Walker County Hospital Corporation

“Memorial hermann hospital system (mhhs), also a texas nonprofit corporation, managed the operations of the hospital through an operating agreement. Under the operating agreement, mhhs provided day-to-day operations management of the hospital. The management agreement between mhhs and the hospital expired on april 30, 2013. Management fees, expense reimbursements, and other amounts paid pursuant to this agreement for the years ended june 30, 2014 and 2013, was approximately $704,494 and $1,401,000, respectively. The following individuals were reported in form 990, part vii but shown with no compensation per irs guidance. Their compensation under their employment with mhhs, an unrelated entity, for services to the hospital are as follows: sally i nelson, ceo $195,225 shannon brown, ceo $ 93,820 david ficklen, md, cmo $ 85,948”

“The detailed review of the form 990 is conducted by the cfo following the preparation and review of the return by the organization's paid preparer. An electronic copy of the final form 990 is emailed to each board member prior to filing with the irs.”

“The organization follows a conflict of interest disclosure process which requires all officers, directors, key employees, highly compensated employees and other management officials ("covered persons") to disclose potential conflicts. Pursuant to the policy, a disclosure statement is circulated annually to covered persons in which the individual must disclose transactions that may result in a conflict. Covered persons are also encouraged to notify the board, appropriate management personnel, chief compliance office, general counsel, or the audit and compliance committee of the governing body as necessary. When necessary, the board chair or appropriate board committee may appoint a disinterested person(s) or committee to investigate the potential conflict of interest and recommend alternatives to the applicable transaction or arrangement or otherwise determine if the conflict can be resolved. If a more advantageous transaction or arrangement is not reasonably possibly under the circumstances not producing a conflict of interest, the governing board or committee shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the best interest of the organization, and whether it is reasonable. The governing board or committee makes the decision as to whether to enter into the transaction or arrangement. Any member of the board operating under a conflict is not permitted to be present or otherwise participate in the vote on any matter to which the conflict relates. If the governing board or committee of the organization has reasonable cause to believe that a covered person has failed to disclose an actual or possible conflict of interest and after investigation the board or committee determines that the covered person failed to disclose a conflict of interest, the organization takes appropriate disciplinary or corrective action, which may include, termination of the individual's membership, employment, or contract.”

“The organization used aon hewitt to develop the compensation plan and aon hewitt utilized numerous market surveys to establish the plan. The plan was developed by an independent person and approved by the finance committee and board. Hmh also utilizes salary reviews and surveys for comparison when determining compensation of highly compensated employees.”

“The organization makes its governing documents, financial statements, and conflict of interet policy available at its business office upon request.”

“Change in pension liability 74,636. Rounding adjustments 2.”

“The taxpayer has determined in good faith that the taxpayer does not have any activities generating unrelated business taxable income ( as defined in irc section 152 (a)) in the current year. Therefore, the taxpayer is not required to file any return other than form 990.”

“Pursuant to the management agreement between walker county hospital corporation d/b/a huntsville memorial hospital ("hmh") and memorial hermann hospital services ("mhhs"), the salaries of sally i. Nelson, shannon l. Brown, david r. Ficklen and susan white are paid by mhhs. Hmh pays mhhs a management fee to cover the salaries of these individuals for serving as officers of hmh.”