TY 2017 Form 990 Schedule O

efile Public Visual Render ObjectId: 201932739349301358 - Submission: 2019-09-30 TIN: 58-1649541

SCHEDULE O
(Form 990 or 990-EZ)

Department of the Treasury
Internal Revenue Service

Supplemental Information to Form 990 or 990-EZ

Complete to provide information for responses to specific questions on
Form 990 or 990-EZ or to provide any additional information.
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Attach to Form 990 or 990-EZ.
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Go to www.irs.gov/Form990 for the latest information.

OMB No. 1545-0047

2017

Open to Public
Inspection

Name of the organization

WELLSTAR HEALTH SYSTEM INC

Employer identification number

58-1649541

Return Reference	Explanation
FORM 990, HEADING, ITEM B, AMENDED RETURN	THE WELLSTAR HEALTH SYSTEM, INC. 2017 FORM 990 HAS BEEN AMENDED TO UPDATE TRANSACTIONS BETWEEN AFFILIATES. FORM 990, PART III, LINE 4A PROGRAM SERVICE ACCOMPLISHMENTS WELLSTAR HEALTH SYSTEM IS A VERTICALLY INTEGRATED HEALTH CARE DELIVERY SYSTEM WHICH PROVIDES THROUGH AFFILIATED BUSINESS ORGANIZATIONS A FULL SPECTRUM OF HEALTH SERVICES, INCLUDING WELLNESS PROGRAMS, PHYSICIAN OFFICE VISITS, OUTPATIENT CARE, INPATIENT CARE, AND POST-ACUTE SERVICES SUCH AS HOME HEALTH, HOSPICE AND LONG-TERM NURSING CARE. THE SYSTEM THROUGH ITS AFFILIATED BUSINESS ORGANIZATIONS OPERATES 11 HOSPITALS (KENNESTONE, COBB, PAULDING MEDICAL CENTER, DOUGLAS, WINDY HILL, ATLANTA MEDICAL CENTER DOWNTOWN AND SOUTH, NORTH FULTON, SPALDING, SYLVAN GROVE AND WEST GEORGIA), MULTIPLE PHYSICIAN OFFICES, PRIMARY CARE CENTERS, OUTPATIENT CARE FACILITIES, A NURSING HOME AND OTHER HEALTH RELATED SERVICES INCLUDING TWO INPATIENT HOSPICE FACILITIES. THE SYSTEM IS SUPPORTED FINANCIALLY BY A FUNDRAISING ORGANIZATION, WELLSTAR FOUNDATION, INC. THE SERVICE AREA FOR THE SYSTEM ENCOMPASSES PARTS OF THE NORTHWESTERN, CENTRAL AND WESTERN SECTIONS OF THE STATE OF GEORGIA - THE PRIMARY AREA BEING IN BARTOW, CHEROKEE, COBB, DOUGLAS, PAULDING, FULTON, BUTTS, SPALDING AND TROUP COUNTIES. APPROXIMATELY MORE THAN 90% OF INPATIENT DISCHARGES AND OUTPATIENTS SERVED ARE FROM THE AFOREMENTIONED COUNTIES. THE WELLSTAR VISION IS TO DELIVER WORLD CLASS HEALTHCARE. OUR MISSION IS TO CREATE AND DELIVER HIGH QUALITY HOSPITAL, PHYSICIAN AND OTHER HEALTHCARE RELATED SERVICES THAT IMPROVE THE HEALTH AND WELL-BEING OF THE INDIVIDUALS AND COMMUNITIES WE SERVE. HISTORY IN 1993, WHAT WAS THEN KNOWN AS THE COBB HEALTH SYSTEM, THE KENNESTONE REGIONAL HEALTH CARE SYSTEM, AND THE DOUGLAS GENERAL HOSPITAL AFFILIATED TO FORM THE NORTHWEST GEORGIA HEALTH SYSTEM. PAULDING MEMORIAL MEDICAL CENTER AFFILIATED WITH NORTHWEST GEORGIA HEALTH SYSTEM IN 1994. IN 1994, THE NORTHWEST GEORGIA HEALTH SYSTEM HELPED FORM THE PROMINA HEALTH SYSTEM AND CHANGED ITS NAME TO PROMINA NORTHWEST HEALTH SYSTEM. IN 1998, PROMINA NORTHWEST HEALTH SYSTEM CHANGED ITS NAME TO WELLSTAR HEALTH SYSTEM. WELLSTAR DISASSOCIATED FROM AND BECAME TOTALLY INDEPENDENT OF PROMINA IN 1999. IN 2016 WELLSTAR ACQUIRED ATLANTA MEDICAL CENTER, NORTH FULTON HOSPITAL, SPALDING HOSPITAL, SYLVAN GROVE HOSPITAL AND WEST GEORGIA MEDICAL CENTER. WELLSTAR HEALTH SYSTEM IS A PARENT CORPORATION, WHICH PROVIDES OVERALL COORDINATION INCLUDING GOVERNING BODY TO ITS 11 AFFILIATES: - COBB HOSPITAL, INC.; - CHS FOUNDATION, INC. (INVESTMENT MANAGEMENT); - DOUGLAS HOSPITAL INC.; - KENNESTONE HOSPITAL, INC.; - PAULDING MEDICAL CENTER, INC.; - WELLSTAR FOUNDATION INC.; - WELLSTAR ATLANTA MEDICAL CENTER, INC.; - WELLSTAR NORTH FULTON HOSPITAL, INC.; - WELLSTAR SPALDING REGIONAL HOSPITAL, INC.; - WELLSTAR SYLVAN GROVE HOSPITAL, INC.; - WELLSTAR WEST GEORGIA HEALTH SERVICES, INC.
SERVICES	WELLSTAR HEALTH SYSTEM IS ABLE TO OFFER A FULL RANGE OF HEALTHCARE SERVICES THROUGH ITS AFFILIATES. THE SERVICES OFFERED INCLUDE BUT ARE NOT LIMITED TO: - MOST MAJOR INPATIENT CLINICAL SERVICES, - OUTPATIENT SERVICES, - DIAGNOSTIC AND THERAPEUTIC SERVICES, - ANCILLARY AND SUPPORT SERVICES, - URGENT CARE SERVICES, - HOME HEALTH SERVICES, - SKILLED NURSING SERVICES AND - HOSPICE SERVICES. THE 11 HOSPITAL LOCATIONS ARE ACUTE CARE FACILITIES WITH INPATIENT, OUTPATIENT, AND EMERGENCY SERVICES. THE SYSTEM INCLUDES A RESIDENTIAL FACILITY ON THE KENNESTONE HOSPITAL CAMPUS, CALLED ATHERTON PLACE. ATHERTON PLACE ALSO HOUSES AN ASSISTED LIVING UNIT AS AN ADDITIONAL LEVEL OF CARE. PAULDING MEDICAL CENTER IS HOME TO A FULL CARE NURSING HOME, PAULDING NURSING CENTER AND WEST GEORGIA MEDICAL CENTER IS ALSO HOME TO TWO FULL CARE NURSING HOMES. VERNON WOODS RETIREMENT COMMUNITY IS AN ASSISSTED LIVING FACILITY. COBB HOSPITAL IS HOME TO A HOME HEALTH AGENCY AND A RESIDENTIAL HOSPICE FACILITY CALLED TRANQUILITY FOR THOSE PATIENTS IN THE END STAGES OF LIFE. KENNESTONE HOSPITAL ALSO OPENED A RESIDENTIAL HOSPICE FACILITY NOT FAR FROM ITS MAIN CAMPUS. THE SYSTEM IS COMPLIMENTED WITH APPROXIMATELY 275 PHYSICIAN PRACTICES AND SEVERAL URGENT CARE CENTERS. THE SYSTEM IS THUS ABLE TO PROVIDE A COMPLETE CONTINUUM OF CARE FOR THE COMMUNITY IT SERVES. THE FOLLOWING STATEMENTS OF COMMUNITY BENEFIT AND PROGRAM SERVICE ACCOMPLISHMENTS REPRESENT SYSTEM-WIDE ACTIVITY FOR WELLSTAR HEALTH SYSTEM, INC. (THE "SYSTEM") - EIN 58-1649541. ALL AFFILIATED ENTITIES OF THE SYSTEM EXCEPT THE PHYSICIAN HOSPITAL ORGANIZATION (EIN 58-2116179) OPERATE AS CHARITABLE ORGANIZATIONS CONSISTENT WITH THE REQUIREMENTS OF INTERNAL REVENUE CODE SECTION 501(C)(3) AND THE "COMMUNITY BENEFIT STANDARD" OF IRS REVENUE RULING 69-545. THE FOLLOWING EXCERPT FROM THE AUDITED FINANCIAL STATEMENTS IDENTIFIES A BROAD OVERVIEW OF THE CHARITABLE PURPOSE FOR THE SYSTEM. "THE SYSTEM MAINTAINS RECORDS TO IDENTIFY AND MONITOR THE LEVEL OF CHARITY CARE IT PROVIDES THROUGH ITS AFFILIATES. THESE RECORDS INCLUDE THE AMOUNT OF CHARGES FOREGONE FOR SERVICES AND SUPPLIES FURNISHED UNDER ITS COMMUNITY FINANCIAL AID POLICY." IN FISCAL YEAR 2018 AND 2017, WELLSTAR AFFILIATE HOSPITALS MADE $255.6 MILLION AND $251.9 MILLION, RESPECTIVELY, IN PROVIDER PAYMENTS AND RECOGNIZED SUCH PAYMENTS AS A REDUCTION IN NET PATIENT SERVICE REVENUE IN THE ACCOMPANYING COMBINED FINANCIAL STATEMENTS. THE SYSTEM ALSO PARTICIPATES IN CERTAIN GOVERNMENTAL INSURANCE PROGRAMS, INCLUDING MEDICARE AND MEDICAID. UNDER THESE PROGRAMS, THE SYSTEM PROVIDES CARE TO PATIENTS AT PAYMENT RATES WHICH ARE DETERMINED BY THE FEDERAL AND STATE GOVERNMENTS, REGARDLESS OF THE SYSTEM'S ACTUAL CHARGES. IN MOST CASES, THESE PROGRAMS PAY THE SYSTEM AT AMOUNTS WHICH ARE LESS THAN ITS COST OF PROVIDING SERVICES. THE SYSTEM OFFERS MANY WELLNESS AND EDUCATIONAL SERVICES AT LITTLE OR NO COST TO THE COMMUNITY. HEALTH FAIRS ARE HELD THROUGHOUT THE YEAR AT CONVENIENT LOCATIONS, PROVIDING VARIOUS HEALTH SCREENINGS, SUCH AS MAMMOGRAMS, BONE DENSITY, BLOOD PRESSURE AND CHOLESTEROL CHECKS. A LARGE NUMBER OF EDUCATIONAL PROGRAMS ARE OFFERED FOR ALL AGES. THESE PROGRAMS INCLUDE BICYCLE SAFETY, CAR SEAT SAFETY, DEFENSIVE DRIVING, CPR AND FIRST-AID CLASSES. FLU SHOTS ARE AVAILABLE TO THE COMMUNITY DURING FLU SEASON AND HEALTH SCREENINGS, MEDICAL SUPPLIES, AND IMMUNIZATIONS ARE PROVIDED TO CHILDREN THROUGH LOCAL HEALTH DEPARTMENTS AND HEALTH FAIRS. THE COSTS OF THESE SERVICES ARE INCLUDED IN UNRESTRICTED REVENUE, GAINS AND OTHER SUPPORT IN EXCESS OF EXPENSES AND LOSSES IN THE FINANCILA STATEMENTS.THE PHYSICIANS OF THE SYSTEM MAKE SIGNIFICANT CONTRIBUTIONS TO IMPROVE THE HEALTH STATUS OF THE COMMUNITY, INCLUDING INVOLVEMENT IN MANY COMMUNITY ACTIVITIES PROMOTING HEALTH AWARENESS AND IMPROVEMENT, EMERGENCY ROOM CARE, AND DELIVERY OF CARE TO THE INDIGENT POPULATION OF THE SYSTEM'S SERVICE AREA. THE SYSTEM ALSO MADE SIGNIFICANT CONTRIBUTIONS TO THE NURSING PROGRAM AT A LOCAL UNIVERSITY. THIS FINANCIAL SUPPORT HAS HELPED TO GROW THE PROGRAM, WHICH BENEFITS THE SYSTEM AS WELL AS THE COMMUNITY. THE SYSTEM AND ALL BUT ONE OF ITS AFFILIATES HAVE BEEN RECOGNIZED AS ORGANIZATIONS EXEMPT FROM FEDERAL INCOME TAX UNDER INTERNAL REVENUE CODE SECTION 501(A) AS ORGANIZATIONS DESCRIBED IN SECTION 501(C)(3) AND, THEREFORE, RELATED INCOME IS GENERALLY NOT SUBJECT TO FEDERAL OR STATE INCOME TAXES. ONE OF THE SYSTEM'S AFFILIATES IS A CONTROLLED FOREIGN CORPORATION NOT SUBJECT TO FEDERAL INCOME TAX. THE PHYSICIAN HOSPITAL ORGANIZATION (EIN 58-2116179) IS A TAXABLE AFFILIATE OF THE SYSTEM AND FILES IRS FORM 1120 US CORPORATION INCOME TAX RETURN."
FINANCIAL & DATA STATISTICS	SERVICES PROVIDED SYSTEM-WIDE: LICENSED BEDS 2,775 ADULT DISCHARGES 114,306 NEWBORN DISCHARGES 14,959 EMERGENCY ROOM VISITS 658,118 SURGERIES - 68950 CATH LAB/PACEMAKERS/EP 18,029 NON-ED O/P RADIOLOGY PROCEDURES 459,418 MED/SURG. SHORT STAY CASES 1,462 GI LAB PROCEDURES 10,628 RADIOLOGY ONCOLOGY PROCEDURES 31,718 COMMUNITY BENEFITS WELLSTARS COMMUNITY EDUCATION & OUTREACH DEPARTMENT PROVIDES FREE BROCHURES ON A VARIETY OF HEALTH-RELATED ISSUES. WELLSTAR PROVIDES SUPPORT GROUPS AND EDUCATIONAL OPPORTUNITIES TO THE COMMUNITY ON A VARIETY OF TOPICS INCLUDING MEN'S AND WOMEN'S HEALTH ISSUES, CARDIAC HEALTH, NUTRITION, CANCER, AND DIABETES. SOME OF THESE OPPORTUNITIES ARE PROVIDED FREE OF CHARGE OR AT A MINIMAL FEE. WELLSTAR ALSO PROVIDES FREE HEALTH SCREENINGS SUCH AS BLOOD PRESSURE, CHOLESTEROL, GLUCOSE, BONE DENSITY AND WEIGHT ASSESSMENT. COMMUNITY EDUCATION & OUTREACH PROVIDES HEALTH AND WELLNESS PROGRAMS AND SERVICES ACROSS ALL WELLSTAR MARKETS REACHING OVER 450,000 PEOPLE ANNUALLY. SOME OF THE MORE SPECIFIC PROGRAM/DEPARTMENTS ARE DOCUMENTED AS FOLLOWS: CLINICS: WELLSTAR IS AFFILIATED WITH SEVERAL CLINICS WHICH PROVIDE FREE OR SLIDING SCALE HEALTH SERVICES TO PERSONS WHO CANNOT AFFORD TO PAY OR THOSE WHO ARE NOT EXPECTED TO PAY. SCHOOL HEALTH PROGRAM: THIS PROGRAM TEACHES CHILDREN ABOUT HEALTH AND SAFETY TOPICS TO INCLUDE NUTRITION, PHYSICAL ACTIVITY, HYGIENE, BIKE AND PEDESTRIAN SAFETY AND MORE. THE PROGRAMS ARE CURRENTLY TAUGHT IN ELEMENTARY SCHOOLS (GRADES K-5) AND MIDDLE SCHOOLS (GRADES 6-8) IN CHEROKEE, COBB, DOUGLAS AND PAULDING COUNTIES. SAFE KIDS: WELLSTAR IS A CO-LEAD AGENCY FOR SAFE KIDS COBB COUNTY ALONG WITH COBB AND DOUGLAS PUBLIC HEALTH. SAFE KIDS COBB COUNTY IS COMMITTED TO REDUCING AND PREVENTING ACCIDENTAL INJURIES TO CHILDREN AGES 19 AND UNDER IN COBB COUNTY BY HOSTING SAFETY EDUCATION EVENTS AND DISTRIBUTING SAFETY EDUCATION MATERIALS AND EQUIPMENT THROUGHOUT THE COUNTY TO FAMILIES IN NEED. SAFETY AREAS OF FOCUS INCLUDE: CHILD PASSENGER, PEDESTRIAN, WHEEL, HOME, POISON PREVENTION AND WATER. EQUIPMENT DISTRIBUTION INCLUDES: CAR AND BOOSTER SEATS, BICYCLE HELMETS AND REFLECTORS, SMOKE/CARBON MONOXIDE ALARMS, HOME SAFETY KITS AND LIFEJACKETS. MOST OF THE EVENTS ARE FREE AND OPEN TO THE PUBLIC. THE IMPORTANT MESSAGE TAUGHT AT THESE EVENTS IS THAT SAFETY BEGINS WITH THE PARENTS AND CAREGIVERS. ANNUALLY, NEARLY 800 CAR SEATS ARE PRESENTED TO FAMILIES IN NEED, AND NEARLY 2,500 INFANT CAR SEATS ARE CHECKED AT OVER 130 CAR SEAT EVENTS. WOMEN & CHILDREN RESOURCE CENTERS: THE WOMEN'S AND CHILDREN'S RESOURCE CENTER AT COBB, DOUGLAS, AND KENNESTONE HOSPITALS PROVIDE MUCH NEEDED SUPPORT FOR MOTHERS AND THEIR NEWBORN BABIES THROUGH INPATIENT AND OUTPATIENT CONSULTATIONS, WARM LINE PHONE CALLS, CHILDBIRTH, NEWBORN CARE AND BREASTFEEDING CLASSES, AN ANNUAL MATERNITY AND BABY FAIR, AS WELL AS OTHER EDUCATIONAL OPPORTUNITIES. THESE PROGRAMS DEMONSTRATE WELLSTARS COMMITMENT TO THE HEALTH AND WELL-BEING OF THE NEW MOTHERS AND THEIR BABIES IN OUR COMMUNITY. IN FY2018 THE UNREIMBURSED COSTS ASSOCIATED WITH THE PROGRAM TOTALED APPROXIMATELY $400,000 AND MORE THAN 7,000 PARENTS PARTICIPATED IN PRENATAL AND CHILDBIRTH PROGRAMS. THE GOOD LIFE CLUB: WELLSTAR PROVIDES A SPECIAL PROGRAM FOR AREA RESIDENTS AGE 50 AND OLDER CALLED THE GOOD LIFE CLUB. THIS PROGRAM PROVIDES HEALTHY AGING RESOURCES AND PROMOTES HEALTH, WELLNESS, AND AN ACTIVE LIFESTYLE THROUGH CLASSES, HEALTH SCREENINGS AND OTHER OPPORTUNITIES. A SMALL ONE-TIME FEE COVERS A LIFETIME MEMBERSHIP AND INCLUDES: - HEALTH AND WELLNESS EDUCATION AND PROGRAMS - A QUARTERLY NEWSLETTER - FREE HEALTH SCREENINGS - DISCOUNTED PARKING AT HOSPITALS AND OTHER RETAIL DISCOUNTS - TRAVEL DISCOUNTS THE GOOD LIFE CLUB CURRENTLY HAS MORE THAN 2,000 MEMBERS. COMMUNITY ACTIVITIES - WELLSTAR HAS PARTNERED WITH A LOCAL COLLEGE, KENNESAW STATE UNIVERSITY ("KSU") TO DEVELOP EDUCATIONAL AND ON-SITE TRAINING PROGRAMS WHICH WILL HOPEFULLY IMPROVE THE CURRENT AND FUTURE HEALTH OF OUR COMMUNITY. MANY OF THE NURSES IN THE SYSTEM ARE TRAINED THROUGH THE NURSING PROGRAM OFFERED BY KSU. WELLSTAR IS ALSO AFFILIATED WITH THE CHATTAHOOCHEE TECHNICAL COLLEGE- NORTH METRO CAMPUS'S RADIOLOGIC TECHNOLOGY PROGRAM. WELLSTAR SERVES AS THE CLINICAL AFFILIATE FOR THE STUDENTS IN THIS TWO-YEAR PROGRAM. THE STUDENTS TRAIN AT WELLSTAR'S HOSPITALS AND OUTPATIENT FACILITIES. THE PROGRAM RECEIVED ACCREDITATION FROM THE JOINT REVIEW COMMITTEE ON EDUCATION IN RADIOLOGIC TECHNOLOGY. THE GOAL IS TO HAVE TRAINED STUDENTS WHO CAN SUBSEQUENTLY CONTRIBUTE TO THE HEALTH OF THE COMMUNITY WE SERVE. COMMUNITY PARTNERSHIPS AND SPONSORSHIPS - COMMUNITY EDUCATION & OUTREACH IS RESPONSIBLE FOR DEVELOPING AND CULTIVATING STRATEGIC COMMUNITY PARTNERSHIPS BY ALIGNING WELLSTARS STRATEGIC GOALS, COMMUNITY DEVELOPMENT OPPORTUNITIES AND THE PRIORITY HEALTH NEEDS OF OUR LOCAL COMMUNITIES. SPONSORSHIPS PROVIDE AN OPPORTUNITY TO SUPPORT WELLSTARS MISSION TO IMPROVE THE HEALTH AND WELL-BEING OF THE COMMUNITIES WE SERVE BY SUPPORTING ORGANIZATIONS AND EVENTS AS A SPONSOR. ORGANIZATIONS INCLUDE THE AMERICAN HEART ASSOCIATION, AMERICAN CANCER SOCIETY, AMERICAN LUNG ASSOCIATION, THE AMERICAN DIABETES ASSOCIATION, MARCH OF DIMES, AS WELL AS NUMEROUS LOCAL ORGANIZATIONS. MANY EMPLOYEES ALSO VOLUNTEER AND PARTICIPATE IN SOME OF THE EVENTS HELD BY THESE ORGANIZATIONS SUCH AS WALKS, FUNDRAISERS AND SCREENINGS. IN FY2018 THE TOTAL UNCOMPENSATED CARE, OTHER COMMUNITY BENEFITS AND COMMUNITY INVESTMENTS PROVIDED BY WELLSTAR WAS OVER $ 939 MILLION. COMMITMENT TO THE COMMUNITY BREAKDOWN: CHARITY & INDIGENT (UNCOMPENSATED CARE COSTS) - $ 255,954,000 MEDICAID SHORTFALLS (UNCOMPENSATED CARE COSTS) - $ 86,107,000 MEDICARE SHORTFALLS (UNCOMPENSATED CARE COSTS) - $ 206,724,000 OTHER PATIENTS (UNCOMPENSATED CARE COSTS) - $ 127,756,000 TOTAL UNCOMPENSATED CARE - $ 676,541,000 OTHER COMMUNITY PROGRAMS (PARTICIPATION IN COALITIONS) - $ 345,000 OTHER COMMUNITY PROGRAMS (COMMUNITY HEALTH EDUCATION) - $ 249,000 OTHER COMMUNITY PROGRAMS (HEALTH CARE SUPPORT) - $ 7,777,000 TOTAL OTHER COMMUNITY PROGRAMS - $ 8,371,000 COMMUNITY INVESTMENTS (FUNDS BACK INTO INFRASTRUCTURE) - $ 245,436,000 COMMUNITY INVESTMENTS (ALLIED HLTH/MEDICAL EDUCATION) - $ 9,456,000 COMMUNITY INVESTMENTS (OPERATIONS - STAFF/SOFTWARE) - $ 92,000 TOTAL COMMUNITY INVESTMENTS - $ 254,984,000 WELLSTAR CONTINUES TO PARTICIPATE IN THE CENTER FOR MEDICARE AND MEDICAID SERVICES (CMS) MEDICARE SAVINGS PROGRAM AS AN ACCOUNTABLE CARE ORGANIZATION (ACO). WELLSTARS ACO IS THE LARGEST ACO IN GEORGIA INCLUDING 50,000 MEMBERS AND 1,400 PHYSICIANS. THE ACO HAS BEEN RECOGNIZED AS ONE OF THE TOP 100 ACOS IN THE COUNTRY. THE PROGRAM HAS BEEN SUCCESSFUL THROUGH A FOCUS ON WELLNESS AND THE IMPROVED MANAGEMENT OF CHRONIC ILLNESSES AND THE RELATED COORDINATION OF CARE, TO ENSURE PATIENTS, ESPECIALLY CHRONICALLY ILL, GET THE RIGHT CARE AT THE RIGHT TIME TO MAINTAIN THEIR OPTIMAL HEALTH, AND AVOID THE NEED FOR HIGH-COST EMERGENCY AND HOSPITAL CARE.
AWARDS, RECOGNITION AND ACCOMPLISHMENTS	WELLSTAR HEALTH SYSTEM (WELLSTAR) WAS RECOGNIZED FOR DIVERSITY IN THE WORKPLACE. DIVERSITY MAGAZINE LISTS WELLSTAR AS ONE OF ITS 50 BEST PLACES FOR WOMEN AND DIVERSE MANAGERS TO WORK. WELLSTAR WEST GEORGIA MEDICAL CENTER (WGMC) WAS NAMED TO BECKER HOSPITAL REVIEW'S 2016 LIST OF "100 GREAT COMMUNITY HOSPITALS." WGMC IS ONE OF ONLY THREE COMMUNITY HOSPITALS IN GEORGIA TO RECEIVE THIS HONOR. WELLSTAR KENNESTONE REGIONAL MEDICAL CENTER RECEIVED THE PRESTIGIOUS AMERICAN ACADEMY OF MEDICAL SURGICAL NURSED PRISM AWARD. THIS HONOR RECOGNIZED EXCEPTIONAL NURSING PRACTICE, LEADERSHIP AND OUTCOMES IN HOSPITAL MEDICAL-SURGICAL UNITS ACROSS THE COUNTRY. KENNESTONE REGIONAL MEDICAL CENTER IS JUST ONE OF 14 HOSPITALS TO RECEIVE THIS HONOR IN 2016 AND THE ONLY ONE IN THE STATE OF GEORGIA. US NEWS AND WORLD REPORT NAMED WELLSTAR KENNESTONE REGIONAL MEDICAL CENTER TO ITS ANNUAL LISTING OF BEST REGIONAL HOSPITALS RANKING IT THIRD IN GEORGIA. WELLSTAR DOUGLAS HOSPITAL WAS DESIGNATED AS A REMOTE TREATMENT STROKE CENTER BY THE OFFICE OF EMS AND TRAUMA IN THE GEORGIA DEPARTMENT OF PUBLIC HEALTH BECOMING ONE OF THE FIRST HOSPITALS IN THE STATE TO GARNER THE RECOGNITION. WELLSTAR EARNED A SPOT IN THE DAVE THOMAS FOUNDATION FOR ADOPTIONS 100 BEST ADOPTION-FRIENDLY WORKPLACES. THIS IS THE SYSTEMS FIFTH TIME ON THE FOUNDATIONS TOP 100 LIST. WELLSTAR OFFERS FULL-TIME TEAM MEMBERS 120 HOURS AND ELIGIBLE PART-TIME TEAM MEMBERS 60 HOURS OF PAID LEAVE. IN ADDITION, WELLSTAR OFFERS TEAM MEMBERS A MAXIMUM OF $19,000 PER FINALIZED ADOPTION ($20,000 PER FAMILY LIFETIME AMOUNT.) EMPLOYEE RECRUITING AND COMMITMENT TO PROPER WORK-LIFE BALANCE OF PERSONAL AND PROFESSIONAL TIME ARE IMPORTANT TO THE DESIGNATION OF THIS AWARD. WELLSTAR WAS NAMED TO WORKING MOTHER 100 BEST COMPANIES LIST FOR THE 9TH TIME FOR ITS COMMITMENT TO PROGRESSIVE WORKPLACE PROGRAMS, INCLUDING ADVANCEMENT OF WOMEN, FLEXIBILITY, CHILD CARE AND PAID PARENTAL LEAVE. WELLSTAR WAS NAME TO THE 2016 BEST PLACES TO WORK FOR WOMEN LIST BY GREAT PLACES TO WORK. COBB HOSPITAL WAS DESIGNATED A BABY-FRIENDLY HOSPITAL BY BABY-FRIENDLY USA. ONLY 5 OTHER GEORGIA HOSPITALS HOLD THIS DESIGNATION. GEORGIA TREND MAGAZINE NAMED WELLSTAR WGMC THE NUMBER 1 LARGE HOSPITAL IN THE STATE. FIVE OF WELLSTAR HEALTH SYSTEMS HOSPITALS HAVE BEEN GRANTED THREE-YEAR ACCREDITATION WITH THE GOLD COMMENDATION BY THE COMMISSION ON CANCER(COC), A QUALITY PROGRAM BY THE AMERICAN COLLEGE OF SURGEONS. THIS IS THE HIGHEST HONOR AWARDED TO A CANCER PROGRAM. TO EARN THIS ACCREDITATION THE PROGRAM MUST MEET OR EXCEED COCS QUALITY CARE STANDARDS, BE EVALUATED EVERY THREE YEARS AND SHOW EXCELLENCE IN THE DELIVERY OF PATIENT CENTERED CARE. WELLSTAR CANCER NETWORK ALSO RECEIVED NATIONAL DISTINCTION BY BEING GRANTED A THREE-YEAR ACCREDITATION BY THE COC. THIS IS THE HIGHEST HONOR AWARDED TO A CANCER PROGRAM. WELLSTAR KENNESTONE REGIONAL MEDICAL CENTER AND WELLSTAR ATLANTA MEDICAL CENTER RECEIVED THE PLATINUM HONOR BY THE US DEPARTMENT OF HEALTH AND HUMAN SERVICES HEALTH RESOURCES AND SERVICES ADMINISTRATION FOR THEIR CONTINUED EFFORTS TO PROMOTE ORGAN DONOR REGISTRATION. OTHER HOSPITALS HONORED INCLUDED WELLSTAR COBB, DOUGLAS, NORTH FULTON, WEST GEORGIA MEDICAL CENTER AND PAULDING HOSPITALS. THE PARTNERSHIP FOR HEALTH AND ACCOUNTABILITY(PHA) AN AFFILIATE OF THE GEORGIA HOSPITAL ASSOCIATION, RECENTLY PRESENTED ITS QUALITY AND PATIENT SAFETY AWARD TO SEVERAL WELLSTAR HOSPITALS AS WELL AS TO THE SYSTEM ITSELF. THESE AWARDS RECOGNIZE GEORGIA HEALTHCARE ORGANIZATIONS FOR ACHIEVEMENT IN REDUCING THE RISK OF MEDICAL ERRORS AND IMPROVING PATIENT SAFETY AND MEDICAL OUTCOMES. WELLSTAR SPALDING REGIONAL HOSPITAL WON FIRST PLACE IN THE HOSPITALS WITH 100-299 BEDS CATEGORY FOR ITS HELP ME, DONT HURT ME REDUCING CAUTIS PROJECT. WELLSTAR COBB HOSPITAL WON SECOND PLACE IN THE HOSPITALS WITH GREATER THAN 300 BEDS CATEGORY FOR ITS INTERDISCIPLINARY MODEL BEDSIDE MEDICATION DELIVERY TO REDUCE 30-DAY READMISSION RATES PROJECT. WELLSTAR DOUGLAS HOSPITAL WON THIRD PLACE IN THE HOSPITALS WITH 100-299 BEDS CATEGORY FOR ITS MISSION NOT IMPOSSIBLE: STRATEGIES TO DECREASE CLOSTRIDUM DIFFICILE PROJECT. IN THE HOSPITALS/HEALTH SYSTEMS CATEGORY, WELLSTAR HEALTH SYSTEM EARNED FIRST PLACE FOR ITS OUTPATIENT SURGERY CENTER PRE-OP THROUGHPUT PROJECT, WHICH IMPROVED THE SAFETY OF PATENTS UNDERGOING CT-SCANS. WELLSTAR COBB HOSPITAL WAS ALSO PRESENTED WITH A CIRCLE OF EXCELLENCE AWARD, AN HONOR GIVEN TO HOSPITALS AND HEALTH SYSTEMS THAT HAVE DEMONSTRATED A SUSTAINED COMMITMENT TO QUALITY AND PATIENT SAFETY. EVERY YEAR THE ATLANTA BUSINESS CHRONICLE PUBLISHES ITS LIST OF THE 100 MOST INFLUENTIAL LEADERS IN GEORGIAS HEALTHCARE INDUSTRY. SEVEN MEMBERS OF WELLSTAR HEALTH SYSTEMS SENIOR LEADERSHIP TEAM WERE INCLUDED IN THE 2017 LIST. WELLSTAR KENNESTONE REGIONAL MEDICAL CENTERS CARDIAC PROGRAM IS ONE OF ONLY TWO PROGRAMS IN THE UNITED STATES TO RECEIVE THE JOINT COMMISSION GOLD SEAL DISEASE-SPECIFIC CERTIFICATION FOR HEART-VALVE, CORONARY ARTERY BYPASS SURGERY (CABS) AND CONGESTIVE HEART FAILURE. WELLSTAR WEST GEORGIA MEDICAL CENTER WAS NAMED ONE OF THE NATIONS 100 TOP HOSPITALS BY TRUVEN HEALTH ANALYTICS. TRUVEN IS A LEADING PROVIDER OF INFORMATION AND SOLUTIONS THAT SUPPORT HEALTHCARE COST AND QUALITY IMPROVEMENT. WELLSTAR COBB HOSPITALS INTENSIVE CARE UNIT WAS HONORED WITH THE BEACON AWARD FOR EXCELLENCE BY THE AMERICAN ASSOCIATION OF CRITICAL CARE NURSES. THE BEACON AWARD HONORS INDIVIDUAL HOSPITAL UNITS THAT DISTINGUISH THEMSELVES BY IMPROVING EVERY FACET OF PATIENT CARE. WELLSTAR PAULDING MEDICAL CENTER RECEIVED TWO BRILLIANCE AWARDS FROM VIZIENT MIDSOUTH. THE HOSPITAL WAS RECOGNIZED FOR INNOVATION AND EXCELLENCE IN CLINICAL CARE FOR PATIENTS WITH COPD AND DIABETES. TWO OF WELLSTAR KENNESTONE REGIONAL MEDICAL CENTERS NURSES HAVE BEEN NAMED AS TWO OF THE TOP 10 NURSES IN GEORGIA BY THE ATLANTA JOURNAL CONSTITUTION. WELLSTARS SUPPLY CHAIN SERVICES WAS RECOGNIZED AS A BEST PERFORMER BY THE ECRI INSTITUTE, A NONPROFIT ORGANIZATION THAT USES RESEARCH TO DISCOVER WHICH MEDICAL PROCEDURES, DRUGS AND PROCESSES ARE BEST TO ENABLE IMPROVED PATIENT CARE. THIS AWARD IS GIVEN FOR DEMONSTRATING EXCELLENCE IN OVERALL SPEND MANAGEMENT. THE WOUND CARE CENTER AT WELLSTAR WEST GEORGIA MEDICAL CENTER HAS BEEN RECOGNIZED WITH A CENTER OF DISTINCTION AWARD FOR CLINICAL EXCELLENCE BY HEALOGICS, THE NATIONS LEADING AND LARGEST WOUND CARE MANAGEMENT COMPANY. THE CENTER FOR COMPANIES THAT CARE RECENTLY NAMED WELLSTAR TO ITS HONOR ROLL FOR THE 10TH YEAR IN A ROW. THIS HONOR FOCUSES ON WELLSTARS EFFORT TO OFFERING WORKLIFE SERVICES THAT CREATE A CULTURE OF INCLUSION AND ASSISTANCE FOR TEAM MEMBERS UTILIZING SERVICES THAT PROVIDE A BALANCE BETWEEN WORK AND HOME LIFE. THE PURPOSE OF THE AWARD IS TO RECOGNIZE MEMBER ORGANIZATIONS THAT HAVE ACHIEVED A CERTAIN LEVEL OF EXCELLENCE ACROSS THREE KEY FOCUS AREAS- FINANCIAL AND OPERATIONAL EXCELLENCE, CLINICAL QUALITY EXCELLENCE AND INNOVATION. WELLSTAR WAS NAMED ONE OF BEST AND BRIGHTEST COMPANIES TO WORK FOR BY WSBTV2, BIZ 1190AM-WAFS, CORP! MAGAZINE, BAUDVILLE, BASIC AND THE ORSUS GROUP. THIS AWARD IS GIVEN TO COMPANIES THAT DISTINGUISH THEMSELVES AS HAVING THE MOST INNOVATIVE AND THOUGHTFUL APPROACH TO HUMAN RESOURCES. WELLSTAR HEALTH SYSTEM WAS A WINNER OF THE LEADERSHIP IN EXCELLENCE AWARD BY VIZIENT MIDSOUTH, A MEMBER ALLIANCE FOR NOT FOR PROFIT HEALTHCARE PROVIDERS. THE PURPOSE OF THIS AWARD IS TO RECOGNIZE ORGANIZATIONS THAT HAVE ACHIEVED A CERTAIN LEVEL OF EXCELLENCE ACROSS THREE KEY FOCUS AREAS- FINANCIAL AND OPERATIONAL EXCELLENCE, CLINICAL QUALITY EXCELLENCE AND INNOVATION.
FORM 990, PART IV, LINE 12B	AUDITED FINANCIAL STATEMENTS WellStar Health System, Inc. is audited on an annual basis by an outside auditing firm, KPMG, and as part of that audit a consolidated financial statement is issued for all of WellStar Health System, Inc. and its CONTROLLED Affiliates. The independent auditors report includes the accounts of Wellstar and its controlled affiliates, WELLSTAR Kennestone Hospital, Inc., WELLSTAR Cobb Hospital, Inc., WELLSTAR Douglas Hospital, Inc., WELLSTAR Paulding Medical Center, Inc., WELLSTAR ATLANTA MEDICAL CENTER, INC., WELLSTAR NORTH FULTON HOSPITAL, INC., WELLSTAR SPALDING REGIONAL HOSPITAL, INC., WELLSTAR SYLVAN GROVE HOSPITAL, INC., WELLSTAR WEST GEORGIA HEALTH SERVICES, INC., WELLSTAR WEST GEORGIA MEDICAL CENTER, INC., Wellstar Foundation, Inc., WELLSTAR WEST GEORGIA FOUNDATION, INC., VERNON WOODS RETIREMENT COMMUNITY, INC., CHS Foundation, Inc., Community Assurance Company, Ltd., various Wellstar owned physician practices, a hospice facility, a nursing facility, home health business, and entities for infusion therapy and durable medical equipment. All significant intercompany accounts and transactions have been eliminated in combination. The Board of Trustees of Wellstar HEALTH SYSTEM, INC. has the authority to approve appointments of the members of the board of trustees of all affiliate corporations.
FORM 990, PART VI, SECTION B, LINE 11B	BOARD REVIEW OF FORM 990 Internal staff prepares the organization's Form 990. Before filing the return with the Internal Revenue Service. an external accounting firm, PricewaterhouseCoopers LLP, reviews and sign-offs on the completed return of each organization. Generally, Form 990 is then reviewed by the Finance Committee along with a question and answer session. A motion is then made by the Finance committee to approve the returns and present to the full board copies of the forms in an electronic (PDF. format) version as well as a hard copy. The organization's CFO or designee subsequently signs the return for either manual or electronic filing by the appropriate due date. FORM 990, PART VI, SECTION B, LINE 12C CONFLICT OF INTEREST POLICY OUR Conflict of Interest Policy requires all covered persons to annually review the policy and then complete, sign and return the Conflicts of Interest Survey and Attestation to the Compliance Office. The policy requires an on-going disclosure obligation in the event a conflict arises during the year. The following is our process to regularly and consistently monitor and enforce the policy: Compliance identifies all covered persons who must complete the Survey and Attestation. Compliance verifies that the Survey and Attestation is distributed to these persons. Compliance verifies that these persons return a fully completed and signed Survey and Attestation. Compliance reviews each completed and signed Survey and Attestation to identify all conflicts listed in the document. All conflicts, potential conflicts and incidences of non-compliance are referred to the Chief Compliance Officer. The CCO takes appropriate action to completely resolve all identified conflicts and incidences of non-compliance. FORM 990, PART VI, SECTION B, LINES 15A & 15B COMPENSATION OF OFFICERS WELLSTAR HEALTH SYSTEM, INC. HAS ENGAGED SULLIVAN COTTER TO WORK WITH THE GOVERNING BOARD TO REVIEW AND RECOMMEND EXECUTIVE COMPENSATION. THE EXECUTIVE COMPENSATION PROCESS AT WELLSTAR IS OVERSEEN BY A COMMITTEE OF INDEPENDENT TRUSTEES, WHICH FOLLOWS A BOARD-APPROVED EXECUTIVE COMPENSATION PHILOSOPHY. THE COMPENSATION COMMITTEE CONSISTS OF FIVE TRUSTEES AS WELL AS THE CEO IN AN ADVISORY ROLE AND NOT A VOTING MEMBER. FURTHER IN COMMITTEE DISCUSSIONS ABOUT THE COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER, THE CEO WILL RECUSE HIM/HERSELF FROM THAT PROCESS AND IS A NON-VOTING COMMITTEE MEMBER FOR DISCUSSIONS ON ALL OTHER OFFICERS. THE EXECUTIVE COMPENSATION PHILOSOPHY EMPOWERS THE COMMITTEE TO OVERSEE THE EXECUTIVE COMPENSATION PROCESS AND ADMINISTER THE EXECUTIVE COMPENSATION PROGRAM ON BEHALF OF THE FULL BOARD OF TRUSTEES OF WELLSTAR; PROVIDED, HOWEVER, THE FULL BOARD OF TRUSTEES EVALUATES AND APPROVES THE COMPENSATION OF THE CHIEF EXECUTIVE OFFICER. THE PHILOSOPHY REQUIRES ANNUAL DISCLOSURE OF THE COMMITTEE'S ACTIONS AND DECISIONS TO THE FULL BOARD, WHICH IT HAS DONE. THE COMMITTEE IS GUIDED BY THE BOARD-APPROVED PHILOSOPHY. OVERALL, THE PHILOSOPHY IS INTENDED TO REWARD FOR ORGANIZATIONAL AND INDIVIDUAL PERFORMANCE. BASE COMPENSATION IS TARGETED AT THE MEDIAN BASE COMPENSATION PAID TO SIMILAR POSITIONS AT SIMILAR ORGANIZATIONS (THE MARKET). OFFICERS OF THE COMPANY ALSO RECEIVE VARIABLE COMPENSATION THAT IS DEPENDENT ON INDIVIDUAL AND ORGANIZATION PERFORMANCE. WHEN PERFORMANCE IS AT A PREDETERMINED TARGETED LEVEL, THE TOTAL COMPENSATION, BOTH BASE AND VARIABLE, IS INTENDED TO BE AT OR AROUND THE 75TH% OF COMPENSATION PAID TO SIMILAR POSITIONS AT SIMILAR ORGANIZATIONS. WELLSTAR'S EXECUTIVE COMPENSATION PHILOSOPHY DEFINES THE MARKET AS BEING COMPRISED OF COMPARABLE NOT-FOR-PROFIT HEALTH CARE DELIVERY SYSTEMS, I.E., NOT-FOR-PROFIT ORGANIZATIONS SIMILAR IN COMPLEXITY AND SCALE TO WELLSTAR. TO ASSIST THE COMMITTEE IN FULFILLING ITS DUTIES, THE COMMITTEE ENGAGED SULLIVAN COTTER TO PROVIDE MARKET COMPENSATION DATA TO COMPARE TO THE WELLSTAR POSITIONS WHOSE COMPENSATION THE COMMITTEE OVERSEES. THE COMMITTEE USES THIS DATA TO PROVIDE CONTEXT WHEN MAKING DECISIONS IN ADMINISTERING THE COMPENSATION PROGRAM. ACCURATE MINUTES OF THE COMMITTEE'S DISCUSSION AND DECISIONS ARE RECORDED DURING EACH COMMITTEE MEETING AND REVIEWED AND PROVIDED TO THE FULL BOARD OF TRUSTEES FOR REVIEW. FORM 990, PART VI, SECTION C, LINE 19 DOCUMENTS MADE AVAILABLE TO THE PUBLIC The organization and its AFFILIATES are subject to the Open Records Law in the State of Georgia. Therefore, by law, citizens are permitted to inspect and copy its governing documents, policies and financial statements as may be requested from time to time. Additionally, the organization's Form 990 is made readily available on the Guidestar website. Periodically, the organization publishes its financial performance in the local newspaper for citizens to review, and publishes a community benefit report once a year for distribution to the public. FORM 990, PART VII OFFICERS HOURS WORKED The officers devote their time to all of the organizations WITHIN WellStar Health System that are listed in Schedule R, Part II. As such, the total hours worked by the officers across all of the organizations exceeds 40 hours per week. FORM 990, PART VII & FORM 990, SCHEDULE J COMPENSATION ALL COMPENSATION AMOUNTS REPORTED ON FORM 990, PART VII; PART IX, LINES 5-7; AND SCHEDULE J REPRESENT COMPENSATION PROVIDED TO INDIVIDUALS THAT PROVIDE SERVICES TO THE ORGANIZATION. LIKEWISE, THE NUMBER OF EMPLOYEES REPORTED ON PART V, LINE 2A REPRESENTS THE NUMBER OF INDIVIDUALS PROVIDING SERVICES TO THE ORGANIZATION. ALL FEDERAL EMPLOYMENT TAX RESPONSIBILITIES FOR THESE INDIVIDUALS (INCLUDING FEDERAL EMPLOYMENT TAX REPORTING RESPONSIBILITIES) ARE HANDLED BY WELLSTAR HEALTH SYSTEM, INC. (EIN 58-1649541).
FORM 990, PART XI, LINE 9	OTHER CHANGES IN NET ASSETS FOR THE REPORTING PERIOD WELLSTAR HEALTH SYSTEM, INC. HAD THE FOLLOWING CHANGES IN NET ASSETS: PENSION ADJUSTMENT $ 7,199,000 ASSETS RELEASED FROM RESTRICTION 3,187,000 OTHER CHANGES* 2,053,154) -------------- Total Other Changes in Net Assets $ 8,332,846 *FOR THE REPORTING PERIOD, WELLSTAR HEALTH SYSTEM, INC. HAD A CHANGE IN NET ASSETS OF ($2,053,154) RELATED TO TRANSFERS TO/FROM AFFILIATES AS PART OF THE ALLOCATION OF INCOME STATEMENT AND BALANCE SHEET TRANSACTIONS OVER THE YEAR.

Return Reference

Explanation

FORM 990, HEADING, ITEM B, AMENDED RETURN

THE WELLSTAR HEALTH SYSTEM, INC. 2017 FORM 990 HAS BEEN AMENDED TO UPDATE TRANSACTIONS BETWEEN AFFILIATES. FORM 990, PART III, LINE 4A PROGRAM SERVICE ACCOMPLISHMENTS WELLSTAR HEALTH SYSTEM IS A VERTICALLY INTEGRATED HEALTH CARE DELIVERY SYSTEM WHICH PROVIDES THROUGH AFFILIATED BUSINESS ORGANIZATIONS A FULL SPECTRUM OF HEALTH SERVICES, INCLUDING WELLNESS PROGRAMS, PHYSICIAN OFFICE VISITS, OUTPATIENT CARE, INPATIENT CARE, AND POST-ACUTE SERVICES SUCH AS HOME HEALTH, HOSPICE AND LONG-TERM NURSING CARE. THE SYSTEM THROUGH ITS AFFILIATED BUSINESS ORGANIZATIONS OPERATES 11 HOSPITALS (KENNESTONE, COBB, PAULDING MEDICAL CENTER, DOUGLAS, WINDY HILL, ATLANTA MEDICAL CENTER DOWNTOWN AND SOUTH, NORTH FULTON, SPALDING, SYLVAN GROVE AND WEST GEORGIA), MULTIPLE PHYSICIAN OFFICES, PRIMARY CARE CENTERS, OUTPATIENT CARE FACILITIES, A NURSING HOME AND OTHER HEALTH RELATED SERVICES INCLUDING TWO INPATIENT HOSPICE FACILITIES. THE SYSTEM IS SUPPORTED FINANCIALLY BY A FUNDRAISING ORGANIZATION, WELLSTAR FOUNDATION, INC. THE SERVICE AREA FOR THE SYSTEM ENCOMPASSES PARTS OF THE NORTHWESTERN, CENTRAL AND WESTERN SECTIONS OF THE STATE OF GEORGIA - THE PRIMARY AREA BEING IN BARTOW, CHEROKEE, COBB, DOUGLAS, PAULDING, FULTON, BUTTS, SPALDING AND TROUP COUNTIES. APPROXIMATELY MORE THAN 90% OF INPATIENT DISCHARGES AND OUTPATIENTS SERVED ARE FROM THE AFOREMENTIONED COUNTIES. THE WELLSTAR VISION IS TO DELIVER WORLD CLASS HEALTHCARE. OUR MISSION IS TO CREATE AND DELIVER HIGH QUALITY HOSPITAL, PHYSICIAN AND OTHER HEALTHCARE RELATED SERVICES THAT IMPROVE THE HEALTH AND WELL-BEING OF THE INDIVIDUALS AND COMMUNITIES WE SERVE. HISTORY IN 1993, WHAT WAS THEN KNOWN AS THE COBB HEALTH SYSTEM, THE KENNESTONE REGIONAL HEALTH CARE SYSTEM, AND THE DOUGLAS GENERAL HOSPITAL AFFILIATED TO FORM THE NORTHWEST GEORGIA HEALTH SYSTEM. PAULDING MEMORIAL MEDICAL CENTER AFFILIATED WITH NORTHWEST GEORGIA HEALTH SYSTEM IN 1994. IN 1994, THE NORTHWEST GEORGIA HEALTH SYSTEM HELPED FORM THE PROMINA HEALTH SYSTEM AND CHANGED ITS NAME TO PROMINA NORTHWEST HEALTH SYSTEM. IN 1998, PROMINA NORTHWEST HEALTH SYSTEM CHANGED ITS NAME TO WELLSTAR HEALTH SYSTEM. WELLSTAR DISASSOCIATED FROM AND BECAME TOTALLY INDEPENDENT OF PROMINA IN 1999. IN 2016 WELLSTAR ACQUIRED ATLANTA MEDICAL CENTER, NORTH FULTON HOSPITAL, SPALDING HOSPITAL, SYLVAN GROVE HOSPITAL AND WEST GEORGIA MEDICAL CENTER. WELLSTAR HEALTH SYSTEM IS A PARENT CORPORATION, WHICH PROVIDES OVERALL COORDINATION INCLUDING GOVERNING BODY TO ITS 11 AFFILIATES: - COBB HOSPITAL, INC.; - CHS FOUNDATION, INC. (INVESTMENT MANAGEMENT); - DOUGLAS HOSPITAL INC.; - KENNESTONE HOSPITAL, INC.; - PAULDING MEDICAL CENTER, INC.; - WELLSTAR FOUNDATION INC.; - WELLSTAR ATLANTA MEDICAL CENTER, INC.; - WELLSTAR NORTH FULTON HOSPITAL, INC.; - WELLSTAR SPALDING REGIONAL HOSPITAL, INC.; - WELLSTAR SYLVAN GROVE HOSPITAL, INC.; - WELLSTAR WEST GEORGIA HEALTH SERVICES, INC.

SERVICES

WELLSTAR HEALTH SYSTEM IS ABLE TO OFFER A FULL RANGE OF HEALTHCARE SERVICES THROUGH ITS AFFILIATES. THE SERVICES OFFERED INCLUDE BUT ARE NOT LIMITED TO: - MOST MAJOR INPATIENT CLINICAL SERVICES, - OUTPATIENT SERVICES, - DIAGNOSTIC AND THERAPEUTIC SERVICES, - ANCILLARY AND SUPPORT SERVICES, - URGENT CARE SERVICES, - HOME HEALTH SERVICES, - SKILLED NURSING SERVICES AND - HOSPICE SERVICES. THE 11 HOSPITAL LOCATIONS ARE ACUTE CARE FACILITIES WITH INPATIENT, OUTPATIENT, AND EMERGENCY SERVICES. THE SYSTEM INCLUDES A RESIDENTIAL FACILITY ON THE KENNESTONE HOSPITAL CAMPUS, CALLED ATHERTON PLACE. ATHERTON PLACE ALSO HOUSES AN ASSISTED LIVING UNIT AS AN ADDITIONAL LEVEL OF CARE. PAULDING MEDICAL CENTER IS HOME TO A FULL CARE NURSING HOME, PAULDING NURSING CENTER AND WEST GEORGIA MEDICAL CENTER IS ALSO HOME TO TWO FULL CARE NURSING HOMES. VERNON WOODS RETIREMENT COMMUNITY IS AN ASSISSTED LIVING FACILITY. COBB HOSPITAL IS HOME TO A HOME HEALTH AGENCY AND A RESIDENTIAL HOSPICE FACILITY CALLED TRANQUILITY FOR THOSE PATIENTS IN THE END STAGES OF LIFE. KENNESTONE HOSPITAL ALSO OPENED A RESIDENTIAL HOSPICE FACILITY NOT FAR FROM ITS MAIN CAMPUS. THE SYSTEM IS COMPLIMENTED WITH APPROXIMATELY 275 PHYSICIAN PRACTICES AND SEVERAL URGENT CARE CENTERS. THE SYSTEM IS THUS ABLE TO PROVIDE A COMPLETE CONTINUUM OF CARE FOR THE COMMUNITY IT SERVES. THE FOLLOWING STATEMENTS OF COMMUNITY BENEFIT AND PROGRAM SERVICE ACCOMPLISHMENTS REPRESENT SYSTEM-WIDE ACTIVITY FOR WELLSTAR HEALTH SYSTEM, INC. (THE "SYSTEM") - EIN 58-1649541. ALL AFFILIATED ENTITIES OF THE SYSTEM EXCEPT THE PHYSICIAN HOSPITAL ORGANIZATION (EIN 58-2116179) OPERATE AS CHARITABLE ORGANIZATIONS CONSISTENT WITH THE REQUIREMENTS OF INTERNAL REVENUE CODE SECTION 501(C)(3) AND THE "COMMUNITY BENEFIT STANDARD" OF IRS REVENUE RULING 69-545. THE FOLLOWING EXCERPT FROM THE AUDITED FINANCIAL STATEMENTS IDENTIFIES A BROAD OVERVIEW OF THE CHARITABLE PURPOSE FOR THE SYSTEM. "THE SYSTEM MAINTAINS RECORDS TO IDENTIFY AND MONITOR THE LEVEL OF CHARITY CARE IT PROVIDES THROUGH ITS AFFILIATES. THESE RECORDS INCLUDE THE AMOUNT OF CHARGES FOREGONE FOR SERVICES AND SUPPLIES FURNISHED UNDER ITS COMMUNITY FINANCIAL AID POLICY." IN FISCAL YEAR 2018 AND 2017, WELLSTAR AFFILIATE HOSPITALS MADE $255.6 MILLION AND $251.9 MILLION, RESPECTIVELY, IN PROVIDER PAYMENTS AND RECOGNIZED SUCH PAYMENTS AS A REDUCTION IN NET PATIENT SERVICE REVENUE IN THE ACCOMPANYING COMBINED FINANCIAL STATEMENTS. THE SYSTEM ALSO PARTICIPATES IN CERTAIN GOVERNMENTAL INSURANCE PROGRAMS, INCLUDING MEDICARE AND MEDICAID. UNDER THESE PROGRAMS, THE SYSTEM PROVIDES CARE TO PATIENTS AT PAYMENT RATES WHICH ARE DETERMINED BY THE FEDERAL AND STATE GOVERNMENTS, REGARDLESS OF THE SYSTEM'S ACTUAL CHARGES. IN MOST CASES, THESE PROGRAMS PAY THE SYSTEM AT AMOUNTS WHICH ARE LESS THAN ITS COST OF PROVIDING SERVICES. THE SYSTEM OFFERS MANY WELLNESS AND EDUCATIONAL SERVICES AT LITTLE OR NO COST TO THE COMMUNITY. HEALTH FAIRS ARE HELD THROUGHOUT THE YEAR AT CONVENIENT LOCATIONS, PROVIDING VARIOUS HEALTH SCREENINGS, SUCH AS MAMMOGRAMS, BONE DENSITY, BLOOD PRESSURE AND CHOLESTEROL CHECKS. A LARGE NUMBER OF EDUCATIONAL PROGRAMS ARE OFFERED FOR ALL AGES. THESE PROGRAMS INCLUDE BICYCLE SAFETY, CAR SEAT SAFETY, DEFENSIVE DRIVING, CPR AND FIRST-AID CLASSES. FLU SHOTS ARE AVAILABLE TO THE COMMUNITY DURING FLU SEASON AND HEALTH SCREENINGS, MEDICAL SUPPLIES, AND IMMUNIZATIONS ARE PROVIDED TO CHILDREN THROUGH LOCAL HEALTH DEPARTMENTS AND HEALTH FAIRS. THE COSTS OF THESE SERVICES ARE INCLUDED IN UNRESTRICTED REVENUE, GAINS AND OTHER SUPPORT IN EXCESS OF EXPENSES AND LOSSES IN THE FINANCILA STATEMENTS.THE PHYSICIANS OF THE SYSTEM MAKE SIGNIFICANT CONTRIBUTIONS TO IMPROVE THE HEALTH STATUS OF THE COMMUNITY, INCLUDING INVOLVEMENT IN MANY COMMUNITY ACTIVITIES PROMOTING HEALTH AWARENESS AND IMPROVEMENT, EMERGENCY ROOM CARE, AND DELIVERY OF CARE TO THE INDIGENT POPULATION OF THE SYSTEM'S SERVICE AREA. THE SYSTEM ALSO MADE SIGNIFICANT CONTRIBUTIONS TO THE NURSING PROGRAM AT A LOCAL UNIVERSITY. THIS FINANCIAL SUPPORT HAS HELPED TO GROW THE PROGRAM, WHICH BENEFITS THE SYSTEM AS WELL AS THE COMMUNITY. THE SYSTEM AND ALL BUT ONE OF ITS AFFILIATES HAVE BEEN RECOGNIZED AS ORGANIZATIONS EXEMPT FROM FEDERAL INCOME TAX UNDER INTERNAL REVENUE CODE SECTION 501(A) AS ORGANIZATIONS DESCRIBED IN SECTION 501(C)(3) AND, THEREFORE, RELATED INCOME IS GENERALLY NOT SUBJECT TO FEDERAL OR STATE INCOME TAXES. ONE OF THE SYSTEM'S AFFILIATES IS A CONTROLLED FOREIGN CORPORATION NOT SUBJECT TO FEDERAL INCOME TAX. THE PHYSICIAN HOSPITAL ORGANIZATION (EIN 58-2116179) IS A TAXABLE AFFILIATE OF THE SYSTEM AND FILES IRS FORM 1120 US CORPORATION INCOME TAX RETURN."

FINANCIAL & DATA STATISTICS

SERVICES PROVIDED SYSTEM-WIDE: LICENSED BEDS 2,775 ADULT DISCHARGES 114,306 NEWBORN DISCHARGES 14,959 EMERGENCY ROOM VISITS 658,118 SURGERIES - 68950 CATH LAB/PACEMAKERS/EP 18,029 NON-ED O/P RADIOLOGY PROCEDURES 459,418 MED/SURG. SHORT STAY CASES 1,462 GI LAB PROCEDURES 10,628 RADIOLOGY ONCOLOGY PROCEDURES 31,718 COMMUNITY BENEFITS WELLSTARS COMMUNITY EDUCATION & OUTREACH DEPARTMENT PROVIDES FREE BROCHURES ON A VARIETY OF HEALTH-RELATED ISSUES. WELLSTAR PROVIDES SUPPORT GROUPS AND EDUCATIONAL OPPORTUNITIES TO THE COMMUNITY ON A VARIETY OF TOPICS INCLUDING MEN'S AND WOMEN'S HEALTH ISSUES, CARDIAC HEALTH, NUTRITION, CANCER, AND DIABETES. SOME OF THESE OPPORTUNITIES ARE PROVIDED FREE OF CHARGE OR AT A MINIMAL FEE. WELLSTAR ALSO PROVIDES FREE HEALTH SCREENINGS SUCH AS BLOOD PRESSURE, CHOLESTEROL, GLUCOSE, BONE DENSITY AND WEIGHT ASSESSMENT. COMMUNITY EDUCATION & OUTREACH PROVIDES HEALTH AND WELLNESS PROGRAMS AND SERVICES ACROSS ALL WELLSTAR MARKETS REACHING OVER 450,000 PEOPLE ANNUALLY. SOME OF THE MORE SPECIFIC PROGRAM/DEPARTMENTS ARE DOCUMENTED AS FOLLOWS: CLINICS: WELLSTAR IS AFFILIATED WITH SEVERAL CLINICS WHICH PROVIDE FREE OR SLIDING SCALE HEALTH SERVICES TO PERSONS WHO CANNOT AFFORD TO PAY OR THOSE WHO ARE NOT EXPECTED TO PAY. SCHOOL HEALTH PROGRAM: THIS PROGRAM TEACHES CHILDREN ABOUT HEALTH AND SAFETY TOPICS TO INCLUDE NUTRITION, PHYSICAL ACTIVITY, HYGIENE, BIKE AND PEDESTRIAN SAFETY AND MORE. THE PROGRAMS ARE CURRENTLY TAUGHT IN ELEMENTARY SCHOOLS (GRADES K-5) AND MIDDLE SCHOOLS (GRADES 6-8) IN CHEROKEE, COBB, DOUGLAS AND PAULDING COUNTIES. SAFE KIDS: WELLSTAR IS A CO-LEAD AGENCY FOR SAFE KIDS COBB COUNTY ALONG WITH COBB AND DOUGLAS PUBLIC HEALTH. SAFE KIDS COBB COUNTY IS COMMITTED TO REDUCING AND PREVENTING ACCIDENTAL INJURIES TO CHILDREN AGES 19 AND UNDER IN COBB COUNTY BY HOSTING SAFETY EDUCATION EVENTS AND DISTRIBUTING SAFETY EDUCATION MATERIALS AND EQUIPMENT THROUGHOUT THE COUNTY TO FAMILIES IN NEED. SAFETY AREAS OF FOCUS INCLUDE: CHILD PASSENGER, PEDESTRIAN, WHEEL, HOME, POISON PREVENTION AND WATER. EQUIPMENT DISTRIBUTION INCLUDES: CAR AND BOOSTER SEATS, BICYCLE HELMETS AND REFLECTORS, SMOKE/CARBON MONOXIDE ALARMS, HOME SAFETY KITS AND LIFEJACKETS. MOST OF THE EVENTS ARE FREE AND OPEN TO THE PUBLIC. THE IMPORTANT MESSAGE TAUGHT AT THESE EVENTS IS THAT SAFETY BEGINS WITH THE PARENTS AND CAREGIVERS. ANNUALLY, NEARLY 800 CAR SEATS ARE PRESENTED TO FAMILIES IN NEED, AND NEARLY 2,500 INFANT CAR SEATS ARE CHECKED AT OVER 130 CAR SEAT EVENTS. WOMEN & CHILDREN RESOURCE CENTERS: THE WOMEN'S AND CHILDREN'S RESOURCE CENTER AT COBB, DOUGLAS, AND KENNESTONE HOSPITALS PROVIDE MUCH NEEDED SUPPORT FOR MOTHERS AND THEIR NEWBORN BABIES THROUGH INPATIENT AND OUTPATIENT CONSULTATIONS, WARM LINE PHONE CALLS, CHILDBIRTH, NEWBORN CARE AND BREASTFEEDING CLASSES, AN ANNUAL MATERNITY AND BABY FAIR, AS WELL AS OTHER EDUCATIONAL OPPORTUNITIES. THESE PROGRAMS DEMONSTRATE WELLSTARS COMMITMENT TO THE HEALTH AND WELL-BEING OF THE NEW MOTHERS AND THEIR BABIES IN OUR COMMUNITY. IN FY2018 THE UNREIMBURSED COSTS ASSOCIATED WITH THE PROGRAM TOTALED APPROXIMATELY $400,000 AND MORE THAN 7,000 PARENTS PARTICIPATED IN PRENATAL AND CHILDBIRTH PROGRAMS. THE GOOD LIFE CLUB: WELLSTAR PROVIDES A SPECIAL PROGRAM FOR AREA RESIDENTS AGE 50 AND OLDER CALLED THE GOOD LIFE CLUB. THIS PROGRAM PROVIDES HEALTHY AGING RESOURCES AND PROMOTES HEALTH, WELLNESS, AND AN ACTIVE LIFESTYLE THROUGH CLASSES, HEALTH SCREENINGS AND OTHER OPPORTUNITIES. A SMALL ONE-TIME FEE COVERS A LIFETIME MEMBERSHIP AND INCLUDES: - HEALTH AND WELLNESS EDUCATION AND PROGRAMS - A QUARTERLY NEWSLETTER - FREE HEALTH SCREENINGS - DISCOUNTED PARKING AT HOSPITALS AND OTHER RETAIL DISCOUNTS - TRAVEL DISCOUNTS THE GOOD LIFE CLUB CURRENTLY HAS MORE THAN 2,000 MEMBERS. COMMUNITY ACTIVITIES - WELLSTAR HAS PARTNERED WITH A LOCAL COLLEGE, KENNESAW STATE UNIVERSITY ("KSU") TO DEVELOP EDUCATIONAL AND ON-SITE TRAINING PROGRAMS WHICH WILL HOPEFULLY IMPROVE THE CURRENT AND FUTURE HEALTH OF OUR COMMUNITY. MANY OF THE NURSES IN THE SYSTEM ARE TRAINED THROUGH THE NURSING PROGRAM OFFERED BY KSU. WELLSTAR IS ALSO AFFILIATED WITH THE CHATTAHOOCHEE TECHNICAL COLLEGE- NORTH METRO CAMPUS'S RADIOLOGIC TECHNOLOGY PROGRAM. WELLSTAR SERVES AS THE CLINICAL AFFILIATE FOR THE STUDENTS IN THIS TWO-YEAR PROGRAM. THE STUDENTS TRAIN AT WELLSTAR'S HOSPITALS AND OUTPATIENT FACILITIES. THE PROGRAM RECEIVED ACCREDITATION FROM THE JOINT REVIEW COMMITTEE ON EDUCATION IN RADIOLOGIC TECHNOLOGY. THE GOAL IS TO HAVE TRAINED STUDENTS WHO CAN SUBSEQUENTLY CONTRIBUTE TO THE HEALTH OF THE COMMUNITY WE SERVE. COMMUNITY PARTNERSHIPS AND SPONSORSHIPS - COMMUNITY EDUCATION & OUTREACH IS RESPONSIBLE FOR DEVELOPING AND CULTIVATING STRATEGIC COMMUNITY PARTNERSHIPS BY ALIGNING WELLSTARS STRATEGIC GOALS, COMMUNITY DEVELOPMENT OPPORTUNITIES AND THE PRIORITY HEALTH NEEDS OF OUR LOCAL COMMUNITIES. SPONSORSHIPS PROVIDE AN OPPORTUNITY TO SUPPORT WELLSTARS MISSION TO IMPROVE THE HEALTH AND WELL-BEING OF THE COMMUNITIES WE SERVE BY SUPPORTING ORGANIZATIONS AND EVENTS AS A SPONSOR. ORGANIZATIONS INCLUDE THE AMERICAN HEART ASSOCIATION, AMERICAN CANCER SOCIETY, AMERICAN LUNG ASSOCIATION, THE AMERICAN DIABETES ASSOCIATION, MARCH OF DIMES, AS WELL AS NUMEROUS LOCAL ORGANIZATIONS. MANY EMPLOYEES ALSO VOLUNTEER AND PARTICIPATE IN SOME OF THE EVENTS HELD BY THESE ORGANIZATIONS SUCH AS WALKS, FUNDRAISERS AND SCREENINGS. IN FY2018 THE TOTAL UNCOMPENSATED CARE, OTHER COMMUNITY BENEFITS AND COMMUNITY INVESTMENTS PROVIDED BY WELLSTAR WAS OVER $ 939 MILLION. COMMITMENT TO THE COMMUNITY BREAKDOWN: CHARITY & INDIGENT (UNCOMPENSATED CARE COSTS) - $ 255,954,000 MEDICAID SHORTFALLS (UNCOMPENSATED CARE COSTS) - $ 86,107,000 MEDICARE SHORTFALLS (UNCOMPENSATED CARE COSTS) - $ 206,724,000 OTHER PATIENTS (UNCOMPENSATED CARE COSTS) - $ 127,756,000 TOTAL UNCOMPENSATED CARE - $ 676,541,000 OTHER COMMUNITY PROGRAMS (PARTICIPATION IN COALITIONS) - $ 345,000 OTHER COMMUNITY PROGRAMS (COMMUNITY HEALTH EDUCATION) - $ 249,000 OTHER COMMUNITY PROGRAMS (HEALTH CARE SUPPORT) - $ 7,777,000 TOTAL OTHER COMMUNITY PROGRAMS - $ 8,371,000 COMMUNITY INVESTMENTS (FUNDS BACK INTO INFRASTRUCTURE) - $ 245,436,000 COMMUNITY INVESTMENTS (ALLIED HLTH/MEDICAL EDUCATION) - $ 9,456,000 COMMUNITY INVESTMENTS (OPERATIONS - STAFF/SOFTWARE) - $ 92,000 TOTAL COMMUNITY INVESTMENTS - $ 254,984,000 WELLSTAR CONTINUES TO PARTICIPATE IN THE CENTER FOR MEDICARE AND MEDICAID SERVICES (CMS) MEDICARE SAVINGS PROGRAM AS AN ACCOUNTABLE CARE ORGANIZATION (ACO). WELLSTARS ACO IS THE LARGEST ACO IN GEORGIA INCLUDING 50,000 MEMBERS AND 1,400 PHYSICIANS. THE ACO HAS BEEN RECOGNIZED AS ONE OF THE TOP 100 ACOS IN THE COUNTRY. THE PROGRAM HAS BEEN SUCCESSFUL THROUGH A FOCUS ON WELLNESS AND THE IMPROVED MANAGEMENT OF CHRONIC ILLNESSES AND THE RELATED COORDINATION OF CARE, TO ENSURE PATIENTS, ESPECIALLY CHRONICALLY ILL, GET THE RIGHT CARE AT THE RIGHT TIME TO MAINTAIN THEIR OPTIMAL HEALTH, AND AVOID THE NEED FOR HIGH-COST EMERGENCY AND HOSPITAL CARE.

AWARDS, RECOGNITION AND ACCOMPLISHMENTS

WELLSTAR HEALTH SYSTEM (WELLSTAR) WAS RECOGNIZED FOR DIVERSITY IN THE WORKPLACE. DIVERSITY MAGAZINE LISTS WELLSTAR AS ONE OF ITS 50 BEST PLACES FOR WOMEN AND DIVERSE MANAGERS TO WORK. WELLSTAR WEST GEORGIA MEDICAL CENTER (WGMC) WAS NAMED TO BECKER HOSPITAL REVIEW'S 2016 LIST OF "100 GREAT COMMUNITY HOSPITALS." WGMC IS ONE OF ONLY THREE COMMUNITY HOSPITALS IN GEORGIA TO RECEIVE THIS HONOR. WELLSTAR KENNESTONE REGIONAL MEDICAL CENTER RECEIVED THE PRESTIGIOUS AMERICAN ACADEMY OF MEDICAL SURGICAL NURSED PRISM AWARD. THIS HONOR RECOGNIZED EXCEPTIONAL NURSING PRACTICE, LEADERSHIP AND OUTCOMES IN HOSPITAL MEDICAL-SURGICAL UNITS ACROSS THE COUNTRY. KENNESTONE REGIONAL MEDICAL CENTER IS JUST ONE OF 14 HOSPITALS TO RECEIVE THIS HONOR IN 2016 AND THE ONLY ONE IN THE STATE OF GEORGIA. US NEWS AND WORLD REPORT NAMED WELLSTAR KENNESTONE REGIONAL MEDICAL CENTER TO ITS ANNUAL LISTING OF BEST REGIONAL HOSPITALS RANKING IT THIRD IN GEORGIA. WELLSTAR DOUGLAS HOSPITAL WAS DESIGNATED AS A REMOTE TREATMENT STROKE CENTER BY THE OFFICE OF EMS AND TRAUMA IN THE GEORGIA DEPARTMENT OF PUBLIC HEALTH BECOMING ONE OF THE FIRST HOSPITALS IN THE STATE TO GARNER THE RECOGNITION. WELLSTAR EARNED A SPOT IN THE DAVE THOMAS FOUNDATION FOR ADOPTIONS 100 BEST ADOPTION-FRIENDLY WORKPLACES. THIS IS THE SYSTEMS FIFTH TIME ON THE FOUNDATIONS TOP 100 LIST. WELLSTAR OFFERS FULL-TIME TEAM MEMBERS 120 HOURS AND ELIGIBLE PART-TIME TEAM MEMBERS 60 HOURS OF PAID LEAVE. IN ADDITION, WELLSTAR OFFERS TEAM MEMBERS A MAXIMUM OF $19,000 PER FINALIZED ADOPTION ($20,000 PER FAMILY LIFETIME AMOUNT.) EMPLOYEE RECRUITING AND COMMITMENT TO PROPER WORK-LIFE BALANCE OF PERSONAL AND PROFESSIONAL TIME ARE IMPORTANT TO THE DESIGNATION OF THIS AWARD. WELLSTAR WAS NAMED TO WORKING MOTHER 100 BEST COMPANIES LIST FOR THE 9TH TIME FOR ITS COMMITMENT TO PROGRESSIVE WORKPLACE PROGRAMS, INCLUDING ADVANCEMENT OF WOMEN, FLEXIBILITY, CHILD CARE AND PAID PARENTAL LEAVE. WELLSTAR WAS NAME TO THE 2016 BEST PLACES TO WORK FOR WOMEN LIST BY GREAT PLACES TO WORK. COBB HOSPITAL WAS DESIGNATED A BABY-FRIENDLY HOSPITAL BY BABY-FRIENDLY USA. ONLY 5 OTHER GEORGIA HOSPITALS HOLD THIS DESIGNATION. GEORGIA TREND MAGAZINE NAMED WELLSTAR WGMC THE NUMBER 1 LARGE HOSPITAL IN THE STATE. FIVE OF WELLSTAR HEALTH SYSTEMS HOSPITALS HAVE BEEN GRANTED THREE-YEAR ACCREDITATION WITH THE GOLD COMMENDATION BY THE COMMISSION ON CANCER(COC), A QUALITY PROGRAM BY THE AMERICAN COLLEGE OF SURGEONS. THIS IS THE HIGHEST HONOR AWARDED TO A CANCER PROGRAM. TO EARN THIS ACCREDITATION THE PROGRAM MUST MEET OR EXCEED COCS QUALITY CARE STANDARDS, BE EVALUATED EVERY THREE YEARS AND SHOW EXCELLENCE IN THE DELIVERY OF PATIENT CENTERED CARE. WELLSTAR CANCER NETWORK ALSO RECEIVED NATIONAL DISTINCTION BY BEING GRANTED A THREE-YEAR ACCREDITATION BY THE COC. THIS IS THE HIGHEST HONOR AWARDED TO A CANCER PROGRAM. WELLSTAR KENNESTONE REGIONAL MEDICAL CENTER AND WELLSTAR ATLANTA MEDICAL CENTER RECEIVED THE PLATINUM HONOR BY THE US DEPARTMENT OF HEALTH AND HUMAN SERVICES HEALTH RESOURCES AND SERVICES ADMINISTRATION FOR THEIR CONTINUED EFFORTS TO PROMOTE ORGAN DONOR REGISTRATION. OTHER HOSPITALS HONORED INCLUDED WELLSTAR COBB, DOUGLAS, NORTH FULTON, WEST GEORGIA MEDICAL CENTER AND PAULDING HOSPITALS. THE PARTNERSHIP FOR HEALTH AND ACCOUNTABILITY(PHA) AN AFFILIATE OF THE GEORGIA HOSPITAL ASSOCIATION, RECENTLY PRESENTED ITS QUALITY AND PATIENT SAFETY AWARD TO SEVERAL WELLSTAR HOSPITALS AS WELL AS TO THE SYSTEM ITSELF. THESE AWARDS RECOGNIZE GEORGIA HEALTHCARE ORGANIZATIONS FOR ACHIEVEMENT IN REDUCING THE RISK OF MEDICAL ERRORS AND IMPROVING PATIENT SAFETY AND MEDICAL OUTCOMES. WELLSTAR SPALDING REGIONAL HOSPITAL WON FIRST PLACE IN THE HOSPITALS WITH 100-299 BEDS CATEGORY FOR ITS HELP ME, DONT HURT ME REDUCING CAUTIS PROJECT. WELLSTAR COBB HOSPITAL WON SECOND PLACE IN THE HOSPITALS WITH GREATER THAN 300 BEDS CATEGORY FOR ITS INTERDISCIPLINARY MODEL BEDSIDE MEDICATION DELIVERY TO REDUCE 30-DAY READMISSION RATES PROJECT. WELLSTAR DOUGLAS HOSPITAL WON THIRD PLACE IN THE HOSPITALS WITH 100-299 BEDS CATEGORY FOR ITS MISSION NOT IMPOSSIBLE: STRATEGIES TO DECREASE CLOSTRIDUM DIFFICILE PROJECT. IN THE HOSPITALS/HEALTH SYSTEMS CATEGORY, WELLSTAR HEALTH SYSTEM EARNED FIRST PLACE FOR ITS OUTPATIENT SURGERY CENTER PRE-OP THROUGHPUT PROJECT, WHICH IMPROVED THE SAFETY OF PATENTS UNDERGOING CT-SCANS. WELLSTAR COBB HOSPITAL WAS ALSO PRESENTED WITH A CIRCLE OF EXCELLENCE AWARD, AN HONOR GIVEN TO HOSPITALS AND HEALTH SYSTEMS THAT HAVE DEMONSTRATED A SUSTAINED COMMITMENT TO QUALITY AND PATIENT SAFETY. EVERY YEAR THE ATLANTA BUSINESS CHRONICLE PUBLISHES ITS LIST OF THE 100 MOST INFLUENTIAL LEADERS IN GEORGIAS HEALTHCARE INDUSTRY. SEVEN MEMBERS OF WELLSTAR HEALTH SYSTEMS SENIOR LEADERSHIP TEAM WERE INCLUDED IN THE 2017 LIST. WELLSTAR KENNESTONE REGIONAL MEDICAL CENTERS CARDIAC PROGRAM IS ONE OF ONLY TWO PROGRAMS IN THE UNITED STATES TO RECEIVE THE JOINT COMMISSION GOLD SEAL DISEASE-SPECIFIC CERTIFICATION FOR HEART-VALVE, CORONARY ARTERY BYPASS SURGERY (CABS) AND CONGESTIVE HEART FAILURE. WELLSTAR WEST GEORGIA MEDICAL CENTER WAS NAMED ONE OF THE NATIONS 100 TOP HOSPITALS BY TRUVEN HEALTH ANALYTICS. TRUVEN IS A LEADING PROVIDER OF INFORMATION AND SOLUTIONS THAT SUPPORT HEALTHCARE COST AND QUALITY IMPROVEMENT. WELLSTAR COBB HOSPITALS INTENSIVE CARE UNIT WAS HONORED WITH THE BEACON AWARD FOR EXCELLENCE BY THE AMERICAN ASSOCIATION OF CRITICAL CARE NURSES. THE BEACON AWARD HONORS INDIVIDUAL HOSPITAL UNITS THAT DISTINGUISH THEMSELVES BY IMPROVING EVERY FACET OF PATIENT CARE. WELLSTAR PAULDING MEDICAL CENTER RECEIVED TWO BRILLIANCE AWARDS FROM VIZIENT MIDSOUTH. THE HOSPITAL WAS RECOGNIZED FOR INNOVATION AND EXCELLENCE IN CLINICAL CARE FOR PATIENTS WITH COPD AND DIABETES. TWO OF WELLSTAR KENNESTONE REGIONAL MEDICAL CENTERS NURSES HAVE BEEN NAMED AS TWO OF THE TOP 10 NURSES IN GEORGIA BY THE ATLANTA JOURNAL CONSTITUTION. WELLSTARS SUPPLY CHAIN SERVICES WAS RECOGNIZED AS A BEST PERFORMER BY THE ECRI INSTITUTE, A NONPROFIT ORGANIZATION THAT USES RESEARCH TO DISCOVER WHICH MEDICAL PROCEDURES, DRUGS AND PROCESSES ARE BEST TO ENABLE IMPROVED PATIENT CARE. THIS AWARD IS GIVEN FOR DEMONSTRATING EXCELLENCE IN OVERALL SPEND MANAGEMENT. THE WOUND CARE CENTER AT WELLSTAR WEST GEORGIA MEDICAL CENTER HAS BEEN RECOGNIZED WITH A CENTER OF DISTINCTION AWARD FOR CLINICAL EXCELLENCE BY HEALOGICS, THE NATIONS LEADING AND LARGEST WOUND CARE MANAGEMENT COMPANY. THE CENTER FOR COMPANIES THAT CARE RECENTLY NAMED WELLSTAR TO ITS HONOR ROLL FOR THE 10TH YEAR IN A ROW. THIS HONOR FOCUSES ON WELLSTARS EFFORT TO OFFERING WORKLIFE SERVICES THAT CREATE A CULTURE OF INCLUSION AND ASSISTANCE FOR TEAM MEMBERS UTILIZING SERVICES THAT PROVIDE A BALANCE BETWEEN WORK AND HOME LIFE. THE PURPOSE OF THE AWARD IS TO RECOGNIZE MEMBER ORGANIZATIONS THAT HAVE ACHIEVED A CERTAIN LEVEL OF EXCELLENCE ACROSS THREE KEY FOCUS AREAS- FINANCIAL AND OPERATIONAL EXCELLENCE, CLINICAL QUALITY EXCELLENCE AND INNOVATION. WELLSTAR WAS NAMED ONE OF BEST AND BRIGHTEST COMPANIES TO WORK FOR BY WSBTV2, BIZ 1190AM-WAFS, CORP! MAGAZINE, BAUDVILLE, BASIC AND THE ORSUS GROUP. THIS AWARD IS GIVEN TO COMPANIES THAT DISTINGUISH THEMSELVES AS HAVING THE MOST INNOVATIVE AND THOUGHTFUL APPROACH TO HUMAN RESOURCES. WELLSTAR HEALTH SYSTEM WAS A WINNER OF THE LEADERSHIP IN EXCELLENCE AWARD BY VIZIENT MIDSOUTH, A MEMBER ALLIANCE FOR NOT FOR PROFIT HEALTHCARE PROVIDERS. THE PURPOSE OF THIS AWARD IS TO RECOGNIZE ORGANIZATIONS THAT HAVE ACHIEVED A CERTAIN LEVEL OF EXCELLENCE ACROSS THREE KEY FOCUS AREAS- FINANCIAL AND OPERATIONAL EXCELLENCE, CLINICAL QUALITY EXCELLENCE AND INNOVATION.

FORM 990, PART IV, LINE 12B

AUDITED FINANCIAL STATEMENTS WellStar Health System, Inc. is audited on an annual basis by an outside auditing firm, KPMG, and as part of that audit a consolidated financial statement is issued for all of WellStar Health System, Inc. and its CONTROLLED Affiliates. The independent auditors report includes the accounts of Wellstar and its controlled affiliates, WELLSTAR Kennestone Hospital, Inc., WELLSTAR Cobb Hospital, Inc., WELLSTAR Douglas Hospital, Inc., WELLSTAR Paulding Medical Center, Inc., WELLSTAR ATLANTA MEDICAL CENTER, INC., WELLSTAR NORTH FULTON HOSPITAL, INC., WELLSTAR SPALDING REGIONAL HOSPITAL, INC., WELLSTAR SYLVAN GROVE HOSPITAL, INC., WELLSTAR WEST GEORGIA HEALTH SERVICES, INC., WELLSTAR WEST GEORGIA MEDICAL CENTER, INC., Wellstar Foundation, Inc., WELLSTAR WEST GEORGIA FOUNDATION, INC., VERNON WOODS RETIREMENT COMMUNITY, INC., CHS Foundation, Inc., Community Assurance Company, Ltd., various Wellstar owned physician practices, a hospice facility, a nursing facility, home health business, and entities for infusion therapy and durable medical equipment. All significant intercompany accounts and transactions have been eliminated in combination. The Board of Trustees of Wellstar HEALTH SYSTEM, INC. has the authority to approve appointments of the members of the board of trustees of all affiliate corporations.

FORM 990, PART VI, SECTION B, LINE 11B

BOARD REVIEW OF FORM 990 Internal staff prepares the organization's Form 990. Before filing the return with the Internal Revenue Service. an external accounting firm, PricewaterhouseCoopers LLP, reviews and sign-offs on the completed return of each organization. Generally, Form 990 is then reviewed by the Finance Committee along with a question and answer session. A motion is then made by the Finance committee to approve the returns and present to the full board copies of the forms in an electronic (PDF. format) version as well as a hard copy. The organization's CFO or designee subsequently signs the return for either manual or electronic filing by the appropriate due date. FORM 990, PART VI, SECTION B, LINE 12C CONFLICT OF INTEREST POLICY OUR Conflict of Interest Policy requires all covered persons to annually review the policy and then complete, sign and return the Conflicts of Interest Survey and Attestation to the Compliance Office. The policy requires an on-going disclosure obligation in the event a conflict arises during the year. The following is our process to regularly and consistently monitor and enforce the policy: Compliance identifies all covered persons who must complete the Survey and Attestation. Compliance verifies that the Survey and Attestation is distributed to these persons. Compliance verifies that these persons return a fully completed and signed Survey and Attestation. Compliance reviews each completed and signed Survey and Attestation to identify all conflicts listed in the document. All conflicts, potential conflicts and incidences of non-compliance are referred to the Chief Compliance Officer. The CCO takes appropriate action to completely resolve all identified conflicts and incidences of non-compliance. FORM 990, PART VI, SECTION B, LINES 15A & 15B COMPENSATION OF OFFICERS WELLSTAR HEALTH SYSTEM, INC. HAS ENGAGED SULLIVAN COTTER TO WORK WITH THE GOVERNING BOARD TO REVIEW AND RECOMMEND EXECUTIVE COMPENSATION. THE EXECUTIVE COMPENSATION PROCESS AT WELLSTAR IS OVERSEEN BY A COMMITTEE OF INDEPENDENT TRUSTEES, WHICH FOLLOWS A BOARD-APPROVED EXECUTIVE COMPENSATION PHILOSOPHY. THE COMPENSATION COMMITTEE CONSISTS OF FIVE TRUSTEES AS WELL AS THE CEO IN AN ADVISORY ROLE AND NOT A VOTING MEMBER. FURTHER IN COMMITTEE DISCUSSIONS ABOUT THE COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER, THE CEO WILL RECUSE HIM/HERSELF FROM THAT PROCESS AND IS A NON-VOTING COMMITTEE MEMBER FOR DISCUSSIONS ON ALL OTHER OFFICERS. THE EXECUTIVE COMPENSATION PHILOSOPHY EMPOWERS THE COMMITTEE TO OVERSEE THE EXECUTIVE COMPENSATION PROCESS AND ADMINISTER THE EXECUTIVE COMPENSATION PROGRAM ON BEHALF OF THE FULL BOARD OF TRUSTEES OF WELLSTAR; PROVIDED, HOWEVER, THE FULL BOARD OF TRUSTEES EVALUATES AND APPROVES THE COMPENSATION OF THE CHIEF EXECUTIVE OFFICER. THE PHILOSOPHY REQUIRES ANNUAL DISCLOSURE OF THE COMMITTEE'S ACTIONS AND DECISIONS TO THE FULL BOARD, WHICH IT HAS DONE. THE COMMITTEE IS GUIDED BY THE BOARD-APPROVED PHILOSOPHY. OVERALL, THE PHILOSOPHY IS INTENDED TO REWARD FOR ORGANIZATIONAL AND INDIVIDUAL PERFORMANCE. BASE COMPENSATION IS TARGETED AT THE MEDIAN BASE COMPENSATION PAID TO SIMILAR POSITIONS AT SIMILAR ORGANIZATIONS (THE MARKET). OFFICERS OF THE COMPANY ALSO RECEIVE VARIABLE COMPENSATION THAT IS DEPENDENT ON INDIVIDUAL AND ORGANIZATION PERFORMANCE. WHEN PERFORMANCE IS AT A PREDETERMINED TARGETED LEVEL, THE TOTAL COMPENSATION, BOTH BASE AND VARIABLE, IS INTENDED TO BE AT OR AROUND THE 75TH% OF COMPENSATION PAID TO SIMILAR POSITIONS AT SIMILAR ORGANIZATIONS. WELLSTAR'S EXECUTIVE COMPENSATION PHILOSOPHY DEFINES THE MARKET AS BEING COMPRISED OF COMPARABLE NOT-FOR-PROFIT HEALTH CARE DELIVERY SYSTEMS, I.E., NOT-FOR-PROFIT ORGANIZATIONS SIMILAR IN COMPLEXITY AND SCALE TO WELLSTAR. TO ASSIST THE COMMITTEE IN FULFILLING ITS DUTIES, THE COMMITTEE ENGAGED SULLIVAN COTTER TO PROVIDE MARKET COMPENSATION DATA TO COMPARE TO THE WELLSTAR POSITIONS WHOSE COMPENSATION THE COMMITTEE OVERSEES. THE COMMITTEE USES THIS DATA TO PROVIDE CONTEXT WHEN MAKING DECISIONS IN ADMINISTERING THE COMPENSATION PROGRAM. ACCURATE MINUTES OF THE COMMITTEE'S DISCUSSION AND DECISIONS ARE RECORDED DURING EACH COMMITTEE MEETING AND REVIEWED AND PROVIDED TO THE FULL BOARD OF TRUSTEES FOR REVIEW. FORM 990, PART VI, SECTION C, LINE 19 DOCUMENTS MADE AVAILABLE TO THE PUBLIC The organization and its AFFILIATES are subject to the Open Records Law in the State of Georgia. Therefore, by law, citizens are permitted to inspect and copy its governing documents, policies and financial statements as may be requested from time to time. Additionally, the organization's Form 990 is made readily available on the Guidestar website. Periodically, the organization publishes its financial performance in the local newspaper for citizens to review, and publishes a community benefit report once a year for distribution to the public. FORM 990, PART VII OFFICERS HOURS WORKED The officers devote their time to all of the organizations WITHIN WellStar Health System that are listed in Schedule R, Part II. As such, the total hours worked by the officers across all of the organizations exceeds 40 hours per week. FORM 990, PART VII & FORM 990, SCHEDULE J COMPENSATION ALL COMPENSATION AMOUNTS REPORTED ON FORM 990, PART VII; PART IX, LINES 5-7; AND SCHEDULE J REPRESENT COMPENSATION PROVIDED TO INDIVIDUALS THAT PROVIDE SERVICES TO THE ORGANIZATION. LIKEWISE, THE NUMBER OF EMPLOYEES REPORTED ON PART V, LINE 2A REPRESENTS THE NUMBER OF INDIVIDUALS PROVIDING SERVICES TO THE ORGANIZATION. ALL FEDERAL EMPLOYMENT TAX RESPONSIBILITIES FOR THESE INDIVIDUALS (INCLUDING FEDERAL EMPLOYMENT TAX REPORTING RESPONSIBILITIES) ARE HANDLED BY WELLSTAR HEALTH SYSTEM, INC. (EIN 58-1649541).

FORM 990, PART XI, LINE 9

OTHER CHANGES IN NET ASSETS FOR THE REPORTING PERIOD WELLSTAR HEALTH SYSTEM, INC. HAD THE FOLLOWING CHANGES IN NET ASSETS: PENSION ADJUSTMENT $ 7,199,000 ASSETS RELEASED FROM RESTRICTION 3,187,000 OTHER CHANGES* 2,053,154) -------------- Total Other Changes in Net Assets $ 8,332,846 *FOR THE REPORTING PERIOD, WELLSTAR HEALTH SYSTEM, INC. HAD A CHANGE IN NET ASSETS OF ($2,053,154) RELATED TO TRANSFERS TO/FROM AFFILIATES AS PART OF THE ALLOCATION OF INCOME STATEMENT AND BALANCE SHEET TRANSACTIONS OVER THE YEAR.

For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.

Cat. No. 51056K

Schedule O (Form 990 or 990-EZ) 2017

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