Memorial Hermann Medical Group

“Memorial Hermann Medical Group has as its sole member Memorial Hermann Health System, both of which are 501(c)(3) non-profit entities.”

“The member has the authority to annually elect the board members of the organization and to terminate and replace them at its discretion.”

“The member has approval authority over the decisions of the board for amendments to the bylaws and articles of incorporation, annual operating and capital budget, the purchase or sale of substantial assets, and the merger or dissolution of the organization.”

“Memorial Hermann Medical Group PROVIDES A COPY OF THE FORM 990 TO ALL MEMBERS OF THE GOVERNING BODY VIA A WEBSITE SET UP SPECIFICALLY FOR BOARD MEMBERS TO ACCESS VARIOUS BOARD MEMBER DOCUMENTS. THE FORM 990 IS REVIEWED BY MEMORIAL HERMANN FINANCIAL ACCOUNTING STAFF, BY SPECIFIC DEPARTMENTS INVOLVED IN RELATED SECTIONS OF THE RETURN, BY THE MEMORIAL HERMANN CHIEF ACCOUNTING OFFICER PRIOR TO ITS FILING.”

“Memorial Hermann Medical Group utilizes a conflict of interest survey and has codified its procedure in a policy. The policy is monitored by our Corporate Compliance Department through annual surveys of board members, corporate officers, management level employees, and other selected employees, physicians and vendors for all of its entities and related affiliates. In addition to responding to the survey, each recipient affirms that they have received a copy of the policy, has read and understood it, has agreed to comply with it, and understands that Memorial Hermann is a charitable organization that must engage in primarily tax-exempt purpose activities. The Corporate Compliance Department, Chief Legal Officer and the Corporate Audit Committee, consisting of independent board members, receive a report of all items disclosed. The Audit Committee Chair reports the existence of any conflicts to the Corporate Board of Directors. Memorial Hermann's conflicts of interest policy requires that Board members excuse themselves from discussions in which they have a conflict of interest. The policy also subjects Board members to disciplinary action if they are found to have violated the policy.”

“Memorial Hermann Medical Group (MHMG) has established communication channels to report problems and concerns including a telephone Helpline. Employee partners are encouraged to report problems or concerns either anonymously or in confidence via the Helpline when they deem appropriate. The Helpline establishes an avenue for employee partners or interested parties to report suspected criminal activity, and illegal or unethical conduct occurring within the organization in the event other resolution channels are ineffective or the caller wishes to remain anonymous. The Corporate Compliance Helpline is administered by an outside service in order to protect the anonymity of callers to the Helpline if they so desire to remain anonymous. All those who are employed in the Helpline operation or contracted organizations administering the Helpline are expected to act with utmost discretion and integrity in assuring that information received is acted upon in a reasonable and proper manner. MHMG has established a strict non-retaliation policy to protect, from retaliation, employee partners and others who report problems and concerns in good faith. There shall be no retaliation against a MHMG employee, independent contractor, vendor, allied health professional or medical staff member for reporting or raising a question regarding MHMG's compliance with a law or regulation. Those reporting suspected non-compliance who wish to remain anonymous may do so if they so choose. All reports of suspected non-compliance will be addressed in a confidential manner. The Corporate Compliance Officer or designee will always strive to maintain confidentiality during the compliance review and investigation process; however there may be a point where the identity of a reporter may need to be revealed where appropriate.”

“The process for determining compensation for the Organization's CEO and other top management is described below in the following four sections. *Compensation Philosophy *Components of Executive Compensation *Roles of Compensation Decision Makers *Summary Compensation Philosophy The Compensation Committee has established the following compensation philosophy. Accountable for Business Performance: Compensation should be tied to our long-term and short-term business strategies of each dimension of our business including, but not limited to, Quality & Safety, Service & Satisfaction, Operational Excellence, and Growth & People. Attract, Retain and Motivate: Compensation should reflect the competitive marketplace so the Company can attract, retain and motivate talented executives. Accountable for Individual & Business Unit Performance: Compensation should be tied to our individual and business unit performance. Comply with IRC Section 4958: Compensation programs and pay levels should be "Reasonable" within the definition of IRC Section 4958. Balanced Approach: We should balance any potential strategic, financial, operational and reputational risk with our pay-for-performance philosophy. Components of Executive Compensation; Compensation Component - Base Salary Description - Fixed compensation component. Objectives - Attract, retain, and motivate executives by providing a competitive level of fixed compensation based on the executive's responsibilities. Compensation Component - Management Incentive Plan Description - Variable and annual performance-based compensation component. Target amounts for each executive are set by the Compensation Committee. Actual payouts may be less than or greater than the target amounts based on the Company's performance against its short-term goals. Goals are set at a significant "stretch" level such that target performance results in above median payouts. Objectives Align short-term performance with the goals of the Company. Ensure cost-effective and efficient use of Company assets by offering the appropriate amounts and mix of compensation. Compensation Component - Long-Term Incentive Plan Description Variable and three-year performance-based compensation component. Target amounts for each executive are set by the Compensation Committee. Actual payouts may be less than or greater than the target amounts based on the Company's performance against its long-term goals. Goals are set at a significant "stretch" level such that target performance results in above median payouts. Objectives Promote retention, advance pay-for-performance, and reinforce the link between the interests of the executive and the overall long-term success of the Company. Ensure cost-effective and efficient use of Corporate assets by offering the appropriate amounts and mix of compensation. Compensation Component - Deferred Compensation Plan Description - Program designed to promote retention and long-term success of Memorial Hermann by acting as a backstop for our performance-based programs. Objectives - Promote retention by encouraging the executive to continue to serve Memorial Hermann for the vesting period. As part of his compensation package, the CEO and President, Mr. Wolterman, has been provided with a retention agreement. Per the terms of this agreement, he will receive a lump sum payment in July 2016. This lump sum payment is being accrued over the life of the retention agreement (July 2009 to January 2017). The 2013 accrual is included in Column C of Part II on the attached Form 990 Schedule J. If Mr. Wolterman voluntarily leaves prior to January 2017, he does not receive any portion of this lump sum payment. Under certain circumstances (e.g., death or disability), Mr. Wolterman, or his beneficiary, would be entitled to a prorated portion of this lump sum payment. All employees are paid by the Corporation or an affiliate health system entity and no time or salary is allocated. Corporate officers perform administrative acti”

“The articles of incorporation, corporate bylaws, conflict of interest policy and financial statements of Memorial Hermann Health System and its affiliates are generally not made available to the public. If the inquirer provided a valid reason for desiring a copy of the documents that are related to the business interests of any of the Memorial Hermann Health System corporate entities, we would consider doing so.”

“Memorial Hermann Medical group does not have its financial accounts separately audited nor receive audited financial statements. For the consolidated entities of the Memorial Hermann Health System and its affiliates an independent audit is conducted and audited financial statements are prepared according to GAAP by an independent accounting firm, of which the financial accounts of The Medical Group is a part.”

“The employees of Memorial Hermann Medical group are record-kept and paid through the payroll system of Memorial Hermann Health System and reported under the Memorial Hermann Medical Group EIN for Form 941 and Form W-2 purposes. All costs of the compensation and benefits of the Medical Group employees are reimbursed to the Health System. Corporate officers are employees of Memorial Hermann Health System and their salaries and benefits are not allocated amongst the various corporate entities for which they conduct employment activities.”

“Memorial Hermann Health System has independent committees for audits, governance, and compensation which perform their respective functions on a consolidated basis for all corporate entities. The audit committee hires the independent accountants and oversees all audits that are conducted within all affiliated entities for financial information, grants and awards, and qualified plans.”