| Form 990, Part III, Line 1 ORGANIZATION'S MISSION |
(CONTINUED FROM PART III) CATHOLIC HEALTH INITIATIVES, SPONSORED BY A LAY-RELIGIOUS PARTNERSHIP, CALLS TO OTHER CATHOLIC SPONSORS AND SYSTEMS TO UNITE TO ENSURE THE FUTURE OF CATHOLIC HEALTH CARE. TO FULFILL THIS MISSION, THE CORPORATION AND CATHOLIC HEALTH INITIATIVES, AS VALUE-BASED ORGANIZATIONS AND IN PARTNERSHIP WITH LAITY AND OTHERS, WILL ASSURE THE INTEGRITY OF THE MINISTRY IN BOTH CURRENT AND DEVELOPING ORGANIZATIONS AND ACTIVITIES; RESEARCH AND DEVELOP NEW MINISTRIES THAT INTEGRATE HEALTH, EDUCATION, PASTORAL, AND SOCIAL SERVICES; PROMOTE LEADERSHIP DEVELOPMENT THROUGHOUT THE ENTIRE ORGANIZATION; ADVOCATE FOR SYSTEMIC CHANGES WITH SPECIFIC CONCERN FOR PERSONS WHO ARE POOR, ALIENATED, AND UNDERSERVED; AND STEWARD RESOURCES BY GENERAL OVERSIGHT OF THE ENTIRE ORGANIZATION. |
| Form 990, Part VI, Line 16b JOINT VENTURE POLICY |
MERCY MEDICAL CENTER, INC. has not formally adopted a written policy or written procedure regarding joint ventures. However CHI's system-wide joint venture model operating agreement incorporates controls over the venture sufficient to ensure that (1) the exempt organization at all times retains control over the venture sufficient to ensure that the partnership furthers the exempt purpose of the organization; (2) in any partnership in which the exempt organization is a partner, achievement of exempt purposes is prioritized over maximization of profits for the partners; (3) the partnership does not engage in any activities that would jeopardize the exempt organization's exemption; (4) returns of capital, allocations, and distributions must be made in proportion to the partners' respective ownership interests; and (5) all contracts entered into by the partnership with the exempt organization must be at arm's-length, with prices set at fair market value. Any joint venture agreements that do not conform to the model agreement are generally reviewed by counsel. |
| Form 990, Part VI, Line 15a PROCESS USED TO ESTABLISH COMPENSATION OF TOP MANAGEMENT OFFICIAL |
The organization's top management official's compensation is paid by Catholic Health Initiatives (CHI), a related organization. CHI has a defined compensation philosophy. Both the executive and non-executive compensation structures and ranges are reviewed annually in comparison to market data. CHI uses The Korn Ferry Hay Group as the independent third party to assess executive compensation programs and to ensure the reasonableness of actual salaries and total compensation packages. Compensation of the senior most executives is reviewed annually. The Korn Ferry Hay Group reviews both cash and total compensation for overall reasonableness, for adherence to CHI's compensation philosophy, and for comparability to the not-for-profit healthcare market. This independent review is delivered by Korn Ferry Hay Group to the HR committee of the CHI Board of Stewardship Trustees annually at their September meeting and minutes are shared with the full board at the December meeting. The last review was September 13, 2016. In addition, Korn Ferry Hay Group completed a comprehensive review of all positions at the level of vice president and above in the fall of 2014 to determine and validate appropriate compensation levels. These levels have been reviewed annually since and revised based on market data, where applicable. |
| Form 990, Part VI, Line 1a Delegate broad authority to a committee |
Pursuant to Section 8.6 of the Bylaws of Mercy Medical Center, the Executive Committee is composed of the board chair, the board vice chair, the President and CEO, each of whom shall serve as an ex officio voting member of the Executive Committee, and two voting members appointed by the Board of Directors. Each individual appointed to the Executive Committee shall serve for a term of one year or until his or her successor is duly appointed by the Board of Directors. The Executive Committee shall consist of only directors of the Corporation. Pursuant to Section 8.1 of the Corporation's bylaws, committees, such as the executive committee, that are granted the authority to act on behalf of the board of directors may include only directors of the corporation. Further, pursuant to Section 8.6 of the Corporation's bylaws, the executive committee has and may exercise such powers as may be delegated to it by the board of directors. The Executive Committee also possesses the power to transact routine business of the corporation in the interim period between regularly scheduled meetings of the board of directors. |
| Form 990, Part VI, Line 3 Delegation of management duties |
Mercy Medical Center, Inc. has delegated limited control over management duties for certain hospital departments to the following management companies: Professional Management of Oregon, LLC, California Emergency Physicians, Douglas Medical Group, Umpqua Medical Group and Evergreen Family Medicine. The surgical and emergency areas are managed by these management organizations. The management companies have their own employees that they hire, fire and supervise. None of Mercy Medical Center's current or former officers, directors, etc. have received compensation from the management companies during the 2015 calendar year. |
| Form 990, Part VI, Line 6 Classes of members or stockholders |
ACCORDING TO THE BYLAWS OF MERCY MEDICAL CENTER, INC., THE ENTITY'S SOLE MEMBER IS CATHOLIC HEALTH INITIATIVES, A COLORADO NONPROFIT CORPORATION. |
| Form 990, Part VI, Line 7a Members or stockholders electing members of governing body |
According to the organization's bylaws, directors shall be appointed or refused by the corporate member. The corporate member may appoint one or more individuals to the board of directors, and may at any time remove, with or without cause, any member of the board of directors. According to the organization's bylaws, directors of the corporation shall be appointed by the corporate member no later than June 30 of each year. The names and qualifications of each individual accepted by the board of directors shall be submitted to the corporate member, who shall appoint or refuse each nominee in accordance with the corporate member's bylaws and with endorsement of the senior vice president of operations. The corporate member may unilaterally appoint one or more individuals to the board of directors should the board fail to furnish the corporate member with a list of individuals qualified to serve on the board of directors of the corporation. |
| Form 990, Part VI, Line 7b Decisions requiring approval by members or stockholders |
The organization's corporate member is Catholic Health Initiatives ("CHI"). Pursuant to Section 5.4 of the organization's bylaws, both Mercy Medical Center, Inc.and Catholic Health Initiatives ("CHI") have reserved powers as outlined in the CHI governance matrix. Pursuant to the governance matrix the following rights are held by the CHI Board: *Approve members of the Mercy Medical Center, Inc. board *Amendment of the corporate documents of the Mercy Medical Center, Inc. *Approve removal of a member of the governing body of the Mercy Medical Center, Inc. *Adoption of long range and strategic plans for the Mercy Medical Center, Inc. The following rights are reserved to the CHI Board directly or through powers delegated to the CHI Chief Executive Officer: *Substantial change in the mission or philosophy of the Mercy Medical Center, Inc. *Removal of a member of the governing body of the Mercy Medical Center, Inc. *Approval of issuance of debt by Mercy Medical Center, Inc. *Approval of participation of Mercy Medical Center, Inc. in a joint venture *Approval of formation of a new corporation by Mercy Medical Center *Approval of a merger involving the Mercy Medical Center, Inc. *Approval of the sale of all or substantially all of the assets of the Mercy Medical Center Inc. *To require the transfer of assets by the Mercy Medical Center, Inc. to CHI to accomplish CHI's goals and objectives, and to satisfy CHI debts. Pursuant to Section 5.5.2 of the organization's bylaws, CHI may, in exercise of their approval powers, grant or withhold approval in whole or in part, or may, in its complete discretion, after consultation with the Board and its President and the Chief Executive Officer of the organization, recommend such other or different actions as it deems appropriate. |
| Form 990, Part VI, Line 11b Review of form 990 by governing body |
Once the return is prepared, the return is reviewed by the Chief Financial Officer and Controller. A copy of the draft return is made available to board members that would like to review it. Subsequent to the review by the CFO, the tax department files the return with the appropriate federal and state agencies, making any non-substantive changes necessary to effect e-filing. Any such changes are not re-submitted to the board. |
| Form 990, Part VI, Line 12c Conflict of interest policy |
Catholic Health Initiatives ("CHI") has a Conflicts of Interest ("COI") policy in place to maintain the integrity of all of its activities. The policy applies to CHI Board of Stewardship Trustees and members of its committees; all board and board committee members of CHI Entities; all CHI employees; all CHI physicians (both employed and non-employed) and all physician administrators and leaders; advanced practice clinicians (both employed and non-employed); and all CHI research personnel (both employed and non-employed). Disclosure, review and management of perceived, potential or actual conflicts of interest are accomplished through a defined COI disclosure process. Each person has a general ongoing obligation to promptly and fully report to his/her direct manager, supervisor, medical staff office, board or board committee chair any situation or circumstance that may create a conflict of interest. The person must report the actual or potential conflict as soon as she/he becomes aware of it. In any situation where the person may be in doubt, a full disclosure should be made to permit an impartial and objective determination. In addition to the general ongoing obligation, there are initial disclosure obligations. The board, board committee members, and new employees are required to make disclosures at the time of their initial hiring/appointment. All non-employed, credentialed or contracted physicians are required to make disclosures at the time of their credentialing and during any subsequent reappointment or recredentialing. All researchers are required to make disclosures upon consideration of affiliation with a research sponsor. In addition to the general ongoing and initial disclosure obligations, there is an annual disclosure obligation. All corporate officers, board and board committee members, employees at the level of manager and above, researchers, supply chain employees, employed physicians, physician administrators and leaders, and employed advanced practice clinicians must complete a new conflict of interest disclosure annually. Disclosures of perceived, potential or actual conflicts involving financial interests are forwarded to the Conflicts of Interest Review Committee ("C-CIRC") or Legal Services Group for review depending on the position of the person involved. The C-CIRC reviews COI questionnaires containing disclosures of perceived or possible conflicts for employees at a level of manager or above, supply chain employees, researchers and physicians, physician administrators and leaders, and advanced practice clinicians (both employed and non-employed). In the determination of a conflict, a COI management plan will be developed for that person. With respect to those audiences for which the C-CIRC has review responsibility, the C-CIRC will facilitate development of any such conflict of interest management plan in collaboration with local CRP staff. A designated CHI Entity staff will be responsible for monitoring the COI management plan and for documenting monitoring activities. At its sole discretion, a CHI Entity may reject a Person's request to enter into the relationship in question, or require the relationship be sufficiently altered to avoid a potential COI. If the C-CIRC determines that there is a potential or actual conflict of interest that does not currently have appropriate controls to address the conflict of interest, it may recommend that the disclosing person be allowed to participate in the activity or transaction subject to restrictions as outlined in the COI management plan. If a Person does not agree with a determination made by the C-CIRC, its interpretation of the Policy or Addenda, or seeks an exemption or exception, the following steps should be followed. The Employee disputing the review decision, interpretation of the Policy, or seeking exemption or exception must present the matter to the Employee's immediate direct manager or supervisor for review and determination. If the Employee and the manager do not agree with the review decision, interpretation of the Policy, or seek exemption or exception, the manager shall consult with the manager's Vice President (or higher if the manager is a Vice President) to reach a determination. If the matter remains unresolved, it shall be referred to the CHI Vice President of Human Resources and the CHI Corporate Responsibility Officer. If they are unable to reach agreement, the matter shall be referred to the CHI General Counsel, whose decision shall be final. Reviews and determinations involving board and board committee members and corporate officers will be the responsibility of the board, board executive committee, or board chair, with guidance from the Legal Services Group (LSG). Annual COI disclosures of all trustee and corporate officers will be reviewed by the CHI Senior Vice President, Legal Services, and General Counsel or his or her designee who will report potential conflicts to the applicable Board Chair. The Board Chair or designee shall make such further investigation of any conflict of interest disclosures as he or she may deem appropriate. If the conflict involves the Board Chair, the Vice Chair will assume the Chair's role. Based on review and evaluation of the relevant facts and circumstances, the Board Chair will make an initial determination as to whether a conflict of interest exists and whether, pursuant to the COI Policy, review and approval or other action by the Board is required. A written record of the Board Chair's determination, including relevant facts and circumstances, will be made. The Board Chair shall then make an appropriate report to the Executive Committee of the Board concerning such review, evaluation and determination. If a difference of opinion exists between the Board Chair and another Trustee as to whether the facts and circumstances of a given situation constitute a conflict of interest or whether Board review and approval or other action is required within the COI Policy, the matter shall be submitted to the Board's Executive Committee, which shall make a final determination as to the matter presented. Such determination, including relevant facts and circumstances, will be reflected in the Executive Committee minutes and will be reported to the Board. When any conflict of interest is considered by the board, the trustee or corporate officer, as appropriate, must disclose all of the material facts to the Board. The trustee shall not vote and the trustee or corporate officer shall not use his or her personal influence on the matter. The trustee or corporate officer shall be excused from the meeting during discussion and vote on the conflict of interest. In reviewing such transactions between CHI or CHI Entities and vendors or other contractors who are, or are affiliated with, Trustees or Corporate Officers, the Board will act as it would in reviewing transactions with unrelated third parties. The transaction is not to be approved unless the Board determines that the transaction is fair to CHI or the CHI Entity. The Board must approve the transaction by a majority of the Trustees on the Board, without counting the vote of any individual who has an interest in the transaction. All determinations of conflicts of interest are reported as required by law, regulations, and CHI policy. |
| Form 990, Part VI, Line 15b Process to establish compensation of other employees |
MERCY MEDICAL CENTER, INC ANNUALLY SEEKS COMPARABLE MARKET DATA FOR THEIR VPS FROM AN INDEPENDENT SOURCE. THE DATA IS PRESENTED TO A SUBCOMMITTE OF THE BOARD WHO APPROVES ANY INCREASES FROM A MARKET PERSPECTIVE. INCREASES ARE RECOMMENDED DEPENDING ON THE DATA AND FINANCES. FOR KEY PERSONNEL THAT HAVE EMPLOYMENT CONTRACTS IN PLACE, THE CONTRACT IS FOLLOWED FOR ANY INCREASES (MOST CONTRACTS ARE FOR 3 YRS). CONTRACT RENEWALS ARE APPROVED BY A PHYSICIAN TRANSACTION COMMITTEE. EMPLOYEES THAT HAVE EMPLOYMENT CONTRACTS AREN'T PART OF THE MERIT OR MARKET REVIEW PROCESS. PERSONS ELIGIBLE FOR MERIT INCREASES HAVE AN ANNUAL EVALUATION THAT IS APPROVED BY THE HIGHEST LEVEL OF SENIOR MANAGEMENT. During the tax year ended 6/30/15, certain officers, directors and/or trustees received compensation from related organizations. Any executive compensation paid to officers, directors or trustees by related organizations was set by the related organization's compensation committee utilizing both an independent consultant and comparability studies to determine compensation. |
| Form 990, Part VI, Line 19 Required documents available to the public |
The organization's financial statements, conflict of interest policy and governing documents are available to the public upon request. The organization's financial statements are included in Catholic Health Initiatives' consolidated audited financial statements that are available at www.catholichealthinitiatives.org or at www.DACBOND.org. |
| Form 990, Part IX, Line 11g Other Fees |
Other Fees for Services - Total Expense: 1115760, Program Service Expense: 761968, Management and General Expenses: 353792, Fundraising Expenses: ; Contract Labor - Total Expense: 7839794, Program Service Expense: 7839794, Management and General Expenses: , Fundraising Expenses: ; Purchased Services - Total Expense: 13077010, Program Service Expense: 13077010, Management and General Expenses: , Fundraising Expenses: ; Contract Services - Total Expense: 11189413, Program Service Expense: 11189413, Management and General Expenses: , Fundraising Expenses: ; |
| Form 990, Part XI, Line 9 Other changes in net assets or fund balances |
Capital Pool Contribution - -2773584; |
Attach to Form 990 or 990-EZ.