Ucm Network Development Foundation

“On october 1, 2016, the university of chicago medical center (ucmc), an independent health system serving chicago, acquired ingalls health system (ihs), now known as ucm community health & hospital division, inc., and its affiliates through an affiliation and member substitution. As a result of this transaction, ihs and its affiliates became a wholly-owned subsidiary of ucmc through a newly created community health and hospital division of ucmc. Ingalls development foundation (idf) filed amended and restated articles of incorporation on september 30, 2016 to reflect the following changes: - the name of its sole member changed from ingalls health system to ucm community health & hospital division, inc. - in the event of dissolution, idf will first pay or make provision for the payment of all of the liabilities and obligations of the organization. Thereafter, the board will adopt and implement a plan of distribution to the sole member, if the sole member is in existence and qualified under internal revenue code section 501(c)(3). If the sole member is not in existence or so qualified, the assets will be distributed to an organization that at the time qualify under internal revenue code section 501(c)(3). Any such assets not disposed will be disposed of by a court of competent jurisdiction of the county in which the principal office of the organization is then located to an organization(s) qualified under internal revenue code section 501(c)(3). In addition, idf amended and restated its bylaws on september 30, 2016 to reflect the following changes: - the purposes of idf will be to promote and support, directly or indirectly, by donation, loan or otherwise, the interests and purposes of ingalls memorial hospital (imh) and the university of chicago medical center. - the name of its sole member changed from ingalls health system to ucm community health & hospital division, inc. - sections added and amended to describe the general powers and reserved powers of the sole member. - amendments to the general powers of the board of directors. - the number of directors shall be a minimum of ten and a maximum of fifteen, excluding directors ex officio, of which there shall be two. The ex officio directors of the corporation shall be the president of imh, and the dean and executive vice president for medical affairs of the university of chicago, biological sciences division (or his designee) who shall serve with full voting privileges. - one-half of the members of the board shall constitute a quorum for the transaction of business at any meeting of the board, and the act of a majority of the directors present at a meeting at which there is a quorum shall be the act of the board. - the officers of the corporation shall be a president, a secretary/treasurer, and such other officers and assistant officers as the board may authorize. - the articles of incorporation and bylaws of idf may be amended, modified or repealed, and new and different bylaws and articles of incorporation may be adopted, only by the sole member.”

“Pursuant to the organization's governing documents, the sole voting member of the organization is ucm community health & hospital division, formerly known as ingalls health system, a related tax-exempt organization. As the organization's sole corporate member, it has the right to participate in the organization's governance. Form 990, part vi, line 7a prior to 9/30/2016, ucm community health & hospital division, inc. (formerly ihs) has the right to elect and appoint any board of director of the organization. Effective 9/30/2016, ucm community health & hospital division, inc. Designates directors annually at the annual meeting or at such other times as may be determined by ucm community health & hospital division, inc. Form 990, part vi, line 7b prior to 9/30/2016, ucm community health & hospital division, inc. (formerly ihs) has the right to remove any board of director of the organization without cause at any time. Ucm community health & hospital division, inc. Has the exclusive right to approve or ratify significant decisions of the organization's governing body. Significant decisions of the organization's governing body include, but are not limited to, the right to approve long-term capital and operational budgets, to approve a plan of dissolution or merger with another organization, and to approve the development, construction or implementation of any new healthcare facility, program, or service. Effective 9/30/2016, ucm community health & hospital division, inc. Shall retain the right to remove any director, other than the ex officio directors, with or without cause, at any time. Ucm community health & hospital division, inc. Must approve any modification or amendment to any mission statement, statement of goals or values, the articles of incorporation or the bylaws of the corporation; the sale, lease, exchange or disposition of all or substantially all of the assets of the corporation; and the merger, consolidation or dissolution of the corporation.”

“The form 990 is prepared by an independent accounting firm with information provided by management. The full form 990, including supplemental schedules, was presented by the chief financial officers to the finance committee at a committee meeting. The full board has granted to the finance committee authority to approve the form 990. The full board will receive a report from the finance committee, describing the finance committees review performed. Prior to filing with the irs, the form 990 will be available at the organizations board meeting for each members review.”

“Pursuant to the organizations conflict of interest policy, all officers, directors, board members, and key employees must avoid situations in which their personal interests may conflict, or appear to conflict, with the interest of ingalls, and ingalls reviews its own relationships with other care providers, educational institutions, and payers to determine if potential conflicts exists. Board members and employees shall have the continuing affirmative duty to report to the president and chief financial officer (ceo) of ingalls any personal ownership of interest or other relationship that might affect their ability to exercise impartial, ethical business judgments in the area of their responsibilities. Per the organizations conflict of interest policy, board members and employees at management level will be required to complete a certification and disclosure form, on a schedule determined by the corporate compliance officer. Completion of this form is a requirement for all board members and managerial employees, and may be required of non-management employees as determined by the president and ceo and corporate compliance officer. Employees also have a duty to report conflicts or potential conflicts of interest of which they may be aware of involving other employees. Each situation reported shall be reviewed by the president and ceo, and ingalls corporate compliance officer, and a determination shall be made as to whether a conflict of interest exists of may arise from such situation. The decision of the president and ceo and corporate compliance officer regarding whether a conflict exists shall be final. Persons with a conflict are prohibited from participating in the governing bodys resolution of such conflict. The organization further promotes knowledge and understanding of the conflict of interest policy in the employee handbook. Each employee is required to sign an acknowledgement of the handbook upon employment.”

“Ingalls memorial hospital is responsible for determining and administering compensation for all officers of each respective entity within the ucm community health & hospital division, inc. Corporate structure. Below is the process used to establish compensation for the top management official. In setting the top management officials compensation, the executive committee relies on recent comparability studies that provide compensation data for similarly qualified persons in comparable organizations to support its decision-making process. In addition, the organization received an independent compensation review by willis towers watson in september 2015. The committee adequately documents its compensation determinations, deliberations, and approval of the top management officials compensation in the meeting minutes. The process for reviewing and determine compensation for the ceo was last undertaken in september 2015.”

“An outside compensation consultant is used to render a reasonable opinion as to what percentage of increase an officer or key employee should receive by performing a market comparison for all officers and key employees. The process to determine an increase in compensation of salary increases are approved annually by the president and executive committee once received by the outside consultant. Directors and managers receive an increase in compensation based on whether or not performance goals have been reached before a fiscal year starts. Performance goals are put together by the director or manager and submitted to the vice president for approval. Approved goals are then reviewed by all other executives. Once approved by all, these are the goals for the year after the year is over. The performance goals are reviewed by the vice president and director or manager. Market adjustments are set by the immediate vice president and sent to all executives for their approval.”

“During fiscal year ended 9/30/2016, the financial statements, governing documents, and conflicts of interest policies were not made publicly available. The hospital is in the process of changing this policy for the following fiscal period.”

“Ingalls development foundation has no employees in which they have direction and control. The foundation is charged a salary allocation for services rendered to the organization by individuals that are employees of ingalls memorial hospital. This salary charge is shown in part ix, line 24.”

“Change in fmv of private foundations (184,671)”