Shore Health Services Corporation

“Shore memorial health system ("system") is the sole member of this organization. System has the right to elect the members of this organization's board of trustees and has certain reserved powers as defined in this organization's bylaws.”

“THE ORGANIZATION IS AN AFFILIATE within SHORE MEMORIAL HEALTH SYSTEM and affiliates; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM ("SYSTEM") WHICH INCLUDES SHORE MEDICAL CENTER. SHORE MEMORIAL HEALTH SYSTEM IS THE tax-exempt PARENT ENTITY OF THE SYSTEM. THis ORGANIZATION'S FEDERAL FORM 990 WAS provided TO EACH VOTING MEMBER OF ITS GOVERNING BODY (ITS BOARD OF TRUSTEES) PRIOR TO FILING WITH THE INTERNAL REVENUE SERVICE ("IRS"). THE SHORE MEDICAL CENTER AUDIT AND COMPLIANCE COMMITTEE ASSUMED THE RESPONSIBILITY TO OVERSEE AND COORDINATE THE FEDERAL FORM 990 PREPARATION, REVIEW AND FILING PROCESS. AS PART OF THE ORGANIZATION'S FEDERAL FORM 990 TAX RETURN PREPARATION PROCESS THE ORGANIZATION HIRED A PROFESSIONAL CPA FIRM WITH EXPERIENCE AND EXPERTISE IN BOTH HEALTHCARE AND NOT-FOR-PROFIT TAX RETURN PREPARATION TO PREPARE THE FEDERAL FORM 990. THE CPA FIRM'S TAX PROFESSIONALS WORKED CLOSELY WITH THE ORGANIZATION'S FINANCE PERSONNEL AND SYSTEM INDIVIDUALS INCLUDING THE CHIEF FINANCIAL OFFICER, DIRECTOR OF FINANCE AND OTHER SYSTEM INDIVIDUALS ("INTERNAL WORKING GROUP") TO OBTAIN THE INFORMATION NEEDED IN ORDER TO PREPARE A COMPLETE AND ACCURATE TAX RETURN. THE CPA FIRM PREPARED A DRAFT FEDERAL FORM 990 AND FURNISHED IT TO THE ORGANIZATION'S INTERNAL WORKING GROUP FOR REVIEW. THE ORGANIZATION'S INTERNAL WORKING GROUP REVIEWED THE DRAFT FEDERAL FORM 990 AND DISCUSSED QUESTIONS AND COMMENTS WITH THE CPA FIRM. REVISIONS WERE MADE TO THE DRAFT FEDERAL FORM 990 WHERE NECESSARY AND A FINAL DRAFT WAS FURNISHED BY THE CPA FIRM TO THE ORGANIZATION'S INTERNAL WORKING GROUP FOR FINAL REVIEW AND APPROVAL. A MEETING with the MEDICAL CENTER's audit and compliance committee WAS ALSO HELD TO REVIEW THE FINAL DRAFT OF THE FEDERAL FORM 990. FOLLOWING THIS REVIEW, THE FINAL FEDERAL FORM 990 WAS provided TO EACH VOTING MEMBER OF THE ORGANIZATION'S GOVERNING BODY PRIOR TO FILING WITH THE IRS.”

“THE ORGANIZATION IS AN AFFILIATE within SHORE MEMORIAL HEALTH SYSTEM and affiliates; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM ("SYSTEM") WHICH INCLUDES SHORE MEDICAL CENTER. SHORE MEMORIAL HEALTH SYSTEM IS THE tax-exempt PARENT ENTITY OF THE SYSTEM. THIS ORGANIZATION AND THE SYSTEM REGULARLY MONITOR AND ENFORCE COMPLIANCE WITH ITS CONFLICT OF INTEREST POLICY. ANNUALLY ALL MEMBERS OF THE BOARD OF TRUSTEES, OFFICERS AND SENIOR MANAGEMENT PERSONNEL ARE REQUIRED TO REVIEW THE EXISTING CONFLICT OF INTEREST POLICY AND COMPLETE A QUESTIONNAIRE. THE COMPLETED QUESTIONNAIRES ARE RETURNED TO THE ORGANIZATION AND ITS CHIEF FINANCIAL OFFICER FOR REVIEW. THEREAFTER THE CHIEF FINANCIAL OFFICER PREPARES A SUMMARY OF THE COMPLETED QUESTIONNAIRES WHICH CONTAINS INFORMATION DISCLOSED ON AN INDIVIDUAL BY INDIVIDUAL BASIS AND PRESENTS THIS SUMMARY TO THE MEDICAL CENTER'S AUDIT AND COMPLIANCE COMMITTEE FOR ITS REVIEW AND DISCUSSION.”

“THE ORGANIZATION IS AN AFFILIATE within SHORE MEMORIAL HEALTH SYSTEM and affiliates; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM ("SYSTEM") WHICH INCLUDES SHORE MEDICAL CENTER. SHORE MEMORIAL HEALTH SYSTEM IS THE tax-exempt PARENT ENTITY OF THE SYSTEM. THIS FILING ORGANIZATION ITSELF HAS NO PAID SENIOR MANAGEMENT PERSONNEL RECEIVING COMPENSATION DIRECTLY FROM THIS ORGANIZATION. RATHER, KEY SENIOR MANAGEMENT PERSONNEL INCLUDING, BUT NOT LIMITED TO, THE PRESIDENT/CHIEF EXECUTIVE OFFICER ARE EMPLOYED BY SHORE MEDICAL CENTER; THE TAX-EXEMPT MEDICAL CENTER WITHIN THE HEALTHCARE SYSTEM. HOWEVER, THE COMPENSATION AND BENEFITS OF THIS INDIVIDUAL ARE SHOWN ON THIS TAX RETURN BECAUSE HE IS ALSO AN OFFICER AND BOARD MEMBER OF THIS ORGANIZATION. ACCORDINGLY, THE MEDICAL CENTER'S BOARD OF TRUSTEES HAS AN EXECUTIVE COMPENSATION COMMITTEE ("COMMITTEE"). THE COMMITTEE HAS ADOPTED A WRITTEN EXECUTIVE COMPENSATION PHILOSOPHY WHICH IT FOLLOWS WHEN IT REVIEWS AND APPROVES OF THE COMPENSATION AND BENEFITS OF THE MEDICAL CENTER'S SENIOR MANAGEMENT, INCLUDING THE PRESIDENT/CHIEF EXECUTIVE OFFICER. THE COMMITTEE REVIEWS THE "TOTAL COMPENSATION" OF THE INDIVIDUALS WHICH IS INTENDED TO INCLUDE BOTH CURRENT AND DEFERRED COMPENSATION AND ALL EMPLOYEE BENEFITS, BOTH QUALIFIED AND NON-QUALIFIED. THE COMMITTEE'S REVIEW IS DONE ON AT LEAST AN ANNUAL BASIS AND ENSURES THAT THE "TOTAL COMPENSATION" OF SENIOR MANAGEMENT IS REASONABLE. THE ACTIONS TAKEN BY THE COMMITTEE ENABLE THE MEDICAL CENTER TO RECEIVE THE REBUTTABLE PRESUMPTION OF REASONABLENESS FOR PURPOSES OF INTERNAL REVENUE CODE SECTION 4958 WITH RESPECT TO THE TOTAL COMPENSATION OF CERTAIN MEMBERS OF THE SENIOR MANAGEMENT TEAM, INCLUDING THE PRESIDENT/CHIEF EXECUTIVE OFFICER. THE THREE FACTORS WHICH MUST BE SATISFIED IN ORDER TO RECEIVE THE REBUTTABLE PRESUMPTION OF REASONABLENESS ARE THE FOLLOWING: 1. THE COMPENSATION ARRANGEMENT IS APPROVED IN ADVANCE BY AN "AUTHORIZED BODY" OF THE APPLICABLE TAX-EXEMPT ORGANIZATION WHICH IS COMPOSED ENTIRELY OF INDIVIDUALS WHO DO NOT HAVE A "CONFLICT OF INTEREST" WITH RESPECT TO THE COMPENSATION ARRANGEMENT; 2. THE AUTHORIZED BODY OBTAINED AND RELIED UPON "APPROPRIATE DATA AS TO COMPARABILITY" PRIOR TO MAKING ITS DETERMINATION; AND 3. THE AUTHORIZED BODY "ADEQUATELY DOCUMENTED THE BASIS FOR ITS DETERMINATION" CONCURRENTLY WITH MAKING THAT DETERMINATION. THE COMMITTEE IS COMPRISED OF MEMBERS OF THE BOARD OF TRUSTEES EACH OF WHO ARE INDEPENDENT AND ARE FREE FROM ANY CONFLICTS OF INTEREST. THE COMMITTEE RELIED UPON APPROPRIATE COMPARABLE DATA; SPECIFICALLY THE COMMITTEE OBTAINED A WRITTEN COMPENSATION STUDY FROM AN INDEPENDENT FIRM WHICH SPECIALIZES IN THE REVIEWING OF HOSPITAL AND HEALTHCARE SYSTEM EXECUTIVE COMPENSATION AND BENEFITS THROUGHOUT THE UNITED STATES. THIS STUDY USED COMPARABLE GEOGRAPHIC AND DEMOGRAPHIC MARKET DATA INCLUDING BUT NOT LIMITED TO SIMILAR SIZED HOSPITALS, # OF LICENSED BEDS AND NET PATIENT SERVICE REVENUE. THE COMMITTEE ADEQUATELY DOCUMENTED ITS BASIS FOR ITS DETERMINATION THROUGH THE TIMELY PREPARATION OF WRITTEN MINUTES OF THE COMPENSATION COMMITTEE MEETINGS DURING WHICH THE EXECUTIVE COMPENSATION AND BENEFITS WAS REVIEWED AND SUBSEQUENTLY APPROVED. THE ACTIONS OUTLINED ABOVE WITH RESPECT TO THE COMMITTEE AND THE ESTABLISHMENT OF THE REBUTTABLE PRESUMPTION OF REASONABLENESS ONLY APPLIES TO CERTAIN SENIOR MANAGEMENT PERSONNEL INCLUDING, BUT NOT LIMITED TO, THE PRESIDENT/CHIEF EXECUTIVE OFFICER.”

“THE ORGANIZATION'S FILED CERTIFICATE OF INCORPORATION AND ANY AMENDMENTS CAN BE OBTAINED AND REVIEWED THROUGH THE STATE OF NEW JERSEY department of the treasury.”

“Part vii and schedule j reflect a board member and officer receiving compensation and benefits from a related organization. Please note this remuneration was for services rendered as a full-time employee of the related organization and not for services rendered as a voting member or officer of this organization's board of trustees.”

“THE ORGANIZATION IS AN AFFILIATE within SHORE MEMORIAL HEALTH SYSTEM and affiliates; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM WHICH INCLUDES SHORE MEDICAL CENTER ("SYSTEM"). SHORE MEMORIAL HEALTH SYSTEM IS THE tax-exempt PARENT ENTITY OF THE SYSTEM. THE SYSTEM INCLUDES BOTH FOR-PROFIT AND NOT FOR-PROFIT ORGANIZATIONS. CERTAIN BOARD OF TRUSTEE MEMBERS, OFFICERS AND/OR DIRECTORS LISTED ON CORE FORM, PART VII AND SCHEDULE J OF THIS FORM 990 MAY HOLD SIMILAR POSITIONS WITH BOTH THIS ORGANIZATION AND OTHER AFFILIATES WITHIN THE SYSTEM. THE HOURS SHOWN ON THIS FORM 990, FOR BOARD MEMBERS WHO RECEIVE NO COMPENSATION FOR SERVICES RENDERED IN A NON-BOARD CAPACITY, REPRESENT THE ESTIMATED HOURS DEVOTED PER WEEK FOR THIS ORGANIZATION. TO THE EXTENT THESE INDIVIDUALS SERVE AS A MEMBER OF THE BOARD OF TRUSTEES OF OTHER RELATED ORGANIZATIONS IN THE SYSTEM, THEIR RESPECTIVE HOURS PER WEEK PER ORGANIZATION ARE APPROXIMATELY THE SAME AS REFLECTED ON PART VII OF THIS FORM 990. THE HOURS REFLECTED ON PART VII OF THIS FORM 990, FOR BOARD MEMBERS WHO RECEIVE COMPENSATION FOR SERVICES RENDERED IN A NON-BOARD CAPACITY, PAID OFFICERS AND KEY EMPLOYEES, REFLECT TOTAL HOURS WORKED PER WEEK ON BEHALF OF SHORE MEMORIAL HEALTH SYSTEM; NOT SOLELY THIS ORGANIZATION.”

“Other changes in net assets or fund balances include: - loss on discontinued operations - $4,480”

“THE ORGANIZATION IS AN AFFILIATE within SHORE MEMORIAL HEALTH SYSTEM and affiliates; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM ("SYSTEM") WHICH INCLUDES SHORE MEDICAL CENTER. SHORE MEMORIAL HEALTH SYSTEM IS THE tax-exempt PARENT ENTITY OF THE SYSTEM. AN INDEPENDENT CPA FIRM AUDITED THE CONSOLIDATED FINANCIAL STATEMENTS OF SHORE MEMORIAL HEALTH SYSTEM AND ALL ITS AFFILIATES FOR THE YEARS ENDED DECEMBER 31, 2014 AND DECEMBER 31, 2013; RESPECTIVELY. THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS CONTAIN CONSOLIDATING SCHEDULES ON AN ENTITY BY ENTITY BASIS. THE INDEPENDENT CPA FIRM ISSUED AN UNQUALIFIED OPINION WITH RESPECT TO THE AUDITED CONSOLIDATED FINANCIAL STATEMENTS FOR each YEAR. THE SHORE MEDICAL CENTER AUDIT AND COMPLIANCE COMMITTEE HAS ASSUMED RESPONSIBILITY FOR THE OVERSIGHT OF THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS, WHICH INCLUDES THIS ORGANIZATION, AND THE SELECTION OF AN INDEPENDENT AUDITOR.”