Ucare Minnesota

“Eight directors affiliated with the University of Minnesota Medical School, Department of Family Medicine are reported here as not independent. The Medical School/Department is not a traditional parent organization of UCare, and does not directly appoint or elect all of these directors. The Department also does not have direct removal authority for all of these directors, and removal of a director under the bylaws requires the vote of at least one director not affiliated with the Medical School/Department. However, the Medical School/Department has indirect control of the appointment and election process of these eight directors. One Director is appointed by the Dean of the Medical School, two Directors (including the Chair) are on the Board by virtue of their positions at the Department, and the Chair appoints five physicians on faculty at the Department. UCare's current Board includes six independent Directors: five Directors who are enrollees of UCare's plan, and an at-large Director from the community. Under Minnesota law, the Board is charged to act in the best interests of the Corporation. See Minn. Stat. Sections 62D.12, subd. 9 and 317A.251. UCare's bylaws describe an executive committee subject to the control of the Board and with the authority to only meet between scheduled meetings of the Board and to take actions on certain matters. This executive committee rarely is convened and did not meet during 2018.”

“UCare updated its Articles of Incorporation to clarify the non-taxable nature of the Department of Family Medicine and Community Health of the University of Minnesota Medical School (the "Department of Family Medicine") that UCare works in close association with to fulfill its purpose. The revision notes that UCare may continue to work in close association to fulfill its purpose so long as the Department of Family Medicine continues to qualify as a state or integral part thereof and services a public purpose. UCare updated its Bylaws to add additional specificity regarding the terms of service for the At-Large Director position on the Board of Directors. The revision states the At-Large director can serve no longer than three consecutive terms and addresses limits when terms are non-consecutive. There were no additional changes to the terms related to other director positions.”

“UCare's Board of Directors consists of 15 Directors. Under UCare's bylaws, the Chair of the Board had the authority to appoint five physician Directors from the University of Minnesota Medical School. Department of Family Medicine and the Dean of the Medical School appoints one Director. In addition, two Directors (including the Chair) are Directors by virtue of their positions in the Department. Individuals enrolled in UCare's health plans have the right under the bylaws, and consistent with Minn. Stat. 62D.06, to elect six of the Board of Directors among the enrolled members.”

“In addition to the powers set forth in Wisconsin law for members, UCare Minnesota has reserved to itself the following powers concerning the governance of the Corporation, which shall be expressed through the UCare Minnesota Board of Directors: (a) The approval of any plans of merger or consolidation by the Corporation with any foreign or domestic Corporation, voluntary dissolution of the Corporation, or any sales, lease, or transfer of all or substantially all of the Corporation's assets; (b) the approval of the grant of a security interest in all or substantially all of the Corporation's assets or the guarantee of any indebtedness before such security interest or guarantee becomes legally binding, and (c) the amendment of the articles of incorporation or bylaws.”

“The Form 990 is prepared by the Controller and reviewed by an independent accounting firm. UCare provides a copy and reviews the detail of the completed 990 Form with the Board's Finance and Audit Committee. UCare also provides a copy of the completed 990 Form to all members of the Board of Directors via on-line portal prior to the Finance and Audit Committee's report to the Board. Upon approval by the Board of Directors, the 990 Form is filed with the Internal Revenue Service.”

“UCare requires completion of an annual questionnaire by its Board members, Officers, and Senior Executive, which is designed to surface potential conflicts of interest. In addition, UCare's policy requires disclosure to the Board Chair and/or CEO of a potential conflict involving a Director, Officer, or management staff when a particular transaction arises. If the Board or designated Board Committee determines that a potential conflict exists related to a transaction requiring action by the Board, the policy calls for the Board member with the potential conflict to abstain from voting. In addition, a majority of the disinterested Directors must find that the transaction is fair and reasonable to the operation and that the organization could not reasonably find a more advantageous transaction from another entity without a potential conflict. In practice, UCare seeks to manage certain business matters so that they are not subject to action by the Board or Senior Executives where a potential conflict exists. For example, the Board includes members who are enrolled in UCare's health plans, and the benefit designs and premium amounts of such plans are not brought before the Board for action. The policy also requires disclosure of potential conflicts to the Board or designated committee even for transactions not requiring board action.”

“On an annual basis, UCare's Compensation Committee reviews and approves the President and CEO's total cash compensation, including base pay and incentive pay. Benefits are reviewed, as described below, every two to three years, with the most recent review in 2017. The Compensation Committee is composed of independent members of the Board of Directors. UCare engages an independent consultant organization that specializes in advising health care organizations about Executive compensation issues. The independent consultant organization conducts a comparability analysis that incorporates multiple industry surveys and compensation for comparable positions at peer organizations. The independent consultant organization then shares the results of this comparability analysis with the Compensation Committee. After deliberation about the comparability analysis and recommendations, the Committee evaluates the annual cash compensation package for the President & CEO. The Committee brings recommendations about CEO base compensation and incentive opportunity to the Board for approval, and reports other actions taken by the Committee to the Board. Minutes are recorded contemporaneously to accurately document the Committee's discussions and actions, and the independent consultant organization's report is retained for recordkeeping purposes. The Compensation Committee also participates in the compensation process for other Senior Executives, including the Treasurer & Senior Vice President/Chief Financial Officer; the Senior Vice President/Secretary/Chief Legal Officer; the Senior Vice President/Chief Medical Officer; the Senior Vice President/Chief Administrative Officer, and the Senior Vice President of Public Affairs/Chief Marketing Officer. The process for determining compensation for these positions follows a compensation philosophy approved by the Board of Directors. Every two to three years, an independent consultant organization conducts a comparability analysis for these positions, focusing on total compensation data including base pay, incentive pay, and benefits for comparable positions at peer organizations. The President and CEO's position is also included in this comparability analysis. The most recent analysis occurred in 2017. The Compensation Committee receives and discusses the analysis and recommendations with the independent consultant organization, and provides input for the President & CEO in determining cash compensation for the Officers and Senior Executives. The Compensation Committee has delegated specific cash compensation approval for these leaders to the President & CEO, who is an independent person with respect to these compensation determinations, provided that the President & CEO follows the board-approved compensation philosophy, takes into account the comparability analysis, and obtains annual review by the committee. The Committee's discussion and input are reflected in contemporaneous documentation, and a copy of the independent consultant organization's report is retained.”

“UCare Minnesota's 990 Form is available on www.guidestar.org in addition to being made available upon request.”

“UCare files its governing documents and Conflict of Interest Policy with the Minnesota Department of Health, and this public information would be available from this agency upon request. UCare's financial statements are available upon request.”

“Medical Service Expenses: Program service expenses 3,135,633,146. Management and general expenses 0. Fundraising expenses 0. Total expenses 3,135,633,146. Temporoary Employment Services: Program service expenses 8,226,532. Management and general expenses 10,707,077. Fundraising expenses 0. Total expenses 18,933,609. Other Purhased Services: Program service expenses 16,086,514. Management and general expenses 2,921,732. Fundraising expenses 0. Total expenses 19,008,246. Broker Commissions: Program service expenses 4,552,373. Management and general expenses 0. Fundraising expenses 0. Total expenses 4,552,373. Disease Management: Program service expenses 1,004,716. Management and general expenses 0. Fundraising expenses 0. Total expenses 1,004,716. Health Promotions: Program service expenses 1,397,696. Management and general expenses 0. Fundraising expenses 0. Total expenses 1,397,696. Outsourced Services: Program service expenses 13,341,471. Management and general expenses 5,109,587. Fundraising expenses 0. Total expenses 18,451,058.”

“Capital Investment in UCare Health, Inc -15,000,000.”