Mercy Clinic Fort Smith Communities

“Classes of members or stockholders the filing organization has a sole corporate member, mercy health fort smith communities. The following corporate powers and responsibilities are reserved solely for the sole corporate member: - adopt or amend the mission and philosophy of the corporation and any organization controlled by the corporation; - adopt or amend the operating and capital budgets of the corporation and any organization controlled by the corporation and any changes in such budgets in excess of an amount established from time to time by the member; - review and approve any capital expenditures or recommendations not previously approved as part of the corporation's budgets; - authorize or approve the assignment, transfer, sale or lease of any of the assets of the corporation or any organization controlled by the corporation or interest therein in excess of an amount established from time to time by the member; - authorize or approve the grant of any pledge, lien, encumbrance, mortgage, deed of trust or other security interest in any or all of the assets of the corporation and any organization controlled by the corporation; - authorize or approve the incurrence of debt (other than debt incurred for the acquisition of goods that are acquired in the ordinary course of business) by the corporation or any organization controlled by the corporation and the grant any security interests, the placement of any encumbrances, the entering into any covenants, and the execution of any documents and the taking of any actions necessary or appropriate in connection with the incurrence of such debt; - merge, dissolve or abandon the corporation or any organization controlled by the corporation; - amend the articles of incorporation and bylaws of the corporation and any organization controlled by the corporation; - appoint directors; - establish all compensation and benefit terms for physicians and other medical professionals employed or otherwise retained by the corporation; - remove directors with or without cause; - approve the creation, ownership or acquisition of, or affiliation with any other organization controlled by the corporation; - approve contracts in which the corporation assumes financial risk, including but not limited to managed care contracts, subject to consultation with the managed care contracting committee of the member; - approve the corporation's manpower plan; - through the sole action of the president of the member (with the approval of the president of mh), appoint and remove the president of the corporation; and - authorize and amend the charity care policy of the corporation.”

“Dscr the process used by management &/or governing body to review 990 the form 990 is prepared by an independent accounting firm, using information provided by the filing organization. A draft form 990 is reviewed by the filing organization's finance team, including the director of finance and the vice-president of finance. The draft form 990 is also reviewed by mercy health's tax department, to ensure accuracy and consistency with other related organizations' forms 990. After questions arising from the various reviews are addressed and incorporated into the form 990, a revised draft is provided to the filing organization's leadership team, including the cfo and ceo, for review. Once reviewed and approved by the filing organization's leadership team, the form 990 is then signed and filed with the irs.”

“Description of process to monitor transactions for conflicts of interest officers, directors, key employees and other disqualified persons are required to complete a conflict of interest questionnaire annually and did so in the normal course for the year ended june 30, 2021. This process is administered at the mercy health level by mercy's corporate compliance department. The questionnaires are reviewed with leadership at the local level and potential conflicts discussed and resolved. The conflicts and their respective resolutions are shared at the mercy level with a team including mercy's chief financial officer, chief compliance officer and other members of finance, legal and hr. Summary results are reviewed with mercy's stewardship committee of the board of directors.”

“Officers & positions for which process was used, & year process was begun for those classified as officers (and thus disqualified persons), the organization relies upon mercy health, which uses the following to establish the compensation: external market salary surveys, external market salary studies, engagement of an independent compensation consultant, and review/approval of compensation by the compensation committee of the board of mercy health. For those classified as key employees, the filing organization uses the following to establish the compensation: external market salary surveys, external market salary studies, and review/approval of executive management. Compensation reviews are completed on an annual basis and a review was completed during the reporting year.”

“AVAIL OF GOV DOCS, CONFLICT OF INTEREST POLICY, & FIN STMT TO GEN PUBLIC GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS ARE MADE AVAILABLE UPON REQUEST BUT ARE NOT PUBLISHED PUBLICLY. FORM 990, PART VII, SECTION A FORMER EMPLOYEE COMPENSATION IS REPORTED FOR THE CALENDAR YEAR ENDING WITHIN THE ORGANIZATION'S FISCAL YEAR WHILE AVERAGE HOURS ARE BASED ON THE FISCAL YEAR PERIOD FROM JULY 1, 2020 THROUGH JUNE 30, 2021. FORM 990, PART VII, SECTION B IT IS POSSIBLE THAT A PORTION OF THE AMOUNTS REPORTED FOR CONSTRUCTION SERVICES MAY INCLUDE EXPENSE REIMBURSEMENT, IN ADDITION TO AMOUNTS PAID FOR SERVICES. HOWEVER, THE AMOUNTS ARE NOT DISTINGUISHABLE. FORM 990, PART VIII IMPACT OF COVID-19 PANDEMIC Early in 2020, the Mercy Health System was called to serve as the COVID-19 pandemic swept across the world. During FY 2021, it continued to be a difficult time for all healthcare providers. All Mercy facilities adjusted operations for the impacts of the pandemic which meant making changes to patient care areas and cancelling most of our outpatient procedures for periods of time. In addition, Mercy foundations and outreach ministries experienced limitations in fundraising for program and capital support efforts that assist the underserved in our communities. Mercy's total system net patient revenues were reduced during the year due to surges in the communities we serve. Mercy did receive funding from the Coronavirus Aid Relief and Economic Security Act ("CARES Act"). Mercy received CARES Act funding across various entities for the year ended June 30, 2021 and recognized a portion of this funding in other operating revenue. These funds helped to offset revenue losses and additional expenses incurred due to the pandemic; however, these funds fell short of the system losses experienced since the start of the pandemic. The impact of COVID-19 was significant to our communities and coworkers as unemployment rates soared and Mercy acted quickly to provide continuous care to patients and the community. Mercy continues to monitor the impacts of the pandemic both to the health system and the communities served as we continue to provide assistance and maintain access to care within our communities.”

“OTHER PROGRAM SERVICES Multi-Specialty Physician Services: In addition to the top 3 services, Mercy Clinic Fort Smith offers services in the following specialties: Audiology, Behavioral Health, Ear, Nose & Throat, Endocrinology, General Surgery, Head & Neck Surgery, Gastroenterology, Interventional Pain Medicine, Nephrology, Neurology, Neurosurgery, OB/GYN, Occupational Medicine, Oncology, Radiation Oncology, Ophthalmology, Palliative Care, Plastic Surgery, Podiatry, Pulmonology, Sleep Medicine and Wound Care. Mercy Clinic Fort Smith providers serve patients throughout Sebastian County Arkansas and the surrounding service area. During the year, 193,519 office visits were provided in these specialties to patients in our service area. FORM 990, PART V, QUESTION 1A FORM 1099/1096 FILING VENDORS FOR THE FILING ORGANIZATION ARE PAID BY MERCY HEALTH (EIN 43-1423050). AS SUCH, ALL REQUIRED FORM 1099 AND FORM 1096 REPORTING IS MADE FOR THE ENTIRE MERCY HEALTH SYSTEM (WITH LIMITED EXCEPTIONS) UNDER THE MERCY HEALTH EIN.”

“Community Benefit Mercy Clinic Fort Smith Communities provides financial assistance to patients in the form of charity care and the unpaid costs of Medicaid. This assistance is based on the financial assistance policy in place at hospitals in the health system. During FY21, Mercy Clinic Fort Smith Communities reported approximately $2.3 million of charity care and $6.7 million of unpaid costs of Medicaid which were a benefit to the patients served in its community. FORM 990, PART XI, LINE 9 OTHER CHANGES IN NET ASSETS NET TRANSFERS TO/FROM AFFILIATES = $37,962,492”

“Audit of financial statements the filing organization's financial statements were included in mercy health and subsidiaries annual financial statement audit. Mercy health and subsidiaries received an unqualified opinion from the external auditors for fiscal 2021 (the tax year currently being reported). However, no separate audit opinion was issued on the financial statements of the filing organization. The ultimate responsibility for oversight of the financial statement audit and selection of the external auditor lies with the stewardship committee of the mercy health board of directors. Audit results are communicated to this committee. Form 990, part xii, question 3a and 3b single audit act and 2 cfr 200 audit mercy health undergoes a consolidated 2 cfr 200 audit every year. This audit is underway for the fiscal year ending june 30, 2021 and will be completed by september 30, 2022. Each entity that receives federal funds during the year is included on the schedule of expenditures of federal awards (sefa) and is also included in the population included in the audit. If the filing entity received federal funds during the year ended june 30, 2021, it will be included on the mercy health consolidated sefa, and therefore, also included in the population included in the audit.”