Susquehanna Health System

“Board members Dr. Jill Burns, Dr. Ronald DiSimone, Dr. Durriya Esaa, Davie Jane Gilmour, Philip Johnson, Sister Teresa Ann Jacobs, Daniel Klingerman, Keith Kuzio, Donald Leathers, Lynda Livingston, J. Dennis Murray, Dr. Alexander Nesbitt, Thomas Owlett, Dr. Shailesh Patel, Ann Pepperman, Glenn Poirier, and Patrick Wilson all serve on the board of a related taxable organization.”

“Effective October 1, 2016 an amendment to the bylaws for UPMC Susquehanna was adopted by the Board of Directors pursuant to an affiliation agreement with UPMC. Article I: The name of the corporation is UPMC Susquehanna. Article II: The physical address of the registered office of the corporation is 700 High Street, Williamsport, Lycoming County, PA 17701. Article VI: There shall be one member of the corporation, which shall be UPMC (the "Member"), a Pennsylvania nonprofit corporation which has been formed exclusively for charitable, scientific and educational purposes within the meaning of Section 501(c)(3) of the Code and has been determined as such by the Internal Revenue Service. Article VII: The business, property and affairs of the corporation shall be managed and controlled by the Board of Directors, subject to the reserved powers of the Member.”

“UPMC, a federally tax exempt 501(c)(3) nonprofit corporation, is the sole member of UPMC Susquehanna.”

“Two-thirds (2/3) of the total number of Directors shall be UPMC Susquehanna Directors. One-third (1/3) of the total number of Directors shall be UPMC Designated Directors, who shall be appointed by the sole member - UPMC. One member of the board of directors shall be appointed by the Sisters of Christian Charity Health Care Corporation. This director shall have all of the powers provided to the other directors except they shall not have the power to vote to appoint the President of the Corporation and they shall not participate in the discussions of, or vote on any matters contrary to the Directives.”

“The affairs of the corporation shall be managed and controlled by its Board of Directors, subject to the reserved powers of the sole member UPMC. During the 5 year integration period commencing on the closing date (October 1, 2016), the following actions will require joint approval of the Board and UPMC: a) Approval of operating and capital budgets of UPMC Susquehanna and UPMC Susquehanna entities. b) Approval of plans for application and use of the Capital Expenitures and Strategic Opportunities Commitment. c) Approval of any existing affiliations or contractual arrangements of UPMC Susquehanna. d) Approval of renewals or amendments to any existing material contract. e) Approval of strategic plans. f) Material changes to existing contractual arrangements with physicians. g) Entering into new or changing existing joint venture arrangements. h) Approval of selection of the President of UPMC Susquehanna. i) Approval of the terms of any management arrangements with an unrelated third party. j) Any material changes to clinincal programs. k) Any change to the corporate structure. l) Any sale, lease, joint venture, acquisition, merger, consolidation, affiliation, membership transfer or other transaction involving UPMC Susquehanna or any UPMC Susquehanna entity. m) Approval of any business plan with respect to the Regional Services Center. n) The determination that any UPMC Susquehanna Entity will no longer be licensed or operated as currently licensed. o) Any amendment of the Articles of Incorporation or the Bylaws, or other applicable governing documents. p) Any consolidation of UPMC Susquehanna's captive insurance company with UPMC's captive insurance program. q) Sale of any real estate of UPMC Susquehanna. r) Any material change to the residency programs at UPMC Susquehanna. s) Any changes to the Articles of Incorporation or the Bylaws of UPMC Susquehanna.”

“A high-level overview of Forms 990 is presented to the parent Board of Directors (UPMC Susquehanna) before filing and complete drafts of all returns are made available to all Board members through the CEO's and CFO's office.”

“All members of the Board of Directors are required to submit a statement annually disclosing any conflict of interest that may arise. Requests for the annual form are distributed individually to each Board Member by the Office of the President and CEO. The CEO's executive assistant ensures that she receives a completed form from every Board Member. All Board Members agree to abstain when any issue involving the parties with conflicting interest is called to motion.”

“All top management is employed by The Williamsport Hospital. The following paragraph describes the process they use. The Board of Directors, through the Executive Compensation Committee, retains an independent outside consultant to provide guidance with respect to the annual establishment of the rebuttable presumptive or reasonableness relative to executive compensation and benefits. The consultant annually provides detailed market information from its annual Executive Compensation Survey for Health Systems. In addition, other regional survey data is provided in order to supply the health system with a "national" picture of compensation. With this process established, the Executive Compensation Committee takes the proper steps to educate the Board of Directors to understand all of the above-mentioned oversight and to appropriately prepare them for community or media inquiry. In addition, the Board is made aware of the Form 990 and its role in the communication of information to the public.”

“These documents are available to members of the public who request them.”

“Consulting fees: Program service expenses 117,060. Management and general expenses 0. Fundraising expenses 0. Total expenses 117,060.”

“Unrestricted assets transferred to UPMC (parent) -20,192,658.”

“UPMC, the sole member of UPMC Susquehanna, has assumed the responsibility for oversight of the audited financial statements at a system level for FY 2017.”