area at HAP will work with the provider in question to resolve any patient care issue. They will also resolve any claim payment error and any eligibility issue as well.Form 990, Part IV, Line 12: HAP is included in the consolidated financial statements of HAP and Subsidiaries. Form 990, Part IV, Line 12a: HAP has an audited statutory based financial statements. 1695271877 0 0 0 0 0 0 0 0 0 1 1 0 0 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 1 0 0 0 0 0 1 1 1 0 1 7877 0 667 1 1 1 0 0 0 0 0 0 0 0 0 0 0 X 17 15 1 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 X Ronald W Berry 3136648559 2850 West Grand Boulevard Detroit MI 48202 Susan Wells 1.00 X 0 0 0 Jethro Joseph 1.00 X 0 0 0 John T Gargaro 1.00 X 0 0 0 Marvin Beatty 1.00 X 0 0 0 William L Peirce 1.00 X 0 0 0 Linda Ewing 1.00 X 0 0 0 Lauren B Foster CPA 1.00 X 0 0 0 Karen A Wezner 1.00 X 0 0 50 Catherine A Roberts 1.00 X 0 0 0 Richard M Popp 1.00 X 0 0 0 Robin Scales-Wooten 1.00 X 0 0 0 Jack Martin 1.00 X 0 0 0 Rebecca R Smith 1.00 X 0 0 0 Nancy Schlicting 10.00 X 0 2081443 34606 William A Conway MD 10.00 X 0 474070 52259 N Charles Anderson 1.00 X X 0 0 0 William R Alvin 50.00 X X 0 614582 92955 Cindy Bala-Brusilow 1.00 X 0 0 0 Ronald W Berry 50.00 X 386168 0 40381 Maurice McMurray 50.00 X 296043 0 64907 Irita Matthews 50.00 X 108862 0 20571 David Scott 50.00 X 191562 0 5821 Christopher Pike 50.00 X 215808 0 25012 Randy Walker 50.00 X 224878 235595 38452 Donald Hirt Jr 50.00 X 245682 0 59722 Mary Beth Bolton 50.00 X 285002 0 42235 H Michael Flasch 50.00 X 238248 0 51454 Mary Ann Tournoux 50.00 X 156854 0 5389 Balakrishna Pai 50.00 X 283907 0 54352 Ibrahim Mumtaz 50.00 X 278059 0 40979 Jon Clement 50.00 X 236371 0 45947 Karen Wintringham 50.00 X 234254 0 45048 John Loomis 50.00 X 237569 0 21243 Donald Davis Jr X 231455 0 0 Francine Parker X 0 463594 1638 3850722 3869284 743021 111 1 1 0 Accenture LLP PO Box 70629 Chicago IL 60673 Software support & consulting 8473665 Patricia N Harrison 24416 Crocker Blvd Clinton Twp MI 48036 Advertising 6711710 Brian Unlimited Distribution Company 13700 Oakland Ave Highland Park MI 48203 Billing & documentation services 2978350 Logicalis Integration Solutions 34505 W Twelve Mile RdSuite 210 Farmington Hills MI 48331 Software support & consulting 1216443 Michael Flora & Associates 222 Main Street Rochester MI 48307 Advertising 1142148 73 Health Care Premiums 524114 1726430562 1726430562 1726430562 3771086 3771086 179142634 69050 175158856 63042 3983778 6008 3989786 3989786 Miscellaneous revenue 524298 49738 49738 Unrelated revenue from 541900 12405 12405 62143 1734253577 1726480300 12405 7760872 1591824877 1591824877 2703101 1786169 916932 231455 231455 49166776 44787930 4378846 6164827 5366527 798300 6333794 5513614 820180 3539600 3081248 458352 184166 184166 206508 206508 423555 423555 1142148 1142148 14215265 14208177 7088 4589213 4566009 23204 10436647 10435620 1027 1985963 1515283 470680 344307 279570 64737 123734 95090 28644 41448 41448 7460381 6216641 1243740 Miscellaneous 9535880 4452974 5082906 1710653645 1695271877 15381768 0 7922056 2848752 246203713 184941382 28257148 39670999 1922265 2779652 77263167 57983233 19220682 19279934 96179230 192163480 23898537 26063507 3796212 3796212 427399843 471543918 15833440 24875701 13459692 14931635 144651435 150291050 173944567 190098386 X 253455276 281445532 253455276 281445532 427399843 471543918 23599932 4390324 X 0 1 1 X 0 380336 380336 4901920 2885328 2016592 7824624 5789876 2034748 21941284 18779378 3161906 42215003 30528651 11686352 19279934 26063507 C 26063507 Medical Claims 120794604 Capital Lease 490687 Retiree Benefits 1326973 Pension 27678786 150291050 0 Part X: FIN 48 Disclosure HAP adopted the provisions of Financial Accounting Standards Board (FASB) Interpretation 48, Accounting for Uncertainty in Income Taxes (FIN 48)- an interpretation of FASB Statement No. 109 effective January 1, 2008. Any differences between the amounts recognized in the statements of financial position prior to the adoption of FIN No. 48 and the amounts reported after adoption are generally accounted for as a cumulative effect adjustment recorded to the beginning balance of HAP's reserves. HAP adopted the provisions of FIN No. 48 effective January 1, 2008, and its adoption did not have a material impact on HAP's consolidated financial statements. X 1 1 X X X X X 1 1 0 0 0 0 0 0 0 Nancy Schlicting 0 1201258 0 455663 0 424522 0 19647 0 14959 0 2116049 0 0 William A Conway MD 0 451443 0 0 0 22627 0 22097 0 30162 0 526329 0 0 William R Alvin 0 466597 0 120625 0 27360 0 81451 0 11504 0 707537 0 0 Ronald W Berry 351727 0 0 0 34441 0 21240 0 19141 0 426549 0 0 0 Maurice McMurray 266986 0 0 0 29057 0 49327 0 15580 0 360950 0 0 0 David Scott 141485 0 13750 0 36327 0 338 0 5483 0 197383 0 0 0 Christopher Pike 214815 0 0 0 993 0 9923 0 15089 0 240820 0 0 0 Randy Walker 56923 233170 0 0 167955 2425 14312 6961 3284 13895 242474 256451 0 0 Donald Hirt Jr 242085 0 0 0 3597 0 40144 0 19578 0 305404 0 0 0 Mary Beth Bolton 200804 0 0 0 84198 0 28684 0 13551 0 327237 0 0 0 H Michael Flasch 213036 0 0 0 25212 0 34911 0 16543 0 289702 0 0 0 Mary Ann Tournoux 132024 0 17852 0 6978 0 275 0 5114 0 162243 0 0 0 Balakrishna Pai 244973 0 0 0 38934 0 40099 0 14253 0 338259 0 0 0 Ibrahim Mumtaz 254587 0 0 0 23472 0 23238 0 17741 0 319038 0 0 0 Jon Clement 233021 0 0 0 3350 0 35415 0 10532 0 282318 0 0 0 Karen Wintringham 232061 0 0 0 2193 0 28062 0 16986 0 279302 0 0 0 John Loomis 236410 0 0 0 1159 0 19991 0 1252 0 258812 0 0 0 Donald Davis Jr 0 0 0 0 231455 0 0 0 0 0 231455 0 0 0 Francine Parker 0 0 0 0 0 463594 0 0 0 1638 0 465232 0 0 Part I, Line 1a Tax indemnification and gross-up payments: The organization offers a Supplemental Executive Retirement Program for a limited number of employees. The employees that receive this taxable benefit include 1 officer and 1 key employee. In addition, 1 Director received taxable income on travel and entertainment expenses paid by the organization associated with her attendance at a Board of Directors retreat. In addition, 2 key employees received gross-up payments related to re-location costs, these amounts were included in their taxable wages. Part I - 4a: Francine Parker ................$463,594 Donald Davis ................... 230,560 Mary Beth Bolton, M.D. ......... 75,768 4b: Ronald Berry(vested)............$ 16,231 Randy Walker(vested)............ 162,192 Walgreens Board Member/Board Member 23637577 Pharmacy Claim Payments 0 United Auto Workers Officer/Former Officer 167740244 Premium Payments for Ford Motor Co.,General Motors, & Chrysler VEBA Plans. 0 Detroit Urban League Board Member/Treasurer 261357 Premium Payments & Sponsorships for the Detroit Urban League 0 Form 990, Part VI, Section A, line 2 A business relationship exists between Ronald W. Berry, Senior Vice President and CFO of Health Alliance Plan of Michigan and N. Charles Anderson, CEO Detroit Urban League. Ronald Berry is a member and officer (Treasurer) of the Board of the Detroit Urban League and N. Charles Anderson is a member and Chairman of the Board of Health Alliance Plan of Michigan. Nancy Schlicting, President & CEO of Henry Ford Health System serves on the HAP Board of Directors. Dr. William Conway, Chief Medical Officer of Henry Ford Health System also serves on the HAP Board of Directors as a non-voting member. Form 990, Part VI, Section A, line 6 HAP is a nonprofit member corporation. The responsibility for the overall governance of the corporation is shared between the Member and the Board of Directors. HAP's sole member is Henry Ford Health System, a 501(c)(3) corporation. The President and CEO of Henry Ford Health System serves on the HAP Board of Directors. The President and CEO of HAP, who is also an employee of HFHS, serves on the HAP Board of Directors. Form 990, Part VI, Section A, line 7a The HAP Board of Directors is comprised of eighteen Directors. Two Directors are ex officio Directors: President and CEO of the Member and the President and CEO of HAP(also an employee of the Member). Six Directors are elected by the subscribers of HAP. Nine Directors are appointed by the Member's Board of Trustees. The President of HAP may appoint a Quality Officer from HFHS. As indicated above, the Henry Ford Health System may remove the President and CEO of HAP, and may remove any of the appointed Directors, with the input of the HAP Board of Directors. The Member approves the recommendations of the HAP Board of Directors regarding the appointment/removal of the HAP President and CEO, amendments to the articles of incorporation and by-laws, the budget, mergers and acquisitions, potential Directors. Form 990, Part VI, Section A, line 7b The Member has the following reserved powers under the HAP By-laws: A. Appoint Chairperson of the HAP Board of Directors. B. Adopt agreement of merger or consolidation, or approve sale, lease or exchange of Corporation's property and assets. C. Approve the transfer of assets to other organizations or individuals if sum exceeds 5% of Corporation's total assets. D. Admit person/entity as new Member or terminate Member's membership. E. Amend HAP By-laws. F. Appoint/remove President of Corporation. G. Dissolve Corporation or revoke dissolution of Corporation. H. Approve capital and operating budgets. Form 990, Part VI, Section B, line 11 The process the organization uses to review Form 990 prior to filing with the IRS: Prior to submission of the IRS Form 990, Health Alliance Plan provided the Form 990 to the Finance Committee of the HAP Board of Directors for their review. All the voting members of the Board received a complete copy of the Form 990 prior to its filing and received a written report from the Finance Committee on the results of the committee's review of the Form 990 at the October Board meeting. Form 990, Part VI, Section B, line 12c The process for regularly and consistently monitoring and enforcing compliance with the conflict of interest policy for all directors, officers and key employees: HAP has a robust compliance program. The program requires all employees and directors to complete a conflict of interest document. The documents are reviewed and maintained by the Compliance Officer. In addition, HAP is required to submit Board disclosure statements to the Michigan Office of Finance and Insurance Regulations. Thus, on an annual basis, all Directors, Officers, and key employees, and others subject to IRS Form 990 reporting will be requested to complete the Conflict of Interest Questionnaire. In addition, they will be provided a copy of the policy. The Compliance Officer tracks receipt of the Conflict of Interest Questionnaire and follows-up on any identified conflicts. All conflicts are reported to the HAP Board of Directors' Audit Committee, and the President and CEO for review and resolution. All Directors, Officers, and key employees are required, under the policy, to report to the Compliance Officer any conflicts that may arise during the year. Form 990, Part VI, Section B, line 15 The process for determining compensation for CEO, Officers and Key Employees: HAP's process for determining executive compensation is designed to meet the requirements for rebuttable presumption of reasonableness under Section 4958. The process includes review and approval by independent persons, comparability data, and contemporaneous substantiation of the deliberation and decision. CEO compensation is based upon market research data and performance as reviewed by HAP's sole member, Henry Ford Health System's Board of Trustees. HAP compared compensation of the CEO, other officers, and key employees to other HMOs in the surrounding local area with the same or similar title and documented the decisions on compensation in the board minutes. In addition, individuals were not present when their own compensation was decided. The Board of Trustees' Compensation Committee and the HFHS President and CEO are responsible for assuring that the CEO compensation is competitive, using comparative data from the local market place, meets the guidelines of HFHS's compensation philosophy, and is not deemed excess compensation. The performance evaluation and compensation are also reviewed by HAP's Compensation Committee. The Treasurer and Secretary's compensation are based upon market research data and performance as reviewed by the HAP Compensation Committee and approved by the HAP Executive Committee. The market research data is prepared and presented by an outside consulting firm. The HAP Compensation and Executive Committees are responsible for assuring that the Officers' compensation is competitive, meets the guidelines under the HAP Compensation Philosophy, is not excess compensation, and is aligned within their respective pay grades. Key Employees compensation is based upon their pay grade, performance, and the HAP Compensation Philosophy. The performance is evaluated by the immediate supervisor and any increase is based upon the salary increase range approved by the HAP Compensation Committee. These activities are coordinated by the HAP Human Resources department. Form 990, Part VI, Section C, line 19 The process of making governing documents, conflict of interest policy and financial statements available to the public: HAP is committed to the idea of transparency. Therefore, HAP consistently and regularly discloses most information to our providers, consumers, and employer groups. HAP's governing documents and conflict of interest policy are available on the internet. HAP Bylaws, Articles of Incorporation, and financial statements are submitted to the Michigan Office of Financial and Insurance Regulations. They are available to the public through a Freedom of Information Act request to this agency. In addition, HAP will provide its Form 990 to anyone who requests to view it or to receive a copy of the Form 990. The Form 990 is also available for viewing on the following website: www.guidestar.org Part XI-Reconciliation of Net Assets: Line 5 - Other Changes in net assets or fund balances: Alliance Health & Life Insurance Co Net Income..$1,265,261 HAP Preferred Net Income ....................... 1,140,083 Net unrealized gains(losses) on investments .... 3,067,150 HAP Pension Adjustment.......................... (829,391) HAP Preferred Pension Adjustment ............... ( 75,782) Transfer of Equity from CuraNet, LLC ........... (164,592) Unrelated Income from Joint Ventures ........... ( 12,405) Total Adjustments ..............................4,390,324 SCHEDULE R, PART V, LINE 1D & 1E: The organization is a member of the Henry Ford Health System Obligated Group. Members of the Obligated Group are jointly and severally liable for outstanding obligations issued under the Bond Master Indenture. SCHEDULE R, PART V, LINE 2, COL. C: All transactions involved cash transfers at the time of services rendered or received. Therefore, the cash value at the time of the transactions is considered the fair market value. Henry Ford Health System One Ford Place Detroit MI 48202 381357020 Healthcare Service Provider MI 501(c)(3) 3 N/A 0 Henry Ford Macomb Hospital Corporation One Ford Place Detroit MI 48202 382947657 Healthcare Service Provider DE 501(c)(3) 3 Henry Ford Health System 0 Detroit Osteopathic Hospital Corporation One Ford Place Detroit MI 48202 381368330 Healthcare Service Provider MI 501(c)(3) 3 Henry Ford Health System 0 Henry Ford Health System Foundation One Ford Place Detroit MI 48202 237383042 Supporting Organization MI 501(c)(3) 11a-Type 1 Henry Ford Health System 0 Henry Ford Wyandotte Hospital 2333 Biddle Ave Wyandotte MI 48192 382791823 Healthcare Service Provider MI 501(c)(3) 3 Henry Ford Health System 0 HFHS Self Funded Liability One Ford Place Detroit MI 48202 386553031 Malpractice Insurance MI 501(c)(4) n/a Henry Ford Health System 0 Downriver Center for Oncology One Ford Place Detroit MI 48202 383193008 Healthcare Service Provider MI 501(c)(3) 3 Henry Ford Health System 0 Henry Ford Continuing Care One Ford Place Detroit MI 48202 382433285 Nursing Homes MI 501(c)(3) 9 Henry Ford Health System 0 Shaped Beam Surgery LLC One Ford Place Detroit MI 48202 383570453 Operate Radiosurgery Clinic MI Henry Ford Health System Related 0 0 Northwest Detroit Dialysis 30100 Telegraph Bingham Farms MI 48025 383232668 Operate Dialysis Clinic MI Henry Ford Health System Related 0 0 GAM Renal LTD(Dialysis Partners of NW Ohio) 30100 Telegraph Bingham Farms MI 48025 341877956 Operate Dialysis Clinic OH Henry Ford Health System Related 0 0 Macomb Regional Dialysis Centers 16151 Nineteen Mile Rd Clinton Township MI 48038 260423581 Operate Dialysis Clinic MI Henry Ford Health System Related 0 0 Alliance Health and Life Insurance Company 2850 West Grand Boulevard Detroit MI 48202 383291563 Health Insurance MI N/A C 1265261 47079345 1.00000 HAP Preferred Inc 2850 West Grand Boulevard Detroit MI 48202 382513504 Provider Network Leasing MI N/A C 1140083 6658907 1.00000 Sha Realty Inc One Ford Place Detroit MI 48202 381378121 Recreational Service - Golfing MI Henry Ford Health System Foundation C Fairlane Health Services 30100 Telegraph Bingham Farms MI 48025 382565235 Healthcare Management MI Henry Ford Health System C Horizon Properties Inc One Ford Place Detroit MI 48202 382679527 Real Estate - Lessor Buildings MI Detroit Osteopathic Hospital Corp C First Optometry Eye Care Centers Inc 655 W13 Mile Rd Madison Heights MI 48071 382299059 Franchising Eye Care Centers MI Henry Ford Health System C First Optometry Vision Plans Inc 655 W13 Mile Rd Madison Heights MI 48071 382594841 Vision Care Plans MI Henry Ford Health System C Onika Insurance Ltd One Ford Place Detroit MI 48202 Captive Insurance CJ Henry Ford Health System C 0 0 0 0 0 0 0 0 0 0 1 1 1 0 1 1 0 0 HAP Preferred Inc M 274524 fair market value HAP Preferred Inc P 3858072 fair market value Alliance Health and Life Insurance Company P 11616684 fair market value HAP Preferred Inc O 5889190 fair market value Henry Ford Health System K 154514439 fair market value Henry Ford Health System L 554216376 fair market value Henry Ford Wyandotte L 31256804 fair market value Detroit Osteopathic Hospital L 3274214 fair market value Henry Ford Macomb Hospital L 38758008 fair market value Henry Ford Health System O 6745030 fair market value Henry Ford Health System O 2830436 fair market value Henry Ford Health System O 774564 fair market value Henry Ford Health System K 3319836 fair market value